Section 3477 of the Revised Statutes, forbidding all transfer
and assignments of any claim upon the United States before its
allowance, etc., was intended to prevent frauds upon the Treasury,
and does not apply to a transfer resulting from the consolidation
of two railroad corporations whereby, pursuant to their agreement
and the laws of their respective states, the rights, franchises,
property, and choses in action of each are transferred to and
become vested in the consolidated corporation. P.
256 U. S.
656.
53 Ct.Clms. 107 reversed.
The case is stated in the opinion.
MR. JUSTICE McREYNOLDS delivered the opinion of the Court.
Appellant sued in the Court of Claims to recover balances for
transportation services originally payable to the Florida Central
& Peninsular Railroad Company, to whose rights it had succeeded
through merger or consolidation. Holding that, because of § 3477
Rev.Stats., appellant could not maintain the action, that court
dismissed its petition.
Page 256 U. S. 656
Section 3477:
"All transfers and assignments made of any claim upon the United
States, or of 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
they are freely made and executed in the presence of at least two
attesting witnesses, after the allowance of such a claim, the
ascertainment of the amount due, and the issuing of a warrant for
the payment thereof. . . ."
The Seaboard Air Line Railway was originally chartered under the
laws of Virginia; by authorized union with others, it became a
consolidated corporation under the laws of Virginia, North
Carolina, South Carolina, Georgia, and Alabama, and in 1903 under
"articles of agreement of merger and consolidation" and the
statutes of Georgia and Florida (§ 2173, Civil Code Ga. 1895; §
2812, Gen.Stat.Fla.), the Florida Central & Peninsular
Railroad, a Florida corporation, was united with it. As agreed and
provided by the laws of the two states, the rights, privileges,
franchises, and all property, real, personal, and mixed, and all
debts on every account, as well as stock subscriptions and other
things in action belonging to each of the constituents, were
transferred to and vested in the consolidated corporation without
further act or deed, "as effectually as they were in the former
companies."
Section 3477 has been before this Court many times for
construction and application.
United States v. Gillis,
95 U. S. 407;
Erwin v. United States, 97 U. S. 392;
Spofford v. Kirk, 97 U. S. 484;
Goodman v. Niblack, 102 U. S. 556;
St. Paul & Duluth R. Co. v. United States,
112 U. S. 733;
Bailey v. United States, 109 U. S. 432;
Butler v. Goreley, 146 U. S. 303;
Hager v. Swayne, 149 U. S. 242;
Ball v. Halsell, 161 U. S. 72;
Price v. Forrest, 173 U. S. 410.
Page 256 U. S. 657
In
Erwin v. United States, Goodman v. Niblack, and
Price v. Forrest, certain exceptions to the general
language of the section were recognized because not within the evil
at which the statute aimed. It was intended to prevent frauds upon
the Treasury, and the mischiefs designed to be remedied
"are mainly two: first, the danger that the rights of the
government might be embarrassed by having to deal with several
persons instead of one and by the introduction of a party who was a
stranger to the original transaction. Second, that, by a transfer
of such a claim against the government to one or more persons not
originally interested in it, the way might be conveniently opened
to such improper influences in prosecuting the claim before the
departments, the courts, or the Congress as desperate cases when
the reward is contingent on success, so often suggest."
We cannot believe that Congress intended to discourage, hinder,
or obstruct the orderly merger or consolidation of corporations as
the various states might authorize for the public interest. There
is no probability that the United States could suffer injury in
respect of outstanding claims from such union of interests, and
certainly the result would not be more deleterious than would
follow their passing to heirs, devisees, assignees in bankruptcy,
or receivers, all of which changes of ownership have been declared
without the ambit of the statute. The same principle which required
the exceptions heretofore approved applies here.
The judgment of the court below is reversed, and the cause
remanded with direction to afford reasonable opportunity to both
sides for taking any additional proof rendered necessary by the
withdrawal by the United States of a stipulation upon which
reliance had been placed, and for further proceedings in conformity
with this opinion.
Reversed.