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GOODMAN v. NIBLACK.

October 1, 1880

GOODMAN
v.
NIBLACK.



APPEAL from the Circuit Court of the United States for the District of Indiana. This was a bill in chancery filed by Charles Goodman against William E. Niblack, administrator de bonis non of Albert G. Sloo, deceased. A demurrer to it was sustained, and Goodman appealed. The case is fully stated in the opinion of the court.

The opinion of the court was delivered by: Mr. Justice Miller delivered the opinion of the court.

Mr. James C. Denny and Mr. D. V. Burns for the appellant.

Mr. F. W. Viehe for the appellee.

There came into the hands of Niblack, as administrator de bonis non of the estate of Albert G. Sloo, the sum of $150,000, and the complainant is the owner of a judgment against said Sloo for $31,344.44, recovered in the Supreme Court of the State of New York, on the twentieth day of January, 1855. The purpose of the present bill is to follow this money in Niblack's hands as a trust fund devoted by Sloo in his lifetime to the payment of that judgment. This trust arises, if it exist at all, out of a deed of assignment made by Sloo of all his property, rights, and credits to Benjamin H. Cheever and James Wiles, of the date of Feb. 3, 1860, for the benefit of all his creditors, but with some preferences, among which is the judgment. The sum above mentioned was received by Niblack as the share of Sloo's estate in a claim of over a million dollars recovered in the Court of Claims against the United States and paid by the government to Marshall O. Roberts and Edward N. Dickerson, in whose names the judgment was recovered. The history of this claim, which is necessary to an understanding of the case in hand, is this:––

The fourth section of the act of Congress of March 3, 1847, chap. 62 (9 Stat. 187), directed the Secretary of the Navy to contract with Sloo for the transportation of the mails of the United States from New York to New Orleans, Charleston, Savannah, Havana, and Chagres and back twice a month, at a compensation not to exceed the sum of $290,000. The mail was to be carried in steam vessels of a character described in the act, not less than five in number, to be constructed under the supervision of officers of the navy, in such manner as to be easily converted into war steamers of the first class. Under this authority the Secretary and Sloo executed a written contract on the 20th of April of that year, for the construction of the ships and transportation of the mails at the sum of $290,000 per annum. On the 17th of August thereafter Sloo entered into an agreement with Marshall O. Roberts, George Law, Prosper M. Wetmore, and Edwin Croswell, by which they were taken into this contract with him, and agreed to build the vessels, and run them, and perform the obligations of Sloo to the government. He was to receive one-half of the net profits of the venture and the four persons named the other half. In order to the perfect working of this agreement, a tripartite instrument in writing was made, in which Sloo is called the party of the first part, and Roberts, Law, Wetmore, and Croswell the party of the second part, and George Law, Marshall O. Roberts, and Berres R. McIlvaine party of the third part, whereby, after reciting the agreement between the party of the first part and the party of the second part, the contract of Sloo is assigned to the party of the third part as trustees for the due execution of the agreement. This was signed by all the persons named.

The ships were built, and the mails carried for many years. By death and substitution, Marshall O. Roberts and Edward N. Dickerson became the surviving trustees under the agreement, and, as such, recovered in a controversy with the United States in the Court of Claims judgment for the sum of $1,031,000 as money due under the original contract with Sloo, which judgment was affirmed in this court and the money paid to them.

In the mean time, Sloo, who had become insolvent, executed in 1860 the general assignment to Cheever and Wiles, already mentioned. He died before the final payment of the money by the government to Roberts and Dickerson. Niblack was appointed his administrator.

These facts are all set out in the bill, and copies of the several contracts and assignments are filed as exhibits. Another averment of the bill is that the sum really due to Cheever and Wiles, as assignees of Sloo, out of the sum paid by the government, was $182,000; that Cheever and Wiles received $37,000 of this money, and consented to the payment of the remaining $145,000 to Niblack under some arrangement not understood by the complainant. It is also alleged that all the other indebtedness of Sloo which might have been a claim on this fund under his assignment to Cheever and Wiles has been paid, and there remains no other claim on it than complainant's. It is also averred that Wiles and Cheever are not citizens of Indiana, and cannot be served with process, and are not made parties to the bill, and for the reasons above stated are not necessary parties.

The demurrer is, first, general, and, secondly, special as regards the failure to make Cheever and Wiles parties.

The general demurrer is maintained on the ground that the assignments made by Sloo are void by reason of the provisions of sect. 3477 of the Revised Statutes. These provisions were enacted by Congress in 1853 (10 Stat. 170), and were, therefore, not in force when Sloo made his contract with the government, or his agreement with Roberts, Law, and others. That agreement remains unaffected by them. They were in force, however, when he made the general assignment of all his effects to Cheever and Wiles, and as the complainant claims through it, and can probably succeed only in that way (because, as we are informed, the State court of Indiana has decided that the Statute of Limitations bars his claim as an ordinary debt), we must inquire whether that assignment is void under the act of Congress.

The statute has several times within the last few years received the consideration of this court. United States v. Gillis, 95 U. S. 407; Spofford v. Kirk, 97 id. 484; Erwin v. United States, id. 392.

It is understood that the Circuit Court sustained the demurrer under pressure of the strong language of the opinion in Spofford v. Kirk. We do not think, however, that the circumstances of the present case bring it within the one then under consideration, or the principles there laid down. That was a case of the transfer or assignment of a part of a disputed claim, then in controversy, and it was clearly within all the mischiefs designed to be remedied by the statute. Those mischiefs, as laid down in that opinion, and in the others referred to, are mainly two:––

First, the danger that the rights of the government might be embarrassed by having to deal with several persons instead of one, and by the introduction of who was a stranger to the original transaction.

Second, That, by a transfer of such a claim against the government to one or more persons not originally interested in it, the way might be conveniently opened to such improper influences in prosecuting the claim before the departments, the courts, or the Congress, as ...


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