United States v. Isham, 84 U.S. 496 (1873)
U.S. Supreme CourtUnited States v. Isham, 84 U.S. 17 Wall. 496 496 (1873)
United States v. Isham
84 U.S. (17 Wall.) 496
1. The words "memorandum, check," in that part of the schedule of instruments required by the statute of June 30, 1864, 13 Stat. at Large p. 298, § 158, to be stamped, which in the printed statute books are printed with a comma between them, should read, "memorandum-check," with a hyphen instead of a comma.
2. In settling whether an instrument should be stamped or not, regard is to be had to its form, rather than to its operation. Though it may be a device to avoid the revenue acts, and though its operation may have the effect of avoiding them, yet if the device be carried out by means of legal forms, it is subject to no legal censure.
The Act of June 30, 1864, "to provide internal revenue to support the government," &c., [Footnote 1] requires certain instruments, specified in a schedule which it contains, to be stamped. The schedule is as follows:
BANK-CHECK, draft, or order for the payment
of any sum of money whatever, drawn upon
any bank, banker, or trust company, or for
any sum exceeding $10 drawn upon any other
person or persons, companies or corporations,
at sight or on demand . . . . . . . . . . . . . . 2 cents
Bill of exchange (inland), draft, or order
for the payment of any sum of money not
exceeding $100, otherwise than at sight
or on demand, or any promissory note
(except bank notes issued for circulation,
and checks made and intended to be forthwith
presented, and which shall be presented to
a bank or banker for payment), or any memo-
randum, check, receipt, or other written or
printed evidence of an amount of money to
be paid on demand, or at a time designated,
for a sum not exceeding $100. . . . . . . . . . . 5 "
And for every additional $100, or fractional
part thereof in excess of $100 . . . . . . . . . . 5 "
This statute being in force, the United States filed, in 1871, a criminal information in the court below against E. B. Isham, for issuing without a stamp and with intent to evade
the provisions of the above-quoted act, a paper in the form of a draft drawn upon one C. J. Canda. The paper, which was attached to and made part of each count of the information, was in this form:
It appeared from the testimony offered by the government that the Iron Cliffs Company was a corporation of Michigan, situated at Negaunee, in the state just named, and engaged in mining iron ore and in manufacturing pig iron. It had an office at Negaunee where its business was carried on and a head office in New York, where its board of directors met and its funds were kept. Isham was superintendent of the works at Negaunee and resided there. Canda was treasurer of the company, and resided in New York. The company had been in the practice of issuing paper like the instrument above set forth in payment for labor or other debts due at the mine since January, 1868, nearly all payments of balances due for labor having been made since that time and up to 1871, when the information was filed, in it. The amount issued annually since that time had been about $100,000. The blanks were sent to Isham from New York, and signed by him as drawn. The denominations issued were of $1, $2, $3, $5 and $10. When the Iron Cliffs Company began to issue this paper, there were hardly any facilities for getting currency into the country except taking it through one hundred and twenty miles of staging, and through a wilderness chiefly, and when it was issued, it to some extent went into circulation and answered the purpose of a local currency. It was taken at a store, in which the company was interested, in payment for
goods and by all the banks and banking houses in that region, and sometimes paid out by them on checks. But when in the course of business it came into the hands of a bank or banker or a merchant, it was generally retained until a considerable amount of it was on hand -- say from $1,000 to $2,000 -- and then either sent to New York by express for redemption or Isham took it up and gave to the holder a draft on New York for the amount. When Isham took this paper in this way, by giving the holder a large draft for it, he frequently reissued it, or paid it out again in the course of the company's business at the mine; but when it was finally paid in New York, it was cancelled and destroyed.
On this and similar evidence, the following questions arose, concerning which the defendant requested the court to instruct the jury in his favor, and for a verdict of acquittal:
"1st. Whether the instrument was on its face subject to be stamped?"
"2d. Whether the evidence tending to prove that Isham was superintendent of the Iron Cliffs Company, and drew the instrument in that capacity, or that Canda was the treasurer of the said company, and the instrument was drawn upon him in that capacity, or that the said paper was drawn in the course of the company's business, was relevant and admissible?"
"3d. Whether, if the paper in question was made and issued with the design that it should be used as a local circulating medium, and was actually used by the holders as such, it thereby became subject to be stamped, and whether the evidence given by the prosecution, tending to prove these facts, was relevant and admissible?"
"4th. Whether, assuming every fact which the evidence in support of the prosecution tended to prove, the defendant was guilty of the offense charged?"
"5th. Whether the information in this case sufficiently charged any offense under the laws of the United States?"
And the following further question, upon which the district attorney requested the court to charge in favor of the prosecution:
"6th. Whether if the instrument set forth in the information and adduced in evidence was issued with the design and intent to secure time for the payment of the debt it represented, it was therefore subject to stamp duty?"
Which questions (the judges being divided in opinion upon them) were now certified to this Court for its opinion.