Toland v. Sprague, 37 U.S. 300 (1838)
U.S. Supreme CourtToland v. Sprague, 37 U.S. 12 Pet. 300 300 (1838)
Toland v. Sprague
37 U.S. (12 Pet.) 300
Process of foreign attachment cannot be properly issued by the circuit courts of the United States in cases where the defendant is domiciled abroad or not found within the district in which the process issues, so that it can be served upon him. The true construction of the eleventh section of the Judiciary Act of 1789 is that it did not mean to distinguish between those who are inhabitants, or found within the district, by process issued out of the circuit court and persons domiciled abroad, so as to protect the first, and leave the others not within the protection, but even with regard to those who are within the United States, they should not be liable to the process of the circuit courts of the United States unless in one or other of the predicaments stated in the clause. And as to all those who were not within the United States, it was not in the contemplation of Congress that they would be at all subject, as defendants, to the process of the circuit courts which, by reason of their being in a foreign jurisdiction, could not be served upon them, and therefore there was no provision whatsoever in relation to them.
By the general provisions of the laws of the United States:
1. The circuit courts can issue no process beyond the limits of their districts.
2. Independently of positive legislation, the process can only be served upon persons, within the same districts.
3. The acts of Congress adopting the state process adopt the form and modes of service only, so far as the persons are rightfully within the reach of such process, and did not intend to enlarge the sphere of the jurisdiction of
the circuit courts.
4. The right to attach property to compel the appearance of persons can properly be used only in cases in which such persons are amenable to the process of the circuit court in personam -- that is, where they are inhabitants, or found within the United States -- and not where they are aliens or citizens resident abroad at the commencement of the suit, and have no inhabitancy here.
In the case of a person being amenable to process in personam, an attachment against his property cannot be issued against him except as a part of or together with process to be served upon his person.
The circuit court of each district sits within and for that district, and is bounded by its local limits. Whatever may be the extent of the jurisdiction of the circuit court over the subject matter of suits in respect to persons and property, it can only be exercised within the limits of the district. Congress might have authorized civil process from any circuit court to have run into any state of the Union. It has not done so. It has not in terms authorized any civil process to run into any other district, with the single exception of subpoenas to witnesses within a limited distance. In regard to final process, there are two cases, and only two, in which writs of execution can now by law be served in any other district than that in which the judgment was rendered -- one in favor of private persons in another district of the same state and the other in favor of the United States in any part of the United States.
A party against whose property a foreign attachment has issued in a circuit court of the United States, although the circuit court had no right to issue such an attachment, having appeared to the suit and pleaded to issue, cannot afterwards deny the jurisdiction of the court. The party had, as a personal privilege, a right to refuse to appear, but it was also competent to him to waive the objection.
The Judiciary Act of 1789 authorizes the Supreme Court to issue writs of error to bring up final judgments or decrees in a civil action, &c. The decision of the circuit court upon a rule or motion is not of that character. Such decisions are not final judgments.
No principle of law is better settled than that to bring a case within the exception of merchandise accounts between merchant and merchant in the statute of limitations, there must be an account, and that an account open or current; that it must be a direct concern of trade; that liquidated demands on bills and notes, which are only traced up to the trade or merchandise, are too remote to come within this description. But when the account is stated between the parties, or when anything shall have been done by them which by their implied admission is equivalent to a settlement, it has then become an ascertained
debt. Where there is a settled account, that becomes the cause of action, and not the original account, although it grew out of an account between merchant and merchant, their factors or servants.
T. shipped a quantity of merchandise by P. to Gibraltar, who, on arriving there, placed the goods in the hands of S. and received advances from S. upon them. In 1825, S. sold the goods and transmitted an account sales, as of the merchandise received from P. to T., who received it in September, 1825, stating the balance of the proceeds to be two thousand five hundred and seventy-eight dollars. T., in 1825, wrote to S. directing him to remit the amount to him, deducting one thousand dollars, which had been advanced by S. on the goods, and which had been remitted by P. to T. S. refused to make the remittance, alleging that P. was largely indebted to him. No suit was instituted by T. against S. until August, 1834. The account was a stated account, and the statute of limitations applied to it.
The mere rendering an account does not make it a stated account, but if the other party receives it, admits the correctness of the items, claims the balance, or offers to pay it, as it may be in his favor or against him, then it becomes a stated account. It is not at all important that the account was not made out between the plaintiff and the defendant, the plaintiff having received it, having made no complaint as to the items or the balance, but, on the contrary, having claimed that balance, thereby adopted it, and by his own act treated it as a stated account.
T. shipped merchandise consigned to P. as supercargo; P. put the goods into the hands of S., a merchant of Gibraltar, as the merchandise of T., and received an advance upon them. S. having sold the merchandise, rendered an account of the sales, stating the sales to have been made by the order of P. and crediting the proceeds in account with P. The account came into the hands of T. in 1825, and he claimed the balance of the proceeds from S., deducting the advance made by S. to P., and payment of the same was refused by P. Held that as T. had a right in 1825 to call on S. to account, and as no suit was instituted against S. until 1834, S. having always denied his liability to T. for the amount of the sales from the time of the demand, the statute of limitations was a bar to an action to recover the amount from S.
The effect and nature of an averment in a plea put in by a defendant, when it is not essential to the plea.
Where the items of an account stated were not disputed, but were admitted and payment of the same demanded, it was not taking the question of fact whether the account was a stated account from the jury for the court to instruct the jury that the account was a stated account.
This action was commenced on the fifth day of August, 1834, by the plaintiff in error by process of foreign attachment in the Circuit Court for the Eastern District of Pennsylvania. The writ of attachment stated the defendant, Horatio Sprague to be a citizen of the State of Massachusetts and the plaintiff to be a citizen of the State of Pennsylvania. The attachment was served on the property of the defendant on the sixth day of August, 1834, in the hands of Mr. John McCrea, Mr. S. Brown, and Mr. P. Lajus, residents in the City of Philadelphia. At the following term of the circuit court, the counsel for the defendant moved to quash the attachment, which motion was overruled by the court.
The record showed that Horatio Sprague, although stated to be a citizen of the State of Massachusetts, was at the time of the commencement of the suit and for some years before had been a resident at Gibraltar, where he was extensively engaged as a merchant. The defendant entered special bail to the attachment, and having appeared and pleaded to the same, the case was tried by a jury on the twenty-first day of November, 1836, and a verdict, under the charge of the circuit court, was rendered for the defendant, on which a judgment was entered by the court.
The plaintiff at the trial took a bill of exceptions to the charge of the court, stating in full all the evidence given to the jury in the case. The plaintiff prosecuted this writ of error.
The plaintiff declared in assumpsit on three counts against the defendant: first charging the delivery of certain articles of merchandise upon a promise to account and pay over the proceeds of the sale of the same, alleging a sale thereof by the defendant and a breach of promise in not paying or accounting for the same. Second, a count in indebitatus assumpsit, and third, on an account stated. The third count was afterwards, on the application of the plaintiff to the court, struck out of the declaration. The defendant pleaded the general issue and also the statute of limitations. The plaintiff replied that at the time of the transactions with the defendant in which this suit was brought, the defendant was a merchant and the factor of the plaintiff, and
"as such had the care and administration of the money, goods, wares, and merchandise in the said declaration mentioned of the said Henry, and he merchandised and made profit
of for the said Henry, and to render a reasonable account to the said Henry, when he, the said Horatio, should be thereunto afterwards required, and that the said money, in the said several promises and undertakings in the said declaration mentioned, became due and payable on trade had between the said Horatio and the said Henry, as merchants and merchant and factor, and wholly concerned the trade of merchandise between him, the said Henry, as a merchant, and the said Horatio as a merchant and factor of him, the said Henry, to-wit at the district aforesaid, and the said Henry further says that no account or accounts whatever of the said money, goods and merchandise in the said declaration mentioned, or any part thereof, was or were ever stated, settled, or adjusted between him the said Henry."
To this replication the defendant rejoined stating that he was not the factor of the plaintiff, nor did the said money, in the said several supposed promises and undertakings, in the said declaration mentioned, become due and payable in trade had between the said Horatio Sprague and the plaintiff, as merchant and merchant and factor, in manner and form as the plaintiff had alleged.
The bill of exceptions set out at large the evidence given on the trial of the cause. It consisted of a letter, dated Philadelphia, September 25, 1824, from the plaintiff to Charles Pettit, by which certain goods and merchandise, the property of the plaintiff, shipped on board of the William Penn, bound to Gibraltar, was consigned to him for sale, and stating the manner in which returns for the same were to be made; letters from Charles Pettit to the plaintiff relative to the shipment, and a statement of remittances made to him by Charles Pettit, with an account sales of some of the merchandise; also two bills of exchange, one for five hundred and thirty dollars seventeen cents, the amount of the proceeds of sales of eleven hogsheads of tobacco, and a bill of exchange for one thousand dollars, both drawn by Horatio Sprague the defendant, on persons in the United States, to the order of Charles Pettit and by him endorsed to the plaintiff.
By a letter from Charles Pettit to the plaintiff, dated at Gibraltar, December, 1824, after communicating the sales of the eleven hogsheads of tobacco, and the enclosure of the bills, and stating that the bill for one thousand dollars was to be considered as an advance on his shipment, he informed the plaintiff:
"I shall sail from this tomorrow in the ship William Penn for Savannah, and have left the following instructions with my friend,
Mr. Sprague regarding your property left by me in his hands:"
" With respect to the gunpowder tea, cassia, and crape dresses, shipped by Henry Toland, you will please to dispose of them as you may think most for the interest of the shipper, and remit the amount to him in bills on the United States, forwarding me account of sales of the same."
By a letter addressed by Charles Pettit to the defendant, Mr. Sprague; written at Gibraltar, on 18 December, 1825; he says, among other things:
"By your account current rendered this day, a balance stands against me of five thousand five hundred and seventy-four dollars thirty-one cents, to meet which you have in your possession 550 barrels superfine flour, on my account entire, my half interest of 372 barrels flour; an invoice of crapes, &c., amounting to two thousand and twenty dollars; 100 ten-catty boxes gunpowder tea; 500 bundles cassia; and 2 cases super satin Mandarin crape dresses, containing 101 dresses."
"With respect to the gunpowder tea, cassia, and crape dresses, shipped by H. Toland, you will be pleased to dispose of them as you may think most for the interest of the shipper, and remit the amount to him in a bill on the United States, forwarding me account sales of the same."
On 6 January, 1825, the plaintiff wrote to the defendant, from Philadelphia, "I am expecting soon to hear the result of my shipment by the William Penn and hoping it will be favorable."
On 22 February, 1825, the plaintiff addressed the following letter to the defendant:
"Philadelphia, February 22, 1825"
"MR. HORATIO SPRAGUE, Gibraltar."
"Dear Sir -- By the ship William Penn, I consigned to Mr. Charles Pettit 100 boxes gunpowder tea, a quantity of cassia, 11 hogsheads Kentucky tobacco, and 2 cases Mandarin robes. I directed Mr. Pettit to make the returns of this shipment immediately on his arrival at Gibraltar as follows: if quicksilver could be had at forty cents, then the whole amount in said article; if not, to ship the whole amount in dollars by the first vessel for this port or New York, or if good bills of the United States could be had on more favorable terms for a remittance, then to make the return in bills. Mr. Pettit promised a strict compliance with all these things, but since the
sailing of the William Penn from this port, I have never received a line from him. I have heard of his arrival in Savannah, and of his proceeding to Charleston, but I have not yet been favored with a single letter from him."
"As my property may be left in your hands by him unsold, I beg of you to follow the directions given to him as herein detailed and make the remittance direct to me. I have particularly to beg your attention to this matter and to remit as early as possible."
The bill of exceptions also contained letters from the defendant to the plaintiff, written at Gibraltar, commencing on 18 January, 1825, to February 22, 1827, and other correspondence of the plaintiff with the defendant up to an anterior date.
The letters of the plaintiff assert the liability of the defendant to him for the whole amount of the shipment made to Charles Pettit, deducting the two bills of exchange, one for five hundred and thirty dollars seventeen cents and the other for one thousand dollars, the balance of the sales being one thousand five hundred and seventy-nine dollars.
The letter from the defendant to the plaintiff of 18 January, 1825, informs the plaintiff
"that Charles Pettit had left Gibraltar on 19 December, and had placed in his hands, for sale for his account, an invoice of gunpowder tea, cassia, and crape dresses, with directions to dispose of them as he may judge most for his interest, which shall have my best attention."
Letters written afterwards inform the plaintiff of the state of the markets at Gibraltar, and on 7 June, 1825, the defendant wrote to the plaintiff, "I have closed the sales of the crapes and cassia, left by Mr. Pettit some time since, and settled his account."
On being informed by the plaintiff that he was held liable to him for the proceeds of the shipment per the William Penn, the defendant addressed the following letter to the plaintiff:
"Gibraltar, October 24, 1825"
Dear Sir -- I have just received your letter of 12 September, which I hasten to reply to. It would appear by your letter that Mr. Pettit's agency here was not so full as his own instructions to me gave me to expect. The property which he has brought and consigned to me at various times has ever been delivered over to me with invoices in his own name, and I have ever been punctilious in following his instructions, sometimes in remitting to one, sometimes
to another, and on which property I was always ready, and at various times did advance sums of money, but how he, Mr. Pettit, appropriated this money it was not my province to inquire; he might have remitted it to you or anyone else. Here follows the other part of his instructions of the date of 18 December, which you appear to have overlooked, but which must establish in your mind the nature of Mr. Pettit's transactions here. Had you have consigned your property to me instead of Mr. Pettit, I should then have been accountable to you, but it cannot be expected that I am to guarantee the conduct of your agent, who always is accountable to you for his conduct. Here follows the extract of his order of 18 December, 1824:
" By your account current, rendered this day, a balance stands against me of five thousand five hundred and seventy-four dollars and thirty-one cents, to meet which you have in your possession five hundred and fifty barrels of superfine flour, on my account entire, my half interest of three hundred and seventy-two barrels of flour, and invoice of crapes, &c., amounting to two thousand and twenty dollars, one hundred ten-catty boxes gunpowder tea, five hundred bundles cassia, and two cases superior satin Mandarin crape dresses, containing one hundred and one dresses,"
"This paragraph, I repeat, cannot but convince you that all my advances to Mr. Pettit were on the various property which he placed in my hands for sale. It is very true I corresponded with your good self on the subject of the articles which you entrusted to the management of Mr. Pettit, and it is no less true I did the same with him, and from time to time promised him account, which I never did to you, and until his last visit to this did not close the sales of the articles, when, at his particular request, closed every account before he left this. This explanation, I trust, will prove satisfactory, so much so that I may continue to enjoy your confidence."
The letter of the plaintiff of Philadelphia, January 4, 1826, repeats and insists on the liability of the defendant to him, to which the defendant gave the following reply:
"Gibraltar, February 10, 1826"
"Dear Sir -- I am this moment in receipt of your letter of 4th ultimo, per Charles, and from your reference to my letter of 18 January, 1825, have looked into the same. That I was aware the property handed over to me by Mr. Pettit did not belong to himself there is no question, but on what terms you and others consigned it
to him is not for me to inquire. On his arrival, he submitted to me invoices of several shipments, required advances, and gave orders for sales, and on his leaving this, as you may suppose, directed me to correspond with the different shippers by him, which, in my opinion, was very proper, and could not in the faintest degree lessen my claim to the property, on which I had made liberal -- yes, more than liberal -- advances, so much so that Mr. Pettit is over two thousand dollars my debtor; yet so particularly desirous am I to satisfy your mind, as I am in possession of all the original papers, letters, &c., connected with the business, I have no hesitation in submitting the question to any two respectable merchants here, one to be appointed by you, the other by myself, and to their decision I shall most readily subscribe; or if you are willing to leave the business to me, I will submit every paper to two disinterested merchants, and they shall address you on the subject, and the affair shall be settled to our satisfaction."
"Herewith duplicate of my respects of 28th ultimo, since which I have delivered a part of your hyson skin tea, at three and a half rials per pound. This parcel has been sold off, and if no complaints of its quality be made hereafter, I shall be glad."
The bill of exceptions also contained a number of accounts sales of merchandise made by the defendant, by order of Charles Pettit, and accounts current with him commencing in 1822. The only account which was the subject of notice in the charge of the circuit court was one dated at Gibraltar June 30, 1825, of the property of the plaintiff left in the hands of the defendant on 18 December, 1824. This was an account sales showing a balance of two thousand five hundred and seventy-eight dollars and eleven cents. The account sales was stated to be:
"Sales of merchandise received 3 November, 1824, ex ship William Penn, William West master, from Philadelphia, by order of Mr. Charles Pettit, for account and risk of the concerned, per Horatio Sprague Gibraltar."
"Gibraltar, June 30, 1825"
By the account current between the defendant and Charles Pettit, dated "July 6, 1825," in which credit was given for the net proceeds of the sales of June 30, 1825, a balance appeared to be due from Charles Pettit to the defendant, of one thousand four hundred and six dollars and _____ cents.
The bill of exceptions contained no other account in which the
sales of the shipment made by the plaintiff by the William Penn were stated; nor did it contain any account rendered by the defendant to the plaintiff relating thereto.
The circuit court charged the jury:
"That there being a plea of the statute of limitation, the plaintiff must by his replication bring himself within the exception concerning merchants' accounts in the said statute, or must fail. To be within the said exception, such accounts must concern trade and merchandise, and must also contain mutual demands, and must be an open and running account, and must be such for which an action of account would lie, and must be between merchant and merchant, their factors or servants, not merely between those who hold their goods under an obligation to account."
Here the plaintiff claimed one thousand five hundred and seventy-nine dollars, the balance of sales of property, as per account sales June 30, 1825, amounting to two thousand five hundred and seventy-nine dollars. Credit by one thousand dollars -- Bill on Pearson. The plaintiff and defendant agree in the amount of sales, and no item is objected to.
Thus far the account is a stated one, not being objected to for ten years; if any balance is due, it is ascertained by mutual consent.
There is no mutual account between them, nor an open one, and there can be no new account open between them. The contest does not depend on an account, but on who has a right to a liquidated balance, admitted by defendant to be in his hands as the proceeds of plaintiff's property: plaintiff claims it as his own; the defendant claims to apply it to a debt due by Pettit.
On the pleadings, the question is not who has a right to the money, but whether plaintiff is not barred by the statute.
The plaintiff had not made out a case which exempts him from the statute. If Sprague had rendered the account sales to the plaintiff, and admitted the balance to be payable to him, that would not bring plaintiff within the exception.
The plaintiff had a complete right of action, on demand of a settled balance, and he made this demand in 1825, and the statute would then begin to run. The plaintiff's only claim is for a precise balance, and this would not have been the mutual open account current between merchant and merchant, concerning the trade of merchandise between plaintiff and defendant. It did not become so by defendant's claiming to retain the balance for Pettit's debt, nor did it change the
nature of the transaction, or make the cause more a matter of account than if he admitted the plaintiff's right to it.
The only question is who is entitled to the balance of a settled account. Admitting, then, that defendant was the factor of the plaintiff, he has failed in making out his replication as matter of law; it was not a case of trust, not embraced by statute.
Taking the account, then, as one where defendant was factor for plaintiff, bound to account to him and pay him the balance, and having no authority to apply the proceeds to Pettit's debt, and plaintiff not bound by receipt of one thousand dollars, the nature of the transaction does not bring it within the exception, being for a liquidated balance admitted, and by the correspondence between the parties, the controversy brought to a contest for the balance, this can be an exception only on the ground of merchants being privileged characters.
The correspondence between the parties, so long ago as early in the year 1826, shows that the question between them was not about the account or any item in it, but on the right of Mr. Sprague to retain the admitted balance to repay the advances he made to Pettit; that was the only question in dispute between them, and it is the only one now, and has so continued for more than ten years.
This view makes it unnecessary to consider the other interesting questions as to the powers of agents, factors, supercargoes, pledging, and of sub-agents; the jury are to take the direction of the court in the question, which is a matter of law, and so left the same to the jury.