Oelrichs v. Spain, 82 U.S. 211 (1872)

Syllabus

U.S. Supreme Court

Oelrichs v. Spain, 82 U.S. 15 Wall. 211 211 (1872)

Oelrichs v. Spain

82 U.S. (15 Wall.) 211

Syllabus

1. In the jurisprudence of the United States, the objection that there is an adequate remedy at law raises a jurisdictional question, and may be enforced by the court sua sponte though not raised by the pleadings nor suggested by counsel.

2. The equity jurisdiction will be sustained when time, expense, and multiplicity of suits will be saved, as also when the case contains an element of trust.

3. Securities to an injunction bond cannot go behind the decree to raise a question of illegality as to an agreement on which it is founded.

4. A release not under seal is not a technical bar even in a suit at law. But even when sealed, it cannot be set up in equity to defeat those who were not parties to it and who had separate interests.

5. An injunction bond given to one who held the legal title to a fund will enable him at law to recover to the full extent damages touching the entire fund, and a court of equity will follow the law in its proper distribution.

6. Counsel fees are not recoverable on such bonds.

On the 9th of November, 1842, the Bank of the United States was the owner of $500,000 of the bonds of the then independent Republic of Texas, a government, at that time, of bad pecuniary credit. Owing W. S. Wetmore $50,000, the bank assigned these bonds, with arrears of interest on them, to him as a security for the debt. In July, 1845, the Republic became one of the United States under the name of the State of Texas, and immediately certain holders of its bonds became urgent that Congress should assume the payment of them, principal and interest. Among these holders was General James Hamilton, a person of some political influence in his day, and who had been instrumental in procuring the admission of Texas into the Union. As the Bank of the United States would gain largely if the United States did so assume the debt, Hamilton applied to its trustees -- the bank having itself failed, and assigned its effects -- urging them to employ him to have it done, and the trustees, in October, 1845, agreed with him that if he would devote his

Page 82 U. S. 212

"best efforts, time, and means to the great object of securing the recognition and payment of these claims," and if his efforts should be successful, they would allow him a commission of ten percent for the service so rendered. This agreement was limited by its terms to two years. However, Hamilton having labored successfully, this provision as to time was not insisted on. The trustees communicated the agreement fully to Wetmore, September 16, 1850, without mentioning the original limitation, and directing him to "hold subject to the order of Hamilton one-tenth of any sum over and above his claim against the said bonds." Wetmore acknowledged the receipt of this order and promised to hold the bonds accordingly.

Through his, Hamilton's, efforts largely, Congress, by an act of 9 September, 1850, did assume the payment of this debt and authorized a five percent stock of the United States to be issued in lieu of the bonds of Texas, the act requiring, however, that before the stock of the United States should be issued, the holders of the Texas bonds should "first file at the Treasury of the United States, releases of all claims against the United States for said bonds."

The amount finally paid, June 3, 1856, in behalf

of the claim held by Wetmore was . . . . . . . . . $817,720.88

Wetmore having paid himself his own debt, paid

the residue of the nine-tenths to the trustees

of the bank. This left in his hands, as

trustee for Hamilton, the remaining one-tenth, or 81,772.08

A considerable time before this money was payable

by the United States, Hamilton, who had long been

pecuniarily embarrassed, directed Wetmore, by

written orders, which Wetmore accepted, to pay

out of it, when received,

To Wetmore, himself . . . . . . . . $ 2,500

To Corcoran & Riggs . . . . . . . . 25,000

To one Hill . . . . . . . . . . . . 33,500

with interest from certain dates; so much being

due by him, Hamilton, for money borrowed of these

persons respectively.

It seemed to be admitted by all as unquestionable

that the trustees of the Bank of the United States

were, in virtue of some agreement of an admitted

priority, entitled to receive of this. . . . . . . 81,772.08

The sum of . . . . . . . . . . . . . . . . . . . . 12,051.50

----------

Leaving as Hamilton's true one-tenth . . . . . . . . $69,720.58

Page 82 U. S. 213

In this state of things -- and when if Wetmore had been allowed to distribute the one-tenth of Hamilton or his one-tenth less the bank's last-named deduction, it would have paid Hill as well as Wetmore and Corcoran & Riggs, all in full -- one Spain filed a bill against Wetmore, Corcoran & Riggs, and the trustees of the bank, Hill not being by name made a defendant, charging that Wetmore had the $81,772.08 as the property of Hamilton, and that he, Spain, had an assignment of the whole fund made by Hamilton at an early date. The bill then alleged that Wetmore, disregarding this earlier assignment, pretended to hold the fund, subject to certain other alleged assignments of later date, the bill specifying that to Wetmore himself, and those to Corran & Riggs, Hill and the trustees of the bank, and alleging that Wetmore meant to apply the fund to the payment of these last "said recited claims" and that the secretary was about to pay to Wetmore the said sum of $81,772.08. Asserting thus a superior equity, the bill then prayed:

"That the said Wetmore, his assignees, aiders, and abettors, may be enjoined and restrained from receiving the sum of $81,772, being the one-tenth of the three certificates,"

&c. Subpoenas were prayed against all these parties, and that the representative of Hill (Hill himself being now dead) should be made defendant when discovered. An injunction was granted "as prayed for." A bond in the penalty of $15,000, signed by a certain J. F. May and Henry May, in favor of Wetmore, Corcoran & Riggs, and the trustees of the bank, but not by name in favor of Hill, was filed. The writ of injunction was issued on the 31st of May, 1856, directed to Wetmore, Hamilton, Corcoran & Riggs, and the trustees of the bank. It recited the filing of the bill and its object. The restraining clause was in these words:

"You, the said W. S. Wetmore, your assignees, aiders, and abettors, are hereby restrained and enjoined from asking for or receiving the sum of $81,772.08, being the one-tenth part of the bonds or certificates,"

&c.

This writ was served on Wetmore, and Corcoran & Riggs. From that time, until the dissolution of the injunction, hereinafter

Page 82 U. S. 214

mentioned, the money laid idle in the Treasury of the United States. Answers were filed by Wetmore, Corcoran & Riggs, the trustees of the bank, and by the representative of Hill.

On motion of the defendants, it was subsequently thus ordered:

"It appearing to the satisfaction of the court that there is not sufficient security to indemnify the defendants for their costs and damages &c., it is ordered that the complainant file a bond in the penalty of $20,000 conditioned to pay the defendants such costs and damages as they may respectively sustain."

Prior to this, the complainant had released his injunction as to the sum of $12,051, improperly enjoined, and this had been paid by Wetmore to the bank, and a release of the injunction bond executed by the trustees of the bank. The form of that release did not appear in the record.

The second bond, ordered as above-mentioned to be filed, was filed, executed by Spain and Oelrichs. This, by consent of the parties, was ordered to stand in lieu of the bond previously filed, reserving the right of the obligees to have recourse to the original bond for interest theretofore accrued. The obligees named in this bond were Wetmore and Corcoran & Riggs, but not Hill by name. The bond recited the injunction issued by the court to restrain the collection of the money mentioned in the writ; it recited also that certain portions of the money so enjoined had been released and paid over. The condition was:

"That if the said Spain &c., shall prosecute the writ of injunction to effect, and pay as well the costs, damages, and charges that shall occur in said circuit court in Washington County, as all costs, damages, and charges that shall be occasioned by said writ of injunction, and shall in all things obey such order and decree as the said court shall make in the premises, then the obligation to be void and of no effect, otherwise to remain in full force and effect."

The cause being heard, it was decreed, on the 19th February, 1861, 4 years 8 months and 16 days after the injunction had issued:

Page 82 U. S. 215

1. That the legal title to the fund was from the 9th November, 1849, and still is in Wetmore.

2. That from the 16th September, 1850, when the trustees of the bank notified to him their arrangement with Hamilton and he accepted it, Wetmore held the legal title of the one-tenth as trustee of the fund.

First, to pay himself, with interest, the

loan of . . . . . . . . . . . . . . . . . . $ 2,500

Second, to pay Corcoran & Riggs . . . . . . . 30,000

Third, to pay Hill with interest from

9th March, 1852 . . . . . . . . . . . . . . 33,500

From this decree Spain alone appealed. At the December Term 1863, this Court affirmed the decree with costs. [Footnote 1]

Pending the appeal, there being no supersedeas and the decree having dissolved the injunction, the Treasury paid to Wetmore, on 20 March, 1861, the sum remaining due on the one-tenth, $69,720.60.

There had been previously paid to the bank the sum improperly enjoined, to-wit, 30th March, 1859, the pro rata on $12,051.48.

The sum they paid to Wetmore was in three drafts, intended to represent the interests of the parties as settled by the decree, to-wit:

For Wetmore . . . . . . . . . . . . . . . . . $ 4,333.89

" Corcoran . . . . . . . . . . . . . . . . . 30,000.69

" Hill . . . . . . . . . . . . . . . . . . . 35,386.00

----------

$69,720.58

Wetmore and Corcoran & Riggs were paid in full; but on Hill's debt, as found by the decree, $52,457, there still remained unpaid $17,071.

Soon after the injunction was issued in this case, two others were issued on bills filed in the same court, one by the James River & Kanawha Company and one by Pierce Butler. In the former, an injunction bond was executed in the penalty of $5,000, signed by Caperton and others; in the latter, one signed by Butler and others in the penalty of $2,500.

Page 82 U. S. 216

Butler's bill was heard with that of Spain, and subsequent to the decree in that case the James River & Kanawha Company dismissed their bill.

In both of these cases, the bonds expressly included among the obligees Hill's executor, as well as Wetmore and Corcoran & Riggs, while in the two bonds filed in Spain's case, as already said, neither Hill nor his executor was expressly named as obligee.

In this state of things, the only child, heir, and legatee of Hill filed a bill to assert his father's claim for damages occasioned by these several injunction bonds. To aid in this, the representatives of Wetmore as also the executor of Hill were joined as complainants. The securities in the two bonds in the Spain case, May and Oelrichs, and the security in the bond in the James River Company's case, Caperton, were made defendants.

The bill was also filed against Corcoran & Riggs to seek a discovery from them as to whether any settlement had been made with them of the bond in the James River case.

It was also filed to marshal assets, and to assert the right of Hill to the whole of this latter bond, and compel Corcoran & Riggs to resort for payment to the other bonds, they being named as obligees in all, while Hill was named only in one -- provided it should be decreed that the omission to name Hill specifically as obligee in the Spain bonds prevented his looking to them for redress -- a matter which was not conceded.

The bill also stated that Corcoran & Riggs has made some settlement of the $5000 bond, and prayed a discovery.

As to the bond for $2,500 given by Butler, the complainant stated its payment by his representatives; and as to these representatives, the representatives of Henry May, one of Spain's securities, Spain himself, Ellis and Ould, parties to the James River bond, all nonresidents and beyond the jurisdiction -- the bill prayed that process might issue against them if they should come within the jurisdiction.

On this bill, answers, and proofs, the cause was tried and

Page 82 U. S. 217

decrees rendered asserting Hill's right to resort to the Spain bonds for redress of damages, and referring Corcoran & Riggs to the bonds on which they were named and Hill was not; and also allowing both Hill and them to recover counsel fees paid in attending to the injunction. The items thus appeared:

Corcoran & Riggs for damages, interest on

the amount of their lien during the term

payment was delayed by the injunction,

a term of 4 years, 8 months, and 16 days . . . . $8,475.00

Their counsel fees in the adverse litigation . . . 1,000.00

----------

$9,475.00

Deduct the amount they received upon the bond

given in behalf of the James River & Kanawha

Company. . . . . . . . . . . . . . . . . . . . . 5,000.00

---------

Balance . . . . . . . . . . . . . . . . . . . $4,475.00

Of this sum, $2,455.94 was charged on May's bond, and $2,019.06 on Oelrichs'.

To Hill's estate for loss of principal by

reason of the fact that part of the fund

which would otherwise have been applied

to it in part payment was absorbed for

the interest due the prior claims. . . . . . . . $ 827.41

Interest on $36,214.35 for 4 years, 8 months,

and 16 days. . . . . . . . . . . . . . . . . . . 10,230.55

Counsel fees in the adverse litigation . . . . . . 1,500.00

----------

$12,557.96

Deduct the amount received on the Butler bond. . . 2,500.00

----------

Balance. . . . . . . . . . . . . . . . $10,057.96

Of this sum, there was charged to May's bond $5,027.15, and to Oelrichs', $5,030.81.

May and Oelrichs now appealed, and the case was before this Court for final adjudication.

Page 82 U. S. 224


Opinions

U.S. Supreme Court

Oelrichs v. Spain, 82 U.S. 15 Wall. 211 211 (1872) Oelrichs v. Spain

82 U.S. (15 Wall.) 211

APPEAL FROM THE SUPREME COURT

FOR THE DISTRICT OF COLUMBIA

Syllabus

1. In the jurisprudence of the United States, the objection that there is an adequate remedy at law raises a jurisdictional question, and may be enforced by the court sua sponte though not raised by the pleadings nor suggested by counsel.

2. The equity jurisdiction will be sustained when time, expense, and multiplicity of suits will be saved, as also when the case contains an element of trust.

3. Securities to an injunction bond cannot go behind the decree to raise a question of illegality as to an agreement on which it is founded.

4. A release not under seal is not a technical bar even in a suit at law. But even when sealed, it cannot be set up in equity to defeat those who were not parties to it and who had separate interests.

5. An injunction bond given to one who held the legal title to a fund will enable him at law to recover to the full extent damages touching the entire fund, and a court of equity will follow the law in its proper distribution.

6. Counsel fees are not recoverable on such bonds.

On the 9th of November, 1842, the Bank of the United States was the owner of $500,000 of the bonds of the then independent Republic of Texas, a government, at that time, of bad pecuniary credit. Owing W. S. Wetmore $50,000, the bank assigned these bonds, with arrears of interest on them, to him as a security for the debt. In July, 1845, the Republic became one of the United States under the name of the State of Texas, and immediately certain holders of its bonds became urgent that Congress should assume the payment of them, principal and interest. Among these holders was General James Hamilton, a person of some political influence in his day, and who had been instrumental in procuring the admission of Texas into the Union. As the Bank of the United States would gain largely if the United States did so assume the debt, Hamilton applied to its trustees -- the bank having itself failed, and assigned its effects -- urging them to employ him to have it done, and the trustees, in October, 1845, agreed with him that if he would devote his

Page 82 U. S. 212

"best efforts, time, and means to the great object of securing the recognition and payment of these claims," and if his efforts should be successful, they would allow him a commission of ten percent for the service so rendered. This agreement was limited by its terms to two years. However, Hamilton having labored successfully, this provision as to time was not insisted on. The trustees communicated the agreement fully to Wetmore, September 16, 1850, without mentioning the original limitation, and directing him to "hold subject to the order of Hamilton one-tenth of any sum over and above his claim against the said bonds." Wetmore acknowledged the receipt of this order and promised to hold the bonds accordingly.

Through his, Hamilton's, efforts largely, Congress, by an act of 9 September, 1850, did assume the payment of this debt and authorized a five percent stock of the United States to be issued in lieu of the bonds of Texas, the act requiring, however, that before the stock of the United States should be issued, the holders of the Texas bonds should "first file at the Treasury of the United States, releases of all claims against the United States for said bonds."

The amount finally paid, June 3, 1856, in behalf

of the claim held by Wetmore was . . . . . . . . . $817,720.88

Wetmore having paid himself his own debt, paid

the residue of the nine-tenths to the trustees

of the bank. This left in his hands, as

trustee for Hamilton, the remaining one-tenth, or 81,772.08

A considerable time before this money was payable

by the United States, Hamilton, who had long been

pecuniarily embarrassed, directed Wetmore, by

written orders, which Wetmore accepted, to pay

out of it, when received,

To Wetmore, himself . . . . . . . . $ 2,500

To Corcoran & Riggs . . . . . . . . 25,000

To one Hill . . . . . . . . . . . . 33,500

with interest from certain dates; so much being

due by him, Hamilton, for money borrowed of these

persons respectively.

It seemed to be admitted by all as unquestionable

that the trustees of the Bank of the United States

were, in virtue of some agreement of an admitted

priority, entitled to receive of this. . . . . . . 81,772.08

The sum of . . . . . . . . . . . . . . . . . . . . 12,051.50

----------

Leaving as Hamilton's true one-tenth . . . . . . . . $69,720.58

Page 82 U. S. 213

In this state of things -- and when if Wetmore had been allowed to distribute the one-tenth of Hamilton or his one-tenth less the bank's last-named deduction, it would have paid Hill as well as Wetmore and Corcoran & Riggs, all in full -- one Spain filed a bill against Wetmore, Corcoran & Riggs, and the trustees of the bank, Hill not being by name made a defendant, charging that Wetmore had the $81,772.08 as the property of Hamilton, and that he, Spain, had an assignment of the whole fund made by Hamilton at an early date. The bill then alleged that Wetmore, disregarding this earlier assignment, pretended to hold the fund, subject to certain other alleged assignments of later date, the bill specifying that to Wetmore himself, and those to Corran & Riggs, Hill and the trustees of the bank, and alleging that Wetmore meant to apply the fund to the payment of these last "said recited claims" and that the secretary was about to pay to Wetmore the said sum of $81,772.08. Asserting thus a superior equity, the bill then prayed:

"That the said Wetmore, his assignees, aiders, and abettors, may be enjoined and restrained from receiving the sum of $81,772, being the one-tenth of the three certificates,"

&c. Subpoenas were prayed against all these parties, and that the representative of Hill (Hill himself being now dead) should be made defendant when discovered. An injunction was granted "as prayed for." A bond in the penalty of $15,000, signed by a certain J. F. May and Henry May, in favor of Wetmore, Corcoran & Riggs, and the trustees of the bank, but not by name in favor of Hill, was filed. The writ of injunction was issued on the 31st of May, 1856, directed to Wetmore, Hamilton, Corcoran & Riggs, and the trustees of the bank. It recited the filing of the bill and its object. The restraining clause was in these words:

"You, the said W. S. Wetmore, your assignees, aiders, and abettors, are hereby restrained and enjoined from asking for or receiving the sum of $81,772.08, being the one-tenth part of the bonds or certificates,"

&c.

This writ was served on Wetmore, and Corcoran & Riggs. From that time, until the dissolution of the injunction, hereinafter

Page 82 U. S. 214

mentioned, the money laid idle in the Treasury of the United States. Answers were filed by Wetmore, Corcoran & Riggs, the trustees of the bank, and by the representative of Hill.

On motion of the defendants, it was subsequently thus ordered:

"It appearing to the satisfaction of the court that there is not sufficient security to indemnify the defendants for their costs and damages &c., it is ordered that the complainant file a bond in the penalty of $20,000 conditioned to pay the defendants such costs and damages as they may respectively sustain."

Prior to this, the complainant had released his injunction as to the sum of $12,051, improperly enjoined, and this had been paid by Wetmore to the bank, and a release of the injunction bond executed by the trustees of the bank. The form of that release did not appear in the record.

The second bond, ordered as above-mentioned to be filed, was filed, executed by Spain and Oelrichs. This, by consent of the parties, was ordered to stand in lieu of the bond previously filed, reserving the right of the obligees to have recourse to the original bond for interest theretofore accrued. The obligees named in this bond were Wetmore and Corcoran & Riggs, but not Hill by name. The bond recited the injunction issued by the court to restrain the collection of the money mentioned in the writ; it recited also that certain portions of the money so enjoined had been released and paid over. The condition was:

"That if the said Spain &c., shall prosecute the writ of injunction to effect, and pay as well the costs, damages, and charges that shall occur in said circuit court in Washington County, as all costs, damages, and charges that shall be occasioned by said writ of injunction, and shall in all things obey such order and decree as the said court shall make in the premises, then the obligation to be void and of no effect, otherwise to remain in full force and effect."

The cause being heard, it was decreed, on the 19th February, 1861, 4 years 8 months and 16 days after the injunction had issued:

Page 82 U. S. 215

1. That the legal title to the fund was from the 9th November, 1849, and still is in Wetmore.

2. That from the 16th September, 1850, when the trustees of the bank notified to him their arrangement with Hamilton and he accepted it, Wetmore held the legal title of the one-tenth as trustee of the fund.

First, to pay himself, with interest, the

loan of . . . . . . . . . . . . . . . . . . $ 2,500

Second, to pay Corcoran & Riggs . . . . . . . 30,000

Third, to pay Hill with interest from

9th March, 1852 . . . . . . . . . . . . . . 33,500

From this decree Spain alone appealed. At the December Term 1863, this Court affirmed the decree with costs. [Footnote 1]

Pending the appeal, there being no supersedeas and the decree having dissolved the injunction, the Treasury paid to Wetmore, on 20 March, 1861, the sum remaining due on the one-tenth, $69,720.60.

There had been previously paid to the bank the sum improperly enjoined, to-wit, 30th March, 1859, the pro rata on $12,051.48.

The sum they paid to Wetmore was in three drafts, intended to represent the interests of the parties as settled by the decree, to-wit:

For Wetmore . . . . . . . . . . . . . . . . . $ 4,333.89

" Corcoran . . . . . . . . . . . . . . . . . 30,000.69

" Hill . . . . . . . . . . . . . . . . . . . 35,386.00

----------

$69,720.58

Wetmore and Corcoran & Riggs were paid in full; but on Hill's debt, as found by the decree, $52,457, there still remained unpaid $17,071.

Soon after the injunction was issued in this case, two others were issued on bills filed in the same court, one by the James River & Kanawha Company and one by Pierce Butler. In the former, an injunction bond was executed in the penalty of $5,000, signed by Caperton and others; in the latter, one signed by Butler and others in the penalty of $2,500.

Page 82 U. S. 216

Butler's bill was heard with that of Spain, and subsequent to the decree in that case the James River & Kanawha Company dismissed their bill.

In both of these cases, the bonds expressly included among the obligees Hill's executor, as well as Wetmore and Corcoran & Riggs, while in the two bonds filed in Spain's case, as already said, neither Hill nor his executor was expressly named as obligee.

In this state of things, the only child, heir, and legatee of Hill filed a bill to assert his father's claim for damages occasioned by these several injunction bonds. To aid in this, the representatives of Wetmore as also the executor of Hill were joined as complainants. The securities in the two bonds in the Spain case, May and Oelrichs, and the security in the bond in the James River Company's case, Caperton, were made defendants.

The bill was also filed against Corcoran & Riggs to seek a discovery from them as to whether any settlement had been made with them of the bond in the James River case.

It was also filed to marshal assets, and to assert the right of Hill to the whole of this latter bond, and compel Corcoran & Riggs to resort for payment to the other bonds, they being named as obligees in all, while Hill was named only in one -- provided it should be decreed that the omission to name Hill specifically as obligee in the Spain bonds prevented his looking to them for redress -- a matter which was not conceded.

The bill also stated that Corcoran & Riggs has made some settlement of the $5000 bond, and prayed a discovery.

As to the bond for $2,500 given by Butler, the complainant stated its payment by his representatives; and as to these representatives, the representatives of Henry May, one of Spain's securities, Spain himself, Ellis and Ould, parties to the James River bond, all nonresidents and beyond the jurisdiction -- the bill prayed that process might issue against them if they should come within the jurisdiction.

On this bill, answers, and proofs, the cause was tried and

Page 82 U. S. 217

decrees rendered asserting Hill's right to resort to the Spain bonds for redress of damages, and referring Corcoran & Riggs to the bonds on which they were named and Hill was not; and also allowing both Hill and them to recover counsel fees paid in attending to the injunction. The items thus appeared:

Corcoran & Riggs for damages, interest on

the amount of their lien during the term

payment was delayed by the injunction,

a term of 4 years, 8 months, and 16 days . . . . $8,475.00

Their counsel fees in the adverse litigation . . . 1,000.00

----------

$9,475.00

Deduct the amount they received upon the bond

given in behalf of the James River & Kanawha

Company. . . . . . . . . . . . . . . . . . . . . 5,000.00

---------

Balance . . . . . . . . . . . . . . . . . . . $4,475.00

Of this sum, $2,455.94 was charged on May's bond, and $2,019.06 on Oelrichs'.

To Hill's estate for loss of principal by

reason of the fact that part of the fund

which would otherwise have been applied

to it in part payment was absorbed for

the interest due the prior claims. . . . . . . . $ 827.41

Interest on $36,214.35 for 4 years, 8 months,

and 16 days. . . . . . . . . . . . . . . . . . . 10,230.55

Counsel fees in the adverse litigation . . . . . . 1,500.00

----------

$12,557.96

Deduct the amount received on the Butler bond. . . 2,500.00

----------

Balance. . . . . . . . . . . . . . . . $10,057.96

Of this sum, there was charged to May's bond $5,027.15, and to Oelrichs', $5,030.81.

May and Oelrichs now appealed, and the case was before this Court for final adjudication.

Page 82 U. S. 224

MR. JUSTICE SWAYNE delivered the opinion of the Court.

This litigation grows out of a prior suit to which it is necessary briefly to advert in order to render intelligible the issues to be decided in the case before us.

The Bank of the United States assigned to William S. Wetmore certain bonds of the State of Texas as security for a debt which the bank owed him. He surrendered the bonds to the state and received in their stead certificates of indebtedness which he deposited in the Treasury of the United States for payment, under the Act of Congress of the 9th of September, 1850, and the Explanatory Act of February 28, 1855. The bank thereafter transferred one-tenth of the certificates, less the amount due to Wetmore, to General James Hamilton. Hamilton subsequently became indebted to Wetmore and gave Wetmore a lien upon his share of the fund to secure the payment of the debt and interest. He gave like liens to Corcoran & Riggs, to James Robb & Co., and to H. R. W. Hill. Robb & Co. transferred their claim to Hill. The trustees of the bank also claimed a part of the one-tenth as not embraced in the transfer to Hamilton. Before the fund was paid over by the Treasury Department, Albert C. Spain, as guardian of Mary McCrae, a lunatic, filed a bill in

Page 82 U. S. 225

equity, wherein he asserted a prior and paramount lien upon the fund in behalf of his ward, and prayed an injunction to prevent the defendants from receiving any part of the amount in question until the claim set up in the bill should have been passed upon by the court. To this bill Wetmore and the other claimants, except Hill were made parties defendant. An injunction was granted as prayed for, and on the 31st of May, 1856, an injunction bond was executed. The penalty was $15,000. The obligees were Wetmore and the other defendants. The obligors were John F. and Henry May. The condition was that Spain "should prosecute the writ of injunction with effect and pay all damages and costs" which the obligees, "or any of them, shall sustain by the granting of this injunction." On the 23d of April, 1856, a further bond was given, pursuant to the order of the court, in the penal sum of twenty thousand dollars. The obligees were Wetmore and others. Hill was not one of them. The obligors were Spain and Oelrichs. The condition was that Spain should prosecute the writ of injunction

"with effect and satisfy and pay as well the costs, damages, and charges which shall accrue in said Circuit Court of Washington County, as all costs, damages, and charges which shall be occasioned by said writ of injunction, unless the said court shall decree to the contrary."

By consent of parties, it was thereupon ordered by the court that this bond should be filed in lieu of the prior bond,

"reserving the right to the obligees to have recourse to the original bond for interest theretofore accrued, at the election of the obligees, and not otherwise."

On the 31st of May, 1856, the James River & Kanawha Company having filed a bill and procured a like injunction, gave bond in the sum of $5,000. The obligees were Wetmore and all the other adverse claimants of the fund, including Spain and the executor of Hill. The obligors were Thomas H. Ellis, Hugh Caperton, and Robert Ould. The condition of the bond was that the company

"shall well and truly prosecute the said suit with effect and shall answer all damages and costs which the defendants, or either of them,

Page 82 U. S. 226

may sustain by the granting of this injunction in case it shall be dissolved."

On the 20th of June, 1856, Pierce Butler procured a like injunction and gave bond in the sum of $2,500. The obligees were Wetmore and the other claimants of the fund, including Hill's executor. The condition was that Butler should "pay and satisfy all costs and damages that may accrue to the obligees, or either of them, by reason of said injunction in case the same shall be dissolved." In the progress of the cause, Spain dismissed his injunction as to the claim of the trustees of the bank for the sum of $12,051.50. That amount was paid to them, and they thereupon released their claim under the injunction bonds. By agreement of counsel, the cases of Spain and Butler were heard together. The court decreed that there should be first paid to Wetmore the principal and interest of his debt, amounting together, including the cost of audit, to $4,333.66. That there should be next paid to Corcoran & Riggs the amount of their lien, $30,000. And, thirdly, to the representatives of Hill the debt due to his estate, found to be then, with interest, $52,457.

The amount applicable to this demand, after satisfying the demands of Wetmore and Corcoran & Riggs, was $38,171. This left a balance due Hill's estate of $14,285.54 unsatisfied and unprovided for. The case was removed to this Court by appeal, and the decree of the court below was here affirmed. [Footnote 2] The James River & Kanawha Company dismissed their bill. Corcorna & Riggs subsequently collected upon the bond executed by Ellis, Caperton & Ould the sum of $5,000. The penalty of the bond of Butler, $2,500, was paid to the complainant, J. Dick Hill.

This bill is brought by the executors of Wetmore, the executor of H. R. W. Hill and J. Dick Hill his devisee and only heir-at-law, against John F. May, William W. Corcoran, George W. Riggs, Hugh Caperton, and Henry Oelrichs. It gives sufficient reasons for not making additional parties whose presence would otherwise be necessary, though not

Page 82 U. S. 227

indispensable, in this litigation. The object of the bill is to enforce in favor of Hill's estate the liability for damages arising under the injunction bonds, and if need be to marshal the assets. The executors of Wetmore claim nothing except in trust for the benefit of Hill's estate.

The court below allowed Corcoran & Riggs for damages, interest on the amount of their lien during the time payment was delayed by the injunction, being a period of four years eight months and sixteen days.

The interest, thus computed, makes the sum of . . $8,475.00

The court also allowed them for counsel fees

in the adverse litigation . . . . . . . . . . . 1,000.00

---------

$9,475.00

From this was deducted the amount they received

upon bond given in behalf of the James River

and Kanawha Co. . . . . . . . . . . . . . . . . 5,000.00

---------

Balance . . . . . . . . . . . . . . . . . . $4,475.00

Of this sum, $2,455.94 was apportioned to May's bond, and $2,019.06 to Oelrichs'.

The damages awarded to Hill's estate were as follows:

Loss of principal by reason of the fact that

part of the fund which would otherwise have

been applied to it in part payment was

absorbed for the interest upon the prior

claims. . . . . . . . . . . . . . . . . . . . . $ 827.41

Interest on $36,214.35 for 4 yrs. 8 mos. 16 days 10,230.55

Counsel fees in the adverse litigation. . . . . . 1,500.00

----------

$12,557.96

Deduct the amount received on the Butler bond . . 2,500.00

----------

Balance . . . . . . . . . . . . . . . . . $10,057.96

Of this sum, there was appropriated to May's bond $5,027.15, and to Oelrichs' $5,030.81.

May and Oelrichs appealed, and the case is now before this Court for final adjudication.

It has been insisted by the counsel for the appellants that there is a complete remedy at law, and that the bill must therefore be dismissed. Such must be the consequence if the objection is well taken. In the jurisprudence of the

Page 82 U. S. 228

United States, this objection is regarded as jurisdictional, and may be enforced by the court sua sponte, though not raised by the pleadings nor suggested by counsel. [Footnote 3]

The 16th section of the Judiciary Act of 1789 provides "That suits in equity shall not be sustained in any case where plain, adequate, and complete remedy can be had at law," but this is merely declaratory of the preexisting rule, and does not apply where the remedy is not "plain, adequate, and complete," or, in other words, "where it is not as practical and efficient to the ends of justice and to its prompt administration, as the remedy in equity." [Footnote 4]

Where the remedy at law is of this character, the party seeking redress must pursue it. In such cases, the adverse party has constitutional right to a trial of the issues of fact by a jury. [Footnote 5]

But this principle has no application to the case before us. Upon looking into the record, it is clear to our minds not only that the remedy at law would not be as effectual as the remedy in equity, but we do not see that there is any effectual remedy at all at law. If the injunction bonds were sued upon at law and judgments recovered, a proceeding in equity would still be necessary to settle the respective rights of the several obligees to the proceeds. The direct proceeding in equity will save time, expense, and a multiplicity of suits and settle finally the rights of all concerned in one litigation. Besides, there is an element of trust in the case which, wherever it exists, always confers jurisdiction in equity.

It has been urged that Hamilton's arrangement with the bank was illegal and void and never fulfilled on his part, and that he had no title to the residuum of one-tenth of the certificates to which his assignment related. It is a sufficient answer to say that the trustees of the bank were parties to the former suit and that the court recognized and affirmed

Page 82 U. S. 229

the validity of the claim by administering the fund arising from it. The appellants cannot go behind the decree in the case in which their bonds were given. The law and the facts of that case, as settled by the court, are conclusive of their rights in this proceeding. They cannot be permitted to raise any question as to either.

The release given by the trustees of the bank cannot avail the defendants. If it were not by a sealed instrument, it would not be a technical bar even in a suit at law. In what form it was given is not disclosed in the record. But if it were properly executed under seal, it cannot in equity affect the severable and separate rights of parties to the bonds other than those by whom it was executed.

It is true that neither Hill nor his representatives were parties to either the bond of May or the bond of Oelrichs, and that they were not named in the writ of injunction issued upon the filing of the first bond. But Spain's bill averred that Wetmore held the fund in trust for Hill. Wetmore was an obligee in both bonds. The legal title to the entire fund was in him, and was never divested. It was extinguished by the payment of the money by the Treasury Department, and its distribution pursuant to the decree of the court. Wetmore during his lifetime, and after his death, his legal representatives, might have recovered upon the bonds at law to the full extent of the damages touching the entire fund. Such was his and their legal right. Equity would have distributed the proceeds, if need be, according to his rights and the equities of the other parties in interest. In this case, equity follows the law as regards the liability of the appellants, and, having the proceeds in hand, will distribute them in this proceeding. [Footnote 6]

The objection that proper releases were not filed in the Treasury Department is untenable. The proofs establish three facts:

The fund would have been paid over earlier but for the injunction.

Page 82 U. S. 230

It was paid after the injunction was dissolved.

The delay caused by the injunction was the period for which interest was allowed by the court below.

Whether the payment was, or would have been, improperly made is an inquiry which does not arise in this case, and with which the appellants have nothing to do.

It is sufficient for the purpose of this case that there was in fact such delay and that it proceeded from the cause alleged in the bill.

The decree of the court below was preceded by the report of a master, which the decree affirmed and followed. Upon looking into the report, we find it clear and able, and we are entirely satisfied with it except in one particular. We think that both the master and the court erred in allowing counsel fees as a part of the damages covered by the bonds.

In Arcambel v. Wiseman, [Footnote 7] decided by this Court in 1796, it appeared

"by an estimate of the damages upon which the decree was founded, and which was annexed to the record, that a charge of $1,600 for counsel fees in the courts below had been allowed."

This Court held that it "ought not to have been allowed." The report is very brief. The nature of the case does not appear. It is the settled rule that counsel fees cannot be included in the damages to be recovered for the infringement of a patent. [Footnote 8] They cannot be allowed to the gaining side in admiralty as incident to the judgment beyond the costs and fees allowed by the statute. [Footnote 9]

In actions of trespass where there are no circumstances of aggravation, only compensatory damages can be recovered, and they do not include the fees of counsel. The plaintiff is no more entitled to them if he succeed than is the defendant if the plaintiff be defeated. Why should a distinction be made between them? In certain actions ex delicto, vindictive damages may be given by the jury. In regard to that class of cases, this Court has said:

"It is true that

Page 82 U. S. 231

damages assessed by way of example may indirectly compensate the plaintiff for money expended in counsel fees, but the amount of these fees cannot be taken as the measure of punishment or a necessary element in its infliction. [Footnote 10]"

The point here in question has never been expressly decided by this Court, but it is clearly within the reasoning of the case last referred to, and we think is substantially determined by that adjudication. In debt, covenant and assumpsit, damages are recovered but counsel fees are never included. So in equity cases, where there is no injunction bond, only the taxable costs are allowed to the complainants. The same rule is applied to the defendant, however unjust the litigation on the other side and however large the expensa litis to which he may have been subjected. The parties in this respect are upon a footing of equality. There is no fixed standard by which the honorarium can be measured. Some counsel demand much more than others. Some clients are willing to pay more than others. More counsel may be employed than are necessary. When both client and counsel know that the fees are to be paid by the other party, there is danger of abuse. A reference to a master, or an issue to a jury, might be necessary to ascertain the proper amount, and this grafted litigation might possibly be more animated and protracted than that in the original cause. It would be an office of some delicacy on the party of the court to scale down the charges, as might sometimes be necessary.

We think the principle of disallowance rests on a solid foundation, and that the opposite rule is forbidden by the analogies of the law and sound public policy.

The amount of the allowance in this case may be remitted here, as was done in the case in 3d Dallas, and the decree of the circuit court will thereupon be

Affirmed. Otherwise the decree will be reversed and the cause remanded for the reformation of the decree in conformity to this opinion.

IN CONFORMITY TO THIS OPINION.

[Footnote 1]

Spain v. Hamilton's Administrator, 1 Wall. 604.

[Footnote 2]

Spain v. Hamilton's Adm., 1 Wall. 604.

[Footnote 3]

Parker v. Winnipissiogee Company, 2 Black 551; Graves v. Boston Company, 2 Cranch 419; Fowle v. Laurdson, 5 Pet. 495; Dade v. Irwine, 2 How. 383.

[Footnote 4]

Boyce v. Grundy, 3 Pet. 215.

[Footnote 5]

Hipp v. Baben, 19 How. 278.

[Footnote 6]

Livingston v. Moore, 7 Pet. 547; Riddle v. Mandeville, 5 Cranch 322.

[Footnote 7]

3 U. S. 3 Dall. 306.

[Footnote 8]

Tesse v. Huntingdon, 23 How. 2; Whittemore v. Cutter, 1 Gallison 429; Stimpson v. Railroads, 1 Wall. Jr. 164.

[Footnote 9]

The Baltimore, 8 Wall. 378.

[Footnote 10]

Day v. Woodworth, 13 How. 370, 54 U. S. 371.