An instrument by which A, as attorney in fact by substitution,
for good consideration, assigns to B an interest in claims to be
established against a foreign government in a mixed commission is
valid in equity although made before the establishment of the claim
and creation of the fund, and may work a distinct appropriation of
the fund in B's favor to the extent of the assignment within the
rule laid down in Wright v.
1 Wall. 16.
This was an appeal from a decree in a suit in equity in the
Supreme Court of the District of Columbia. The facts which make the
case are stated in the opinion of the Court.
Page 112 U. S. 738
MR. JUSTICE MATTHEWS delivered the opinion of the Court.
Several awards were made by the Mexican Claims Commission under
the Treaty between the United States and Mexico of July 4, 1868, in
favor of claimants, representatives respectively of three American
citizens, Parsons, Conrow, and Standish, which amounted in the
aggregate to $143,812.32. Of this, one-half was paid to the
claimants and the other half remained with their consent under the
control of the Secretary of State, to be paid to the agents and
counsel of the claimants according to their respective rights and
interests. Several bills in equity to determine these interests
were filed in the Supreme Court of the District of Columbia, to one
of which Peugh, the appellant, was made a defendant, and appearing
therein also filed a cross-bill on his own behalf. On final
hearing, all the bills and cross-bills were dismissed, Peugh alone
appealing. The adverse interest in the litigation is represented by
White, who claims as a purchaser of the whole fund. The object of
the bill of Peugh was to obtain a declaration of the fact and
extent of his interest in the fund and to enjoin the defendant
White from demanding and receiving more than what should remain
after satisfaction of the appellant's claim. The Secretary of State
was made a party defendant, but did not appear, and no relief is
asked against him. The jurisdiction of the Court is invoked for the
single purpose of determining the relative equities of the parties
in the fund and giving effect to them by an appropriate decree.
The history of the case, so far as material to the determination
of the controversy, we gather from a volume of testimony, not
without conflict, and find to be as follows:
The three claimants severally employed Richard H. Musser, of St.
Louis, to prosecute their claims, and, agreeing that he should pay
all expenses and receive half the net proceeds of the claims after
deducting the expenses of their prosecution, executed and delivered
to him full powers of attorney, with power of substitution.
Knowledge of the existence of these claims had been first
Page 112 U. S. 739
communicated to Musser by Richard H. Porter, and the agreement
between them was that each should have an equal interest in the
prosecution and proceeds of the claims in case of recovery.
Accordingly, Porter entered into an agreement with the
appellant, Peugh, and C. E. Rittenhouse, a copy of which is as
"Memorandum of agreement, made by and between Richard H. Porter,
of St. Louis, Mo. and Charles E. Rittenhouse and Samuel A. Peugh,
of this City of Washington, District of Columbia."
"Whereas, said Richard H. Porter, acting as attorney for Richard
H. Musser by authority of substitution from said Musser, who,
acting in behalf as attorney in fact for Mildred Standish, widow of
Austin M. Standish; Mrs. _____ Conrow, widow of Aaron H. Conrow,
and _____ Parsons, father of Monroe M. Parsons, and guardian of the
son, Monroe M. Parsons, above named, all of the State of Missouri,
and whereas, said Porter is desirous of the aid of said Rittenhouse
and Peugh in a certain advance of money to the said Porter, to
enable him to procure the testimony to sustain the claims these
other certain-named parties have against the government of Mexico
for robbery and destruction of the lives of those whom they
represent under the treaty made between the United States and the
Republic of Mexico on the 4th day of July, 1868, and also the
prosecution of said claim before a commission appointed by and
between the two said republics, and now in session in the City of
Washington, D.C., and whereas said Porter, being, in his agreement
with the said parties claiming against Mexico as aforesaid,
entitled to one-half of any amount to which he may establish claim
before said commission, he hereby agrees to, and does hereby,
transfer and assign, in consideration of the premises, unto the
said Rittenhouse and Peugh one-half of the amount he is entitled to
receive under and by virtue of his authority in the premises; the
said last-named parties to be at the expense of prosecuting the
said claims before the commission herein named, but the testimony
to be produced to them by the said parties. "
Page 112 U. S. 740
"In testimony whereof, we and each of us have hereunto set our
hands and seals this 16th day of February, 1870."
"R. H. PORTER [Seal]"
"S. A. PEUGH [Seal]"
"C. E. RITTENHOUSE [Seal]"
At the date of the execution of this paper, Porter had not in
fact been substituted by Musser, under his powers, in writing, but
subsequently, on July 4, 1870, Musser did so, by writing endorsed
on the letters of attorney given by the claimants, and Porter
himself subsequently, in 1874, obtained direct powers from at least
two of them.
Peugh and Rittenhouse entered upon the performance of their
engagements with Porter in pursuance of the agreement of February
16, 1870, but Rittenhouse subsequently released his interest
therein to Porter, by the following instrument:
"WASHINGTON, September 2, 1872"
"In consideration of said Porter's having paid certain expenses
on the claim of Mrs. Hamilton for $35,000, now pending before the
Southern Claims Commission, one-half of which he demands of me on
account of my interest therein, I hereby relinquish to him, said
Porter, all my right, title, and interest in and to the several
claims referred to in the foregoing agreement, and release him from
his obligation to repay me the sum advanced by me for my aforesaid
interest in these Mexican claims."
"[Signed] C. E. RITTENHOUSE"
In the meantime, Peugh and Rittenhouse had employed Charles H.
Winder as counsel, for a fixed compensation, payable out of their
proportion of the awards, to present the case to the commission in
argument, and, after the relinquishment by Rittenhouse of his
interest in the matter, Peugh and Winder continued to cooperate in
the prosecution of the claims.
Their services in that behalf were well known to Porter and to
Musser, as well as the particular arrangements under which they
were rendered. Indeed, the latter, by a letter to Rittenhouse,
Page 112 U. S. 741
dated February 18, 1871, expressly ratified the contract made by
Porter with Peugh and Rittenhouse. Mr. Winder, the record
abundantly shows, under his employment by Peugh, and a distinct
agreement directly with Porter, made afterwards, rendered constant
and evidently very valuable and efficient services in the
prosecution of the claims until the awards were finally made. And,
in respect to the services rendered by Peugh, which were also
continuous during the entire proceeding, Mr. Winder, whose
statements seem to be entitled to full credit, testifies as
"With regard to the statements contained in the eighth paragraph
of Mr. Peugh's amended cross-bill, in cause of McManus v. White
No. 6,382, I would say that I have no knowledge of the
amount of money Mr. Peugh may have spent in the matter, but as
attorney in fact and agent, he was industrious and persistent in
his efforts to procure testimony and to forward the proceedings
before the commission. I think he was especially diligent in
getting the parties in Missouri to furnish the necessary pleadings
in the case -- I mean memorials -- and also the testimony upon
which the cases were adjudicated. My belief at the time was that it
was in a great measure due to his efforts that the testimony was
received in time to meet the requirements of the commission in
relation to the closing of the cases on the first of April, 1872. I
don't know of any duties strictly as counsel that were performed by
On the whole, we think it is satisfactorily shown that Peugh's
services were as valuable and meritorious in the successful
prosecution of these claims as those of any other person engaged in
it, and that they were rendered in pursuance of his agreement with
Porter, confirmed by Musser, and assented to by all parties in
The claim of White is founded upon a purchase made by him from
Musser and Porter, and from others claiming under the former, whose
rights arose subsequent in time to the contract between Porter and
Peugh and Rittenhouse, and White's purchase being made after
Peugh's services had been fully rendered.
Apart from the merits, objection is made to a decree in
Page 112 U. S. 742
of Peugh on the ground that he has no equitable lien on the fund
in controversy within the decisions of Wright v.
1 Wall. 16, and Trist v.
21 Wall. 441, 88 U. S. 447
The rule as declared in the first of these cases is that
"it is indispensable to a lien thus created that there should be
a distinct appropriation of the fund by the debtor, and an
agreement that the creditor should be paid out of it."
1 Wall. 68 U. S. 22
Here, as between Musser and Porter, on the one hand, and Peugh,
on the other, there were words in the agreement of express transfer
and assignment of the very fund now in dispute, though not then in
existence, which, in contemplation of equity, is not material. And
if that was not the case in the powers of attorney given by the
claimants to Musser and Porter, it is not pertinent to this
controversy, for the principals have voluntarily permitted the
one-half of the fund to remain unclaimed by them in order that
their agents and attorneys may have it apportioned among themselves
according to their respective rights.
It is further objected that Peugh's rights under the contract of
February 16, 1870, were lost by the release of Rittenhouse, their
interest being joint. If this were so at law, it would not be so in
equity, contrary to the intention of the parties, but here there
was an express and distinct recognition of the several interest of
Peugh in the contract and of his right to proceed in its
performance after the release of his co-contractor. His services
were rendered and were accepted, and he is entitled to his
compensation in accordance with his agreement. There should have
been a decree in his favor on his cross-bill for the one-fourth of
the fund, subject to the claim of the estate of Winder, who is
deceased, for the amount of his compensation under his agreement
with Peugh and Rittenhouse.
The decree of the Supreme Court of the District of Columbia
is accordingly reversed and the cause remanded with directions to
render a decree in conformity with this opinion.