Union Insurance Company v. United States - 73 U.S. 759 (1867)
U.S. Supreme Court
Union Insurance Company v. United States, 73 U.S. 6 Wall. 759 759 (1867)
Union Insurance Company v. United States
73 U.S. (6 Wall.) 759
1. The Act of August 6, 1861, "to confiscate property used for insurrectionary purposes" -- (which act declares that such property shall be the lawful subject of prize and capture, and that such prizes and captures shall be condemned in the district or circuit court . . . having jurisdiction or in admiralty in any district in which they may be seized, or into which they may be taken, and that the attorney general "may institute the proceedings of condemnation") -- extended to all descriptions of property, real or personal, on land or on water.
2. The circuit court has jurisdiction, under that act, of proceedings for the condemnation of real estate or property on land, and such proceedings may be shaped in general conformity to the practice in admiralty -- that
is to say they may be in the form and modes analogous to those used in admiralty. But issues of fact, on the demand of either party, must be tried by jury, such cases differing from cases of seizure made on navigable waters where the course of admiralty may be strictly observed.
3. Such proceedings, having forms and modes but analogous to those used in admiralty, and issues of fact being to be tried by a jury, do not necessarily constitute "a cause in admiralty."
4. Where a proceeding under the act to enforce the forfeiture of real estate was carried on in a circuit court by libel, monition, claim interposed, and testimony taken in conformity with the practice of courts of admiralty, and without a jury anywhere, jurisdiction of the decree was taken by this Court on appeal, but only for the purpose of reversing the decree as irregular, and directing a new trial.
5. The proceedings in cases of the seizure of real estate should, in respect to trial by jury and exceptions to evidence, be conformed to the course of proceedings by information on the common law side of the court, in cases of seizure on land.
6. An owner of real property in New Orleans who leased it during the late rebellion to a firm publicly engaged in the manufacture of arms for the rebel confederacy -- the lease stating in terms that the lessees intended to establish "engines, machinery," &c., in the property leased -- was presumed to have made the lease knowing the purpose for which the property was to be used, and consenting to it. And his interest in the property was held to be rightly confiscated under the Act of 6 August, 1861.
7. But the presumption was held to be otherwise in regard to a party taking a mortgage from the owner before the lessees took possession, and where there was no proof of consent by the mortgagee to the use made of the premises, beyond the fact of his having taken a mortgage. And the interest of such mortgagee was held not confiscable under the act.
8. The forfeiture was incurred when the lessees went into actual use of the premises under lease, and the subsequent seizure for condemnation divested all intermediate liens.
An Act of Congress of August 6, 1861, passed during the late rebellion, and entitled "An act to confiscate property used for insurrectionary purposes," provides, in different sections, as follows:
The first section provides that property used in aid of the rebellion, with consent of the owner, shall be the "lawful subject of prize and capture wherever found," and makes it the duty of the President to cause it" to be seized, confiscated, and condemned."
The second section provides that such
"prizes and captures shall be condemned in the district or circuit court of the United States having jurisdiction of the amount, or in admiralty, in any district in which the same may be seized, or into which the same may be taken and proceedings commenced."
The third section provides that
"The attorney general or any district attorney of the United States in which said property may at the time be may institute the proceedings of condemnation, and in such cases they shall be wholly for the benefit of the United States, or any person may file an information with such attorney, in which case the proceedings shall be for the use of such informer and the United States in equal parts."
With this statute in force, a square of ground in New Orleans, with the buildings upon it, was leased on the 17th of September, 1861, by one Leonce Burthe to a firm, Cook & Brother, who, in October or November, established on the premises a manufactory of arms for the rebel government, and
continued the business until the occupation of the city by the national forces in the spring of 1862.
On the 8th of October, 1861, the Union Insurance Company of New Orleans took a mortgage from Burthe upon three undivided twenty-fifths of the property to secure the payment of a note for $3,500, due from him to the company.
Subsequently, suit was instituted upon the mortgage, and in due course a decree of sale was rendered under which the insurance company became purchasers of the mortgaged premises for $1,400, and on the 26th of February, 1864, received the sheriff's deed of the property.
In April, 1864, the company obtained a judgment for $2,735, being the balance due on the note of Burthe, and was about to sell the residue of the property when further proceeding was arrested by a military order.
It appeared further from the evidence that three minors of the Burthe family were legal owners of four thirty-sixths of the property on which the gun factory was established.
The Cooks, to whom Burthe made the lease, were well known manufacturers of arms on a large scale for the rebel government, and the lease stated the fact that they intended to establish in the property leased "engines, machinery," &c.
At the time, however, when the insurance company took its mortgage, the Cooks had not taken possession of the property, nor was it proved otherwise than as the mere taking of the mortgage proved it, that the company had consented to the use which the Cooks meant to make of the premises.
On the 4th of April, 1865, the District Attorney for the Eastern District of Louisiana filed in the circuit court of the United States for that district a libel of information against the property thus leased. The libel described the case as one of seizure and forfeiture, and after reciting the already mentioned act of Congress of August 6, 1861, which declared the property of all persons who should knowingly use or employ it, or consent to the use and employment of it in aid of the rebellion, to be lawful subject of prize and capture, proceeded to allege that the property leased had been
so used and employed, and asked a decree for its condemnation and forfeiture to the use of the United States and the informant.
Upon the filing of this libel, notice was given, monition was published, claims were interposed, and testimony was taken in general conformity with the practice of courts of admiralty.
The circuit court condemned the whole property as forfeited to the United States, except the four thirty-sixths, called in the decree four twenty-fifths, of the minors.
An appeal was taken by the Union Insurance Company, and another claimant, who abandoned the prosecution of his appeal. No appeal was taken by the United States from that part of the decree which exempted the interests of the minors from condemnation.
Three points were made in this Court on the appeal:
1. That the circuit court had no jurisdiction under the act of 1861; that the proceedings were in admiralty form throughout -- a form dispensing with jury; that the Constitution securing to the citizen trial by jury, Congress had no power to convert into a "case in admiralty," and so to bring into admiralty jurisdiction cases which were not admiralty cases and were not liable to be brought within that jurisdiction when the Constitution was made, and that such a purpose was not to be presumed; that it was impossible to regard the proceeding in this case -- one against real estate in the midst of a great city, and under a statute of municipal forfeiture -- as an "admiralty case" in any true definition of those terms.
2. That the proceeding should have been by the course of the common law, and with a jury, when the decree of the court below would have come up by writ of error, which form of bringing the matter here, and not appeal, was the proper form.
3. That on the merits the decree was wrong.