Court Opinion

ID: 86585
Source: CourtListenerOpinion
Date Created: 2010-04-28 16:00:40+00
Date Added: 2024-06-11T09:39:43.046444
License: Public Domain

50 U.S. 580 (1850)
9 How. 580
JOHN BALDWIN, APPELLANT,
v.
CHARLES ELY.
Supreme Court of United States.

*585 It was argued by Mr. Bibb, for the appellant, and Mr. Bradley, for the appellee.
*598 Mr. Chief Justice TANEY delivered the opinion of the court.
This case is brought here by appeal from the decision of the Circuit Court for the District of Columbia for the County of Washington, sitting as a court of chancery.
The appellant filed his bill in that court, stating that large sums of money were awarded to him under the convention with Mexico, for which he obtained certificates, payable to him or his assigns, from the Treasury Department, according to the act of Congress of September 1, 1841. That among these certificates were three for one thousand dollars each, numbered 989, 990, and 991; that upon the back of these certificates, among others, he wrote his name, but without any words of transfer or assignment, and continued to hold them as the lawful owner; and that while he thus held them, the said three certificates were either casually lost by him, or, as he verily believed, purloined or stolen. He states further, that upon discovering their loss he gave notice of it to the Secretary of the Treasury, who agreed to suspend payment in case they should be presented, until an opportunity should be afforded him to regain possession of them, or to assert his right by some legal proceeding, but that he had been unable to discover where these certificates were, or who held them, until a short time before the bill was filed, when he received notice from the Department, that they had been presented for payment on behalf of the appellee, and would be paid accordingly, unless sufficient grounds for refusing should be furnished by the appellant; and that as the appellee resided out of the District of Columbia, and his agent was a member of Congress, and therefore not liable to arrest, he was without remedy except by the aid of the court to obtain a discovery of the right and title which Ely, the appellee, possessed, or under which he claimed; and prayed that he might be required to prove and show how the certificates were procured from the appellant, and for what consideration, and when and where, and to produce them before the court, and be compelled by its decree to deliver them to the complainant.
The appellee appeared and put in his answer, in which he states that these certificates, indorsed in blank by the appellant, were delivered to him by a certain Perry G. Gardiner, to be held as security for loans and advances previously made by the appellee to the said Gardiner, and also for such further loans and advances as he might thereafter make. He further states, that he afterwards made sundry advances, which he particularly *599 mentions, and that he has altogether advanced to Gardiner two thousand and seventy-seven dollars, for which he holds these certificates. He further states, that, at the time he took them, he believed, from Gardiner's representations, that he was the owner, and had no knowledge or suspicion of any circumstance that could invalidate his title. And further, that he is informed, and believes, and charges, that they were indorsed with the express intention of passing by such indorsement a perfect title to Gardiner, and handed by the appellant to him, that he might go into the market and negotiate them, and apply the proceeds in payment of a debt due from Baldwin to him.
The transactions between the appellee and Gardiner are set out in the answer much more particularly and in detail than is here stated, and a great portion of it is taken up in stating a transaction between him and Gardiner concerning a pledge of other certificates, upon which a large portion of the advances now due were originally made, and explaining how these three certificates became finally pledged for the whole amount loaned by the respondent, and the others released. But it is unnecessary to state these particulars here, because we see nothing in the case to impeach the fairness and good faith of the appellee, and the summary above given is sufficient to show the issues upon which this controversy must be decided.
Gardiner was examined as a witness on the part of the appellee, and sustains in every respect the statement in the answer. But his testimony is objected to by the appellant, first, upon the ground that he is interested, and therefore incompetent; and secondly, that if he is competent he is not worthy of credit. It is not necessary to express an opinion upon the validity of either of these objections, for the admission or rejection of his testimony would not change the equity of the case.
Putting aside, therefore, the testimony of Gardiner, it appears from the bill and answer that the appellee is in possession of these certificates, claiming title to them as assignee. The act of Congress directs that such certificates shall be made payable to the person entitled under the award of the commissioners, his legal representatives or assigns, and the certificates in question were issued in conformity to the law, and made payable to the party, his legal representatives or assigns, upon the surrender of the certificates at the Department. They are therefore legally transferable by assignment, and no particular form of assignment is prescribed. The certificates in question were indorsed in blank by the appellant, and that indorsement would be altogether useless and unmeaning, unless made for the purpose of transferring the property to an assignee, and authorizing *600 any person entitled to it in that character to write over his name a formal and regular assignment, if it should become necessary, or he should deem it his interest to do so. The holders of certificates of this description, thus indorsed in blank, have always been recognized at the Treasury Department as assignees, without any formal assignment, and the money due on the certificate paid to them, except only when doubts were entertained of the genuineness of the indorsement, or notice given that the title of the holder was disputed. Neither the law nor the usages of the Department require that the indorsement or assignment should be attested by a witness.
There is nothing, therefore, in the form and character of the indorsement calculated to awaken suspicion that the appellee had obtained them unfairly. The handwriting of the appellant is admitted, and the indorsement is according to the usage sanctioned by the Department at which they are to be paid. His possession, therefore, upon established principles of law, is primâ facie evidence that he is entitled to the property until the contrary appears. A different rule would put in jeopardy the title to a great portion of this scrip, which has been fairly purchased for a valuable consideration. For it has been a common article of traffic, and much of it has passed through a variety of hands, with no other evidence of an assignment to the holder but the indorsement in blank of the original payee. We do not mean to say that these certificates are to be regarded as commercial instruments, to be regulated by the commercial law, and that the holder is entitled to all the rights which belong to a bonâ fide indorsee of a promissory note. He certainly is not. They are, however, property, and the legal right to them may, under the act of Congress, be transferred to another, like the right to any other property. And the possession of them by the appellee, with the customary form of assignment indorsed upon them, in the handwriting of the party to whom they were originally issued, entitles him to the benefit of the legal presumptions in favor of his right which always arise from possession, until proof is offered to the contrary.
Now the appellant offers no proof that the certificates were lost or stolen, as charged in his bill, nor any proof that they remained in his possession after he indorsed them, nor any evidence that the indorsement was made for any other purpose than that which it imports; that is, for the purpose of transferring it to another person.
It is true, that it appears from the testimony of witnesses to whom there can be no objection, that these certificates were advertised by the appellant, as having been improperly obtained *601 from him, and that his advertisement appeared in some newspaper before they were pledged the second time to Ely. But the advertisement is no evidence of the fact stated in it, and there is no reason to believe that it came to the knowledge of the appellee before the last transaction between him and Gardiner. And if Gardiner's testimony is rejected, there is no evidence in the case to support the allegations in the appellant's bill, nor any ground upon which he can entitle himself to the relief he asks for.
Besides, the object of the appellant's bill is for discovery as well as relief, and to obtain from the appellee a discovery of the right and title which he possesses, or under which he claims. The answer, therefore, is responsive to the bill, when it states the transactions with Gardiner, and the circumstances under which he received the certificates, and the advances he made upon them. And it is entitled to all the weight which the rules of equity give to an answer when it is responsive to the bill, and speaks of facts within the personal knowledge of the respondent.
The case of Williamson v. Thomson, 16 Ves. 442, relied on by the appellant, depended on different principles. The East India certificate in dispute in that case was not by law assignable, and the order indorsed upon it by the party to whom it was issued, to pay the amount to another, did not transfer the legal right to the money. It might pass the equitable title, if so intended, but nothing more. The decision turned upon the meaning and intention of the indorsement. The Court of Chancery was called upon to expound it, and to determine, from the evidence, whether it was intended as a transfer of the equitable right, or as an authority merely to receive the money as the agent of the original payee, and for his use. The court determined that he took it in the latter character, but upon evidence which presented a case altogether unlike the one now before us.
The decree of the Circuit Court dismissing the bill cannot, however, be sustained. The appellee admits that he did not purchase the certificates from Gardiner, but took them as security for the money loaned. Consequently, the appellant is entitled to redeem, upon payment of the advances stated in the answer, with interest upon the several sums from the time they were respectively loaned. The decree of the court below must therefore be reversed, with the costs in this court, and the case remanded, with directions to cause an account to be stated in conformity to this opinion, and to pass a decree requiring the certificates to be delivered to the appellant, upon his paying *602 or tendering to the appellee the amount found to be due, and in case the money is not paid or tendered by a day to be fixed by the Circuit Court, then the certificates to be sold, and the proceeds apportioned between the parties in the manner herein directed.
In taking the account, the appellee is to be allowed the whole amount of the loans and advances to Gardiner, for which these three certificates were ultimately left in pledge. And as the appellant did not offer to redeem them, and insisted on their absolute re-delivery to him, the court think that, under the circumstances as they appear in the record, the appellee is equitably entitled to his costs in the Circuit Court, and they are accordingly in the account to be charged against the appellant. But as regards the costs in this court, the appellant, by the established rules and practice of the court, is entitled to recover them, and they must be charged against the appellee.
A mandate will be issued to the Circuit Court in conformity with this opinion.

Order.
This cause came on to be heard on the transcript of the record from the Circuit Court of the United States for the District of Columbia, holden in and for the County of Washington, and was argued by counsel. On consideration whereof, it is now here ordered, adjudged, and decreed by this court, that the decree of the said Circuit Court in this cause be, and the same is hereby, reversed, with costs for the appellant in this court, and that this cause be, and the same is hereby, remanded to the said Circuit Court, with directions to that court to proceed therein in conformity to the opinion of this court, and as to law and justice shall appertain.