Meredith v. United States
Annotate this Case
38 U.S. 486 (1839)
U.S. Supreme Court
Meredith v. United States, 38 U.S. 13 Pet. 486 486 (1839)
Meredith v. United States
38 U.S. (13 Pet.) 486
An action was instituted by the United States to recover from the assignees of S. Smith & Buchanan, insolvent merchants, the duties on merchandise imported by them and for which bonds had been given, but which remained unpaid. The United States had retained, from money awarded under the treaty with France to Lemuel Taylor, who was the surety in the bonds, a sufficient sum to pay the bonds, but had not appropriated the
same towards their satisfaction. The assignees claimed to set off against the demand of the United States the amount due by Lemuel Taylor to the estate they represented, he having been discharged by the insolvent laws of Maryland. The Court said
"Whatever might be the merits of such an equitable claim in any suit brought by Lemuel Taylor, the insolvent, or by his assignee against S. Smith & Buchanan or against their assignees, it could have no proper place in a suit brought by the United States to recover demands justly due to them for duties. It was to them res inter alios acta, and the United States was not called upon to engage in or to unravel any of the accounts and setoffs existing between those parties in a suit at law like the present."
The importers of goods do, in virtue of the importation thereof, become personally indebted to the United States for the duties thereon, and the remedy of the United States for the duties is not exclusively confined to the lien on the goods and the security of the bond given for the duties. The duties due upon all goods imported constitute a personal debt due to the United States from the importer, independently of any lien on the goods and of any bond given for the duties. The consignee of goods imported is for this purpose treated as the owner and importer.
The right of the government to the duties accrues, in the fiscal sense of the term, when the goods have arrived at the port of entry. The debt for the duties is then due, although it may be payable afterwards according to the regulations of acts of Congress.
The debt due to the United States for duties on imported merchandise is not extinguished by the giving of bonds, with surety, for the same. The revenue collection act of 1799, ch. 128, requires that the collector should take the bonds for the duties from all the persons who are the importers, whether they be partners or part owners.
The government of the United States has a right to retain money in its hands belonging to a surety in a bond given for duties which is unpaid until a suit shall be terminated for the recovery of the amount of the duties on the goods due by the importers. The government is not obliged to appropriate the money of the surety to the satisfaction of the bond, but may hold it as a security until the suit is determined.
The United States instituted an action of assumpsit against Jonathan Meredith and Thomas Ellicott to recover from them, as the assignees of Samuel Smith, James A. Buchanan, and Thomas A. Buchanan, formerly trading as merchants under the firm of S. Smith & Buchanan, a certain amount due to the United States for duties; the United States claiming a right of priority of payment against the estate in the hands of the trustees. The deed of trust to the plaintiffs in error was executed by S. Smith & Buchanan, on the 9th of November, 1820.
In July, 1818, there was imported into Baltimore by S. Smith & Buchanan and by Hollins & McBlair a quantity of merchandise from Canton on board the brig Unicorn, and in February, 1819, the same persons imported from Calcutta a quantity of merchandise on board of the ship Brazilian. In the importation by the
Unicorn, S. Smith & Buchanan had an interest of two-thirds, and of five-ninths in the cargo of the Brazilian, the remaining interest in both importations belonging to Hollins & McBlair.
Entries of the merchandise of both cargoes were made by John Smith Hollins, one of the joint importers, and a partner in the firm of Hollins & McBlair, who, with James A. Buchanan, also one of the joint importers, and a partner in the firm of S. Smith & Buchanan, and a certain Lemuel Taylor, executed to the United States their joint and several bonds for the payment of the duties.
Upon these bonds the United States afterwards instituted actions against each of the obligors and recovered judgments in the Circuit Court for the District of Maryland. These judgments have been twice revived by scire facias, and are now in full force and unreversed.
S. Smith & Buchanan afterwards became insolvent, as also did Lemuel Taylor. A large sum of money was awarded under the treaty with France to Lemuel Taylor, which was claimed by Mr. Colt, his assignee, but the United States withheld a part thereof, being the amount of the bonds given for the duties on the importations by the brig Unicorn and ship Brazilian, for which Lemuel Taylor was surety. A large sum of money was also awarded to Smith & Buchanan, under the treaty with France, which was paid to Messrs. Meredith and Ellicott, their assignees. The sum so received by the assignees was sufficient to pay the amount claimed by the United States for the duties on the portions of cargoes of the Unicorn and Brazilian, which had been imported by S. Smith & Buchanan, but not enough to pay their partnership debts. The United States had not adverted to the alleged liability of S. Smith & Buchanan for the duties unpaid on their importations when the awards under the French treaty were paid to their assignees.
The case was tried before the Circuit Court of Maryland, and a verdict rendered in favor of the United States. The defendants prosecuted this writ of error.
In the progress of the trial, the defendants, now plaintiffs in error, offered evidence to prove that at the time of Lemuel Taylor's application for the benefit of the insolvent laws of Maryland, he was indebted and still remains indebted to the estate of S. Smith & Buchanan in a sum more than sufficient to pay the whole amount due upon the several bonds for duties before mentioned, but the admissibility of this evidence was objected to by the counsel for the United States, and the court sustained the objection.
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