Case: CHARLES BORCHERLING v. THE UNITED STATES
Abbreviation: Borcherling v. United States
Decision Date: 1900-04-02
Docket Number: No. 21140
Citation: 35 Ct. Cl. 311
Volume: 35
Reporter: United States Court of Claims Reports
Court: United States Court of Claims
Jurisdiction: United States
Parties: CHARLES BORCHERLING v. THE UNITED STATES.
Judges: 
Pages: 311–346

Head Matter:
CHARLES BORCHERLING v. THE UNITED STATES.
[No. 21140.
Decided April 2, 1900.]
On the Proofs.
In 1857 Forrest recovers judgment against Price in New Jersey. Forrest dies and his administratrix revives the judgment and in her bill prays discovery, injunction, and the appointment of a receiver. In 1891 Congress authorize tho Secretary of the Treasury to settle and adjust the accounts of Price, late purser, and pay him the balance found due. The amount found due is $76,204.08. In the meantime the Chancery Court issues an order restraining him from collecting the money notwithstanding which he receives from the Treasury $45,204.08. ■ In 1892 the claimant is appointed by the Chancery Court receiver of the property and things in action belonging to or held in trust for Price with authority to sue. A certified copy of the order is sent to the Secretary of the Treasury. In 1893 the court enjoins Price from seeking to obtain any part of the balance of the $31,000 remaining to his credit. A certified copy of this order is sent to the Secretary of the Treasury, and the receiver makes formal demand on the Secretary for the payment of the money to him. Thereafter the Supreme Court of the District of Columbia enjoins Price from receiving, collecting, or indorsing to his own use any warrants or drafts from the Treasurer. December 22, 1893. the court, with the assent of Price, exonerates $7,900 from the effect of the restraining decree. The Comptroller certifies a balance in Price’s favor of $7,900, leaving a balance to his credit of $23,100. Thereafter the Comptroller orders the balance remaining to be paid to the receiver, which is done. The receiver now sues to recover the $7,900 paid to Price.
I.The authority of a receiver appointed under the laws of a State is limited by the territorial boundaries of the State. The laws of the State can not be extended by any decree of its court to a foreign jurisdiction.
II.Personal property of a debtor passes to a receiver by operation of law, but he takes title to property outside the State where he is appointed, subject to every equity of foreign creditors.
III. The rule limiting the authority of receivers of State courts does not prevent one State or sovereignty from recognizing the laws of another by comity.
IV. Where the Treasury pays money to a receiver his receipt is as complete a defense as that of the creditor. Money paid to a receiver discharges the liability of the United States.
V.The Government has no special place of domicile and debts due by it are not local assets.
VI.Debt is an asset which passes to a receiver, and payment by the Secretary of the Treasury of money of the debtor in his hands to creditors is in derogation of settled law.
VII.The jurisdiction of the Court of Claims extends throughout the United States. In all cases relating to contracts, title to property, and the proper parties to prosecute, the court is, to all intents and purposes, sitting where the cause of action arose.
VIII.The accounting officers of the Treasury have effective means under Revised Statutes, § 1063, to protect the Government. In the case of conflicting rights the court must assume jurisdiction and render judgment for one claimant against the other.
IX.It is not inconsistent with Revised Statutes, § 3477, for a court for the protection of a creditor to forbid a claimant to collect his demand except through a receiver.
The Reporters' statement of the case:
The following are the facts of the case as found by the court:
I. Rodman M. Price lived in the State of New Jersey and died there June 8, 1894. (Agreed facts based on the statement of facts in opinion of Harlan, J., in Price v. Forrest, 173 ü. S., 410, p. 1.)
II. By act of Congress approved February 23, 1891, the Secretary of the Treasury of the United States was authorized and directed to adjust, upon principles of equity and justice, the accounts of Rodman M. Price, late purser in the United States Navy and acting navy agent at San Francisco, crediting him with the sum paid over to and receipted for by his successor, A. M. Van Nostrand, acting purser, January 14, 1850, and pay to said Rodman M. Price, or his heirs, out of any money in 'the Treasury not otherwise appropriated, any sum that may be found due him upon such adjustment.
III. August 31,1892, the Treasury officials adjusted Price’s accounts and found there was due him $76,204.08, which included a credit of $75,000 that Price said he had advanced to Van Nostrand from his private funds.
IY. In 1857 Samuel Forrest recovered in the supreme court of New Jersey a judgment against Price for $17,000 and costs. Execution on that judgment was returned unsatisfied. Forrest died in 1869, intestate. 1 ■
In 1874 his widow, Anna M. Forrest, as administratrix of his estate, revived the judgment by soire facias. In her bill she prayed discovery, injunction, and the appointment of a receiver. Price and his wife answered. The cause slept till August 9, 1892, when Mrs. Forrest, administratrix, filed a petition stating that since filing her bill of complaint no payment had been made on the judgment against Price; that neither she nor her solicitors had been able to find any personalty or real estate belonging to Price by levy upon and sale of which any part of the amount due on the judgment could be obtained; that it had lately come to her knowledge that about $45,000 was about to be paid Price by officers of the Treasury of the United States; that that sum was to be paid by the delivery to Price or his' attorneys of a draft of the Treasurer of the United States payable to his order; that said draft was to be made and the transaction closed on the 15th day of August thereafter; and if Price obtained said money he would, unless restrained, put the same beyond the reach of the petitioner.
The petitioner prayed the appointment of a receiver of the draft, and that Price be ordered immediately on the receipt of such draft to indorse the same to the receiver, to the end that the same might be received by him as an officer of the court and disposed of according to law.
V. The chancellor, August 8,1892, issued a rule, returnable September 12, 1892, to show cause and restraining Price from making any indorsement of the draft referred to in the petition.
YI. A duly certified copy of the order was served upon Price August 10, 1892. Nevertheless after that date, Price received from the Assistant Treasurer of the United States at Washington and, without permission of the court, collected four several drafts signed by that officer for -the respective sums of $2,704.08, $13,500, $20,000, and $9,000, in all the sum of $45,204.08, leaving in the hands of the United States of the amount due on the settlement of Price’s accounts the sum of about $31,000.
YII. On the 10th day of October, 1892, Charles Borcherling was appointed by the chancery court receiver in said cause of the property and things in action belonging or due to or held in trust for Price at the time of issuing said executions, or at any time afterwards, and especially of said four drafts, with authority to possess, receive, and sue for such property and things in action and the evidence thereof; and it was made the duty of the receiver to hold such drafts subject to the further order of the court. The receiver was required to give bond in the sum of $40,000, conditioned for the faithful discharge of his duties. At the same time Price was ordered to convey and deliver to the receiver all such property and things in action and the evidence thereof, and especially forthwith to indorse and deliver the drafts to him, and he and all agents or attorneys appointed by him were enjoined and restrained from intermeddling with the receiver in regard to said drafts, and ordered, if in possession or control thereof, to deliver them to the receiver with an indorsement to that officer or to the clerk of the court for deposit; provided, the order should be void if the drafts other than the one for $9,000 were delivered Avith Price’s indorsement to the clerk, the proceeds to be deposited to the credit of the cause. Price was expressly enjoined from making any indorsement or appropriation of the drafts other than to the receiver or the clerk for deposit.
VIII. The receiver gave the required bond, and having entered-upon the duties of his office, he caused a copy of the above order to be served upon Price, and demanded compliance with its provisions.
IX. In 1892, the particular day not being stated, the chancery court issued an attachment against Price for contempt of court in disobeying the order of August 8, 1892. By an order made May 18, 1894, the court held him to be guilty of such contempt, and he was directed to pay the receiver the sum of $31,704.08, and a fine of $50 and costs, and in default of obedience to that order to be imprisoned in the county jail until it was complied-WithY* (7 Dickinson (52 N. J., Eq.), " 16, 31.) Upon apfJeáNá #f&4Sourt of éM'or-snand appeals the order of the cMfftftk-y Wí^fuffiftÉfed. (8 Dickinson
(53 N. J.,Eq.), b§>8>J) om joJ .aoiíaojjp "
X. The Treasúr5fi©'e^ái-t3feMtf%.k7the time of allowing the $76,204.08, withheld $31,0C/Ó, under the provisions of the act of March 3, 1875 (18 Stat., 481), to await the determination of a suit to be instituted against Price, or surety upon Yan Nostrand’s bond as acting purser, United States Navy.
The suit was instituted, but was dismissed sometime previous to December 22, 1893.
XI. On the 16th of July, 1892, counsel for Mrs. Forrest wrote the Secretary of the Treasury referring to a previous letter to the Department of May 14, 1891, in the matter of the claim of Rodman M. Price, and asking to be seasonably advised in case the Department took action in the direction desired by Price.
The Secretary was advised that Mrs. Forrest could prove to the satisfaction of the Department that if Mr. Price did turn over $75,000, or any large sum, to the United States a part of that sum, namely, $17,078.04, must have belonged to Mrs. Forrest; that it was trust money, and it would not be equitable to cause that much to be paid to Price.
XII. By letter of November 27, 1893, counsel for the receiver notified the Secretary of the Treasury of Borcherling’s appointment and qualification by giving bond of $40,000; that Price, though personally enjoined, had, in contempt of the New Jersey court, indorsed the drafts and collected the proceeds. The letter inclosed is a certified copy of the order of the court, October 10, 1892, appointing the receiver. Counsel in behalf of the receiver made claim for the balance of $31,000 about to be paid Price under act of February 23, 1891.
The letter closed as follows: “I respéctfully ask that comity be shown the chancellor of New Jersey, and that the draft to be issued in payment of the balance due and payable to the order of Rodman M. Price be not delivered (or mailed) to said Price or his attorney, but be transmitted to the chancery court of the State of New Jersey, at Trenton, N. J., where said Price’s rights will bo abundantly protected, the receiver, of course, being an impartial officer of the court. I request that before action is taken (otheiiIjftp<q,4g asked for by the receiver) due noti§&;íi$ybe giy^pgfl© receiver may be heard, to set forth the ¡reason wtoyo¡)hif_-id)ifiP>sition should be made of the drafts in question. Let me ^dijthat the Forrest judgment and interest novfjpxjgqftdAijk^jSÍYh of 160,000.”
XIII. On December 4, 1893, the chancery court of New Jersey, being informed by the receiver that Price, assisted by John C. Fay, esq., his attorney, was endeavoring to obtain payment at the Treasury of the balance, about $30,000, of this debt, and appropriate it for his own use, issued orders against Price, enjoining him from seeking to obtain payment of any part of that sum.
X1Y. On December 6,1893, the receiver notified the Secretary of the Treasury, by letter, that a copy of injunction of December 4 had been served upon Price, and inclosed a copj^ of the same to the Secretary. He also invited the attention of the Secretary to the opinion of the Court of Claims in Redfield v. United States in the twenty-seventh volume of reports of the court; informed him that he (the receiver) had applied to the supreme court of the District of Columbia for an injunction, and asked, that if that court should not grant relief, he might have the benefit of the injunction of the New Jersey court now brought to the Secretary’s notice. The receiver asked that if no relief were granted by the supreme court of the District that the Secretary send the drafts (otherwise to be handed to R. M. Price) to the chancellor of New Jersey, at Trenton.
XY. The Supreme Court of the District of Columbia, December 19,1893, in a proceeding for injunction upon bill of Borch-erling, receiver, and Anna M. Forrest, administratrix, after personal service upon Price and Fay, enjoined Price from receiving, assigning, collecting, or indorsing to his own use by himself, or by attorney, any warrants or drafts from the Treasury of the United States in payment, in whole or in part, of any balance remaining unpaid under act of February 23, 1891, until the further order of the court; and it being the design of this order in no wise to interfere with the claim of any creditor of the said Rodman M. Price resident in this District against said Price, it is further ordered and decreed that, upon the representation of any person so claiming to be a creditor in this District and the establishment of such claim in a manner that shall satisfy tbe court of the bona fide existence of such claim, so much of said balance as shall be sufficient to cover an3T and all such claims so established shall be considered as exonerated from the effect of this decree.
XYI. The supreme court of the District, on the 22d of December, 1893, passed the following order in the said suit:
“From the affidavits of John C. Fay and Jeremiah M. Wilson, claimants, and the assent á'nd affidavit of the said Rodman M. Price, filed this day, it appearing to the satisfaction of the court that John C. Fay, Bichare! J. Bright, Frank S. Bright, Samuel Shellabarger, J. M. Wilson, and M. L. Woods, residents of the District of Columbia, appear to be bona fide creditors of the defendant, Rodman M. Price, and it appearing to the satisfaction of the court that as such they have bona fide claims for services rendered said Price, to the extent of $7,900, it is ordered that the sum of seven thousand nine hundred dollars ($7,900) shall be exonerated from the effects of the decree passed herein on the 19th of December, instant, restraining and enjoyining Rodman M. Price from receiving, etc., any warrants or drafts from the Treasury in payment of the whole or any part of the balance due him under the act of February 23,1891; and said injunction order shall not operate to effect said sum of seven thousand nine hundred dollars.”
XVII. Counsel for the receiver, Friday, December 22,1893, addressed the Assistant Secretary of the Treasury, setting forth the fact that the order of that day had been hastily acted upon, and explaining that the judge sent a verbal order to counsel to be in court at 1 o’clock; that he had already told Mr. Fay, attorney of Price, that he wanted copies of his papers served two days in advance, in compliance with. the rules; that at 12 o’clock he had been telegraphed for to go out of the city on account of illness in his family, and had sent a message to that effect to thé judge. The letter also notified the Secretary that the receiver claimed that the money under the Redfield case belonged to the receiver and not to Price. Counsel asked a reasonable delay, that he was obliged to leave Washington, but expected fully to return Saturday night, and expressed hope that “no action will be railroaded through to pay out any money to-morrow.” He also notified the Treasury that a mandatory order had been issued against Price in New Jersey, and asked that before any action was taken to paying Price, that he (counsel) might be heard to show reason why the money had not passed to the receiver under the ruling of the Redfield case, copy of which he inclosed.
XVIII. The same day counsel for the receiver sent the following telegram to the Secretary of the Treasury: “Washington, D. C., December 22, 1893. — To Secretary of Treasury, Washington, D. C.: Please defer action in Price matter over to-morrow. The receiver notifies Treasury that he claims the money is his, not Price’s, and will hold the United States responsible if paid Price or his attorney. Frank W. Hackett, attorne3r for receiver.”
XIX. On the same day, namely, Friday, December 22, 1893, the Acting Secretary of the Treasury indorsed a copy of the order of the supreme court of the District of Columbia of December 22, with a reference to the Second Comptroller to issue a certificate in favor of Rodman M. Price for $7,900, “the balance to be withheld pending an injunction against Price from receiving said balance.”
XX. On the same day, Friday, December 22,1893, Second Comptroller certified that there were due and payable to Rod-man M. Price $7,900. The balance, $23,100, to be withheld “pending an injunction against Price from recovering said balance now pending before the supreme court of the District of Columbia.”
The draft on navy warrant No. 907, dated December 23, 1893, and payable to the order of Rodman M. Price, late purser, United States Navy, for $7,900, was paid at the Treasury December 23,1893, by the Treasurer of the United States, said draft being indorsed “Rodman M. Price, late purser, United States Navy; John C. Fay.”
XXI. On the 25th of December, 1893, Borcherling, receiver, addressed a letter to the Secretary of the Treasury, claiming that on and after October 10, 1892, all property in the right to Price to receive from the- United States the balance under the act approved February 19, 1881, passed to him, the receiver. He reminded the Secretary that on the 27th of November, 1893, he had the honor of advising the Treasury of his appointment and inclosing a copy of the order of the chancellor; that Mr. Fay, attorney for Mr. Price, had full notice of the receivership as well as of the injunction of the court of chancery addressed to Price and bis attorneys forbidding them from receiving any part of the $31,000, and that both Pay and Price had committed contempt of court. The receiver asked the Secretary to take the opinion of the Attorney-General upon the following questions:
1. Did the appointment of a receiver by the chancery court of New Jersey convey to that officer the property in the claim against the United States of Rodman M. Price?
2. Would payment to the receiver be a quittance to the United States in the premises ?
3. Can the Secretary of the Treasury safely pay to Rodman M. Price or his heirs the money still unpaid under the act of February 19,1891, now that the receiver claims that it should be paid over to him?
A similar letter was addressed by the receiver and his counsel to the Secretary of the Navy.
XXU. On April 1, 1899, the Comptroller ordered the bal anee, $23,100, to be paid to Charles Borcherling, receiver, and the same was paid at the Treasury that day to Mr. Borcher-ling, the present claimant:
Mr. Frank W. ITackett and Mr. Oortlandt Parker for the claimant:
1. After the 10th of October, 1892, the claimant, Mr. Bor-cherling, under the statutory power exercised by the court of chancery, became as an officer of the court the owner of all the personal property of Price wherever situated. The passing to a receiver of the right to be-paid by the Treasury is not prohibited by section 3477 of the Revised Stautes, relative to assignments. (Price v. Forrest, 173 U. S., 410.)
2. The claim upon the Treasury was personal estate of Price, situated within the State of New Jerse3r. It passed by operation of law to the claimant as effectively as any other personal property actually within the jurisdiction of the court. When the accounting officers of the Treasury had once fixed the amount due to Price, nothing further remained to be done but to pay over the money to the person legally entitled to receive it. The right to receive this money was a chose in action. Such a right can be said only by fiction of law to have locality. The authorities are in' conflict with respect to the situs of a private debt, where questions have arisen between courts of different States. It may now, however, be declared to be settled that the situs of a claim against the United States is that of the domicile of the creditor.
Debts due from the United States have no locality at the seat of Government. (Vaughan v. RTorthrup, 15 Peter, 1.)
The question here related to taking out administration based upon a claim that the decedent had against the United States.
The Supreme Court of the United States held that a debt due from the United States was assets in Tennessee; that the officers of the Treasuiy may pay a debt due to the estate of a deceased person, either to the administrator appointed in the State of his domicile, or to an ancillary administrator duly appointed in the District of Columbia; and that the exercise of their discretion in this regard can not be controlled by writ of mandamus. (Wymcm v. Halstead, 109 U. S., 654.)
All debts follow the person, not of the debtor in respect of the right of property, but of the creditor to whom due. Per NelsoN, J. (Williams v. FUett, 9 Wall., 743.)
In a late case in the circuit court, eastern district of Tennessee, Clare, J., discussing the question of the situs of a debt in respect to the right of garnishment, says:
“Does the debt follow the creditor and his domicile, or the debtor and his domicile? The legal title and right are clearly in the creditor, and by analogy to the principle that constructive possession is with the rightful owner, we would expect that the chose in action, particulary a debt, follows the person of the creditor. And such is the established rule. (Ta/ppam v. Ba/nlt, 19 Wall., 490; Kwtlamd v. Hotc/Iciss, 100 U. S., 491; State Tax on Foreign Held Bonds, 15 Wall., 300,” citing many other authorities. Central Trust Company v. Chattanooga F. F. Co., 68 Fed. Rep., 689.)
The subject of the situs of choses in action is well handled in an article by Hollis R. Bailey, in the Harvard Law Review for June, 1897, Vol. II, pp. 95-113. The article refers to two previous articles by the same writer, “Assignment in insolvency and its effect upon persons outside of the State.” (7 Ibid., 281.) “A discharge in insolvency and its effect on nonresidents.” (6 Ibid., 394). These articles present the latest authorities bearing on the subject. Their author treats of the “conflict of laws” that attends the theory of the situs of a debt, points out the confusion that exists among the authorities, and advances strong reasons why it ought to be done away with. It does not appear that in regard to private debts courts have ever gone to the length of denying that a situs does exist at the domicile of the creditor.
The Court of Claims (Richardson, Chief Justice) have said, “We are unable to see how a claim due from the United States can be a legal asset in the District of Columbia ” {King, ad/m., v. TJ. 8., 27 C. Cls.R., 537), where it held that letters of administration granted by the supreme court of the District of Columbia, on a petition that showed that the only alleged assets in the District consisted of a claim against the United States pending in the Court of Claims, were void for want of jurisdiction. The opinion in this case discusses the meaning of the decision in Wyman v. Halstead, and makes it clear that the supreme court did not intend to lay down the doctrine that the existence alone of a claim against the United States would be ground for issuing ancillary letters in the District of Columbia.
A late expression of views upon this subject by the Supreme Court of the United States will be found in Oole v. Cunningham, 133 U. S., 128.
The “claim” being situated in New Jersey, passed by operation of law to Borcherling, assignee. By this we mean that it passed to Borcherling, not only as against Price, but as against the United States.
This must be so, unless for grave reasons the United States is to be excepted from the operation of the statute transferring a debtor’s things in action to a receiver for a just distribution to his creditors. But no good reason can be conceived why the action of the chancery court of New Jersey upon the status of the personal property of Price should not bind the officials of the Treasury. Those officials deal directly with a creditor of the United States. He may not assign his right; but a court of plenary jurisdiction clothed with statutory authority to that end may change the status of all his personal property, a claim against the United States included.
The objection that the appointment of Mr. Borcherling as a receiver had no extraterritorial effect is not well taken, for the reason that the decided cases go no further than to indicate an unwillingness on the part of a State to recognize and enforce in its own courts the order of a court of another State appointing the receiver, so long as creditors of their own may be prejudiced thereby.
The court of “another State” treats the assignment as something which may or may not be pronounced valid. If no creditors object, the assignment is recognized. In a word, the court in certain cases withholds a remedy. The remedy is granted, however, where it does not prejudice local creditors.
The court, where the question of a foreign receivership comes up, is asked to apply a state of facts indisputably proved by the records of a sister State. It admits the creation of a receivership. It admits also that the personal property of the debtor has everywhere passed to the receiver, except so far as a portion of such property may he needed for the satisfaction of the claims of creditors within the State where it is actually found. The portion thus withheld is considered not as the absolute property of the debtor, unaffected by the receivership, but provisionally such, until the claims of home creditors are ascertained and satisfied. At the farthest, courts do not undertake to declare that an absolute property remains to the debtor within their jurisdiction. They only say that, for the purpose of aiding our own creditors, we shall treat this as if it were the property of the debtor subject to a lien. Obviously this is nothing else than a doctrine of the remedy. It is not a determination of an absolute title.
But there is no need to examine the decisions in various jurisdictions based upon an alleged want of extraterritorial force in the judgments of the court of a sister State. They are numerous and conflicting. Summed up they amount to nothing more than an expression of a duty on the part of a court to protect “its own people.” That an assignment of ■ all the property of an insolvent debtor by the court of his domicile is without force beyond the limits of that particular State is a doctrine laid hold of in the administration of a remedy by the courts, and applied no further than to protect domestic or local creditors.
The Treasury Department, it is clear, has nothing whatever to do with protecting creditors; with granting or withholding remedies. This is a consideration that belongs exclusively to the courts. The obligation imposed upon the Secretary of the Treasury with reference to paying debts of the United States is perfectly simple. He is to pay the legal creditor. This he must do without favor to any individual or set of individuals. In paying the Price “claim” it was the duty of the Treasury officials to ascertain whether Price still continued to be the legal creditor of the United States. If he, in New Jersey, was no longer the legal creditor of the United States, because a court of the State where he lived had acted upon the status of his property and conveyed it to the claimant, Borcherling, it is clear that he (Price) could not be such in the District of Columbia.
Nor could the Assistant Secretary of the Treasury properly consult the interest of any alleged creditors of Price living in the District of Columbia. It had never become a part of his official duty to consider creditors of Price, either in New Jersey, New York, in the District of Columbia, or anywhere else. The Treasury could take notice that by operation of law that which Price had owned as a claim against the United States had passed into the hands of a receiver under an order affecting all of Price’s property. Where did the Treasury Department acquire the right to pay a part of this money to Price and the remainder to the receiver?
There is a distinction between an attempt by a court to assign a specific claim against the United States, thus in terms naming a new creditor, which is virtually requiring the Secretary of the Treasury to pay the claim in question to somebody other than the creditor 'himself — between such an attempt, we say, and the operation of law, that acts generally upon all personal property of a debtor, wherever situated, in the nature of an assignment in insolvency. To the former supposed action executive officers of the Government reply that they are not to be interfered with in the administration of their duties. In the latter case, however, the Treasury officials are just as amenable to the effect of the operation of the law as anyone else. In the latter case a court is not directing them what to do. A statute has acted in rem upon the title to property. The devolution of title occurs much as it does when a court appoints a committee for a lunatic, or a guard ian for a spendthrift, or an administrator of a decedent. A court with full power to act notifies the world that the title of the former owner has passed to another by operation of law, and all parties concerned take notice accordingly.
Unless the statutes of the United States, therefore, expressly or by obvious implication, required that the money in suit should have been paid to Price himself and to no one else, the course pursued by the Assistant Secretary can not be upheld.
The Comptroller insists that the duty of paying devolves uppn executive officers, and that no court may interfere and direct how these duties shall be performed. The position is unquestionably sound. By ‘4 national executive common law ” the Comptroller should be understood as meaning those doctrines of the common law that from time to time have been applied by the executive officers of the Government in the discharge of the duty of paying debts.
That is to say, the action of a court having jurisdiction of the person, which has the effect to work an assignment by operation of law, is, according to the Comptroller, to be respected by the Treasury Department. Such respect results in no sense from an interference by the court, nor is there a direction by the court to the executive officer. It is the natural regard paid to a status created by law, a status which receives the same recognition at the Treasury that it does everywhere else.
The Treasury officers appear to have been misled by dwelling exclusively upon the injunction proceedings in the District, and leaving out of sight the effect of the operation of law that had taken place through the action of the New Jersey court. They had no right to hand this money over to Price in any event; nor does the circumstance that it might enable him to pay alleged creditors resident in the District of Columbia afford any excuse to the officials for their action, since the money no longer belonged to Price, but had passed to the receiver who represented Price’s creditors, and to whom alone payment could legally be made.
It is a familiar principle of the law of assignments that the debtor, upon being notified of a valid assignment, and asked by the assignee to pay the debt, can not discharge himself from liability by paying the debt, or a part of it, to the original creditor. (Burrill on Assignments (3d ed.), 575.)
Paying $7,900 to Price after the receiver bad notified tbe Treasury that he (Borcherling) had the right to collect it, could not discharge the debt that was legally due to the receiver. It was equivalent to paying a person not entitled to receive the money. The United States may have the right to recover the money back as paid under a mistake; but this action of the Treasury officials did not discharge the debt due Mr. Borcherling, the claimant.
Mr. William H. Button (with whom was Mr. Assistant Attorney-General Bradt) for the defendant:
The United States -is the debtor, and has possession of the ■funds from which the debt must be paid, if at all. The United States is not subject to the operation of the laws of anjr of the individual States, nor is the fund in the possession of the United States subject to the operation of such laws. The laws of New Jersey can not reach up into the region in which the laws of the United States have their operation, and it is too plain for argument that the manner in which the United States shall pay its debts and the funds from which such debts shall be paid are matters subject only to the laws of the United States. The creditor is an inhabitant and citizen of the State of New Jersey. That State has jurisdiction over him. If it also had jurisdiction over the United States and the funds in the possession of the United States, there probably is no question but that the right to payment of this particular debt would have passed to the claimant under the decree of the New Jersey court. Such would be the result if the debt was owed by a citizen of the State of New Jersejr and that citizen had property in that State from which the debt could be enforced; but such is not the case. It consequently follows that the debt due from the United States to Price could not be .transferred from Price to the claimant by the operation of the laws of New J ersey nor by any decree that the courts of New Jersey operating under such laws could make. The claim could only pass by virtue of the laws of the United States, and the question becomes whether or not the laws of the United States' are such as to pass to the claimant the right to receive payment.
■ The error into which the claimant falls is that he discusses the jurisdiction over this debt solely from the standpoint of its territorial location. He maintains, and probably correctly, that the United States is ubiquitous, relying on the cases of Vaughn, v. JVorthrwp (15 Peters, 1), where Justice Story makes a statement to that effect, quoted on page 3 of the claimant’s brief; also on the cases of Wyrrumv. Halstead (109 U. S., 645); Williams v. EUett (9 Wallace, 743), and perhaps others.
The reason that the State of New Jersey has no power to enact laws affecting this debt is not because the United States is not territorially present within the bounds of the State of New Jersey, but it is because the United States has to do with matters of such a character that they are beyond the reach of the laws of the State of New Jersey. The exemption from legislation by the State of New Jersey is founded upon the quality of the matters exempted rather than upon their location, and those matters are as completely without the control of the State of New Jersey as if they had their actual situs in the State of California or some foreign country. This principle is recognized throughout our jurisprudence. Witness matters relating to our interstate commerce, which, though they may have locality within certain States, ' yet are as effectively beyond the reach of the legislation of those States as if they had their locality elsewhere. The Federal courts, including the Court of Claims, although they may be deemed to be sitting in the State of New Jersey, yet are courts foreign to that State. (Olney v. Tamier, 10 Fed. B.ept., 101.)
In Pennoyer v. Neff (95 U. S., B 714), the court said as to the Federal courts—
“ While they are not foreign tribunals in their relations to the State courts, they are tribunals of a different sovereignty, exercising a distinct and independent jurisdiction.”
It was held in Brigham v. Buddington (12 Blatchford, 237) that the various district courts of the United.States are foreign to each other.
It must consequently follow that the principles that govern the relations of the courts of one State to the courts of another must also govern the relations of the Court of Claims to the courts of the various States.
Consequently the question with which we are confronted is what effect will the laws of one sovereignty have within another and. distinct sovereignty. Concerning this question there are two propositions that are supported by authority: First, the laws of one sovereignty have absolutely no force by their own operation within another sovereignty; second, whenever the laws of one sovereignty are recognized within another sovereignty, it is by virtue of the fact that it is the law of the latter sovereignty that under the particular circumstances that sovereignty will look to the laws of the former for its rules of conduct and the laws of the former have operation in the latter bjr virtue of this law of the latter and not by virtue of any force given to them by the former.
The first proposition is abundantly maintained by authority in this and in every other country.
The principle is well exemplified in the case of insolvency laws. The insolvency laws of one State have no force as such in another. The Supreme Court of the United States decided this in the case of Ogden v. Saunders (12 Wheat., 213, pp. 358-369), relying on the cases of Harrison v. Sterry (5 Cranch., 298) and Balter v. Wheaton (5 Mass., 509).
This doctrine was affirmed in the case of Boyle v. Zaeha/rie (6 Pet., 318) and Boyle v. Zacharie (6 Pet., 635).
The case of Ogden v. Saunders is one of the most famous .decided by the Supreme Court, and the opinion delivered by Justice Johnson was finally concurred in by all the judges.
It was an easy step for the court from Ogden v. Saunders to Booth v. Olarlt (17 Plow., 327), in which it was decided that the appointment of a receiver, statutory or otherwise, by the court of one State had no effect to pass title to a debt owed by a citizen of another State, and that the receiver could not proceed outside the jurisdiction appointing him.
The case contains a very thorough discussion of the matter, and the decision is squarely against the theory that a receiver obtains title to any property outside the jurisdiction of the court appointing him.
The Federal courts hold to this doctrine. {Hale v. Hardon, 89 Fed. Kept., 283; Olney v. Tanner, 10 Fed. Kept., 101.)
This seems to be the law in New Jersey. In the case of State Bank at New Brunswick v". The Fvrst National Bank of Plainfield (34 New Jersey Equity, 450) the question of whether the appointment of a receiver by a New Jersey court passed title by operation of law to a debt owed by a person m a foreign jurisdiction was discussed. The court said:
“It is obvious that a transfer of title, by operation of law, can only be effected within the limits of the territory where the law prevails; and, as the laws of a State have no extrater-ritoiial force, it follows that the title to property located in one State can not be passed by force of the law of another.”
The property spoken of was, as in this case, a debt due from a party in a foreign jurisdiction.
The matter was recently discussed by the supreme court of Indiana in the case of Gatlin v. The Wilcox 8id/oer Plate Company (123 Indiana, 477).
In the case of FilMnsv. Nunnemcaeher (81 Wis., 91) the rights of a receiver appointed by a court of chancery are considered. The suit was brought to collect a debt owed by a person in Wisconsin. The court held that the appointment of a receiver in Illinois did not convey the title to such debt. Wood v. Parsons (27 Mich., 159); Graydon v. Church (7 Mich., 36, p. 53); WilUtts v. Waite (25 New York, 577).
In Smith on Receivers, a recent work on this subject, and one much relied upon by the claimant, the American doctrine in regard to this question is summarized with this result, as stated on page 109:
“As to the disposition of personal property by operation of law, as in receiverships, the law being local has no extraterritorial effect so far as the title is concerned. In such cases the assignee takes the property subject to every equity of foreign creditors, and subject to all remedies of foreign countries. HoTbroohe v. Ford (153 Ill., 633); Pha/wn v. Pearce (110 IR, 350).”
In all these cases the familiar principle that personal property has its situs at the domicile of the owner was disregarded, and the fact that the debtor, alone was out of the jurisdiction was held sufficient to make the assignment of no force so far as the debt was concerned.
The authorities abundantly sustain the conclusion that the decree of the New Jersey court appointing the receiver in this case had no" operation except within the limits of the jurisdiction of that court. And it is further to be gathered from them that the maxim mobilia personam sequuntmr does not apply, and the fact that the person owing the debt is without the jurisdiction is determinative to the effect that the title to the debt does not pass.
In this case the United States is the debtor and, as such debtor, inhabits a jurisdiction entirely foreign to the State of New Jersey and its courts. No law that the State óf New Jersey can pass will in any way affect the United States nor will any decrees of its courts. The United States is amenable only to the decrees of this court.
It follows from the above considerations that the title to the debt owed by the United States to Price could not pass to the plaintiff by virtue of the laws of New Jersey nor the decree of the New Jersey court.
Comity is a term concerning the meaning of which there has been much dispute; more, in fact, than would seem to be necessary. The term seems to mean simply that it is the law of one sovereignty that under certain circumstances that sovereignty will not adjudicate according to its own laws, but will import the laws of a foreign State as a rule of conduct.
If such comity is extended, then the laws of the foreign State do not operate by their own force, but by force of the local law, which says under the circumstances the foreign law shall be applied. The foreign law becomes part of the local law f to Jiao vice. DaVryuyple v. Dalrymple (2 Hagg. C., 485); Scrimshirev. Scrimshvre (2 Hagg. C., p. 568); Caldwell v. Vani Vlissengen (9 Hare, 415).
This comity seems to be a courteous attitude taken by one State toward another whereby the laws of the other are given a certain effect within the one. It will be extended or withheld as the self-interest, public policy, or generosity of the particular State may dictate. It is not a matter of obligation, but a matter of accommodation. It is what its name implies. It is courtesy. Willitts v. Wa/ite et al. (25 N. Y., 577), Bcmk of Augusta v. Earle (13 Pet., 277), Hilton v. Cuyot 159 U. S., 113).
The test as to whether any law will be universally recognized in all civilized States seems to be whether it has been so recognized for a reasonable period of time by all nations. In regard to the principle that personal property descends and is distributed according to the laws of the domicile of the owner, it was said in the case of Ennis v. Smith (14 How., 400, 424):
“For several hundred years, upon the Continent, and in England, from reported cases, for a hundred years, the rule has been that personal property, in cases of intestacy, is to be distributed by the law of the domicile of the intestate at the time of his death. It has been universally so held for so long a time that it may now be said to be a part of th ejus gentium.”
The English courts maintain a doctrine in respect to the effect of foreign assignments in bankruptcy different from that laid down in Ogden v. Saunders (supra). In establishing this doctrine they attempted to maintain it on the ground that it was a universally accepted doctrine, and was consequently also a part of international law and had force as law. To this attempt the Supreme Court, in the case of Ogden v. Sounders, did not give its approval.
In this case also Justice Johnson sets forth the distinction between voluntary transfers of personal property and transfers ioi vmitmn, which is followed in all of the authorities which have been cited above in the following language:
“ I think it, then, fully established that in the United States a creditor of the foreign bankrupt may attach the debt due the foreign bankrupt and apply the money to the satisfaction of' his peculiar debt, to the prejudice of the rights of the assignees or other creditors.
“Ido not speak of assignees or rights created under the bankrupt’s own deed; those stand on a different ground and do not affect this question. I confine myself to assignments or transfers resting on the operation of the laws of the country, independent of the bankrupt’s deed; to the rights and liabilities of debtor, creditor, bankrupt, and assignees, as created by law.”
In Booth v. Olarh (supra), the language of the court shows that the decision was placed upon the same ground as that in Ogden v. Saunders; Gole v. Ownnmgham (133 U. S., 107, p. 129).
It is evident from these cases that there has not been such a unanimity of opinion among the different States on the question of the effect of an assignment by operation of the law of a foreign State as to be the basis of any international law on the subject; consequently, in determining the effect of such an assignment, we are remitted' to the general principles regulating the effect of the laws of one State within the limits of another, and can not refer to the principles of international law for such determination.
How is it to be determined what comity one sovereignty will extend to the laws and judicial decrees of another? The most obvious method is to seek its expression in some treaty or statute. It is seldom found expressed, and then it becomes the duty of the courts of a sovereignty to declare the attitude of that sovereignty as to any particular force to be given to foreign laws when opportunity offers.
In Hilton v. Gruyot {swpra), it is said:
“International law, in its widest and most comprehensive sense — including not only questions of right between nations, governed by what has been appropriately called the law of nations; but also questions arising under what is usually called private international law, or the conflict of laws, and concerning the rights of persons within the territory and dominion of one nation, by reason of acts, private or public, done within the dominions of another nation — is part of our law, and must be ascertained and administered by the courts of justice as often as such questions are presented in litigation between man and man, duly submitted to their determination.
“The most certain guide, no doubt, for the decision of such questions is a treaty or statute of this country. But when, as in the case here, there is. no written law upon the subject, the duty still rests upon the judicial tribunals of ascertaining and declaring what the law is, whenever it becomes necessary to do so, in order to determine the rights of parties to suits regularly brought before them. In doing this, the courts must obtain such aid as they can from judicial decisions, from the works of jurists and commentators, and from the acts and usages of civilized nations.” {Fremont v. United States, 17 How., 542, 557; The Scotia, 14 Wall., 170, 188; Fes pullica v. De long champs, 1 Dali., 116; Moultrie v. Hunt, 23 N. Y., 394, 396.)
It seems from the above cases that in the absence of statutes the utterances of the courts of the various States and of the United States are to be relied upon as showing the attitude of those States and of the United States toward receiverships created under the laws of another of the States. None of the State courts have ever held that such a foreign receivership passed title to property within its own sovereignty, except by virtue of this comity, and the only questions in the cases have ■been as to whether such comity would be extended at all, and if so, to what extent.
The cases above cited show that it has been withheld by the United States as regards receivers appointed by the courts or under the laws of one of the States.
Nor is this comity by any means accorded by all the States. {FilJdns v. Nunnemacher, 81 Wis., 91.) It was denied in Farmers cund Merchants'1 Insurcunee Go. v. Needles (52 Mo., 1Y).
It is obvious that if it is the law of one of the States as embodied in statute or in the common law as interpreted by its courts that the appointment of a receiver in another State vests in such receiver the title to property in the former State the receiver can, as a matter of right, proceed for the recovery of such property. There is no comity extended to him. The comity is extended by the one State to the other in allowing the laws of the other to be operative for certain purposes in the one.
It is urged by the claimaixt that if a receiver appointed by the courts, or under the laws of one of the States has not heretofore been recognized by the United States, yet it is time that such recognition should take place in the interests of harmony and more close fellowship among the States of the Union and the closer relation of those States to the General Government. In answer to this it is suggested that, even admitting that such a state of affairs is desirable, it should be brought about by positive law and not by the decisions of this court in the face of the principles that have been established by Booth v. Olcvrlc and the cases succeeding it. The principle of stare decisis should have some weight, particularly as the payment in this case was undoubtedly made relying upon those principles as established. If a change is to be made in what must be admitted to have been the policy of the United States heretofore it would be much better that such change should take place by a statute or constitutional amendment in order that everyone might know just what his rights and duties under such circumstances may be.
The only guide the Secretary of the Treasury had as to what the law of the United States was as to the effect of the appointment of the receiver in New Jersey was the utterances of tbe Supreme Court. He should be protected in bis action thereunder. ' •

Opinion:
Peelle, J.,
deliveréd the opinion of the court:
The findings present the question, broadly stated, as to whether the Secretary of the Treasury has the discretion in law to pay or not to pay a • receiver, appointed by a State court, of the property and fhings in action of a creditor of the United States, for the purpose of reaching' the assets or choses in action of such creditor for the payment of his debts; and if payment be made to such creditor by such officer after due notice of the appointment of such receiver and the order restraining such creditor from receiving money to his credit, whether a judgment can be recovered in this court in favor of the receiver for the amount so paid.
The material and substantial fact disclosed by the findings are these:
In 1851 Samuel Forrest recovered a judgment against Rod-man M. Price, in the supreme court of the State of New Jersey, for 117,000.
In 1874, Forrest, having in the meantime died, and execution having been returned unsatisfied, his widow, as adminis-tratrix, revived the judgment by scvre facias and in her bill prayed discovery, injunction, and the appointment of a receiver, to which answer was filed. No further proceedings were had therein until 1892, at which time said judgment, with the interest accrued thereon, amounted to over $60,000.
In February, 1891, the Congress enacted,a law whereby the Secretary of the Treasury was authorized to settle and adjust the accounts of said Price, late purser of the United States Navy, and to pay to him, or his heirs, any sum found due thereon.
In the adjustment thus made there were found due to Price $76,204.08, of which $75,000 Price claimed had been advanced by him out of his private funds to A._M. Yan Nostrand, his successor in office.
In the adjustment of said accounts $31,000 was withheld from Price to await the determination of a suit to be thereafter brought against Price as surety upon Yan Nostrand's bond as acting purser of the United States Navy.
For the payment of the balance, $45,204.08, drafts were issued and made payable to Price; and in the meantime the chancery court issued an order restraining him from collecting' or making any indorsement on the drafts referred to, of which order a certified copy was served on him. But notwithstanding said order he received from the Assistant Treasurer at Washington, D. C., payment of said drafts aggregating the sum of $45,204.08.
October 10, 1892, thereafter, the claimant herein was appointed by the chancery court receiver in said cause of the property and things in action belonging or due to or held in trust for Price, with authority to possess, receive, and sue for such property and things in action and the evidence thereof. The receiver gave bond in the sum of $40,000, as required by the court. A duly certified copy of the order of appointment was sent to the Secretary of the Treasury, about which there is no controversy.
Thereafter, an attachment was issued against Price for contempt of court in disobeying the order restraining him from indox*sing the drafts and receiving payment thereon, and he was fined $50 for contempt and directed to pay the residue of the money, $31,000, to the receiver, which proceedings were affirmed on appeal to the court of errors and appeals of the State of New Jersey.
The suit against Price as surety on Yan Nostrand's bond was commenced, but was thereafter, prior to December 22, 1893, dismissed.
On December 4, 1893, the chancery court of New Jersey issued an order enjoining Price from seeking to obtain any part of said balance of $31,000 so remaining to his credit, of which order a duly certified copy was sent to the Secretary of the Treasury, after which the receiver made formal demand upon the Secretary for the payment of the money to him. The suit against Price as surety on the bond of Yan Nostrand was commenced, but dismissed prior to December 22, 1893.
Thereafter, the supreme court of the District of Columbia in a proceeding instituted by the claimant as receiver and Anna M. Forrest, administratrix of the estate of Samuel Forrest, after personal service upon Price and his attorney, John C. Fay, enjoined Price from receiving, assigning, collecting, or indorsing to his own use, b,y himself or by his attorney, any warrants or drafts from the Treasurer of the United States in payment in whole or in part of any of said balance of $31,000 until the further order'of the court, not, however, interfering with the claim of any creditor of Price resident within the District of Columbia.
December 22, 1893, in said supreme court, upon the affidavits of said Fay and Jeremiah M. Wilson, with the assent and affidavit of Price, it was made to appear to the court that said parties and others named in the findings, residents of said District, were bona fide creditors of Price, and as such had claims against- him aggregating $7,900, and in view thereof it was ordered by the court that the said sum be exonerated from the effect of the decree restraining Price from receiving any warrant or draft as aforesaid.
On the same day the order was modified the Comptroller certified a balance in Price's favor of $7,900, leaving $23,100 still to the credit of Price, which was withheld pending the injunction against Price in the supreme court of the District, as aforesaid.
December 23,1893, in disregard of the restraining order of the chancery court of. New Jersey, a draft was issued to Price, late purser of the United States Navy, for said sum of $7,900, and he indorsed the same to John- C. Fay, to whom the money was paid, as appears from their indorsements on said draft set out in the findings.
December 25, 1893, the receiver addressed a letter to the Secretary in which, among other things, the Secretary was requested to take the opinion of the Attorney-General upon the questions involved, which was done; and thereafter, April 1, 1899, the Comptroller ordered the said balance of $23,100 to be paid to the claimant as receiver, which was done.
It will thus be seen that the particular question before the court is as to the right of the receiver to recover judgment for the $7,900 so paid to Fay on the draft issued to Price.
The claimant's contention is that the $31,000 standing on the books of the Treasury Department to the credit of Price was a personal asset within the State of New Jersey, and that as Price was domiciled in New Jersey, where he was personally served with process, the title to the claim passed to the receiver by operation of the laws of New Jersey, and therefore entitle him to collect and receive from the United States Treasury the money thereon, to the exclusion of Price.
That contention the defendants deny, on the theory, substantially, that the laws of one sovereignty have no force by their own operation within the jurisdiction of another sovereignty.
In the case of Ogden v. Saunders (12 Wheat., 213), where the question was first distinctly presented to the Supreme Court, it was ruled that an insolvent or bankrupt law in one State did not affect the rights of creditors who were citizens of other Stales; and the principles thus announced were adhered to five years later in the cases of Boyle v. Zacharie (6 Pet., 348 and 635).
Following the rule thus announced and affirmed came the decision in 1854 in the well-known case of Booth v. Clark (17 Howard, 322), where it was held that a receiver appointed under a creditor's bill filed by the court of chancery of New York against a resident of that State did not vest in the receiver title to a claim in favor of such debtor against a foreign Government (Mexico).
The substance and effect of that decision is that the receiver so appointed was limited in his action to the territorial limits of that State; that the laws of New York, no matter what the decree of the court in respect of the authority of the receiver to sue elsewhere, did not extend to a foreign jurisdiction or to the jurisdiction of another State.
It is unquestionably the recognized and well-settled rule that a court can not endow or confer upon its officers powers beyond its own jurisdiction. Pank of Augusta v. Earle (13 Pet., 519); Pennoyer v. Nebb) (95 U. S., 714); Pana v. Bowler (107 U. S., 529); Hilton v. Guyot (159 U. S. R., 113 and 163).
The personal property of a debtor passes to the receiver as a general rule by operation of law without any act of transfer on the part of the debtor, but in respect of the title to property without the State of the receiver's appointment he ' ' takes the property subject to every equity of foreign creditors and subject to all remedies of foreign countries." (Smith on Receivers, 109 et seq.)
However, the foregoing well-established rules do not pre vent one State or sovereignty from recognizing tbe laws of another by that other rule known as comity between States or sovereignties and by which is meant "the recognition which one nation allows within its territory to the legislative, executive, or judicial acts of another nation, having due regard both to international duty and convenience and to the rights of its own citizens or of other persons who are under the protection of its laws." (Hilton v. Guyot, supra, p. 164.)
While the obligation ' of the laws of one State or nation within the territory of another is derived from the voluntary consent of the latter, still if not prejudicial to its interests or contrary or repugnant to its known policy, silence in respect of such rules or laws will warrant courts of justice in presuming the tacit adoption of them by their own G-overnment; and in determining the rights of persons under such foreign laws the courts will adopt them for that purpose. (Story's Conflict of Laws, section 38.)
Rights thus determined become as fully settled as though adjucated upon by the courts of such foreign jurisdiction.
Had the Secretary of the Treasury paid, or caused to be paid, to the receiver the 131,000 standing to the credit of Price, the receipt of the receiver therefor would have exonerated the Treasury and been as complete-a defense to any claim thereafter made by Price as though it had been signed by him.
Hence, had the money been paid to the receiver after notice to the Secretary of his appointment, or to an administrator likewise appointed, the liability of the United States would thereby have been discharged. - (Vaughn v. Northrup, 15 Pet., 1.)
And this we say, though the restraining order issued by the supreme court of the District of Columbia was modified in respect of the creditors of Price resident in the District, as such restraining order, as originally entered or as modified, did not in any way restrain the Secretary or any other officer of the Treasury Department from paying the money to the receiver, and payment to the receiver would have exonerated the United States from any payment to such creditors, even after the modification of the restraining order,
The only purpose or effect of the order was to restrain Price from receiving any part of the money; and when tbe order was modified, exonerating therefrom the sum of $7,900 due the creditors of Price resident within the District, the Secretary was not thereby relieved' from whatever obligation may have been imposed upon him by reason of the previous notice of the claimant's appointment as receiver of the property and things in action of Price, and of the order of the chancery court' of New Jersey, still in force, restraining Price from collecting or receiving any draft or payment from the Treasury on account of said balance of $31,000.
The modification of the restraining order left Price .and his creditors resident within said District the same as though no restraining order had been granted, and did not in any way authorize Price or his creditors to collect money from the Treasury. If such right existed it was independent of the restraining order and the modification thereof. So that the failure or refusal of the Secretary to pay the money to the receiver could not well have been founded upon any supposable risk of having to pay the money again.
His refusal to pay the receiver, therefore, must have been based upon his supposed right in law to pay or not to pay'in the exercise of the discretion lodged in him; and having, as the head of an executive department, exercised his discretion by refusing to pay to the receiver, his action, the defendants contend, is conclusive upon the courts.
As between the States or as between the Federal Government and a foreign government there can be no question but that the principle for which the defendants contend would apply.
Do they, as between the Federal Government and a State? While the several States are territorially separate and distinct from each other, and possess sovereign rights and powers under the Constitution distinct from those of the Federal Government, they are nevertheless each an integral part thereof.
By virtue of the claimant's appointment by the chancery court of New Jersey, as the receiver of the personal property of Price for the payment of an unsatisfied judgment, he thereby became entitled to the possession of all the personal property and choses in action of which Brice was possessed or to which he was entitled at the time of his appointment, except such as may have been exempt-from levy and sale for the payment of debts and subject to the rights of creditors of Price resident within a foreign jurisdiction as to any property located therein. In other words, as" between Price and the receiver, the appointment divested Price of all right and title in and to his personal property and choses in action, wherever located, and clothed the receiver with the rights thus divested, subject to the future order of the court in respect of the rights of Price, after the payment of the judgment out of the property and choses in action so transferred.
Thus the receiver took the place of Price and thereby received "authority to possess, receive, and in his own name, as such receiver, sue for such property or things in action. " (Revision Laws of N. J., 120.)
There is no controversy as to the authority and right of the receiver to possess himself of the personal property and choses in action of Price within the territorial jurisdiction of New Jersey, as such property passed to the receiver in virtue of his appointment under the adjudication of the courts of New Jersey without formal assignment by the debtor. (Harrison v. Maxwell, 44 N. J., 316.)
In the able brief of the counsel for the defendants it is conceded that "when both debtor and creditor and the property of the debtor are within the reach of one sovereignty, there is little room for contention," but he contends "that the debt due from the United States to Price could not be transferred from Price to the claimant by the operation of the laws of New Jersey nor by any decree that the courts of New Jersey operating under such laws could make;" that such claim, he contends, ' ' could only pass by virtue of the laws of the United States."
It becomes important, therefore, to. inquire' whether the claim of Price, a resident of New Jersey, as against the United States was an asset or chose in action as other personal property of the debtor within that State.
This question seems to be answered in the case of Vaughan v. Northup (15 Pet., 1, 6), where Mr. Justice Story, speaking for the court, said: "The debts due from the Government of the United States have no locality at the seat of Government. The United States, in their sovereign capacity, have no particular place of domicile, but possess, in contemplation of law, an ubiquity throughout the Union; and the debts due by them are not to be treated like the debts of a private debtor, which constitute local assets in his own domicile." For the reason thus given it was held, in that case, that "the administrator of a creditor of the Government duly appointed in the State where he was domiciled at his death has full authority to receive payment and give a full discharge of the debt due to his intestate in any place where the Government may choose to pay it, whether it be at the seat of Government or at any other place where the public' funds are deposited." And, furthermore, "that moneys so received constituted assets under that administration, for which he was accountable to the proper tribunals in Kentucky," where he was appointed.
Under that decision debts against "the United States have no locality at the seat of Government; " and if not there, then they have none in any particular locality and may be discharged whenever the Government may choose to pay them.
The claim due Price, therefore, was as much an asset in New Jersey as in the District of Columbia, and inasmuch as Price was domiciled in New Jersey, where he was personally served with process, such claim, at least as against the creditors of Price domiciled in the District of Columbia, passed to the receiver in virtue of his appointment, of which appointment such creditors had due notice.
Therefore the payment of the money or any part thereof by the Secretary of the Treasury to Price or to such creditors was in derogation of the settled law of New Jersey. (Miller v. McKenzie, 2 Stewart, 291.) Did not the claimant, as receiver, therefore have the right to collect the money? The right of Price to receive and possess himself of the money ceased to exist when the receiver was appointed, and he was, in addition thereto, restrained from so doing, of all which the Secretary of the Treasury was duly notified. Hence the only one in law, at least as against Price and such creditors, entitled to collect the money was the receiver.
The right of a receiver appointed bv a State court to main tain an action in this court was sustained in tbe case of Redfield v. The United States (27 C. Cls. R., 393), following tbe decision in tbe case of Erwin v. The United States (97 U. S. R., 392); Goodman v. Niblack (102 U. S. R., 556).
It may be said, however, that inasmuch as the money sought to be reached in that case had not been paid to the creditor in whose favor it stood on the books of the Treasury after the receiver was appointed, that therefore the court, in the exercise of its judicial discretion within the rule announced in the case of Hilton v. Guyot (supra), might show comity to the State of New York, where the receiver was appointed, by adopting her laws in determining the rights of the receiver in respect of such claim.
But the main question settled in that case, from which no appeal was taken, was that the claim against the United States was, in virtue of the appointment of the receiver, transferred to him by operation of law; and if so, then it was by operation of the laws of the State of New York, where the receiver had been appointed, and he alone was entitled to receive the money thereon from the Treasury, as such transfer was not prohibited by the act of February 26, 1853 (10 Stat. L., 170, now Rev. Stat., sec. 3477). And when so paid to him the money became an asset in his hands for which he was accountable to the proper court in New York, as in the case of Vaughan v. Northup (supra).
Under section 1, Article XIY, of the Constitution the claimant was and' is a citizen of the United States as well as of the State wherein he resides, but the circuit and district courts of the United States within the several States are neither probate courts nor courts for the settlement of -the affairs of insolvent debtors, except in bankruptcy proceedings, and therefore many reasons exist why the Executive Departments, as well as the courts of the United States, should recognize as of binding force the laws of the several States in respect thereto.
In other words, the claimant, a citizen of the United States and of the State of New Jersey, wherein both he and Price reside and where the claim against the Government in favor of Price existed as a chose in action so far as it had local existence, was within the jurisdiction of the court of chancery in New Jersey, and that being so the claim in favor of Price, as well as' his right to collect the money thereon from the Treasury, were transferred in law to the receiver upon his appointment. Prior thereto the chose 'in action was in Price and he could have maintained an action under the act of March 3, 1887 (24 Stat. L,, 505), in the United States circuit court in New Jersey. Thereafter can it be questioned but that such right was in the receiver?
In the case of Crescent City Live Stock Company v. Butchers' Union Slaughter-House Company (120 U. S. R., 141, 146) the court cites with approval the case of JDupasseur v. Roche-reau (21 Wall., 130, 135), whore it was said: "No higher sanctity or effect can be claimed for the judgment of the.circuit court of the United States rendered in such a case, under such circumstances, than is due to the judgments of the State courts in a like case and under similar circumstances."
See also the case of The Hancock National Bank v. Jonathan W. Farnum (176 U. S., 640), decided March 12, 1900, to the same effect.
The jurisdiction of the Court of Claims extends throughout the United States. "It issues writs to every part of the United States, and is specially authorized to enforce them." (10 Stat. L., p. 612, sec. 3.) (Jones & Brown's Case, 1 C. Cls. R., 383, 398.)
Since that decision it has been held, uniformly and invariably, in all questions relating to the validity of contracts, the title to property, the distribution of estates, and the proper party to prosecute a case, that this court is to all intents and purposes sitting in the State where the cause of action arose or where the claim accrued.
Congress has supplied the accounting officers with effective means in such a case as this to protect the Government. As long ago as 1870 a case of conflicting claimants arose and was referred to this court by the Secretary of War under section 1063, Revised Statutes... It was held that the court in such a case must assume jurisdiction and determine the conflicting rights, rendering final judgment for the one claimant and final judgment against the other. (Bright & Hutchings's Case, 6 C. Cls. R., 118; 8 id., 326.) Since this, similar references, have been made by different heads of Executive Departments and by the Comptroller of the Treasury, and always with the effect of fully protecting the Government.
This view we think is sustained by the Supreme Court in the case of Price v. Forrest (173 U. S. R,., 410, 422), wherein a controversy arose between the receiver, claimant herein, and the heirs of Price as to who was entitled to receive the money from the United States.
The heirs denied the jurisdiction of the chancery court of New Jerso3r to sequester the money in dispute in the. Treasury, and insisted that whatever remained there belonged to them. The court decided that the receiver was entitled to the money and restrained the heirs of Price and their attorney, John C. Pajq to whom they had giyen a power of attorney to collect and who was also a defendant in that case, as was the administrator of the estate of Price, from making any demand upon or application to the Government for the money, or from receiving the same from the Treasury or any officer thereof. On appeal to the court of errors and appeals, the decree was affirmed. (56 N. J. Eq.) -
The decree thus affirmed was reviewed in the Supreme Court, Mr. Justice Harlan delivering the opinion of the court, saying, in part: "The ultimate question in this case is whether the plaintiffs in error, as heirs of Rodman M. Price, are entitled to receive from the United States the amount standing to the credit of the deceased on the books of the Treasury, and which represents the balance of a sum found in his lifetime under the authority of a special act of Congress to be due him upon an adjustment of his account as a purser in the Navy." Then, after stating the facts of the case as set forth in the findings herein, and reviewing the authorities construing section 3477, the court in relation thereto held that the transfer of the claim from Price "to the receiver was the act of the law. and whatever remained, whether of property or money, in his hands after satisfying the judgment," etc., was to be disposed of according to the laws of New Jersey. Furthermore, on page 423, it is said:
"As this court has said, the object of Congress by section 3477 was to protect the Government and not the claimant, and to prevent frauds upon the Treasury. (Bailey v. United States, 109 U. S., 432; Hobbs v. McLean, 117 U. S., 567; Freedmen's Savings Co. v. Shepherd, 127 U. S., 494, 506.) There was no purpose to aid those who had claims for money against the United States in disregarding- the just demands of their creditor's. We perceive nothing in the words or object of the statute that prevents any court of competent jurisdiction as to subject-matter and parties from making such orders as may be necessary or appropriate to prevent one who has a claim for money against the Government from withdrawing the proceeds of such claim from the reach of his creditors; provided such orders do not interfere with the examination and allowance or rejection of such claim by the proper officers of the Government, nor in anywise obstruct any action that such officers may legally take under the statutes relating to the allowance or payment of claims against the United States. If a court, in an action against such claimant by one of his creditors, should, for the protection of the creditor, forbid the claimant from collecting his demand except through a receiver, who should hold the proceeds subject to be disposed of according to law, under the order of court, we are unable to say that such action would be inconsistent with section 3477. It may be that the officers charged with the dut3r of allowing or disallowing claims against the Government are not required to recognize a receiver of a claim appointed bjr a court, and may, if the claim be allowed, refuse to make payment, except as provided in section 3477."
That section, to prevent frauds against the Treasury, in substance provides that "all transfers and assignments made of any claim upon the United States," and all powers of attorney for receiving payment of such claim, shall be null and void unless "freely made and executed in the presence of at least two attesting witnesses, after the allowance of such a claim, the ascertainment of the amount due, and the issuing of a warrant for the payment thereof." And yet in construing that section the court in the case of Baily and others v. The United States (109 U. S. R., 433, 439) held, in substance, that the statute was for the protection of the Government, and that payment made to an attorney in fact, constituted such by power of attorney executed before the allowance of a claim, was good as between the Government and such claimant if such power of attorney had not been revoked at the time of payment.
In the case of Erwin v. United States (supra), where cotton had been captured by the military forces of the United States and sold and the proceeds paid into the Treasury, the claim of tbe owner thereto was held to be property which passed to his assignee in bankruptcy, and that under the section of the statute referred to the passing of claims to heirs, devisees, or assignees in bankruptcy was not prohibited thereby; that the transfer of title by operation of law took the case out of the statute.
In the case of Goodman v. Niblack, (supra) a voluntary assignment for the benefit of creditors was upheld, the court, at p. 561, saying: "There can here be no intent to bring improper means to bear in establishing the claim, and it is not perceived how the Government can be embarrassed by such an assignment; " that such a transfer was not "within the evil which Congress sought to suppress by the act of 1853."
Referring again to the case of Price v. Forrest {supra), the court, quoting the opinion of the Second Comptroller to the effect that the chancery court of New Jersey could not compel payment to the receiver of the money in the Treasury to the credit of Price, says: "Even if it be true that the final order of the State court in relation to the money in question would not impose any legal duties upon the, officers of the Treasury, it does not follow that the order of the court appointing the receiver would be null and void, as between those who are parties to the cause and who are before the court."
Therefore, as between the parties to the suit who were before the court, the receiver was entitled to the money in the Treasury due Price. If so, can it be held that the Treasury officials, who had due notice not only of the appointment of the receiver but of the order restraining Price from collecting the money, ma}1' or may not disregard such order, in the absence of any claim against Price by way of offset?
This they did and paid the mone}7 to Price in disregard of the order of the chancery- court of New Jersejr. There being-no purpose to aid those who have claims against the Government "in disregarding the just demand of their creditors," and as there is nothing to prevent "any court of competent jurisdiction as to subject-matter and parties from making such orders as may be necessary or appropriate to prevent one who has a claim for money against the Government from withdrawing the proceeds of such claim from the reach of his creditors," there is certainly no reason in law why a court in an action against such debtor by one of his creditors should not forbid such debtor "from collecting his demand except through a receiver who should hold the proceeds subject to be disposed of according to law under the order of court" (Revision of N. J. Laws, 1877, sec. 26, p. 394); and such action, the court say, would not be inconsistent with section 3477.
If not inconsistent therewith,- then it follows, it seems to us, that the transfer of the claim by operation of law takes the place of .the voluntary transfer provided for in said section and clothes the receiver with the ultimate right to collect the money from the Treasury, as otherwise the purpose of the appointment of the receiver could be defeated by the refusal of the Treasury officials to recognize him as such. The transfer by operation of law, therefore, can only be made effective by payment of the money to the receiver bjr the Treasury, and in doing this the Government runs no risk, for payment to the receiver is as complete a discharge as though paid to the original creditor. (Goodman v. Niblack, supra.)
In reaching the conclusion we have, we are not unmindful that as between the States and as between the Federal Government and a foreign government a different rule prevails, and but for the decisions to which we have referred we should be inclined to follow the rule otherwise so well established.
If we are mistaken in our view as to the effect of the decisions upon -which we have relied, an opportunity will be presented for a review thereof on appeal as to whether they do apply to the precise question in this case, which, so far as we are aware, has never been presented to the Supreme Court — - i. e., the question as to whether the Treasury officials have the right in law to pay a creditor of the Government after the appointment, by a State court of competent jurisdiction, of a receiver of the property and things in action of such creditor, domiciled in such State, for the payment of his debts after due notice thereof.
Therefore, for the reasons we have given, we must hold that the claimant was entitled to receive from the Treasury the money which was due Price, and that payment thereof to Price did not discharge the defendants from their obligation to the receiver after notice of his appointment and of the order restraining Price from receiving the money, and he is therefore entitled to recover the sum of $7,900, for which amount judgment is ordered to be entered.