DIAMOND ,MATCH, C9.,:'Il·· UbomD STATES.
:27,i
The evidence upopthertrial olthis did not <teqd .to mllke a case falling within the seotion as thusconstruEid. On the contrary"it showed that the defendant exacted' the fee charged for' the. services of the merchant appraiser in pursuance of the regulations :ofthe secretary of the treasury ·. The therefore entitled to,t1J.e .instruction that the evideuce,was notsuflieieht to establish a. qause ohctiQu. The judgment is' acoordingly reversed.
DIAMOND ;.: .
M,h'qz' 'Co·. v. ','.'
! ,'i
.QtMrt, P. ,'"
',.'
'.'
.
june2S, 1887.) ., "
BolO;)
RmVENtl1ll.
'b'nE'MNl'rY:..-Ex,\¢nOlf 'i' ,
Il'tT1i:1iNAL '.i ,,.. , '
,cost of Ulaut!factl,ue, advance o( ilf an sUllP1y' of d,hl-staIl1PS, ml),de in '\Vtth a regulatlon'of the commissIoner of internal revenue; and given by the obligol'i ia. order to obtain, in.the transaction of,hisib'usiness, an accommoda;· . . grant,co.mm,iSS.ion. \11 ,might pro. p that· it t.he . .. w., as not, legan,Y. fe" is 1?-0t up<>:n the ground. e;l'Cted. colOreoJicii, , 01"fol.' want of consIderatIon;" , ' . ,, ',.,,'
,4JWnd pf
Gr'ten·B; Raum, for-plaintiff. Lewis'ErStanton, U. S. Atty., fOl'the-United WALLACE, J. This writ of error is brought to review a'Judgment,or the .district court in. favor':Qf theUnitedStatea, and against the plaintiff in action WaB,' by istipl1lation,tried befere a referee., The findings of the referee Were confirmed by the district court. The: suit upon a .. : : "The conditions o:tthc,fpregoing are wbere,as, Companyis a proprietor of to and proV:isions Rev. St.U. f)., has without to the,·United Stl\tes ,ltsowndie!l,or designs .iorstam.P/il to be used and. whereae,tbesaid piamond,»atch CompanyJs,llesirous of avoiding the deli"Ys in tbe,receiptofsuch oft46 stamps as ,it, ,may from time to time orc)er, wh,ichwQul4, if the same were n?t printed anq prepared foriss l1 eprior tQthe bytheCQIU,mUlSioner of int,ernal revenue; ,whereas, the Matcll hilS requested, 01' may hereafter rwuest, the cO/UJAissioner of illternal, ;J.'!lvenue to. prepare, and hold, subject to its order! and tQkf#lP ,flit all of. the stamps a,fprfllilaid, times on hanti, an such supply haVing and filed with miSfi;iQner,Qt internal revenue by the the Diamond Now·. therefore,if. sai4 the :QiamQnd. Match Company shall.·' w:nenever requested. so.,. toc10: by, !'Il;\ijl commissJqner .of. intern;u revenlle.,well and truly pay. ,0.1' cause toqe P!\1P,to the tre3llurelJ of .for the use .of the United and every sucb li\um or. suml!! of, money as, the commissionelJof reyenue to have been paid by theJ]'nited States. for the ,p,aper, gumming! ,apd, perforating, and .preparj.Qg fOJ"
issue,o{tl1e stamps h'erein referred to, the same having been prepared in accordance 'with the estitn'ate of the sHiid the Diamond· Match. Company, which JP.l'ly '<1ny time .be fOl.mdby said commissioner to printed for 8 bowever,;qf stamps.as J:.llay nlloy:e prmted the thre,e months, expu/ttlOn. bY're'Peal or otherWIse, of all laws requiring the use thereof,) butno.t purchased by the said the Diamond Match Company, thehthisubligatil?n tc:i, be void, and of no effect; otherwil:letb be and remain in· full 'foroeand'v'irtue."
It appears by the record that, prior to the repeal of the law imposing Ii tax on matches, the government kept on hand two kinds of internal revenue stamps: First, general stamps ofa common design, and for sale to and to be by all i vate die-stamps, whlCh were printedfr6h1dies engraVea fui' particull11'pll.i'ties from special designs, each party PTpvidipg itsow.n expense andpwning its die and plate, and being Iilona eniiUea to printed therefrom. The to of,stamps.p.alj.1ed. '...Befor,e September 30, 1875, it had been tlie custom of the government to allow, 'Withot1t) any 'itidemnity 'against 10sl1,. the' printing' of private die-stamps in, '.the futnished.oftheil antlCipated,needs, . Shottlybefore that date it was discovered that·large quantities of such st!ltnPS' ",ere, 'which hadbeen'prii1tedhl accordance ",ith the 'estimates therefor;'ana beQn purchase4,' and which never would be purchased, because the parties who had given the estimates, and for whom the stamps were printed, had gone out of business. Thereupon ,the a regulation promulgated in a circular of the date of September 30, 1875, ,," '\'Itappears tbat it has heietoforebeehthe practice of this, office to print s(J.pplies of private-die proprietary 'stamps, in anticipation of orders therefor person, firm, or corporabion furnfs,hing the design, 3pd, in the event of the failure ,,,or retirement from business" from any cause, ()f such person, firm, ()r corporation, government has been subjected to a lossof the amount 'expend,ed for paper, and the prhltinga.rid preparation for issue of the stamps left 'qn band. It is believed that this office is not wan-anted in SUbjecting the 'government t() losses of this character, and that the printing of private diestamps before the receipt of orders therefor should be discontinued, or that proper measures should be 'taken to secure the government againstlossesaris'ipg,from such printing, therefore, such persons, firms, orcorporations (Is order stamps prlnted frorn private dies, anddesire to avoid thil deliysconseqnent upon the printing and preparation of the stamps subsequent to' the receipt of an orderthere:for, win be required to execute and file in this office a bond .cotiditionedf6r the payment to the treas urer ofthe United States, i{Qrtheuse of the' U)1itedStates,· whenever so reqUired by the commissioner 'Qfinternal revenue, of suchsuro orsums as may have been paid by the treaspaper upon which the stamps are printed; togetlJer w'iththeprinting, g'umming, and preparing for issue of private:die'·proprietary stilmps, notexceedlng an estimated three-months supply, as Jtnaybeprepared tinder the directions of the commissioner of internal revenue, 'Fr(accbrdance with the estimate and request of'ihe person, firm, or corporathe same,. ,"A,.ft?rthe sppryVal bftbe bond, or 'w;lththe filmg thereof, an estlmate of's 'three-months average consumpt](Jll "of stamps should be made by the eorpoliation desiring stamps
DIAMOND MA.TCH CO.V. UNITED STA.TES.
273
printed ofbrders, and the same should be accompanied by. 110 request; tliat 'sueh number be printed, and kept continuously on hand, 3wmt-. ing orders therefor. " '
.· 'Thebondin Stl-it waS executed by the Diamond Match Company at the request of the commissioner of internal revenue, and in pursuance of the regulation set forth, after the company had ineffectually tried to induceJhe commissioner to recede from his regulatien. In April, 1881, the'l)liunond Match Coinpany became the 'successor of several' match IllanufaCturing companies which had previously existed,was thereafter the owner of 31 dies, was 'the largest match manufactory in the country, alld wal!lcontiIiubusly'rieeding' from 300,000 to 400,000, stamps per montll,dtl-ririg the busy of the year. It was a convenienee to that thir'governtllent should haV'e oli hand constantly an adequate' $U pply of stam:ps, printed on its own' dies. ,so that orders could be filled, ,and it was also of pecuniary benefit not to be cotllpelleli 'to'anticipate what l}uantity would be required inadvaJlce, 8.ndorder'the printing' in advance, from time to time, and pay for the deliveries b(stamps as theyroight be made 'under such order. On May gave the commissioner of internal revenUe its of a three-motiths supply of its stamps for use, which was 6$',7t)O,OOO, and requested ,that that number be kept on hand. Afterwards, on January 27, 1882;' the defendant requested that 1,890,000 more' stamps should be kept on haQd. by the commissionerofinternal revenue. Thereafter the quantify thus requested, prepared ready for use, ",as kept in stock by the commissioner. By the act of March 3, 1883, the tai imposed upon matches by section 3419 of the Revised Statutes wa:srepealed, the act to take effect July 1, 1883, and day afte:t therepeal statute took effect the internal revenue department had on hand4i3,133,741 stamps, printed from the private dies ofthe company, at its request. The expense of manufactnring these stamps had been $4,364.37. It.is now alleged as error that the bond in question was not required or authorized bylaw, and was exacted by the commissioner of internal revenue colore officii, and is therefore void. No other errors are alleged by the plaintiff in error. The real question to be determined is whether there Was a valid consideration for the bond. No statute directed the commissioner of the internal revenue to require, or prescribed the giving, of such a bond. But it cannot be maintained that the bond was not givenvol\intarily, or was exacted colore officii by the commissioner, if .it was given by the obligor in o'rder to promote its own convenience, and obtain an accommodation in the transaction ofits business with the in.ternal revenue department which the government was under no obligation to provide. As early as in the case of U. S. v. Tingey, 5 Pet 115, it was held that a bond not prescribed by law, but voluntarily given to the United States, isll. vaJid obligation; and that the United States have a right to enter into a contract not prohibited b)' law,and appropriate to the just exercise of their powers, through the instrunlentality of the propel' dev.31F.no.5-18 .
, :it
thQse are confided; and thattherigbt to, .take a bo11d\to:seoul'e,the government for pUblic mone.ys is an incident to the duties belonging to such a department. The dOctcine;'of ,that, was in U. S. v. Bradley, 10 Pet, 343, and inTy7,er v. Hand, 7 How. 573; U. S.v. RodsO'li, 10 Wall. and, U.S. v.Mora,f,l7 ".. ' S.", 106 U. S.147,lSup. Ct. Rep, 74, the court held that It bond taken by the commissioner of the internal to the United States, conditioned that a manufacturer shQuld pay such sum as he United States taken withQ'\ltthe ll.tlthority of a statutfl,Wal!l binding.atcomp:lOn.law. It is tb.ElreforeQlUY. necessary to the obligor in the present. bon!! it in, to ,obtain a concession which was a matter of not of right.· ,. The of requiring taxes to be was the conv:enience of the paid by. the me.nt, alild l :nQt. fqrthe of '¥ix-payers;"l;1pd undoubtedly contemplated ,t1;lat .the departmen,t' the of the internalreyenue laws sho.u1d pr,ov;iqe by the exigenoies of its 'busip,ess, .and be .at, :Uw.es prepared to furnish tlilem to those use thern.pue ofits.provisionsenapted that any, who wefB propriet9l, ,QJ: specified, ,p;rtige* subject to, stamp. tax, including privilege,offurnishing his own dieS or designs matches, tQ,beq8ed thereon commissioner revenue, ;the of i:ntel'nal revenue to cause stamps to bE;l ,sp,Qhqies for tAe.sePllratEl qse of suchprop:t;ietc>r; and., when 1>11cb ,some of the for eellaijqn: Qrdin,ary ,stamps. were ·. Section 8423, Rev. $t, V. S.,,: This was a prov:ision for the accommodatic)I;l, qf the manufacturer. not required,.U:! .avail.himself of it,but could use orthis section, nor any other prodinary stamps,jf he preferred. . vision of the internal revenue law in force when the present bond was executed,l7equir.edthe comllliSflioner qf internal revenue to keep on hand, of orders frOUl the ,Ulanufacturer, sucb ll, llua;ntity of stamp!! printeduponthE;lclie. of the particula,r manufljocturer as the manufacturer If it be conceded ,that it commissione'r ofinternal revenlle ;00 keep on. hand .such a quantity of StanlPS as a manufacturer of matches might at any .to .pur<;hase, either for cash or on a c!epit of 60 days, under time St. U.S., it was ,not his duty, except so far as in his ,oeeds of the department might require it, to be done, to keep on band, in advance of a pv.rchase or order,any specific quantity of .stamps made UpOn the, dies of a particular manufacturer. He was under no obligation to print stamps in advance of orders, and run the risk of ·the,loss.wl1i94; ensue stamps were prepared for the use 'of particullPi persoos who might nqt need all that were prepared, ormight go out of business, or might prefer to purchase or order the ordinary stamps. No duty to the manufacturer required this by implication,be-cause the could procure the ordinary stamps which
can-
-HABVEY 'V.' GAGE. :
275
iHsto bJ'assumed the department would have at all times on hand; or he option,pnrchase in advance of his present needs, an, ticipatingthe futu're exigencies of his business, and rely upon obtaining a. repaymeritof the amount paid ·for those not used, under the provisions (jf section 8426, Rev. St. U. S. In this view the regulation of the commissioner of internal revenue, under whieh this bond was given, was a just and wise one. It was calculated to indemnify the government against the riskof loss which those whodesited themselves of exceptional facilities in their busineSs with thec1epartment could bot expect the government 'to assume. The bond wasgiven'>to obtain an accommodation which the commissioner 'of internal revenue might properly extend, but which he was not required by law' to give. The'judgment of the. district court is affirmed.
HARVEY, Assignee,
GAGE.
(Oirc'UitOo'l.lrt, ;N. D. lllinO'li. June 20, 1887.) BANKR'UPTcY-7SlrATUTlil 011'
5057; RElv. ST. " " SecUQn5057. Rev. St., provides that no suit, either at lawor in equity, shall bemalntainablil between an assignee in bankruptcy and'a' person claiming an b1terest touching .any property transferable to or "]lllted in saidallfrolll the time when such signee, ,unless such 8uitbe brought within two, cause of action accrued for or against such assignee. 1fe'ld.. where the dE!tend,anto;btained two tax deeds made and'toecorded in 1877 and 1880, to prophaq be<;ome seiz.ed In , erty of which the plaintiff as an assignee in' that a suit to Bet aside. said deeds, commenced by the plaintiff Rssuch asaigneeinlB86, was not maintainable. it not having been brought within two . , years from the time the cause ,of action accrued.
George,A. DrJ;Puy, for complainant. 'Gage, for defendant. BLODGETT, J. The bill in this case charges that complainant was, on .the 1st day of December, 1873, by an order ofthis court sitting as a court of bankrup'tcy, duly appointed assignee of the Frlinklin Bank, a corporation organized and doing business in the state. Qf Illinois, and under the laws of'this state, which had been before that time duly adjudged bankrupt irithis court; that he duly qualified as such assignee, and has since beeri discharging the duties of said office; that, by virtue of his saidofficelils assignee, complainant became seiied of a lot, of land, which is specifically described in the bill, and is now in the 'actual possession of said lot; that the defendant, Henry,II.Gage, :holds two tax deeds the said'lot, the first of which was issued'to, him by the county (\lerk of Cook county OIl orsboutthe tenth dayl af Febrnary, 1877, and 'th'e,other ofaaid tax deeds was to him by said'clerkon or about the nineteenthda:y'of April, 1880. The bill alsocontains!8.verments show-