Borgmeyer v. Idler - 159 U.S. 408 (1895)
U.S. Supreme Court
Borgmeyer v. Idler, 159 U.S. 408 (1895)
Borgmeyer v. Idler
Submitted October 15, 1895
Decided October 28, 1895
159 U.S. 408
Colorado Central Mining Co. v. Turck, 150 U. S. 138, affirmed and applied to this case upon the points: (1) that when the jurisdiction of a circuit court of the United States is invoked upon the ground that the determination of the suit depends upon some question of a federal nature, it must appear at the outset, from the pleadings, that the suit is one of that character of which the circuit court could properly take cognizance at the time its jurisdiction was invoked, and (2) that when the jurisdiction of a circuit court is invoked solely on the ground of diverse citizenship, the judgment of the circuit court of appeals is final, although another ground for jurisdiction in the circuit court may be developed in the course of subsequent proceedings in the case.
The mere fact that the matter in controversy in an action is a sum of money received by one of the parties as an award under a treaty with a foreign power providing for the submission of claims against that power of arbitration does not in any way draw in question the validity or the construction of that treaty.
Borgmeyer, administrator of the estate of Alexander Chataing, deceased, under letters granted September 14, 1892, brought an action September 15, 1892, against William Idler and John W. Hazeltine, administrators de bonis non of the estate of Jacob Idler, deceased, in the Circuit Court of the United States for the Eastern District of Pennsylvania, averring that he was a citizen of the State of New Jersey and that the defendants were citizens of the State of Pennsylvania.
Plaintiff's statement of claim or declaration, filed September
22, alleged the recovery by Jacob Idler, after prolonged litigation, of a judgment against the republic of Venezuela in September, 1832, and that throughout the litigation, Chataing was Idler's attorney and counsel, and that he had advanced Idler the sum of 4,400 pesos. The statement then continued thus:
"Thereupon, after obtaining said judgment, the said Jacob Ilder executed in favor of said Chataing, in consideration of his then past services and advances, two promises in writing, expressed in the Spanish language, a copy of each of which, bearing date at Caracas, together with a translation of each, is hereby appended, marked, respectively, 'B' and 'A.' By the first of these, dated September 25, 1832, the said Jacob Idler promised to pay to the said Chataing ten percent (10%) of the amount of said judgment at such time and in such manner as Venezuela should make payment upon the latter. By the second, dated January 9, 1833, he further promised to repay to the said Chataing, out of the first money which should be paid by Venezuela upon said judgment, the said four thousand four hundred (4,400) pesos. After very great and unlooked for delays upon the part of Venezuela in satisfying the said judgment, it was made the basis of awards against the republic in favor of the said Jacob Idler and the defendants, by certain mixed commissions, authorized thereto by the United States and that republic in the years 1868 and 1890, and under said awards, since September 3, 1890, and up to the present date, Venezuela has paid to, and to the order of, the said Jacob Idler or the defendants, by installments as awarded, a portion of the said judgment, deducting from which portion certain legitimate expenses by the latter incurred in obtaining said awards, there has as yet come to the hands of said Jacob Idler or the defendants, in all, ninety-three thousand nine hundred and eighty-six dollars and sixty-five cents ($93,986.65) for principal and interest."
And plaintiff claimed to recover a commission of ten percent under the paper of September 25, 1832, and a balance due on the advance of 4,400 pesos.
Defendants filed an affidavit of defense setting up, as to the ten percent commission, that the judgment was annulled in
1839 by the highest court of Venezuela, and no payment had ever been made thereon; that Chataing died August 30, 1836, and Idler employed other agents to endeavor to obtain payment of the claim, and that after Idler's death, May 26, 1856, William Idler continued these efforts, and employed other agents and counsel; that an award was made in favor of Idler and his associates in 1868 by a mixed commission created under a treaty of 1866, and that in 1871 there was paid by the department of State of the United States, under this award, $17,696.98, and in 1876 the further sum of $20,225.12; that by a treaty of June 4, 1889, all the awards were reopened, and a mixed commission appointed under that treaty, which heard and determined, in the City of Washington in 1890, the validity of the claim of Idler and his associates de novo; that no claim was made before this commission for or on account of any interest in this award by Chataing or his estate; that the commission reopened the award made under the treaty of 1866, and heard and decided as to the validity of the claim, reduced the award, and made a division between all whom the court decided had interests therein; that from 1833 to 1891, no claim or demand of any nature was made by Chataing in his lifetime or after his death against Idler in his lifetime of his associates, nor was any claim or demand of any nature or kind against the estate of Idler or against his associates made by the estate of Chataing or any person for his estate or heirs for or on account of the claims in this suit until 1891, a period of fifty-eight years, and defendants set up the bar of the statute of limitations, payment, etc.
At the trial, the circuit court directed a verdict for plaintiff, reserving all the questions of law, and subsequently entered judgment in favor of plaintiff on the verdict. Defendants took the case on error to the Circuit Court of Appeals for the Third Circuit, which reversed the judgment of the circuit court and entered judgment for the defendants notwithstanding the verdict on the points of law reserved at the trial. The court of appeals held as to the claim for commission that the record disclosed the fact that Idler's judgment in Venezuela had been annulled by the courts of that country, and that
nothing had been paid by Venezuela on the footing of that judgment, and the court observed:
"Idler's judgment having thus been swept away, the consideration for his promise to pay to Chataing a commission thereon wholly failed. The event upon which the commission was to be paid never occurred. Very certain is it that nothing was paid by Venezuela to Idler or to the personal representatives on the footing of the judgment. To apply, then, the writing of September 25, 1832, to the state of affairs brought more than half a century afterwards by the award made by a mixed commission acting under an international treaty would be a perversion of the paper, and would work the greatest injustice to the estate of Idler. The whole situation had radically changed without his fault. His judgment had utterly failed him. The allowance of the claim was ultimately secured by the action of an independent tribunal proceeding upon original grounds. The favorable result was due to the long continued personal exertions of Idler and his associates, and the services at a vast expense of other agents and attorneys. All this the evidence shows. To the result neither Chataing nor his personal representatives contributed aught."
"We do not consider it a matter of any moment that, in pressing their claim before the mixed commissions, Idler's administrators relied upon the Venezuelan judgment of 1832. That judgment was a part of the complicated transactions between their intestate and the government of Venezuela. It perhaps afforded some evidence of the correct amount of the indebtedness in dispute. Nor is it important how the majority of the commissioners may have regarded that judgment. Neither its correctness nor its existence was recognized by either of the treaties. The mixed commissions were to decide with reference to the merits of all claims submitted to them. The opinion filed on behalf of the majority of the last commission shows that the Idler claim was investigated and sustained by them upon its original merits. They were at liberty, had the facts so warranted, to have found against the claim altogether. That they awarded the face amount of
the judgment with interest is of no consequence. The reasons for their award are immaterial here. The important fact is that whatever moneys Venezuela paid on the Idler claim were paid on the awards of the mixed commissions, and not otherwise. Construing the paper of September 25, 1832, with reference to its terms, its subject matter, and the situation of the parties, we conclude that no payment or satisfaction of the judgment therein recited was ever made or realized within the true intent of the parties, and that the stipulated commission to Chataing never became payable. It follows, therefore, that the reserved questions of law appertaining to this branch of the case should have been decided in favor of the defendants."
As to the claim for a balance of the 4,400 pesos and interest, the circuit court of appeals held that the proof of its actual payment by Idler in his lifetime was remarkably full considering its antiquity, and that its nonassertion for over fifty years was inexplicable except upon the hypothesis of full payment in the lifetime of Chataing, but that, independently of the proof of payment, the presumption of payment arose after the lapse of twenty years, and that even on plaintiff's own view, the moneys received in 1871 on the first award were in excess of the 4,400 pesos, and consequently that presumption had operated against the debt before suit was brought. The opinions of the circuit court and of the circuit court of appeals are reported in 65 F. 910. A writ of error to this Court having been allowed, the cause came on on a motion to dismiss or affirm.