It has been frequently held that the device of covering property
as neutral when in truth it was belligerent is not contrary to the
laws of war or of nations. Contracts made with underwriters in
relation to property thus covered have always been enforced in the
courts of a neutral country where the true character of the
property, and the means taken to protect it from capture have been
fairly represented to the insurers. The same doctrine has always
been held where false papers have been used to cover the property,
provided the underwriter knew or was bound to know, that such
stratagems were always resorted
to by the persons engaged in that trade. If such means may be
used to prevent capture, there can be no good reason for condemning
with more severity the continuation of the same disguise after
capture in order to prevent the condemnation of the property or to
procure compensation for it when it has been lost by reason of the
capture. Courts of the capturing nation would never enforce
contracts of that description, but they have always been regarded
as lawful in the courts of a neutral country.
Whatever property or money is lawfully recovered by the executor
or administrator after the death of his testator or intestate in
virtue of his representative character he holds as assets of the
estate, and he is liable therefor in such representative character
to the party who has a good title thereto. The want of knowledge or
the possession of knowledge on the part of the administrator as to
the rights and claims of other persons upon the money thus received
cannot alter the rights of the party to whom it ultimately
belongs.
The owner of property or of money received by an administrator
may resort to the administrator in his personal character and
charge him
de bonis propriis with the amount thus
received. He may do this or proceed against him as executor or
administrator, at his election. But whenever an executor or
administrator, in his representative character, lawfully receives
money or property, he may be compelled to respond to the party
entitled in that character, and shall not be permitted to throw it
off after he has received the money in order to defeat the
plaintiff's action.
In the case of a factor who sells the goods of his principal in
his own name upon a credit and dies before the money is received,
if it is afterwards paid to the administrator in his representative
character, the creditor would be entitled to consider it as assets
in his hands and to charge him in the same character in which he
received it. The debtor -- that is to say the party who purchased
from the factor without any knowledge of the true owner and who
paid the money to the administrator under the belief that the goods
belonged to the factor -- is unquestionably discharged by this
payment, yet he cannot be discharged unless he pays it to one
lawfully authorized to receive it, except only in his
representative character.
In the Circuit Court of Maryland, John H. Duffy, the defendant
in error, instituted a suit against the administrators of Albert P.
De Valengin for the recovery of a sum of money which he claimed to
belong to him, being a portion of the indemnity paid by the
government of Brazil for the capture and loss of the brig
President Adams by a Brazilian cruiser in 1828.
John H. Duffy, a citizen of the United States domiciled at
Buenos Ayres in 1828, shipped a quantity of hides and other
articles of merchandise in 1828 on board the brig
President
Adams, commanded and part owned by Albert P. De Valengin, a
citizen of Baltimore,
Page 39 U. S. 283
for Gibraltar. The government of Brazil and that of Buenos Ayres
were then at war.
For the better security of the property from Brazilian capture,
the property was shipped in the name of De Valengin, and soon after
she sailed she was captured by an armed vessel of Brazil and
carried into Monte Video. There both vessel and cargo were totally
lost.
Under an agreement between John H. Duffy and Captain De
Valengin, a claim for the cargo as well as the vessel was made by
him on the government of Brazil, for indemnity. The ownership of
John H. Duffy was concealed in this application, as his property
was liable to capture by the cruisers of Brazil, he being domiciled
at Buenos Ayres. Captain De Valengin died before anything was
recovered from the government of Brazil for the
President
Adams and cargo, and a certain James Neale, who had become his
administrator under letters of administration granted in Maryland,
prosecuted the claim as the representative of De Valengin, and was
at length paid the indemnity in Baltimore by the aid of Mr. James
Birkhead of Rio de Janeiro, who remitted it to him from that place.
The proceeds of the property remitted by Mr. Birkhead were returned
in an inventory filed by Mr. Neale as administrator in the Orphans
Court at Baltimore, as the estate of De Valengin.
A suit for the recovery of the amount claimed by John H. Duffy
was instituted in the circuit court of the United States against
James Neale as the administrator of De Valengin, and he having died
before the trial of the cause, and the plaintiffs in error having
taken out letters of administration
de bonis non to the
estate of De Valengin, they were summoned, and they appeared and
took defense in the action.
In the declaration in the action, the only court applicable to
the controversy between the parties to the suit, was that for money
had and received by James Neale, the administrator of De Valengin,
for the use of the plaintiff. On the issues of
nonassumpsit and
plene administravit, the jury
found for the plaintiff on the first, and for the defendants on the
second count. The circuit court entered a judgment on the first
plea for the amount found by the jury, fourteen thousand and
thirteen dollars and sixty-seven cents, the judgment to bind
assets.
From this judgment the defendants prosecuted this writ of
error.
On the trial of the cause in the circuit court, the defendants
took a bill of exceptions to the decisions of the court on six
different propositions or prayers submitted by their counsel for
the opinion of the court. The bill of exceptions contains the whole
evidence in the cause. All the prayers of the counsel for the
defendants were refused by the court.
The opinion of the Supreme Court on the matters presented under
the writ of error was given on two propositions into which all
those submitted in the circuit court were considered to be
resolved.
"1. That the agreement between Captain De Valengin and John
Page 39 U. S. 284
H. Duffy, under which De Valengin was to claim remuneration from
the Brazilian government for the loss of the brig
President
Adams and her cargo on the ground of its being neutral
property, when in truth the cargo was the property of John H.
Duffy, and therefore belligerent, and liable to capture by the laws
of nations, was fraudulent and immoral, and that the courts of
justice of the United States will not assist a party to recover
money due on such agreement."
"2. That if the money belonged to John H. Duffy, the action
would not lie against Neale, as administrator, nor the money be
assets in his hands of De Valengin's estate; that his return to the
orphans court cannot alter the character of the transaction, and
that this suit ought to have been continued against Neale's
administrator, and not against the representatives of De Valengin.
"
Page 39 U. S. 288
MR. CHIEF JUSTICE TANEY delivered the opinion of the Court.
It appears from the record that John H. Duffy, an American
citizen, being engaged in commerce and domiciled at Buenos Ayres,
shipped a cargo of hides and lard to Gibraltar on board the brig
President Adams in 1828. Buenos Ayres was then at war with
Brazil. The
President Adams was an American vessel, and De
Valengin, her captain, was a citizen of the United States. He was
also part owner of the vessel.
In order to protect the cargo from capture by the Brazilians, it
was shipped as the property of De Valengin, and the bill of lading
and other papers in relation to it were made out in his name. The
brig was, however, captured on her voyage by a Brazilian cruiser
and was wrecked and the vessel and cargo totally lost near Monte
Video while in possession of the captors, who were endeavoring to
carry her into port.
De Valengin being the ostensible owner of the cargo, he, with
the consent of Duffy, prosecuted a claim for remuneration from the
Brazilian government, insisting that the property belonged to him,
that it was neutral property and therefore unlawfully captured. De
Valengin died before he recovered anything, and after his death,
James Neale took out letters of administration on his estate
Page 39 U. S. 289
in the City of Baltimore, and continued to prosecute the claim
upon the ground that the property was De Valengin's, and at length
succeeded in obtaining compensation for it from the Brazilian
government. The money was paid to Neale's agent at Rio de Janeiro
and invested in coffee and shipped to him to Baltimore, where he
received and took possession of it as property belonging to De
Valengin's estate, and as his administrator. It was duly appraised
as the property of De Valengin and returned as such by Neale to the
orphans court in January, 1834, and afterwards was sold by him, and
the money received. It does not appear from the evidence whether
Neale had or had not any knowledge of the interest of Duffy in the
cargo while he was prosecuting the claim against the Brazilian
government or when he received the compensation for it.
In March, 1834, Duffy brought suit against Neale for the money
he had thus received. The suit was against Neale as administrator
of De Valengin. In 1836, Neale died, the suit being still pending,
and after his death, process was issued against the present
plaintiffs in error, who are the administrators
de bonis
non of De Valengin, in order to make them defendants to the
suit which he had instituted against Neale in his lifetime as
administrator as aforesaid.
The declaration was amended by the plaintiff after the
appearance of the administrators
de bonis non, and the
only count applicable to the case as it appears in the testimony
was that for money had and received by Neale, as administrator of
De Valengin, to and for the use of the plaintiff. The defendants
pleaded
nonassumpsit and plene administravit, upon which
issues were joined, and the jury found for the plaintiff on the
first issue and for the defendants on the second, and the judgment
was entered for the amount found due by the jury in the usual form,
to bind assets when they shall arise.
At the trial, several instructions were asked for by the
defendants, which were refused by the court. They may all, however,
be resolved into two.
1. That the agreement between De Valengin and Duffy, to claim
remuneration from the Brazilian government upon the ground that it
was neutral property when in truth it was Duffy's, and therefore,
belligerent and liable to capture by the laws of nations, was
fraudulent and immoral, and that the courts of justice of this
country will not assist a party to recover money due on such an
agreement.
2. That if the money belonged to Duffy, the action would not lie
against Neale as administrator, nor the money be assets in his
hands, of De Valengin's estate; that his return to the orphans
court cannot alter the character of the transaction, and that the
suit ought to have been continued against Neale's administrator,
and not against the representatives of De Valengin.
The first question may be disposed of in a few words. It has
been frequently held that the device practiced in this case of
covering the property as neutral when in truth it was
belligerent
Page 39 U. S. 290
is not contrary to the laws of war or the laws of nations. And
contracts made with underwriters in relation to property thus
covered have always been enforced in the courts of a neutral
country when the true character of the property and the means taken
to protect it from capture have been fairly represented to the
insurer. The same doctrine has always been held where false papers
were used to cover the property, provided the underwriter knew or
was bound to know that such stratagems were always resorted to by
persons engaged in that trade. And if such means may be used to
prevent a capture, there can be no good reason for condemning with
more severity the continuation of the same disguise after capture
in order to prevent the condemnation of the property or to procure
compensation for it when it has been lost by reason of the capture.
It is true the courts of the capturing nation would never enforce
contracts of that description, but they have always been regarded
as lawful in the courts of a neutral country.
The second question is one of more nicety, and the cases are not
entirely reconcilable to each other. There are doubtless decisions
which countenance to doctrine that no action will lie against an
executor or administrator in his representative character except
upon some claim or demand which existed against the testator or
intestate in his lifetime, and that if the claim or demand wholly
accrued in the time of the executor or administrator, he is liable
therefor only in his personal character. But upon a full
consideration of the nature and of the various decisions on the
subject, we are of opinion that whatever property or money is
recovered or received by the executor or administrator after the
death of his testator or intestate in virtue of his representative
character he holds as assets of the estate, and he is liable
therefor in such representative character to the party who has a
good title thereto. In our judgment, this, upon principle, must be
the true doctrine.
In the case of a factor who sells the goods of his principal in
his own name upon a credit and dies before the money is received,
if it is afterwards paid to the administrator in his representative
character, would not the creditor be entitled to consider it as
assets in his hands and to charge him in the same character in
which he received it? The want of knowledge or the possession of
knowledge on the part of the administrator as to the rights or
claims of other persons upon the money thus received cannot alter
the rights of the party to whom it is ultimately due. The debtor --
that is to say, the party who purchased from the factor without any
knowledge of the true owner and who pays the money to the
administrator under the belief that the goods belonged to the
factor himself -- is unquestionably discharged by this payment. Yet
he cannot be discharged unless he pays it to one lawfully
authorized to receive it, and the party to whom he pays cannot be
lawfully authorized to receive except only in his representative
character. If he is
Page 39 U. S. 291
authorized to receive in that character, why should he not be
liable in that character?
Again, if a note had been taken by the factor payable to himself
and after his death his administrator sued upon it in his
representative capacity, and recovered the money, would he not be
liable to the principal in the same character in which he had by
the judgment of a court recovered the money? It would be difficult
to reconcile the contrary doctrine to any sound principles of
reason or to find any countenance for it in analogous cases.
We do not mean to say that the principal may not in such cases
resort to the administrator in his personal character, and charge
him
de bonis propriis with the amount thus received. We
think he may take either course at his election, but that whenever
an executor or administrator, in his representative character,
lawfully received money or property, he may be compelled to respond
to the party entitled in that character, and shall not be permitted
to throw it off after he has received the money in order to defeat
the plaintiff's action.
In this case, De Valengin was the bailee of the goods shipped by
Duffy, and had a special property in them, and it was his duty to
take all proper measures for their safety and preservation. He had
a right to sell and transfer the goods in his own name and as his
own property. The Brazilian government, by agreeing to pay the
money, admitted that the debt was justly due to him on account of
the destruction of this cargo. Whether that government was deceived
or not is another question, and does not affect the point now to be
decided. The admission of the debt as due to De Valengin places
this case upon the same principles with that of a factor before
mentioned who had sold the property of his principal in his own
name and died before the receipt of the money. If the administrator
is lawfully entitled to receive it in his representative character
and does so receive it, he is liable in the same character to the
party entitled. Neale prosecuted the claim and received the money
as the administrator of De Valengin. He must account for it in the
same character.
If this transaction had taken place before the Act of Assembly
of Maryland of 1820, ch. 174, the suit must unquestionably have
been continued against Neale's representatives, and could not have
been sustained against the administrators
de bonis non of
De Valengin. Because the property which Neale had received as
administrator was converted into money in his lifetime, and must
therefore have been accounted for by his administrator, and would
not have passed to the administrator
de bonis non of the
former intestate. But by the third section of the act of 1820, ch.
174, the administrator
de bonis non is entitled to the
bonds, notes, accounts, and evidences of debt which the deceased
executor or administrator may have taken, and to the money in his
hands in his representative character, and he is authorized to
recover them in the manner there pointed out. And the money now in
controversy being, as we have already said,
Page 39 U. S. 292
lawfully in the hands of Neale in his representative character,
the administrators
de bonis non are entitled to it, and as
they are authorized to recover the fund out of which the money due
to Duffy is to be paid, he had a right to make them parties to the
suit which he had instituted against the first administrator and to
continue it against them. They are not injured or in any manner
placed in danger by this proceeding. For they are not liable unless
the money is recovered from Neale's representatives or securities,
provided there is no negligence or breach of duty on their
part.
The motion in arrest of judgment offered in the circuit court,
if it had not been objectionable upon other grounds, was evidently
too late by the rules of the court, and on that account, properly
overruled.
The judgment of the circuit court is therefore
Affirmed.
This cause came on to be heard on the transcript of the record
from the circuit court of the United States for the District of
Maryland, and was argued by counsel. On consideration whereof it is
ordered and adjudged by this Court that the judgment of the said
circuit court in this cause be and the same is hereby affirmed with
costs and damages at the rate of six percentum per annum.
