Case Name: Walter D. Sprott, appellant, v. The United States, appellees
Court: Supreme Court of the United States
Jurisdiction: United States
Decision Date: 1874-12
Citations: 10 Ct. Cl. 1
Docket Number: 
Parties: Walter D. Sprott, appellant, v. The United States, appellees.
Judges: 
Reporter: United States Court of Claims Reports
Volume: 10
Pages: 1–22

Head Matter:
SPROTT’S CASE.
(8 Court of Claims R., 499; 20 Wallace R., 459.)
Walter D. Sprott, appellant, v. The United States, appellees.
On the claimant's Appeal.
During the years 1864-65 cotton is puraltased by the agents of the Confederate States. Some of it is sold to the claimant by an agent, payable in the currency of the United States. The claimant tmderstands that it is the property of the rebel government, and pwchases it as such. The agent has been specially instructed “ to sell any and all cotton lie can for the purpose of raising money to purchase munitions of war,” but this-purpose is not disclosed to the claimant. Se buys the cotton at its marlcet value, regarding it as a mere business transaction of cotton for cash. At the time of purchase he is a resident within the Confederate lines. The cotton is subsequently captured, but no proceedings to confiscate it have ever been instituted by the Government. The claimant brings his suit, under the Abandoned or captured property Act, for the proceeds in the Treasury. The court below decides that the claimant was chargeable ivith notice of the treasonable intent of the sale ; that the transaction was void; and that he acquired no title to the property. Judgment for the defendants. The claimant appeals.
I. The doctrine that public policy may forbid courts of justice to allow any ■validity to certain contracts extends to an executed contract for the sale and delivery of personal property in a case where the purchaser voluntarily dealt with the Confederate government, and is now asserting a title to the property thus acquired in a suit to recover the proceeds thereof under the Abandoned or captured property Act. Such a contract is void as against public policy. The purchaser cannot base his right to the proceeds of the captured property upon an immoral transaction; nor did he acquire title to the property by the purchase and delivery. Clibeobd and Davis, JJ., concurring in the judgment upon this ground alone, and Field, J., dissenting.
II. A purchase of cotton from the Confederate government during the rebellion, being immoral and void because of the treasonable purpose of the sale, is' not aided by the fact that the purchaser did not intend to aid the rebellion, and that he regarded it as a mere business transaction. He must be held to have intended the consequences of his own voluntary act.
III. The recognition of the validity of certain acts of the ¡Confederate government and of the States in insurrection must be confined to those necessary in their recognition and administration to the existence of or-' ganized society It cannot be extended to acts of the Confederate government designed to prolong its own existence.
IV. The actual exercise of physical power by the Confederate government upon an individual may justify or excuse acts otherwise indefensible ; but acts voluntarily performed by the individual in direct aid of the unlawful purpose of the Confederate government (rap. gr., a voluntary purchase of cotton from, it) can have no validity given to them by the courts of this country.
The Reporters’ statement of the case:
The facts found by the Court of Claims are fully set forth in the opinion of the Supreme Court, with the exception of the following additional facts requested by the claimant on the trial and allowed by the court:
1. Claimant was the owner and in possession of three hundred bales of cottou, the proceeds of which are claimed in this action.
2. That said cotton was seized by the forces and agents of the United States Government, and duly turned over to the agent of the Treasury Department and sold, and the proceeds thereof paid into the Treasury of the United States, and no proceedings have been taken to condemn or confiscate said cotton.
3. That the claimant was a loyal citizen, residing in the State of Mississippi, during the late rebellion, and that the said Confederate cotton agent resided in said State of Mississippi during the said rebellion.
Mr. George Taylor and Mr. R. M. Gorwine for the claimant, appellant:
The court below erred in holding that the Confederate government could not take, hold, and convey a valid title to property, real or personal;
In holding that the claimant was chargeable with notice of the treasonable intent of the agent of the Confederate government;
In holding that the transaction was forbidden by the laws of the United States, and wholly void, and that the claimant acquired no title to the property in-question.
On the first point we respectfully submit that this honorable court has already held that the Confederate government was a government in its nature defacto, and that it was recognized by the Government of the United States a.s such,»and that the said Confederate government exercised all the rights of such governments, (Maurin v. Insurance Company, 6 Wall., 13; Thorington v. Smith, 8 Wall., 11;) that said government bought and sold property, real and personal, and that the United States has repeatedly recognized the validity of its title. The United States took all the property belonging to the Confederate government located in this country, and.it is a historical fact that the'Government followed the property of said de facto government to England, and there enforced its claim in foreign courts. In the case of the United States, (Lyon et al. v. Huchabee, 16 Wall., 429,) this honorable court held the title of the United States good against parties who charged that they had been forced to convey their property to the said defacto government, and that said government had no title to the same. It follows that if the Confederate government had power to acquire and hold title to property, it had also the power to convey and give title. Buying and selling are “ transactions in the ordinary course of civil society, and, though they may indirectly and remotely promote the ends of the unlawful government, are without blame, except when proved to have been entered into with actual intent to further invasion or insurrection.” (8 Wall., 12.) And in the case of Huntington v. Tetras, this court held that the Confederate government could alienate the property of the State. (16 Wall., 403.) We submit that the Confederate' government hqd power to acquire, take, hold, and convey a valid title to property, real and personal.
The Court of Claims erred in finding, as a conclusion of law, that the claimant was chargeable with notice of the treasonable intent of the agent. The said court finds, as matter of fact, that “ the purpose of the sale was not disclosed to the claimant, whose purpose was not to aid the Confederate States,” and that he bought the cotton at its market value, and regarded it as a mere business transaction of “cotton for cash.” The court finds that, in fact, the claimant had no notice of the treasonable intent, and that he did not purpose or intend to aid the rebellion; and, again, that he was loyal to the United States, and had no sympathy with the confederates. And yet the Court of Claims held that claimant is chargeable with notice— that is, with constructive notice — of the criminal intent. Where there is no notice in fact, courts have held parties bound by constructive notice, but only in cases where they ought to have acquired the knowledge, and where it was their duty to acquire it; and the doctrine of constructive notice is applied with great caution, and such notice will not be charged upon one who has acted honestly and paid a full and fair consideration without notice in fact. (Wilson v. Wall, 6 Wall., 90.) Certainly constructive notice of a crime — that of aiding and abetting-rebellion — will not be chargeable to one whom the court finds affirmatively had no notice of the fact and did not intend to aid the rebellion. In this instance constructive notice works a forfeiture of claimant’s property, by making him guilty of a heinous crime; and this, we submit, is contrary to every principle of law. It has been held by this honorable' court, in the case of Thorington v. Smith, (8 Wall., 12,) that parties engaged in ordinary transactions are without blame, except when it is proved that they entered into them “ with actual intent to further invasion or insurrection.” And, again, in Huntington v. Stale of Texas, (16 Wall., 413,) notice of .the illegal transfer for an illegal purpose is held to be necessary. In this case no notice of a criminal intent is proved, but, on the contrary, the Court of Claims finds that the claimant had no notice of the object of the sale, and that he did not intend to aid the rebellion.
The Court of Claims erred in holding that the sale was forbidden by the laws of the United States and was wholly void, and that claimant acquired no title. The Confederate authorities were actually supreme over the territory within their lines, and exercised full authority, and, as decided in the cases of United States v. Rice, (4 Wheat., 254,) and Thorington v. Smith, (8 Wall., 1,) the laws and the authority of the United States were suspended, and the citizens of the Confederate States were not bound by them during the period in which they were under the supremacy of the Confederate government. But there is no law of the United States forbidding such sales, except the Act July 17, 1862, (12 Stat. L., 590;) and, as we have seen, this act could not reach the subjects of another government, whether de facto or otherwise. And it has beenheld by this honorable court that the provisions of that statute cannot be engrafted on contracts such as the one under consideration, (Anderson v. The United States, 9 Wall., 66;) and in the cases of Corbett v. Nutt, (10 Wall., 470,) and Planters’ Panic v. Union Panic, (16 Wall., 496,) this court held that the Act Ju ly 17,1862, applied to cases only to the extent and in the manner provided by said act. In other words, that confiscation of property could be effected under the act only by seizure and proceedings provided for and prescribed in the act, and that the provisions of the act could not be applied or made effective in any other manner. It has been said that the point in question was decided in the case of McKee v. McKee, (8 Wall., 166;) but it will be seen that in that case the property had been seized and proceedings instituted under the Act July 17, 1862, to confiscate the cotton, and that the order had been made, and that it was one of those cases to which the act specifically applied; and this court has already decided that the statute did not apply to cases under the Abandoned or captured property Act March 12, 1863. This question seems to have been settled by the court, and it is useless to occupy further time in its discussion.
The statute of July 17,1862, (12 Stat. L., 590,) has no application to this case. It could not and did not operate within the Confederate States while the jurisdiction of the United States was held in abeyance by a military force. (Thorington v. Smith, 8 Wall. E., 10, and authorities therein cited; Halleck Int. L., 781.) This cotton was not seized and libeled under said act, and property could be taken under said act only in the manner and form therein prescribed. (Anderson v. United States, 9 Wall., 66; Corbett v. Nutt, 10 Wall., 470; Planters'1 Panic v. Union Panic, 16 Wall., 496.)
The Non-intercourse Act does not apply in this case. Sprott, the appellant, although a loyal man, was in contemplation of law a public enemy by reason of his residence within the Confederate lines. {Prize CVtse.s, 2 Black, 635.) His property was liable to be seized and condemned, whether on land or upon the seas. There was no crossing of lines, no communication with parties on this side of the lines. Appellant resided within the Confederate lines, and purchased .this cotton while there, and the ordinary business transactions, buying and selling property, paying taxes to that government, constituted no offense; in fact, these acts became necessary. But if in any particular the appellant violated his duty to the Federal Government, his offense has been pardoned, and can no longer be mentioned against him in a court of justice.
If these positions be correct, the appellant had a right to purchase the cotton the proceeds of which he claims, and the findings of the court below show that he did purchase the cotton in good faith and without notice of wrong, and that he paid for the same and took possession; that, in fact, the title of the government and of all other parties was fully vested in the appellant.
But it is said that the appellant had no title to the cotton because the Confederate government could give none; that said government was an unlawful assemblage of traitors, and that they could neither acquire nor give title to property; yet we find the Federal Government following the property of the Confederate government, and seizing it wherever found, without regard to the claims or rights of previous owners. This property is claimed by the United States as the property of the Confederate government by right of conquest, but this right carries with it the rights only of the former government. (See U. S. Rep., Lyon et al. v. Huolcabee, 16 Wall., 434, 435, and authorities there cited.) This case and many others show that the United States claim all the Confederate property by right of conquest; and this Government has followed Confederate property and rights into foreign nations, and instituted suits for its recovery in their courts, and these courts have decided that the United States had a right to recover all such property as the successor of the Confederate government, but not otherwise; but in all these cases, in the cases in this honorable court and in the English courts, it is admitted that the Confederate government could and did acquire title, for otherwise it had no property or rights for the Government of the United States to acquire by conquest or as its successor. (See the cases of The United States v. McRea, 8 Equity, 69; United States vs. Prioleau, 2 Hem. & M. Chancery Oases, 559; 3 Eq uity, 659.) Iu this case against Prioleau the English court held that the Government of the United States could recover the property of the Confederate government as its successor or representative, but they must take it subject to all the liens and conditions connected with the property claimed; and in that case the property was subject to a lien created by the Confederate government, and the court decided that the United States must take the property subject to such lien; and we submit that the case of the United States v. Lyon et al. goes no further than this. Certainly this Government could not claim property ns the property of the Confederate government in which that government held only a small interest. This Government acquired the property and rights in the Confederate government at the time of the conquest, and only just such title and rights as that government at that time held. (Halleck Int. L., p. 837, §25; p. 841, §§ 28, 29.) In the case before the court the Confederate government had no right, title, or claim to the cotton. That government had purchased the cotton, and had sold it again prior to the conquest, and had no title to it, or interest in it to pass by conquest (Halleck Int. L., p. 448, § 4; p. 789, § 12; 3 Phill. Int. L., 504, 684; Wheat. L. N., § 31.
This court has repeatedly recognized the Confederate government as a de facto government, and it was so recognized by the political department of our Government; and all the authorities on public law hold that a de facto government has all the rights and authority of a government within its own lines. Such government may buy and sell within its own territory, and all sales to a neutral must be recognized by the lawful sovereign ; but on his restoration he may, for motives of policy, annul the sale of the public domain or of confiscated property, when made to his own subjects, but this he cannot do without indemnification; but no such power exists over the sales of property duly acquired by the de facto government; hence the United States could not annul the sale of the appellant. (Wheat. -§ 31.) If this property had been acquired by confiscation, which was not the case, the exercise of the extreme right of our government would have required some legislative act annulling such sales; and, in the absence of such act, our courts are bound to recognize the title acquired from the Confederate government; they have no legislative powér.
The declaration of peace left all property and all rights pre cisely as they then stood, as there was no treaty between the parties changing the same, (1 Kent, 111; 3Phill., 734; Schooner Sophia, 6 Rob., 138;) and the suppression of the rebellion by force of arms, and the resumption of authority by the United States, did not change the character of past transactions. (United States t. Bice, 4 Wheat., 254; TIalleck Int. L., p. 456; § 12, pp., 839, 840; §§28, 29, p. 841; 3 Phill. Int. L., 742; United States v. Pereham, 7 Pet.; United States v. Hayward, 2 Gall., 500; Mitchell v. United States, 9 Pet., 734.)
If these positions be correct, it follows that the title of appellant was complete and perfect, and that it has not been and could not be annulled by the United States after peace; that his title has not been impaired by any legislative act, as this court has held that the Act March 3, 1863, did not divest the title of claimants, (United States v. Padelford, 9 Wall. R., 543,) even if that act could affect the title of property within the lines of territory held adverse to this Government; and, being the owner of the cotton, appellant is entitled to recover the proceeds of the same as found to be in the Treasury of the United States.
Mr. Assistant Attorney-General Hill for the United States, appellees:
This is an action in which the appellant, claiming to be a. loyal citizen of the United States, and therefore not to have adhered to the late rebellion, bought, in Mississippi, from the agent of the Confederate government appointed to sell cotton, a certain quantity of cotton, and paid for it in Federal currency. The question is whether the title passed under this sale, so that he can recover the proceeds of the cotton now in the Treasury of the United States. It is submitted that he cannot.
This was an act of commercial intercourse with the enemies of the United States, and, according to repeated decisions of the court, was therefore illegal and void. The appellant, claiming to be a loyal citizen of the United States, bought, knowingly, from the government of the Confederate States, cotton, and paid for it in Federal currency. Had he gone into the insurgent States for the purpose of making this purchase, the sale would have been clearly illegal within the decision of MeKee v. United States, (8 Wall., 163.) The fact that he was sojourning in Mississippi does not make any essential difference.
Whether the appellant had actual notice that the sale of the cotton by the agent of the Confederate government was made for the purpose Of carrying on war against the United States is immaterial. The Confederate States government was established for that purpose. It existed in defiance of law, and was then waging war against the legitimate Government, and this the appellant knew. Besides, as the court has decided in the case of Alexander’s Cotton, (2 Wall., 404,) cotton' constituted in fact the chief reliance of the rebels as means to purchase munitions of war, and was therefore a proper subject of capture by the Government on general principles of public law relating to war.
The appellant cannot be allowed to assert that when he bought the cotton and paid for it in the currency of the United States he had no purpose of aiding the rebellion. The knowledge of the character of the government with which he was dealing, and the nature of the article that he was buying, gave him notice that the object of the sale was thereby to acquire funds to aid the rebellion. This case does not fall within the principles established by this court in the case of Thorington v. Smith, (8 Wall., 1.) All that that case decided was, that the Confederate government was a government defacto, which could enforce its authority upon those within the territory occupied by it, and therefore excused obedience to its authority in civil and local matters; that the subjects of the United States were in fact under political duress, and to that extent their allegiance to the United States was suspended, on the principle that protection and allegiance are correlative. This being so, it was held that contracts made payable in Confederate currency would be sustained as a currency actually in use there, and established as the currency of the community by irresistible force.
That case can have no application to a voluntary contract with the Confederate government, by a person claiming to be a loyal citizen of the United States, for the purchase of an article contraband of war, and for the payment thereof in the currency of the United States.

Opinion:
Mr. Justice Milleb
delivered the opinion of the court:
This is an appeal from the judgment of the Court of Claims against the appellant, rejecting his claim to the proceeds of the sale of cotton under the act in regard to captured and abandoned property. That court made the following finding of facts and conclusions of law:
I. At different times during the years 1864 and 1866 large quantities of cotton were purchased by the agents of the Confederate States for the treasonable purpose of maintaining the war of the rebellion against the Government of the United States. Of cotton thus purchased by various agents in Claiborne County, Mississippi, three hundred bales were sold to the claimant by one agent, in March, 1866, for 10 cents a pound, in the currency of the United States. The sale was made by the agent as of cotton belonging to the Confederate States, and it was understoodby the claimant at the time of the purchase to be the property of the rebel government, and was purchased as such. The agent had been specially instructed by the confederate government " to sell any and all cotton he could for the purpose of raising money to purchase munitions of war and supplies for the confederate army;" but the purpose of the sale was not disclosed to the claimant, whose purpose was not to aid the Confederate States, buying the cotton át its market value and regarding it as a mere business transaction of " cotton for cash." The cotton was delivered to him at the time when the money was paid, he then being a resident of Claiborne County, within .the confederate lines.
II. The cotton was captured in May, 1865, and the proceeds or some portion thereof are in the Treasury.
And the Court of Claims, upon the foregoing facts, decides as conclusions of law—
1. The government of the Confederate States was an unlawful assemblage, without corporate power to take, hold, or convey a valid title to property, real or personal.
2. The claimant was chargeable with notice of the treasonable intent of the sale by the Confederate government, and the transaction was forbidden by the laws of the United States, and wholly void, so that the claimant acquired no title to the property which is the subject of suit.
We do not think it necessary to say anything in .regard to the first proposition of law laid down by that court. Whether the temporary government of the Confederate States had the capacity to take and hold title to real or personal property, and how far it is to be recognized as having been a defacto govern ment, and, if so, what consequences follow in regard to its transactions as they are to be viewed in a court of the United States, it will be time enough for us to decide when such decision becomes necessary. There is no such necessity in the present case.
We rest our affirmance of the judgment of the Court of Claims upon its second proposition.
It is a fact so well known as to need no finding of the court to establish it — a fact which, like many other historical events, all courts take notice of — that cotton was the principal support of the rebellion, so far as pecuniary aid was necessary to its support. The Confederate government eárly adopted the policy of collecting large quantities of cotton under its control, either by exchanging its bonds for the cotton, or, when that failed, by forced contributions. So long as the imperfect blockade of the southern ports and the unguarded condition of the Mexican frontier enabled them to export this cotton, they were well supplied in return with arms, ammunition, medicine, and the necessaries of life not grown within their lines, as well as with that other great sinew of war, gold. If the rebel government could freely have exchanged the cotton of which it was enabled to possess itself for the munitions of war or for gold, it seems very doubtful if it could have been suppressed. So when the rigor of the blockade prevented successful export of this cotton, their next recourse was to sell it among their own people, or to such persons claiming outwardly .to be loyal to the United States as would buy of them, for the money necessary to support the tottering fabric of rebellion which they called a government.
The cotton which is the subject of this controversy was of this class. It had been in the possession and under the control of the confederate government, with claim of title. It was captured during the last days of the existence of that government by our forces, and sold by the officers appointed for that purpose, and the money deposited in the Treasury.
The claimant now asserts a right to this money on the ground that he was the owner of the cotton when it was so captured. This claim of right or ownership he must prove in the Court of Claims. He attempts to do so by showing that he purchased it of the confederate government and paid them for it in money. In doing this he gave aid and assistance to the rebellion in the most efficient manner he possibly could. He could not have aided that cause more acceptably if he had entered its service and become a blockade-runner, or under the guise of a privateer had preyed upon the unoffending commerce of his country. It is asking too much of a court of law sitting under the authority of the government then struggling for existence against a treason respectable only for the numbers and the force by which it was supported, to hold that one of its own citizens, owing and acknowledging to it allegiance, can, by the proof of such a transaction, establish a title to the property so obtained. The proposition that there is in many cases a public policy which forbids courts of justice to allow any validity to contracts because of their tendency to affect injuriously the highest public interests, and to undermine or destroy the safeguards of the social fabric, is too well settled to admit of dispute. That any person owing allegiance to an organized government can niake. a contract by which, for the sake of gain, he contributes most substantially and knowingly to the vital necessities of a treasonable conspiracy against its existence, and then in a court of that government base successfully his rights on such a transaction, is opposed to all that we have learned of the invalidity of immoral contracts. A clearer case of turpitude in the consideration of a contract can hardly be imagined unless treason be taken out of the catalogue of crimes.
The case is not relieved of its harsh features by the finding of the court that the claimant did not intend to aid the rebellion, but only to make money. It might as well be said that the man who would sell for a sum far beyond its value, to a lunatic, a weapon with which he knew the latter would kill himself only intended to make money and did not intend to aid the lunatic in his fatal purpose. This court, in Hammer v. Dome, (12 Wall., 342,) speaking of one who set up the same defense, says: "He voluntarily aids treason. He cannot be permitted to stand on the nice metaphysical distinction that, although he knows that the purchaser buys the goods for the purpose of aiding the rebellion, he does not sell them for that purpose. The consequences of his acts are too serious to admit of such a plea. He must be taken to intend the consequences of his own voluntary act." This case, and the succeeding one of Hanauer v. Woodruff, (15 Wall., 349,) are directly in point in support of our view of the case before us.
The recognition of the existence and the validity of the acts of the so-called confederate government and that of the States which yielded a temporary support to that government stand on very different grounds and are governed by very different considerations.
The latter, in most if not in all instances, merely transferred the existing State organizations to the support of a new and different national head. The same constitutions, the same laws for the protection of property and personal rights remained and were administered by the same officers. These laws, necessary in their recognition and administration to the existence of organized society, were the same, with slight exceptions, whether the authorities of the State acknowledged allegiance to the true or the false federal power. They were the fundamental principles for which civil society is organized into government in all countries, and must be respected in their administration under whatever temporary dominant authority they may be exercised. It is only when in the use of these powers substantial aid and comfort were given or intended to be given to the rebellion, when the functions necessarily reposed in the State for the maintenance of civil society were perverted to the manifest and intentional aid of treason against the Government of the Union, that their acts are void. (Texas v. White, 7 Wall., 700.)
The government of the Confederate States can receive no aid from this course of reasoning. It had no existence except as a conspiracy to overthrow lawful authority. Its foundation was treason against the existing Federal Government. Its single purpose, so long as it lasted, was to make that treason successful. So far from being necessary to the organization of civil government or to its maintenance and support, it was inimical to social order, destructive of the best interests of society, and its primary object was to overthrow the Government on which these so largely depended. Its existence and temporary power were an enormous evil, which the whole force of the Government and the people of the United States was engaged for years in destroying.
When it was overthrown it perished totally. It left no laws, no statutes, no decrees, no authority which can give support to any contract or any' act done in its service, or in aid of its purpose, or which contributed to protract its existence. So far as the actual exercise of its physical power was brought to bear upon individuals, that may, under some circumstances-, constitute a justification or excuse for acts otherwise indefensible, but no validity can be given in the courts of this country to acts voluntarily performed in direct aid and support of its unlawful purpose. What of good or evil has flown from it remains for the consideration and discussion of the philosophical statesman and historian.
The judgment of the Court of Claims is affirmed.