Case: CHARLES M. HORTON v. THE UNITED STATES
Abbreviation: Horton v. United States
Decision Date: 1896-02-03
Docket Number: No. 15581
Citation: 31 Ct. Cl. 148
Volume: 31
Reporter: United States Court of Claims Reports
Court: United States Court of Claims
Jurisdiction: United States
Parties: CHARLES M. HORTON v. THE UNITED STATES.
Judges: 
Pages: 148–157

Head Matter:
CHARLES M. HORTON v. THE UNITED STATES.
[No. 15581.
Decided February 3, 1896.]
On the Proofs.
This is an informer’s case for a share of money received in compromise and paid into the Treasury prior to the repeal of the act of 13th July, 1866. The award is not made until 1887. The Secretary states that the proof shows that the claimant “gave the lnformaiionu,pon ivliieh a penalty of §75 was recovered by compromise; ’’ and that the compromise was approved by the Secretary of the Treasury, September 3,1884; and that the penalty was paid to the Secretary on the information given by the claimant in March, 1871. The award does not state the amount of the informer’s share, but the Treasury regulations of the time fix it at one-half where the amount recovered does not exceed $500.
I.The amount involved being trivia], and the court having been informed that no other case exists like it, announces that the point now determined will not be deemed stare deeisis.
II.Where a compromise was effected under the internal-revenue laws and the money paid into the Treasury prior to the Aet 6th June, 181% (17 Stat. L., p. 256, % 9), the informer may recover the amount awarded him by the Secretary of the Treasury, though the award was not made until after the repeal of the Aet 13th July, 1866 (14 Stat. L., p. 145).
III. The Secretary of the Treasury, after determining every fact which it is within the jurisdiction of the Treasury to determine concerning an informer’s claim, may remit the question of law involved for the decision of this court.
IV. Where an informer is entitled under the Treasury regulations to a moiety of the amount received by way of compromise, and the Secretary’s award specifies the amount received, it is not necessary to the validity of the award that he specify the amount of the informer’s share.
V.The statute of limitations does not run against an informer’s share until the award of the Secretary of the Treasury is made. His right of action then accrues.
The Reporters’ statement of the case:
The following are the facts of this case as found by the court:
I. On the 14th of August, 1866, the Secretary of the Treasury issued the following circular:
“Treasury Deparment, August 14,1866.
“ The act amendatory of the internal-revenue law, which went into effect on August 1, contains the following provisions:
“On the first five hundred dollars of any penalty the informer shall receive 50 per cent.
* # # # * * *
“Hug-h McCulloch,
11 Secretary of the Treasury.”
II. Upon information first given by the claimant to the proper officers of the United States, in March, 1871, against John M. Isham, a wholesale dealer in liquors, said John M. Isham was proceeded against for violation of the internal-revenue laws.
III. Thereafter claimant made application for a share of said sum so received in compromise, and tbe following decision was made on bis said application:
1 ‘ Tee asuet I)ep aetsient,
“Oeeice oe the Seceetaey,
“ Washington, D. G., February 15, 1887. “G-eoege A. King, Esq.,
“ Attorney at Lato, Washington, P. G.
“Sie: In your letter of the 18th ultimo you request that the claim of your client, Charles M. Horton, of Boston, Massachusetts, to an informer’s share of a penalty of $75 either be settled in accordance with the decision of the Court of Claims in the Ramsay Case, or, if the Secretary does not desire to adopt that course, that he will determine and declare that said Horton was the informer in the case referred to.
“ In reply I have to say that as the decision of the Court of Claims in the Ramsay Case was affirmed in the Supreme Court of the United States by a divided court, I do not consider the Secretary justified in accepting thatcase as a binding i>recedent.
“I see no objection, however, to stating that the proof on file with the Secretary of the Treasury shows that said Charles M. Horton, of Boston, Massachusetts, gave the information upon which a penalty of seventy-five dollars ($75) was recovered by compromise from, one John M. Isham, a wholesale dealer'in liquors, the compromise having been approved by the Secretary of the Treasury on the 3d day of September, 1884, and the penalty having been paid to the Secretary June 14,1871, on information given by said Horton in March, 1871.
“It is presumed that on his declaration you can take the case to the Court of Claims and obtain an adjudication. “Respectfully, yours,
“C. S. Faiechild,
“Acting Secretary.”
IY. The following is a* copy of the application of O. M. Horton to the Secretary of the Treasury for a share of the amount paid into the Treasury by said Isham:
“ The application of G. M. Rorton, of Boston, Mass., to be declared informer in the case of the United States v. John M. Isham, of Pittsfield, Mass.
“The petitioner respectfully shows that in the month of March, 1871, he, of his own motion and accord and without information derived from any other person, discovered that said Isham was guilty of carrying on the business of a wholesale dealer in liquors without payment of the special tax as required bylaw; also that-he had failed to destroy the stamps on distilled spirit barrels at the time of emptying them; also that lie had failed to keep a Government book showing his purchases and sales of distilled spirits as required bylaw; that the petitioner thereupon laid the facts before Supervisor Simmons, who caused prosecution to be commenced in the U. S. court against said Isliam. The defendant’s offer of compromise in the case having been accepted, your petitioner, as thé first and only person who gave any information or facts in the case, prays that he may be awarded the informer’s share in said case.
“C. M. Horton,-
“33 School St., Boston, Mass.
“To the Honorable Secretary
“oe the U. S. Treasury,
“ Washington, D. G.”
“Massachusetts District, Boston, Oct. 15, ’84.
“Subscribed and sworn to before me.
“[seal.] “Henry L. Hallett,
UU. S. Gommis’r, Mass. JDist.”
“ I hereby certify that the within statement is correct, and that O. M. Horton was the first and only person who gave the information upon which the proceedings were commenced.
“W. H. SIMMONS,
“Late Supervisor Int. Revenue, N. England District,”
The court declines to find the Treasury circulars No. 99, July 17,1872, and November 1,1883, as facts in the case, they being public documents of which the Supreme Court will take judicial notice.
Mr. George A. King for the claimant:
In the case of Ramsay v. United States (21 O. Cls. R., 443) this court had before it the question whether the repealing act of 1872 annulled all claims for rewards based upon information previously given, although the money was not recovered from the offender till after the repeal. The court held that the right to the reward remained, notwithstanding the repeal. This case went to the Supreme Court, where the judgment was affirmed by an equal division, (United States v. Ramsay, 120 U. S., 214.)
Another case involving the same question came before this court and, upon a judgment in favor of the claimant, went to the Supreme Court, where the remarkable result was reached of that court being for a second time equally divided, although the justices were not the same. (Bailee v. United States, 23 C. 01s. R., 502.)
For a third time a case involving the same question was brought before this court, and again went to the Supreme Court. That court of its own motion insisted upon the case being heard by a full bench. This having' been done, the court, in an opinion by Mr. Justice Brewer, held that the informer gained no accrued right till the money fixed by judgment or compromise had been actually paid, and that if not so paid before the date of the repealing act of 1872, that act defeated the informer’s right. {United, States v. Connor, 138 U. S., 61.)
Thus it is apxiarent that the decision of the Supreme Court was reached only after considerable division, and probably in the end not by a unanimous court, and should not be pressed beyond the exact point decided.
In the present case the compromise was effected and the amount thereof paid by the offender the year before the repeal of the moiety act. So formal approval of the compromise, however, was entered by the Secretary of the Treasury till twelve years after the repeal, when, in 1881, he entered a formal approval of the compromise. Obviously, however, this was a mere matter of bookkeeping, which could in no wise affect the legal consequences of the act of payment. The money having been paid into the Treasury, the act of compromise was consummated beyond recall. The offender, thereafter, could never have been pursued by the United States, and the subsequent act of approval was a superfluity in law. By the very terms of the original moiety act and of the repealing act, the right vested when the amount of the compromise was paid. This result is not only entirely consistent with, but required by, the decision in the Connor Case, which is that it is the act of payment which finally fixes and vests the right of the informer.
Mr. John G. Capers (with whom was Mr. Assistant Attorney - General Dodc/e) for the defendants:
The case now under consideration comes squarely under the Bamsay Case, as reported in Fourteenth Court of Claims, and under the case of The United States v. Bashaw (152 U. S. B., 436).
In the matter of the time at which an informer’s right accrues, section 30 of the Act of June 6,1872 (17 Stat. L., 256), repealed section 179 of the Act of June 3,1864 (13 Stat. L.,' 305), as amended by the Aet of July 13,1866 (14 id., 145), and tbe thirty-ninth section of tbe Act of 1872, supra, took effect August 1,1872, and provided: “That no right accrues to or is vested in any informer in any case until tbe fine, penalty, or forfeiture in such case is fixed by judgment or. compromise, and tbe amount or proceeds shall have been paid.” That is, that unless tbe amount of tbe fine, penalty, or forfeiture lias been both fixed and paid to tbe Government tbe informer’s right of action does not begin for a share of tbe amount so fixed and paid.
In this case, as appears in tbe Secretary’s letter, tbe amount of $75 was paid by tbe aforesaid John M. Isbam, June 14, 1871, “the compromise having been approved by tbe Secretary of tbe Treasury on tbe 3d day of September, 1884.” Tbe approval of tbe Secretary in September, 1884, “fixed” tbe amount as a satisfactory and final compromise of tbe case, and tbe claimant informer was not therefore entitled to an informer’s share of such sum until tbe said 3d day of September, 1884. His rights accruing then, from and after that date be must in tbe prosecution of them, be governed by tbe law as it existed at that time.
This claimant seems to have recognized tbe fact that bis right to a share of tbe $75 did not accrue until after tbe “approval” of tbe Secretary as shown by bis application to tbe Secretary dated October 15,1884. Tbe Court of Claims has held (Green v. United States, 17 O. Cls. B., 238) that where “a person gives information to tbe Commissioner of Internal Bevenue under bis circular * * * tbe circular expressed tbe contract between him (tbe informer) and tbe Government.” Accepting this proposition (where, of course, tbe circulars are ajiproved by tbe Secretary of the Treasury, as in tbe Green Case and in tbe case at band), we respectfully submit that tbe circular in evidence, and made a part of tbe claimant’s brief, can not in any way regulate or fix tbe claimant’s rights to recover a share of tbe amount paid in compromise as alleged. That circular in evidence is dated “August 14.1866,” and refers specifically to the moiety act of August 1.1866, and tbe schedule of informers’ shares thereto annexed were adopted by tbe Hon. Hugh McCulloch, as Secretary of the Treasury, when tbe moiety act was in full force and effect. It seems absurd, therefore, for claimant to contend for a share as fixed by that schedule (adopted in 1866) when bis rights did not accrue until 1884, after tbe moiety act bad been repealed in 1872, and again in 1874; and further, after other official circulars had been issued by the Secretary, notably in in July, 1872, July, 1873, and in November, 1883, the purpose of these circulars being-, of course, to issue such promises to informers as would work harmoniously with the repealing acts of 1872 and 1874. We contend, therefore, that in any event the claimant in this case, if indeed he could recover anything, would be entitled to only such share as the official circulars of 1872,1873, and 1883 fixed.
It is quite true, as stated by this court in the Bamsay Case (21 C. Cls. R., 443), that “ after an award is made upon the merits by an officer having exclusive jurisdiction of the claim, a refusal to order payment does not deprive the court of jurisdiction, but, on the contrary, is one of the facts upon which jurisdiction rests.” But “the merits” of a case like the one under consideration are the informer and the amount due him. With, therefore, a decision as to only one-half of the merits, and no decision as to the vital half, viz, the amount due, “this court can not substitute its judgment on that question for the judgment of the Secretary.”
“The right asserted by the claimant rests upon a condition •unfulfilled, and courts can not perform executive duties or treat them as performed when they have been neglected.”
On this point the circulars from the Secretary, reproduced here, are in point, for with a provision in each of them that informers would be entitled to “ such reward as the Commissioner of Internal Revenue (with the approval of the Secretary of the Treasury) may deem suitable,” not exceeding 6 per cent, and afterwards 10 per cent; with such a provision, I say, how can this court fix the amount to which the informer would be entitled under that circular as 1 per cent, 2 per cent, 5 per cent, or 10 per cent1? Like the case of Green v. The United States (17 C. Cls. R., 238).
In concluding the discussion of this feature of the case, let" me call the court’s attention to the act of June 22,1874, entitled “An act to amend'the customs-revenue laws and to repeal moieties.” (18 Stat. L., 180.) It does not appear that this act has been cited in any one of the numerous cases on this question. The fourth and the last sections of that act clearly define the duties of the Secretary of the Treasury in such matters, and leave the fixing of awards even more absolutely (if it were possible) to bis judgment and discretion, and makes bis action and approval a condition precedent to the right of an informer for a share of any amount recovered by the Grov-ernment under the customs-revenue laws.
The claimant contends that there is a material difference between this case and the case of Ramsay (21 O. Cls. B., 443), inasmuch as the penalty in the case at hand was paid to the Secretary of the Treasury prior to the repeal of the moiety act. That is true, but it is sufficient in this connection to cite the Act of June 22, 1874 (18 Stat. L., 186), which repeals not only the moiety acts of 1864, 1866, and 1867, but also repeals the act of 1872.
The claimant’s attorney takes the position that the Oonnor Oase (United States v. Connor, 138 U. S., 61) decides that it is not from the time of the approval of the Secretary of the Treasury, but at the time of the actual payment of the fine or penalty that an informer’s right to a share in such ñne or penalty accrues.
In reply to this, it should be said that if the position taken by claimant is the correct one, and that the Connor Case (supra) maintains that position, the claimant is clearly barred by the statute of limitations, and has no right of action whatever in this court, for the penalty in compromise was paid into the Treasury on the 14th day of'June, 1871, and the petition was not filed in this court until February 28, 1887. If, therefore, it were true that the Connor Case had decided the question, as stated by claimant, we would willingly rest the case there, and -the petition, we feel sure, would be promptly dismissed. As a matter of fact, however, the Conner Case makes no such decision as contended (however peculiarly) by claimant.
The only question decided in the Connor Case is that the adjudication of the claim by the Secretary of the Treasury is a prerequisite to the action, and that inasmuch as in the Connor Case (supra) the Secretary adjudicated the case twelve years before the petition was filed in the Court of Claims, that therefore the claimant was barred by the statute of limitations. (Eev. Stat., sec. 1069; Mnn v. United States, 123 U. S.. 227.)

Opinion:
Nott, J.,
delivered the opinion of the court:
The amount involved in this case is trivial, and the court is informed by counsel that no other case exists like it. Nevertheless, the court is reluctant to pass definitely upon the principal question involved; and it must be understood tbat if other cases of a like nature may hereafter be brought before the court the point now determined will not be deemed stare decisis.
In the first case of Ramsay (14 C. Cls. R., p. 367) this court held that an action would not lie for an informer's share or moiety until an award had been made by the Secretary of the Treasury; that the matter was entirely within his jurisdiction, and that his award determining the three essential facts that the claimant had given the information, that his information was the information upon which the Treasury officials acted, and the share in the recovery which he should receive for his information was the only cause of action which could be maintained in a suit at law. In the second Ramsay Case (21 id., 443) the court held that a decision of the Secretary of the Treasury stating the requisite facts, though refusing payment for another reason, was an award; and that an action would lie if the informer's services had been rendered prior to the Act 6th, June, 1872 (17 Stat. L., p. 256, sec. 9), though the amount recovered was not paid into the Treasury until after the repeal of the Act 13th July, 1866 (14 Stat. L., p. 145). The judgment was affirmed by equal division of the Supreme Court. In Bailees Case (23 C. Cls. R., p. 502) a similar judgment was rendered which was'again affirmed by an equal division of the Supreme Court, although the judges were not the same as before. In the case of Connor, a similar judgment was for the third time rendered by this court (without opinion), which was reversed by the Supreme Court (138 U. S. R., 161).
By that decision of the Supreme Court it was determined, generally, "that any rights which an informer might have had to share in a fine, penalty, or forfeiture under the provisions of the act of July 13, 1866, was taken away by the act of June 6,1872, unless the amount of the fine, penalty, or forfeiture toas fixed and settled by judgment or compromise, and by payment, before the passage of the latter actP It was also held in that particular case that the claim of the party had been adjudicated by a previous award of the Treasury than that sued upon, and was barred by the statute of limitations.
In the present case, the compromise was effected and the money paid into the Treasury before the act of 1866 was repealed; that is to say, before the act of 1872 was passed. The case, therefore, seems to come within the exception indicated by the Supreme Court.
This court has no doubt that it was the intention of Secretary Fairchild to do on the loth February, 1887, what Secretary Manning had previously done on the 6th November, 1885, i. e., to determine every fact which it was within the jurisdiction of the Treasury to determine concerning this informer's claim, and remit the question of law involved for the decision of this court. The only difference between the two decisions is that Secretary Manning said, "The informer's share of that amount would have been $1,700," while Secretary Fairchild said nothing. But in the former case it was necessary that the Secretary should specifically determine the amount of the informer's share, for the amount recovered had exceeded $500.. In the latter case it was not necessary that the Secretary should state the amount of the informer's share specifically, for the amount recovered did not exceed $500, and a general regulation of the Secretary then prescribed an informer's share in such cases to be a moiety of the amount. That which was already certain could not be made more certain by the Secretary reiterating it in his decision. When he tvrote into it "that Charles M. Horton, of Boston, Mass., gave the information upon which a penalty of $75 was recovered by compromise from one John M. Isham," he in effect wrote that if the claimant was entitled to anything he was entitled to $37.50.
The point has been raised by the defendants that the case against Isham Avas not finally settled by the Treasury until the 3d September, 1881, when the Secretary approved the payment of $75 made by Isham in June, 1871. It seems clear to the court, however, that if the money was paid into the Treasury prior to the repealing act of 1872, and the compromise then effected received the approval of the Secretary of the Treasury, the time of his formal action is immaterial.
The point is also made that the case is barred by the statute of limitations because the money was paid in and the compromise approved more than six years before the bringing of the action. But it again seems clear to the court that if the claimant has any cause of action it is founded upon and consists exclusively of the award of the Secretary of the Treasury, made in 1887.
The judgment of the court is that the claimant recover $37.50.