By the Act of February 26, 1853, c. 81, § 1 (Rev. Stat. § 3477),
every specific assignment, in whatever form, of any claim against
the United States, under a statute or treaty, whether to be
presented to one of the executive
Page 161 U. S. 73
departments or to be prosecuted in the Court of Claims, is void,
unless assented to by the United States.
A contract, by which the owner of a claim against the United
States for Indian depredations appointed an attorney to receive and
give acquittances for one-half of the money which the attorney
might recover of the United States upon that claim, will not,
although the attorney has obtained from the Secretary of the
Interior a recommendation for the payment of a certain sum upon
that claim, but for the payment of which Congress has made no
appropriation, support an action by the attorney against the
principal for part of a less sum recovered upon that claim from the
United States in the Court of Claims under the subsequent Act of
March 3, 1891, c. 358, out of which the attorney has been allowed
and paid less than twenty per cent of that sum, as provided by that
act.
This was an action brought August 18, 1893, in the Circuit Court
of the United States for the Northern District of Texas, by Thomas
Ball, a citizen of the State of Virginia, against Julia F. Halsell,
a citizen of the State of Texas, residing in that district, and the
widow, legatee, and executrix of J. G. Halsell, upon a written
contract, made with the plaintiff by said Halsell, in his lifetime,
in these words:
"We, the undersigned, parties of the first part, do hereby
constitute and appoint Thomas Ball our lawful attorney to receive,
and to make, sign, and give all necessary acquittances and receipts
for, one-half of all money which may be received by him as our
attorney at law for prosecuting claims against the United States
government, on account of the depredations of the Comanche and
Kiowa Indians on our property of horses, mules, and cattle in the
State of Texas. Said one-half being the amount agreed by us to pay
him of all that he may recover of said government for said
depredations."
"Given under our hands this 22d day of may, A.D. 1874."
"J. G. Halsell"
The signature of the contract was admitted. The other material
facts, as alleged in the petition, and found by the court (to which
the parties, waiving a trial by jury, submitted the case), were as
follows:
The plaintiff presented to the Department of the Interior in
March, 1875, a claim of Halsell, amounting to $24,860, for such
depredations, and prosecuted it before the department,
Page 161 U. S. 74
and the department recommended payment of the sum of $19,625 to
Halsell for such depredations. No appropriation was made by
Congress to pay the sum so awarded. On March 6, 1891, after the
passage by Congress of Act March 3, 1891, c. 538, entitled "An act
to provide for the adjudication and payment of claims arising from
Indian depredations," Ball, acting under his power of attorney,
brought a suit in behalf of Halsell, under the provisions of that
act, in the Court of Claims, to recover the sum so awarded by the
Department of the Interior, and after the death of Halsell, and the
substitution of his executrix as claimant in his stead, judgment
was rendered for the sum of $17,720 in her favor, and against the
United States and the Kiowa and Comanche tribes of Indians, and by
the terms of that judgment the sum of $1,500 was awarded to Ball as
the claimant's attorney. Soon afterwards the United States paid
this sum to him, and paid the amount of the Judgment for $17,720,
less this sum, to the executrix.
In the present suit, Ball claimed to be entitled to recover,
under the contract aforesaid, one-half of said amount of $17,720,
less the sum of $1,500 paid him.
The defendant, in her answer, alleged that
"the contract described in the plaintiff's petition, if any such
was ever made, was declared void by the ninth section of the Act of
March 3, 1891, of the Congress of the United States, entitled 'An
act to provide for the adjudication and payment of claims arising
from Indian depredations,' and, by the authority and directions of
the same section, an allowance, and all that said act permitted to
be paid the plaintiff under his said employment, was made to the
plaintiff in the judgment rendered by said Court of Claims in favor
of this defendant, and was paid to him out of the Treasury of the
United States."
Upon the facts above stated, the circuit court made the
following conclusion of law:
"The court being of opinion that said contract is rendered
nugatory, and the provision therein made for compensation for said
attorney, Thomas Ball, is superseded by the ninth section of the
Act of March 3, 1891, and being of opinion that said contract is
not enforceable,
Page 161 U. S. 75
and that said statute above referred to fixes and provides for
the payment of all the compensation which attorneys prosecuting the
claim under said act are entitled to receive, judgment is rendered
for the defendant."
The plaintiff sued out this writ of error.
Page 161 U. S. 77
MR. JUSTICE GRAY, after stating the facts in the foregoing
language, delivered the opinion of the Court.
In determining the construction and effect of the contract sued
on, it is important to keep in mind the acts of Congress and the
decisions of this Court bearing upon the subject.
In
Kendall v. United
States, 7 Wall. 113, certain attorneys in 1843
(before Congress had passed any act regulating assignments of
claims against the United States) made an agreement with the
representatives of the Western Cherokees, a branch of the Cherokee
tribe of Indians, to prosecute a claim of the Western Cherokees
against the United States, and to receive directly from the United
States five percent of all sums collected upon the claim. By a
treaty between the United States and the Cherokee tribe in 1846, it
was agreed that certain sums found due to the Western Cherokees
should be paid by the United States directly to the heads of
families per capita, and should not be assignable. 9 Stat. 874. And
by Act Sept. 30, 1850, c. 91, making an appropriation of the sum
necessary to fulfill that treaty, Congress provided that
"in no case shall any money hereby appropriated by paid to any
agent of said Indians, or to any other person or persons than the
Indian or Indians to whom it is due."
9 Stat. 556. This Court held that the attorneys could not
maintain a suit in the Court of Claims to recover, as compensation
for their services in procuring the treaty and appropriation, the
five percent that the Indians had agreed should be paid to the
attorneys by the United States, and, speaking by Mr. Justice
Miller, said:
"We apprehend that the doctrine has never been held that a claim
of no fixed amount, nor time or mode of payment -- a claim which
has
Page 161 U. S. 78
never received the assent of the person against whom it is
asserted, and which remains to be settled by negotiation or suit at
law -- can be so assigned as to give the assignee an equitable
right to prevent the original parties from compromising or
adjusting the claim or any terms that may suit them. . . . We have
no hesitation in saying that the United States, under the
circumstances, had the right to make the treaty that was made,
without consulting plaintiffs, or incurring any liability to them.
The act of Congress, which appropriated the money, only followed
the treaty in securing its payment to the individual Indians,
without deduction for agents. And both the act and the treaty are
inconsistent with the payment of any part of the sum thus
appropriated to plaintiffs."
7 Wall.
74 U. S.
116-118.
By the Act of Feb. 26, 1853, c. 81, § 1,
"all transfers and assignments hereafter made of any claim upon
the United States or any part or share thereof, or interest
therein, whether absolute or conditional and whatever may be the
consideration therefor, and all powers of attorney, orders, or
other authorities for receiving payment of any such claim, or of
any part or share thereof, shall be absolutely null and void unless
the same shall be freely made and executed in the presence of at
least two attesting witnesses after the allowance of such claim,
the ascertainment of the amount due, and the issuing of a warrant
for the payment thereof."
10 Stat. 170. This section has been reenacted, in almost the
same words, in section 3477 of the Revised Statutes.
At the first term of this Court after the passage of the act of
1853, it was said by this Court, speaking by Mr. Justice Grier,
that "this act annuls all champertous contracts with agents of
private claims."
Marshall v. Baltimore &
Ohio Railroad, 16 How. 314,
57 U. S. 336.
And the act has since been held by this Court to include all
specific assignments, in whatever form, of any claim against the
United States under a statute or treaty, whether to be presented to
one of the executive departments or to be prosecuted in the Court
of Claims, and to make every such assignment void unless it has
been assented to by the United States.
United States v.
Gillis, 95 U. S. 407;
Page 161 U. S. 79
Spofford v. Kirk, 97 U. S. 484;
McKnight v. United States, 98 U. S.
179;
St. Paul & Duluth Railroad v. United
States, 112 U. S. 733;
Hager v. Swayne, 149 U. S. 242,
149 U. S.
247.
In
Spofford v. Kirk, above cited, the owner of a claim
against the United States for military supplies had, before its
allowance, or the issue of a warrant for its payment, drawn upon
the attorneys employed by him to prosecute it an order to pay to a
third person a certain sum out of any moneys coming into their
hands on account of the claim; the order had been accepted by the
drawees, and sold by the payee to a purchaser in good faith for
value, and the drawer and acceptors, after the issue of the
Treasury warrant, declined to admit the validity of the order. It
was adjudged that the accepted order, otherwise an equitable
assignment, was void, by reason of the statute, and therefore
passed no right in the fund, and could not be enforced against the
drawer and acceptors.
That decision has never been overruled or questioned by the
court, although the act has been held not to apply to general
assignments made by a debtor of all his property for the benefit of
his creditors, whether under a bankrupt or insolvent law or
otherwise;
Erwin v. United States, 97 U. S.
392;
Goodman v. Niblack, 102 U.
S. 556;
Butler v. Goreley, 146 U.
S. 303; nor to enable the original claimant to recover
of the United States a sum once paid by the United States to his
attorney in fact holding a power of attorney, made before the
allowance of the claim and the issue of the warrant, and remaining
unrevoked;
Bailey v. United States, 109 U.
S. 432; nor to invalidate a contract of partnership in
furnishing supplies to the United States, or a promise by one to
another of the partners to pay a sum, already due him under the
partnership articles, out of money to be received from the United
States for such supplies;
Hobbs v. McLean, 117 U.
S. 567; nor to affect the right of a mortgagee of real
estate leased to the United States, or of a pledgee of the rents
thereof, to recover from the mortgagors and pledgors the amount of
rents paid to them by the United States,
Freedman's Co. v.
Shepherd, 127 U. S. 494.
Page 161 U. S. 80
In the latest case in which the act was considered, the Court,
speaking by the present Chief Justice, said:
"The legislation shows that the intent of Congress was that the
assignment of naked claims against the government for the purpose
of suit, or in view of litigation, or otherwise, should not be
countenanced. At common law, the transfer of a mere right to
recover in an action at law was forbidden, as violating the rule
against maintenance and champerty, and, although the rigor of that
rule has been relaxed, an assignment of a chose in action will not
be sanctioned when it is opposed to any rule of law or public
policy."
Hager v. Swayne, 149 U. S. 242,
149 U. S.
247-248.
By several decisions of this Court -- indeed, beginning at
December term, 1853 -- contracts for contingent fees, by which
attorneys employed to prosecute claims against the United States
were to be allowed a proportion of the amount recovered in case of
success, and nothing in case of failure, were held to be lawful and
valid.
Wylie v. Coxe,
15 How. 415 (1853);
Wright v. Tebbitts, 91 U. S.
252 (1875);
Stanton v. Embrey, 93 U. S.
548 (1876);
Taylor v. Bemiss, 110 U. S.
42 (1883). The reason for upholding the validity of such
contracts was first stated by Mr. Justice Miller in
Taylor v.
Bemiss, as follows:
"The well known difficulties and delays in obtaining payment of
just claims which are not within the ordinary course of procedure
of the auditing officers of the government justifies a liberal
compensation in successful cases, where none is to be received in
case of failure. Any other rule would work much hardship in cases
of creditors of small means, residing far from the seat of
government, who can give neither money nor personal attention to
securing their rights."
110 U.S.
110 U. S. 45.
The proportion allowed to the attorneys in
Wylie v. Coxe
was one-twentieth; in
Wright v. Tebbitts, one-tenth; in
Stanton v. Embrey, one-fifth, and in
Taylor v.
Bemiss, one-half.
Congress has evidently considered that, in some cases at least,
to permit contracts to be made for the payment to attorneys, by way
of contingent fee, of a large proportion of the amount to be
recovered is in danger of leading to extortion and oppression.
Page 161 U. S. 81
It was apparently owing to such considerations that Congress, in
the Act of March 3, 1891, c. 538, when conferring upon the Court of
Claims jurisdiction of claims arising from Indian depredations,
including such claims as had been examined and allowed by the
Department of the Interior, and providing that the judgments of
that court, unless reversed or modified on rehearing or appeal,
should "be a final determination of the causes decided, and of the
rights and obligations of the parties thereto," enacted, in section
9, that
"all sales, transfers or assignments of any such claims,
heretofore or hereafter made except such as have occurred in the
due administration of decedents' estates, and all contracts
heretofore made for fees and allowances to claimants' attorneys,
are hereby declared void, and all warrants issued by the Secretary
of the Treasury in payment of such judgments shall be made payable
and delivered only to the claimant or his lawful heirs, executors,
or administrators, or transferee under administrative proceedings
except so much thereof as shall be allowed the claimant's attorneys
by the court for prosecuting said claim, which may be paid direct
to such attorneys, and the allowances to the claimant's attorneys
shall be regulated and fixed by the court at the time of rendering
judgment in each case, and entered of record as part of the
findings thereof; but in no case shall the allowance exceed fifteen
percent of the judgment recovered, except in case of claims of less
amount than five hundred dollars, or where unusual services have
been rendered or expenses incurred by the claimant's attorney, in
which case not to exceed twenty percent of such judgment shall be
allowed by the court."
26 Stat. 851-854.
The contract now sued on begins in the form of a power of
attorney, appearing on its face to have been intended to be signed
by several persons, constituting and appointing Ball their
attorney
"to receive, and to make, sign, and give all necessary
acquittances and receipts for, one-half of all money which may be
received by him, as our attorney at law, for prosecuting claims
against the United States government"
on account of Indian depredations, and the instrument ends
with
Page 161 U. S. 82
this clause: "said one-half being the amount agreed by us to pay
him of all that he may recover of said government for said
depredations." It is signed by Halsell only.
The instrument was a unilateral contract, not signed by the
attorney nor containing any agreement on his part, and -- so long
at least, as it had not been carried into execution -- might be
revoked by the principal or might be disregarded by him in making a
settlement with the United States, or might be treated by him as
absolutely null and void in any contest between him and the
attorney.
Kendall v. United
States, 7 Wall. 113;
Spofford v. Kirk,
97 U. S. 484;
Bailey v. United States, 109 U. S. 432,
109 U. S. 439;
Missouri v. Walker, 125 U. S. 339.
By the very terms of the contract, the attorney was to be paid
only out of money recovered and received by him from the United
States. Although he prosecuted the claim before the Department of
the Interior, and that department recommended payment of a certain
sum upon the claim, yet, before that sum had been paid or Congress
had made any appropriation for its payment, and therefore before he
had either recovered or received any money from the United States
or was entitled to any compensation by the terms of the contract
now sued on, Congress passed the Act of March 3, 1891, c. 538.
By this act, as already stated, Congress, while giving to the
Court of Claims jurisdiction and authority to inquire into and
finally adjudicate certain claims arising from Indian depredations,
including such as had been examined and allowed by the Department
of the Interior, not only declared void all sales, transfers, or
assignments of such claims theretofore or thereafter made -- except
in the administration of the estates of deceased persons -- and all
contracts theretofore made for fees and allowances to claimants'
attorneys, but expressly provided that all Treasury warrants in
payment of the judgments of the court should be made payable and be
delivered only to the claimant, or to his heirs, executors, or
administrators, except so much thereof as the court at the time of
rendering the judgment, and as part thereof, should allow to be
paid directly to the claimant's attorney, not exceeding in any case
twenty percent of the amount recovered.
Page 161 U. S. 83
In view of previous experience, this last provision was a wise,
reasonable, and just provision for the protection of suitors, and
it was clearly within the constitutional power of Congress.
As was said by Chief Justice Taney:
"It is an established principle of jurisprudence in all
civilized nations that the sovereign cannot be sued in its own
courts or in any other without its consent and permission, but it
may, if it thinks proper, waive this privilege and permit itself to
be made a defendant in a suit by individuals or by another state.
And as this permission is altogether voluntary on the part of the
sovereignty, it follows that it may prescribe the terms and
conditions on which it consents to be sued and the manner in which
the suit shall be conducted, and may withdraw its consent whenever
it may suppose that justice to the public requires it."
Beers v.
Arkansas, 20 How. 527,
61 U. S. 529;
In re Ayers, 123 U. S. 443,
123 U. S. 505;
Hans v. Louisiana, 134 U. S. 1,
134 U. S. 17.
Much reliance was placed by the plaintiff upon the recent
decision of the Supreme Judicial Court of Massachusetts in
Davis v. Commonwealth, 164 Mass. 241, in which an agent,
whom the State of Massachusetts had employed to prosecute a claim
of the state against the United States, and to whom the state had
agreed to pay, in full compensation for his services, two percent
of the amount recovered, was held to be entitled to recover from
the state the amount of the compensation so agreed upon
notwithstanding that Congress, in the act appropriating money to
pay the claim of the state, had provided that no part of the money
should be paid by the state to any attorney or agent under a
previous contract between him and the representative of the state.
But the case was treated by the court as not free from difficulty,
and it differed in several respects from the case at bar. The
original agreement between the agent and the state was expressly
authorized by its legislature, and was therefore lawful and valid
when made. That agreement, as construed by the court, did not
necessarily require the agent's compensation to be paid out of
money received from the United States. The act of Congress, as the
court observed, "did not
Page 161 U. S. 84
undertake to declare void any contracts theretofore made between
the representative of the state and an agent or attorney." It did
provide that no part of the money received from the United States
should be paid by the state to its agent. The act was passed after
the services in question had been substantially performed. The act
itself fixed the fact and the amount of the liability of the United
States, appropriated the money to pay it, and left nothing to be
ascertained by subsequent judicial proceedings.
But in the present case, as has been seen, the original
agreement was contrary to the express terms of the act of Congress
of 1853. That agreement cannot, as it appears to us, be construed
as a promise of the principal to pay to the attorney any sum
whatever except out of money recovered and received by the attorney
from the United States. The act of Congress of 1891 expressly
declared void "all contracts heretofore made for fees and
allowances to claimants' attorneys." This act was passed before the
attorney had either recovered or received any money upon the
principal's claim against the United States. The act did not
recognize either the lawfulness or the amount of the claim, or make
any appropriation for its payment. But it provided for its
ascertainment and adjudication by judicial proceedings, and for the
allowance, by the judgment in those proceedings, of a reasonable
compensation to the attorney. The restriction of the compensation
of attorneys to the amounts so allowed by the court was one of the
terms and conditions upon which the United States consented to be
sued.
In the suit brought by Ball on behalf of Halsell against the
United States under the act of 1891, the Court of Claims rendered
judgment in favor of the executrix of Halsell against the United
States for $17,720, a smaller amount than had been recommended by
the Department of the Interior, and fixed the allowance to Ball at
the sum of $1,500, between eight and nine percent of the amount of
the judgment. The United States have paid this sum to Ball and the
rest of the judgment to Halsell's executrix.
For the reasons above stated, Ball cannot maintain this
Page 161 U. S. 85
action upon the contract between him and Halsell, and he does
not sue, and could not recover, upon a
quantum meruit.
Marshall v. Baltimore &
Ohio Railroad, 16 How. 314,
57 U. S.
337.
Judgment affirmed.