
    THE STATE OF NEW YORK v. THE UNITED STATES.
    [No. 16430.
    Decided June 8, 1891.]
    
      On the Proofs.
    
    On the outbreak of the civil war the President calls out troops and requests the governor of New York to buy arms and equipments. The State officers, to raise money for these purposes, issue interest-bearing bonds of the State. They also procure a loan from the canal fund of the State, it being stipulated by the commissioners that interest shall be paid. When the bonds mature the State pays them; when the loan from the canal fund becomes due the State pays it, with interest. The money so borrowed is expended in raising and equipping troops, which are accepted by the General Government. An act of indemnity is passed directing the accounting officers to refund “ the cost, charges, and expenses properly incurred hy said State." They pay the principal of both loans, but refused to refund the interest. The Secretary of the Treasury refers the claim under the Revised Statutes, § 1063.
    
      I.Where a claim was presented, within six years to the prosier Department and never abandoned and never formally rejected, the Secretary, after the lapse of twenty-six years, may refer it to this court, under the Revised Statutes, $ 1063, notwithstanding the statute of . limitations.
    II.Where a State, being requested by the President to raise and equip troops for the service of the General Government, sells its interest-bearing bonds to raise money for that purpose,-the interest paid by the State is a proper subject of indemnity under a statute which directs the accounting officers to refund “the costs, charges, and expenses properly incurred by said State for enrolling, subsisting, clothing, supplying, arming, equipping, paying, and transporting troops
    
    III.But where the State officers took money from an interest-bearing trust fund pledged to creditors of the State, with the stipulation that interest should be paid to the fund for the loan, which was done by the State, it was not a cost, charge, or expense incurred within the intent of the act.
    The Reporters’ statement of the case:
    The following are the tacts of this case as found by the court:
    I. Between the 22d day of April, 1861, and the 4th day of July, 1861, .the State of New York, by its governor, Hon. Edwin D. Morgan, who was the commander in chief of its military forces, and by its other duly authorized officers and agents, enlisted, enrolled, armed, equipped, and caused to be mustered into the military service of the United States, to aid in the suppression of the war of the rebellion, thirty-eight regiments of troops for a period of two years, or during the war, and unmbering in all thirty thousand men.
    II. Such troops were so enlisted, armed, equipped, and mustered into the service of the United States, under and pursuant to the provisions of chapter 277 of the laws of the State of New York, passed April 15, 1861, and which act provided that all expenditures for arms, supplies, or equipments necessary for such forces should be made under the direction of the governor, lieutenant-governor, secretary of state, comptroller, State engineer and surveyor, and State treasurer, or a majority of them, and that the moneys therefor should, on the certificate of the governor, be drawn-from the treasury, on the warrant of the comptroller, in favor of such person or persons as shall, from time to time, be designated by the governor, and the sum of $3,000,000, or so much thereof as might be necessary, was appropriated by the act, out of any moneys in the treasury not otherwise appropriated, to defray the expenses authorized by the act, or any other expenses of mustering the militia of the State, or any part thereof, into the service of the United States. The act also imposes, for the fiscal year commencing on the 1st day of October, 1861, a State tax for such sum as the comptroller should deem necessary to meet the expenses thereby authorized, not to ex ceed 2 mills on each dollar of the valuation of real and personal property in the State, to be assessed, raised, levied, collected, and paid in the same manner as the other State taxes are levied, assessed, collected, and paid into the treasury. (2 Laws of New York, session of 186JL, p. 631, 636.)
    III. There was no money in the treasury of the State in 1861 which was not specifically appropriated for the expenses of the State government, and no money which could be used to defray the expenses of enlisting, enrolling, arming, equipping, and mustering such troops into the service of the United States.
    IV. The fiscal year began on the 1st day of October and ended on the 30th day of September, and the tax rate necessary to raise the tax required for the purpose of raising the moneys necessary to defray the expenses of the State government and other expenses authorized by law, in any fiscal year,,is fixed by the legislature, which convenes on. the first Tuesday in January preceding the commencement of the fiscal year for which the taxes are required; that is to say, for the fiscal year beginning on the 1st day of October, 1860, and'ending on the 30th of September,* 1861, the tax rate was fixed by the legislature which began its session on the first Tuesday ih January, 1860, and the tax rate necessary to defray the- expenditures for the fiscal ye,ar beginning October 1,1861, and ending September 30, 1862,*. was fixed by the. legislature which began its session on the first Tuesday of January,. 1861.
    V. Under the laws of.the. Statepf New Yor.l$ then existing the moneys to be collected for the State taxes could not reach the State treasury.and be made applicable for use in defraying its expenditures until the mouths of April and May of the fiscal year for whichthey were levied, and in some instances not until a later date, and the moneys authorized to b.e raised by the act of 1861, to defray the expenses of enrolling, enlisting, arming, equipping, and mustering in such troops did not reach" the State treasury^ and were not available for use by the State officers in defraying such expenses, until the months of April and May, 1862. The State comptroller, in 1861, made an apportionment of the State taxes among the several counties, and issued to the board of supervisors of each county a requisition requiring such board to cause to be levied and collected and paid into the State treasury the county’s quota of such tax. The board of supervisors were required by law to meet in the month of November for the purpose, among other things, of levying such tax and apportioning it among the several towns of the county and making out a tax roll and warrant to the collector of taxes in each town, for the levy and collection of the town’s quota of the tax into the county treasury, and each town had until the 1st day of February in which to pay its quota of said tax into the county treasury, and the county treasurer had until the 1st day of May in which to pay the quota of the county into the State treasury, and if he failed to pay in the amount by that time the comptroller might report the matter to the attorney-general, who must wait thirty days, or until the 1st day of June, before proceedings could be taken to compel payment.
    VI. The total tax rate of the State, fixed at the session of the legislature beginning on the first Tuesday in January, 1861, was 3J mills, of which 1£ mills was the amount of the tax authorized by chapter 277, and the moneys realized from this tax were paid into the State treasury as follows:
    In January, 1862. $190,403.72
    In February, 1862. 153,792.32-
    In March, 1862........ 696,696.00
    In April, 1862. 170,909.34
    In May, 1862.-... 614,307.09
    In June, 1862. 1,345,671.61
    In July, 1862 . 68,365.27
    In August, 1862...._ 180,023.03
    In September, 1862_ 800,246.93.
    And the sum of, subsequent to October___ 274,590.64
    VII. The State of New York had no other means of raising the money required for the purpose of immediately defraying the expenses of enlisting, enrolling, arming, equipping, and mustering in such troops, except by borrowing money in anticipation of the collection of its State tax; and between June 3, 1861, and July 2,1861, it issued for that purpose bonds in anticipation of such State tax, to provide for the public defense, to the amount of $1,250,000, payable on July 1,1862, except that $100,000 was payable June 1, 1862, at the rate of 7 per cent per annum, payable quarterly, which at that time was the legal rate of interest under the laws of the State of New York. The issue of all these bonds was necessary for the purpose of providing the money required, and the full amount of the face value of such bonds was received by the State upon the sale thereof, and was used and applied by it, together with other moneys, in raising troops, and the entire sum expended by the State for such purpose between the 23d day of April, 1861, and the 1st day of January, 1862, was $2,873,601.19, exclusive of any interest upon the bonds or loans made by the State for that purpose.
    YIII. In addition to the sums aforesaid, the State of New York paid, on account of interest, which from time to time accrued on said bonds issued in anticipation of the tax for the public defense, the sum of $91,320.84, as follows:
    1861.
    October 1st... fl,750.00
    Same date. 2,197.20
    December27th. 22,331.97
    1862.
    January 2d...*... |1,750.00
    Same date. 1,750.00
    March 26th ....... — ... 18,375.00-
    April 1st. 1,750.00
    Same date. 1,750.00
    June 3d...-. 1,166.67
    June 26........... 18,375.00
    July 1st. 1,750.00
    Same date. 1,750.00
    September 26th______ 16,625.00
    Total.. 91,320.84
    And by chapter 192 of the laws of the State óf New York of the session of 1862, passed April 12, the legislature specifically appropriated the sum of $1,250,000 “for the redemption of comptroller’s bonds issued for loans to the treasury in anticipation of the State tax to provide for the public defense, imposed by chapter 277 of the laws of 1861, reimbursable, viz: $100,000 on the 1st day of June, and $1,150,000 on the 1st day of July, 1862, and the further sum of $91,320.84 for the payment of the accruing interest on said bonds.”
    IX. Of the remainder of the above sum of $2,873,501.19 necessarily expended by the State of New York for the purpose aforesaid between April, 1861, and January, 1862, after deducting the amount of $1,250,000, raised by issue of bonds, the sum of $1,623,501.19 was taken from the canal fund, so called, of the State, which fund, under the constitution of the State, is a sinking fund for the ultimate payment of what is known as the canal debt of the State.
    Under the tax rate of 1860 there had been levied and collected and paid into the treasury of the State the sum of $2,039,063.06 for the benefit of and to the credit of the canal fund, which moneys reached the treasury of the State in April and May, 1861, and were then, in the treasury to be invested by the State officers, pursuant to the requirements of law and the constitution of the State, in securities for the benefit of the canal fund, and the interest accruing on which must be paid into that fund, and on May 21, 1861, the lieutenant-governor, comptroller, treasurer, and the attorney-general, who constituted the commissioners of the canal fund, authorized the comptroller to use $2,000,000 of the canal-fund moneys for military purposes until the 1st day of October next, and $1,000,000 until the 1st day of January, 1862, at 5 per cent, and of this amount the sum of $1,623,501.19 was used by the comptroller for the purpose of defraying the expenses of raising and equipping such troops. The following is the order:
    “State oe New Yoke, Canal-Department,
    “Albany, May 21, 1861.
    “The comptroller is to be permitted lo use two millions of dollars of the canal fund monies for military purposes until the first day of October next, when the commissioners of the canal fund will invest one million of dollars of the canal sinking fund under section 1, article 7, in the tax levied for military purposes until the 1st of July, 1862, at five per cent, and the comptroller may use one million of dollars of the tax levied to pay interest on the $12,009,000 debt until the 1st of January, 1862, when the commissioners will, if they have the means, replace that or as large an amount as they may have the means to do it with from the toll of the next fiscal year, so as that the whole advance from the canal fund on account of the tax be two millions of dollars. It is, understood the comptroller will retain the taxes now in the process of col lection, for canal purposes until the above investments are made, paying the funds five per cent interest therefor.
    “Endorsed: Wo assent to the within-named arrangement, Albany, May 22,1861.
    “ R. CAMPBELL,
    “ Lieut. Govr.
    
    “Robert Denniston,
    “P. Dorsheimer,
    “Ohs. G. Myers,
    “ Gomm’s of the Oanal Fund.”
    
    
      On December 28, 29, and 31, 186!, the United States repaid to the State, on account of moneys so expended, the sum of $1,113,000, leaving the sum of $510,501.19 unpaid of the moneys which had been used from the canal fund, and which sum was jfiaced to the canal fund, with interest, on April 4, 1862.
    The amount of interest at 5 per cent, per annum on the moneys so used of the canal fund during the time it was used by the State for the public defense, in raising troops, was $48,187.13. But during the same time the State had received interest on portions of the moneys while it was lying in bank unused to the amount of $8,319.95, and the net deficiency of the State on account of interest on such moneys during the period which they were so used was $39,867.18, which sutn was paid into the canal fund from the State treasury April 4,1861.
    X. The total amount of the sum so paid by the State of New York for interest upon its bonds issued in anticipation of the tax for the public defense and of the amount placed by it in the canal fund for moneys used of that fund, as aforesaid, for the purpose of defraying the expenses of raising and equipping such troops, is $131,188.02; and no part of the same has been paid to the State of New York by the United States, nor has the State been reimbursed therefor, or for any part thereof, by the United States.
    XI. On September 5, 1861, the Federal War Department, by a general order, directed all persons having authority to raise volunteer regiments, batteries, or companies in the State of New York to report to Hon. Edwin D. Morgan, governor of the State, at Albany, and they and their commands were placed under the command of Oovernor Morgan, who was given authority' to reorganize them and. prepare them for the service in such manner as he might deem most advantageous for the interest of the General Government. ■ The order also provided that all commissioned. officers of such regiments,batteries, or companies now in service, raised in the State of New York independent of the State authorities, might receive commissions from the governor of the State by reporting to the adjutant-general of the State and filing in his office a duplicate of the muster rolls of their respective organizations.
    XII. On September 28, 1861, Governor Morgan was commissioned a- major-general in the military' service of the United States, and on October 26,1861, a new military department was created, to be called the Department of the State of New York, and placed under the command of Governor Morgan, as major-general of volunteers in the service of the United States, with headquarters at Albany.
    XIII. On June 27, 1861, Hon. William H. Seward, Secretary of State of the United States, telegraphed to Governor Morgan, acknowledging that New York had furnished 50,000 troops for service in the war of the rebellion, and thanking the governor for his efforts in that direction, and on July 25,1861, Secretary Seward telegraphed Governor Morgan: “ Buy arms and equipments as fast as you can. We pay all.” And on July 27, 1861, that “ Treasury notes for part advances will be furnished on your call for them.” And on August 16, 1861, Hon. Simon Cameron, then Secretary of War of the United States, telegraphed to Governor Morgan: “Adopt such measures as may be necessary to fill up your regiments as rapidly as possible. We need the men. Let me know the best the Empire State can do to aid the country in the present emergency.” On February 11, 1862, Hon. Edwin M. Stanton, Secretary of War, telegraphed Governor Morgan: “The Government will refund the State for the advances for troops as speedily as the Treasurer can obtain the funds for that purpose.”
    Governor Morgan continued to be major-general of volunteers in the Federal military service until about the expiration of his term of office as governor, on the 1st day of January, 1863, when he tendered his resignation, which was subsequently accepted.
    XIV. The moneys above specified, which were actually expended by the State of New York, were necessarily paid out and expended for the purpose of enlisting, enrolling, subsisting, clothing, supplying, arming, equipping, paying, and transporting such troops, and causing them to be mustered into the military service of the United States, where they were employed in aiding to suppress the insurrection which then existed against the Government of the United States, known as the war of the rebellion, and was so paid and expended at the request of the civil and military authorities of the United States.
    XV. A large portion of such expenditures were made and incurred by the Hon. Edwin D. Morgan, governor of the State, while acting in that capacity, and pursuant to his authority as such major-general.
    XVI. Prior to January 3,1889, the State of New York had presented, from time to time, various claims and accounts to the Treasury Department of the United States, for settlement and allowance, for the charges and expenses incurred by it in enlisting, enrolling, arming, equipping, and mustering into the military service of the United States such troops, which claims amounted in aggregate to $2,950,479.46, and included charges for all the moneys paid and placed as here-inbefore specified. That such Department has allowed thereon, from time to time, various sums, amounting in the aggregate to $2,775,915.24, leaviug a balance $174,564.22, not allowed, and the claims and accounts for which were pending in said Department unadjusted on said 3d day of January, 1889.
    That pf said sum of $ 174,564.22, not allowed by the Treasury Department, the sums hereinbefore specified, amounting to $131,188.02, constituted a part, and on said 3d day of January, 1889, the Hon. Charles S. Fairchild, then Secretary of the Treasury of the United States, transmitted to this court, under section 1063 of the Revised Statutes of the United States, the said claim of the State, of New York, so pending in said Department, for said sum of $131,188.02, together with the vouchers, proofs, and documents relating thereto on file in said Department, to be proceeded with in this court according to law.
    The claim of the State of New York for expenditures and expenses in furnishing troops with clothing and munitions of war, as, §et forth in the foregoing fiudings, was filed in the Treasury Department in May, 1862, which claim included said item for interest, and said claim for interest has from said time been suspended in said Department, and was so suspended at the time the matter was transmitted to this court.
    
      Mr. I. S. Maynard and Mr. George K. French for the claimant.
    The act of July 27,1861, constitutes a statutory contract of indemnity on the part of the United States with the several States furnishing troops as therein specified, and the payments made by the State of New York, for which this claim is filed, having been actually and necessarily made for the purpose contemplated by that act, they became part of the expenditures made by the State which the Federal Government has obligated itself to reimburse.
    These statutory contracts are the highest and most solemn form of governmental contracts, and in all cases they are to be construed as contracts, and not as mere legislative enactments. (Ruideeooper,s Lessee v. Douglas, 3 Crunch R., L; 1 Peters’s Condensed Rep., 446; State Bank v. Knoop, 16 How., 369; Cor-bin v. Board, of County Comrs., 1 McCrary, 521; Sinking Fund Cases, 99 U. S. R., 700; Fletcher v. Peek,, 6 Cranch, 87; New Jersey v. Wilson, 7-id., 166; Dartmouth College Case, 4 Wheat., 518; Keith v. Clark, 97 U. S. R., 454.)
    Troops could not be enrolled, equipped, and mustered into the public service without the immediate expenditure of money. The State could not expend money which it did not have in its public treasury. It could, and it did, immediately provide for the levy of a tax upon its citizens to meet these expenditures, but the laws for the collection of taxes must be complied with, and the machinery for their collection could not be moved and applied so speedily as to bring the money into the treasury in season for.its use by the State in enrolling and equipping and mustering in the troops called for by the Federal Government.
    The interest was necessarily paid, and whether it was paid to the persons of' whom the. purchases were made, for the equipment of the troops, or whether it was paid to other persons for cash advances by them, which-was used in making payment for such- purposes, is entirely immaterial. It is within the terms of the contract-in either case; and-if not refunded to the State by the-Federal Government, the contract of the latter in this respect is broken and repudiated-. The State of New -York is willing to stand upon' the contract which the Government made with it, and-upon the strength of which these moneys were paid out.
    In construing this act','the circumstances'under which it was passed are also to be taken into consideration in determining the legislative intent. The emergency was great; the life of the nation was in peril'; troops were imperatively - and promptly required; the Federal Treasury was empty; the State treasury was also empty, and under the Constitution and laws of New York, whatever money was in the treasury was there specifically appropriated for particular objects, and no part of it could be used for any other purpose. The Federal Government beseeches the State government to send it troops, and, in substance, says: “We will reimburse you for all proper expenses incurred in our behalf.”
    All of these things were either matters of public contemporaneous history, or were contained in the constitution and public statues of the State, and were presumably well known to Congress when they passed the act in question; and it must have been contemplated that the State would, for the time being, make use of its own credit for the purpose of raising money to immediately provide the necessary troops for the public defense, and that whatever might be paid out by the State for the use of money so raised would be deemed a part of its expenses incurred for the benefit of, and at the request of, the General Government.
    If we refer to the title of the act of 1861, we will find that the intent of Congress, as expressed by the title, is very clear, and that it was intended to include all expenses incurred by the State in defense of the United States. It reads: “An act to indemnify the States for expenses incurred by them in defense of the United States.” .
    The word “indemnify” has both a present and a future meaning. It means either: “1. To save harmless; to secure against future loss or damages;” or “2. To make up for that which is past; to make good; to' reimburse.” (Webster’s Dictionary.)
    The object of the act, as expressed in the title, will not be satisfied by a partial reimbursement of the expenses ‘incurred by the States for the purposes indicated in the act. The words employed in the act itself, viz: “ Costs, charges, and expenses,” for which reimbursement is to be made, embrace the expenditure which is the foundation of this claim. The terms “ costs” and “charges” there used are probably included in the term “ expenses,” which is the plural of “ expense,” which is defined to be either: “ 1. The act of expending, laying out, or consuming by using; disbursement; outlay; consumption;” or, “2. That which is expended, laid out,or consumed; cost; outlay; charge; as the expenses of war.” (Sullivan v. Triumph Mining Company, 39 Cal., 459; Foster v; Goddard, 1 Cliff., 158; 1 Black, 506; Dashiel v. Mayor, etc., of Baltimore, 46 Md., 615; Dun-woodie v. The United States, 22 C. of Ols. K., 269.)
    There is another familiar rule of statutory construction which should be observed in the application of this act of 1861, and it is, that “ what is implied in a statute is as much a part of it as what is expressed.” (United States v. Babbitt, 1 Black, 55, 61.)
    And the opinion of the court in that respect in this case has been quoted with great emphasis in many subsequent decisions of the Supreme Court of the United States. (Oelpeke v. City of Dubuque, 1 Wall, 221; Groxall v. Sherrard, 5 id., 288; United States v. Hodson, 10 id., 406; Telegraph Company v. Eiser, 19 id., 427; Bullcley v. United States, 19 id., 40.)
    Prior to the adoption of the act of 1861 the Executive Departments of the Government, upon the settlement of claims and accounts for reimbursement of expenses paid by States or individuals for the use or for the benefit of the United States, had universally allowed the claimant whatever sums he may actually have paid out for interest on moneys raised or used for the benefit of the United States, not by way of interest upon any claim that he might have against the General Government, but as a part of the expenses actually .incurred and paid by claimant, and for which reimbursement should be made by the United States.
    (1.) The question arose very early in the history of the Government, under the act approved April 18, 1814 (6 Stat. L., Private Laws, 139), which enacted “That the Secretary of State be and he is hereby directed to liquidate, according to the principles of justice and equity, all the claims of the inhabitants of the late province of West Florida, now included within the limits of the State of Louisiana or of Mississippi Territory, for advances by them, made for the use and benefit of the United States, prior to and since the taking possession of the said late province of West Florida by the United States.”
    Under this act the State Department allowed interest for advances made for the use and benefit of the United States, as appears from the Act of Congress, passed April 9, 1819 (3 Stat. L., 422), and the Act passed April 11, 1820 (id., 560; 5 Op. Atty. Gen., p. 308). *
    (2.) Similar claims, under statutes not so broad in their terms as the act of 1861, were allowed and paid by the Treasury Department for the expenses of furnishing troops in the Florida war of 1838 and 1839. (Act August 23,1842,5 Stat. L., 522; Act August 31, 1842, id., 578; Act March 3, 1843, id., 628; Joint Resolution April 30,1844, id., 716; Joint Resolution March 1, 1845, id., 797; Act approved February 27, 1851, 9 id., 571.)
    It will be seen by reference to the opinion of the Attorney-General of the United States, in a letter addressed by him to the Secretary of War, that the Treasury Department had allowed and paid under these several acts the sum of $95,588.63, a part of which consisted in the payment of bonds issued by the Territory of Florida for the purpose of raising money to defray the expenses of the Territorial militia in the war of 1838 and 1839, and that these bonds, to the full amount, principal and interest, were allowed and paid by the Treasury Department. (5 Op. Atty. Gen., 460.)
    (3.) The precise point involved in this claim was decided favorably to the claimant by the Treasury Department in a case reported in the first volume of the Digest of Second Comptrollers’ Decisions, at page 137, referring to volume 15 of the Office Eecords.
    This decision of the Second Comptroller not only holds that interest, when paid by a State for the benefit of the United States, becomes a part of the principal debt of the latter to the State, which is all that we contend for in the present case, but it also holds that, under the rules and regulations of the Department governing the adjustment of similar claims of the several States, the same principle has been applied.
    Prior to the action of the Treasury Department in the case of the State claims arising under the act of 1861, we have been' unable to find any case reported or alluded to where any Executive Department having jurisdiction and authority to pass upon the claim has refused to allow the claim of a State or any individual for interest paid upon- moneys advanced or loans made for the use and-benefit of the United States.
    The Department of Justice of the United States has uniformly held, in a long series of opinions, that payments made or expenditures incurred by the States, or by individuals, for. interest upon loans or advances made for the use and benefit of the United States, constitute a just and legal claim against the Federal Government, and can properly be allowed by the accounting officers: having jurisdiction to settle the accounts and claims presented wherein such expenditures appear. (1 Op.- Atty. Gen., 542, 568; 2 id., 841; 5 id., 71, 108) 463.
    Hon. Benjamin Harris Brewster, Attorney General, construing' this very act of 1861, in a letter to the Secretary of the Treasury, dat< d July 23, 1883.
    Congress is presumed to have enacted the statute of 1861, in view of the decisions and opinions of the Executive Departments with reference to the construction and application of such laws; and if there is any ambiguity or doubt with reference to the true construction of the act of 1861, the prior decisions and opinions of the Executive Departments should have a controlling weight and the law should be construed in harmony with such decisions and opinions. (United States v. Sill, 120 U. S. It., 169; United States v. Philbriolc, id., 52; Brown v. United States, 113 U. S., R. 568; Halm v. United States, 107 IT. S. B., 402, 406; United States v. Pugh, 99 U. S. R., 265,269; United States v. Moore, 95 TJ. S. R., 760-763.)
    This departmental construction of such laws became as much a part of the law of 1861 as if it had been expressly incorporated in it, and will be respected and adopted by the courts in construing and applying the act of 1861.
    Independently of the act of 1861, the United States is liable for the expenditures upon which this claim is founded, for the reason that such expenditures were made at the request or by the direction of the heads of Executive Departments, and for the purpose of maintaining the executive authority of the Goverpment; and the governor of New York, in making or authorizing the expenditures, was acting as the agent of the Federal Government and by virtue of his authority as a major-general of volunteers in the military service of the United States.
    In view 'of the circumstances in which the General Government was placed, and in which the State found itself, it must be admitted that the expenditures for which reimbursement is claimed in this action were necessary. There has not as yet been even a suggestion that the State of New York could have in any other way responded to these urgent requests of the General Government except by anticipating her State tax, by borrowing money and paying interest thereon.
    The allowance of this claim is not prohibited by section 1091 of tbe Revised Statutes of tbe United States nor by tbe rule adopted by tbe General Government, that interest shall not be paid upon claims against it.
    Tbe State of New York does not ask nor seek to recover in this action any interest upon any claim which it has against tbe General Government. This is an important distinction, to be constantly borne in mind in considering this case, and tbe failure to observe this distinction led the accounting officers into error. There is not a dollar of this claim which represents interest upon any money paid out of her treasury to meet the expenses of-raising and equipping troops for the Federal service.
    It should be borne in mind that the State of New York did not issue bonds having a long period of time to run, and that they are not seeking the repayment of interest upon that class of bonds which may have been issued for the purpose of relieving the citizens of the State from the burden of immediate taxation. On the day after hostilities were begun the legislature ordered a tax to be levied for the purpose of raising the money to meet, these expenditures, and the interest paid was only for the short period of time which must necessarily intervene between the levy of such a tax and the payment of the money into the State treasury upon its collection. The bonds were not issued, the money was not borrowed, the interest was not paid, to relieve her own people, but simply to enable the General Government to immediately put in the field the troops needed for the public defense.
    
      Mr. Henry M. Foote (with whom was Mr. Assistant Attorney-General Cotton) for the defendants.
    Assume that by the act of July 27,1861, certain contract relations between the United States and the State of New York were established: The United States are not by this controversy seeking to annul or abridge the terms of such contract, but, on the contrary, are undertaking to place a construction upon it and measure the extent of their obligations thereunder, and are not, as the bent of the argument suggests, seeking to impair the obligations of any contract which may exist by reason of the act recited through the interposition of any law.
    The proposition, however, that certain contract relations between the Federal and State Government were established by reason of the act of the 27th of July, 1861, is open for discussion and invites earnest opposition. Without entering into an extended discussion upon the rights, duties, and responsibilities of the States under their federation, as manifested by the Constitution adopted for that purpose, we think it sufficient for the purposes of this argument to remark that each State as an integral part of the Union is bound, under the very nature and terms of its compact with all the other States, to maintain and defend the existence of such unity. That under the Constitution there exists an obligation upon the part of each State government to respond to the demand of the representative authority of the General Government whenever the existence and maintenance of such Government is threatened or assailed.
    This obligation arises, as was said by Chief-Justice Chase in the case of Texas v. White (7 U. S. R., 700), from the obligation of the United States to guarantee to every State in the Union a republican form of government. When, therefore, the insurrection threatened these established relations between the States, it became the constitutional duty of the State of New York to respond to the call of the General Government for aid in suppressing this insurrection. “It could not avoid this responsibility. A refusal to respond to this demand would have been an act of insurrection,” as much so as armed resistance against its authority.
    That this duty or obligation resting upon the State was recognized is shown by the payment to the General Government of its pro rata share of the war tax under the act August 5, 1861. This being the status of the State, how can it be said that it required the act of July 27,1861, to establish these contract relations. It did not, as we have seen, and the act only became effective upon the performance of a duty otherwise enjoined upon the State. Tlie statute in question, speaking for all the States, declares that from the Treasury of the General Government the State of New York shall be reimbursed the expenses for doing that which under the Constitution she was bound to do. This much as to the reciprocal rights and duties of the State of New York.
    This discussion is not only for the purpose of answering the theory advanced that duties and responsibilities were assumed by the United States under the act independent of preexisting obligations to the General Government resting upon the State, but also for the further purpose of meeting the fanciful doctrine of agency disclosed by the argument, which for various other reasons can have no application in this controversy. If, as we have seen, there was enjoined upou the State of New York a duty to respond to the call of the General Government, how can it be said that any officer could increase or diminish the responsibility of the Government commensurate with a performance of such duty.
    The special duties assigned to Governor Morgan as a major-general were not to create any liability upon the part of the United States, for that had already been done prior to his appointment, but rather that, as a military agent of the Government, he should accept from the State such troops as she was obligated to furnish. The fallacy of this contention is further shown when it is considered that Governor Morgan was not made a major-general for any purpose until September 28,1861, while this claim originated in June prior to that date.
    The claim as shown comprises two separate and distinct items, one for $39,867.18 and the other for $91,320.84. The former, as we have seen, originates as interest upon $1,619,-110.78, being money in the treásury of the State collected for canal purposes, and the other originates as interest upon $12,-500 in bonds issued by the comptroller to various persons and corporations in the State of New York,
    In commenting upon the uniform practice of the Executive Departments in allowing claims of this character, counsel have only been able to call attention to two cases where a construction has been placed upon certain acts of Congress, refunding interest paid by States, the first being that of Hon. William Wirt, Attorney-General (1 Op., Atty. Gen., 542), relating to the claim of Virginia, and the other being the opinion of Hon. John J. Crittenden, Attorney-General (5 Op. Atty. Gen., 463), relating to the claim of the State of Florida.
    In the case of the State of Virginia, as will be observed, while the language of the Attorney-General is cited quite at length, there is no analogy in tüe case cited as applied to this. The opinion proceeded upou a construction of the Act of June 6,1825 (4 Stat. L., 132), expressly providing for the payment of interest in these words:
    “ That the proper accounting officers of the Treasury be and they are hereby authorized and directed to liquidate and settle the claim of the State of Virginia against the United States, for interest upon loans or moneys bonowed and actually expended by her for the use and benefit of the United States during the late war with Great Britain.”
    And the disputed question arose in that case from a blending of moneys borrowed by the State with those actually in the Treasury, and also by loans made necesssry for State purposes by reason of the State funds having been exhausted for war purposes. Upon this complex condition of affairs the Attorney-General placed a construction upon the act especially authorizing the payment of interest to the extent of its having been paid by the State, and it will be observed that the opinion does not attempt to place a construction upon a statute which is silent in regard to a liability upon this subject, and if a reference is had to prior opinions of that officer (pp. 494 and 550, same opinions), it will be discovered that the doctrine of such liability is squarely repudiated in the absence of express legislation. Without a careful reading of the opinion cited by counsel, it would not be unnatural to commit the same error so manifestly committed by them in applying it to a doubtful or ambiguous case; but when the opinion, as applied to the statute and facts in controversy, is considered, it will be seen that it has no application here, except to demonstrate our contention, that, in order that a liability to refund interest so paid by a State shall accrue, such liability must be expressly created by statute.
    The State of Florida case cited by counsel (5 Op. Atty. Gen., 463) grows out of the act of February 27, 1851 (9. Stat. L., 573), the language of which is as'follows:
    “For reimbursing the State of Florida, under such rules and regulations as have heretofore governed the adjustment of similar claims of the several States on the United States for moneys advanced and paid, and for expenses incurred and obligations contracted by said State for subsistence supplies, services of local troops called into service during the year 1849 by and under the authority of said State, $75,000.”
    The Attorney-General did not place a construction upon this act independent of prior acts expressly providing for the payment of interest, but adopted said acts as defining the scope of the words “ such rules and regulations as have heretofore governed.” * * *
    
      'Note the language of his opinion (p. 461):
    “That reimbursement is to be uuder the rules which have governed the adjustment of similar claims of the several States of the United States, viz, by an act approved May 13, 1826 (4 Stat. L., 161). The accounting officers of the Treasury were directed to liquidate and settle the claim of the State of Maryland against the United States for interest upon loans of money borrowed and actually expended by her for the use and benefit of the United States during the late war with Great Britain.
    “By the Act of March 22, 1832 (4 Stat. L., 499), the proper accounting officers of the Treasury were directed to liquidate and settle the claim of the State of South Carolina against the United States for interest upon money actually expended by her for military stores for the use and benefit of the United States during the war with Great Britain.
    “ By an act to refund money for expenses incurred or transportation furnished for the use of volunteers during the present war before being mustered into the service of the United States, approved June 2,1848 (9 Stat. L., 236), it was enacted in section third, “that in refunding moneys under this act it shall be lawful to pay interest, at the rate of six per cent per annum, on all sums advanced by States, corporations, or individuals in all cases where the State, corporation, or individual has paid or lost interest or is liable to pay it.
    “An act approved January 26, 1849 (Sess. Acts, p. 344), directed the Secretary of War to pay the State of Alabama interest upon advances made by tlip State for the use of the United States Government in the suppression of Indian hostilities by the Creek Indians in 1836 and 1837 at the rate of six per centum per annum * * * That no interest shall be paid on any sum on which the State of Alabama did not either pay or lose interest.”
    The Attorney-General expressly refers to these various acts as being the rules which have heretofore governed the adjustment of similar claims of the several States upon the United States. Thus it will be seen that the Florida case does not support the position contended for by claimants, and that the opinion of the Attorney-General is only valuable as placing a construction upon certain words of the act of 1851 by the adoption of prior statutes, which required no construction, but provided in express terms for the payment of interest.
    In this connection it may be proper to observe that the opinions cited in the personal claims of Joseph de la Francia and the executor of George Galphin were no doubt prompted by the relief afforded under the provisions of the Act of June 
      2,1848. And if the opinion of the court in the case of McKee (10 0. Cls. it., p. 234) is consulted, it will be found that the mandatory clause of the act under which interest was allowed provided that “ the court shall be governed by the rules and regulations heretofore adopted by the United States in the settlement of like cases,” precisely the same language as that which influenced the Attorney-General in his opinion in the Florida case.
    It will therefore be seen that the invariable rule of construction relied upon by counsel becomes a decidedly limited one, and has no application except in cases where a statute to become effective provides for the adoption of prior statutes in its construction. And the Act of July 27, 1861, contains no such provision or rule of construction.
    We contend that it has been the invariable rule of construction by the executive officers of the Departments that interest is not to be paid except where a statute expressly authorizes its payment, or adopts the language of prior statutes as a rule to govern such construction.
    In the case of the east Florida claims (3 Op. Atty. Gen., 639), Attorney-General Crittenden says:
    “It is confidently believed that in all the numerous acts of Congress for the liquidation and settlement of claims against the Government there is no instance in which interest has ever been allowed, except only where those acts have expressly directed or authorized its allowance.”
    Attorney-General H. S. Legaré (4 Op. Atty. Gen., 136) said :
    “ The Government in general has refused to pay interest in the absence of a special contract to that effect.”
    In the opinion of Attorney-General John Nelson (4 Op. Atty. Gen., 294) the invariable rule of disallowing claims for interest is stated, and he adds:
    “ That the omission in the act of 1834 to direct the payment of interest should, under the circumstances, be regarded as a recognition of the settled practice of the Department to disallow it, and that, therefore, the executive authority can not be properly exerted in subversion of its own uniform rule of action and this significant sanction of it by Congress.”
    In the case of certain Florida claims Attorney-General Crit-tenden (5 Op. Atty. Gen., 333-353) reaffirms the opinion of Attorney-General Nelson in tbe suggestion “that the question of interest is not open for discussion,” and states “ that the rule has ever been followed.”
    In the claim of Kedin Blunt, under the Florida treaty with Spain, Attorney-General Cushing (6 Op. Atty. Gen., 533-541) says:
    “ The decisions of the preceding Secretaries of the Treasury that interest is not allowable on such claims is to be considered as res adjudicates, and binding on the present Secretary.”
    And again, the same Attorney-General, in a very elaborate opinion, well worth considering (7 Op. Atty. Gen., 523), reaffirms the rule so often stated, that the Government is not to pay interest in the absence of legislation, and also refers to various acts of Congress authorizing the payment of interest, as indicating that these exceptions were an innovation upon the general rule; and in commenting upon the cases of La Francia and Galphin, cited by counsel, says “ that neither of them is susceptible of expansion or generalization as doctrine.”
    And again, Attorney-General Black, in the claim of the State of Maryland (9 Op. Atty. Gen., 57), says:
    “As a general rule the Government never pays interest upon a debt except under a special contract or a special law expressly providing for the payment of interest.”
    Page 59, he adds:
    “ But if Congress has all the money in the United States under its control, it also has the whole English language to give it away witlq and it is so easy to use definite terms in a law like this, that when they are not used we will presume them not to be meant.”
    To the same effect is the opinion in the claim of De Groot (p. 450, same opinions). The same learned jurist in the earlier case tersely remarked:
    “That the general phrase ‘principles of justice and equity’ do not enlarge the claim ; justice and equity will not give him one cent more than he is entitled to by law.”
    And, lastly, we have the opinion of Hon. Attorney-General Brewster, filed in this case, wherein many of the cases referred to are cited and their reasoning applied, thereby completing the. almost unbroken chain of authorities, from the earliest history of the Government down to the present time, .in favor of disallowing claims of this character.
    
      If we examine tbe various acts of Congress upon this subject this intention will become apparent. It required legislation especially authorizing the payment of interest in the claims of the States of Virginia, Alabama, Georgia, Maryland, and South Carolina, and in many cases of personal relief, as we have seen. A notable illustration of our contention is found in the 1Resolu-tion of March 3, 1847 (9 Stat. L.,-207), wherein—
    “The Secretary of War is hereby authorized and required to cause to be refunded to the several States or to individuals for services rendered, acting under the authority of any States, the amou/nt of expenses incurred by them in organizing, subsisting, and transporting volunteers.” * * *
    Notwithstanding this resolution, it was found necessary to pass an amendatory act June 2,1848 (Stat. L., 23G), authorizing the payment of interest in all cases where the State or individual paid or lost the interest, or is liable to pay it before such interest could be paid. Here we have a declaration of the intention of Congress in framing the act of March 3, 1847, by Congress itself in this subsequent legislation, and it will be observed that the act of March 3, 1847, is almost identical in phraseology to the act of July 27, 1861.
    It seems to us that little more remains to be said. We,have analyzed and applied the cases cited by counsel, and have endeavored to direct the attention of the court to a long line of precedents in support of our position ; we have shown an almost unbroken line of authorities emanating from the best jurists in the United States all in support of the action of the ac-accounting officers of the Treasury in this and similar cases, and if it were necessary to suggest to the court that these authorities ought not to be overruled without cogent reasons, and that long uninterrupted practice under a statute is good evidence of its construction, we would refer to MeKeen v. Delaney (5 Crancli, 22; 111 U. S. R., 412; 95 IT. S. R., 760; and 113 U. S'. Tí., 568).
    We may say, however, in this connection that it was not intended by Congress to enlarge the jurisdiction of the court upon the subject in controversy, but rather that such jurisdiction should not be exercised unless expressly provided for by contract under the provisions of section 1091 of the Revised Statutes of the United States.
    This section is therefore valuable as expressing the intention of Congress that interest is not allowable unless expressly provided for by statute, thus adding another precedent to those already cited in support of the rule herein contended for.
    If, therefore, Congress expressly withheld from this court jurisdiction in a claim for interest incident to an indebtedness, it may’with great propriety be urged that jurisdiction is also denied whenever the claim presented is entirely one for interest after the principal had been fully paid.
   Weldon, J.,

delivered the opinion of the court:

The petition alleges that the defendants became indebted to the claimant, on the 1st day of July, 1862, for money laid out and expended to and for the use of defendants, a,t their request, in the sum of $3,131,188.02, and of this there has been paid the sum of $3,000,000, leaving a balance due the petitioner of $131,188.02.

It is further alleged that the necessity of said expenditure grew out of the wants of the Government in the early i>art of the civil war, and that, for the purpose of maintaining national authority through their proper officers, said defendants requested the State of New York, in common with other States, to provide means and munitions of war for the use of the Government; that in pursuance of such request the claimant did provide and render to the United States a large number of troops, and did equip the same with arms, clothing, and munitions of war, and did also render to the Government arms and munitions in addition to such as were required for the use of troops enrolled in the State of New York; that in equipping-said troops and in furnishing said material for other troops the said State expended the sum of $3,000,000; that in complying with said request so made by the defendants in furnishing equipments for troops, the claimant was compelled to borrow a large part of said sum, there not being in the treasury of said State funds sufficient to meet said expenditure; that bonds of said State were issued upon which claimant was compelled and did pay a large amount of interest, to wit, the sum of $131,188.02; that under the act of Congress of J uly 27,1861, a portion of the expenditure of said claimant has been paid by defendants, but there still remains unpaid a portion of the costs, charges, and expenses properly incurred by said State iii enrolling, subsisting, clothing, supplying, arming, equipping, paying, and transporting said troops as aforesaid, to wit, the amount paid by the State of New York for interest, the said sum of $131,188,02 5 that after the payment of said sum, and within six years from such payment, a claim for said amount was presented to the Secretary of the Treasury, and such proceedings were thereon had in the Treasury Department and before the proper officer thereof, to wit, the Second Comptroller, that on or about the 23d day of December, 1869, the question of said claim for interest so paid by the State of New York as aforesaid against the United States was suspended, subject to future decision; and thereafter, on or about the 7th day of June, 1882, the said claim and the question of the validity thereof was presented to the Attorney-General of the United States for his opinion, and said Attorney-General thereafter, and on or about the 23d day of July, 1883, rendered his opinion thereon, and the same was filed in the Treasury Department of the United States, which opinion is to the effect that said claim of the State of New York does not come within the provisions of the act of July 27, 1861. Thereafter such proceedings were had in the Treasury Department in the matter of said claim that, at the request of said claimant by its attorney in fact, on or about the 3d day of January, 1889, the Secretary of the Treasury did, under the provisions of section 1063 of the He vised Statutes of the United States, transmit the said claim, with all the vouchers, papers, proofs, and documents pertaining thereto, to the Court of Claims, there to be proceeded in accordance with law.

The findings in substance tend to maintain the allegations of the petitions, except in the amount actually paid by claimant as interest on the funds used in the purchase of material and the payment of expenses incident to the equipment of troops.

Of said $131,188.02 the sum of $39,867.18 is based upon the following state of facts:

Under the tax rate of 1860 of said State there had been levied, collected, and paid into the treasury of said State the sum of $2,039,663.06 for the benefit of the canal fund, which money reached the treasury in April and May, 1861, and was then in the treasury, to be invested by certain State officers, pursuant to the law and requirements of the constitution of the State, in securities, for the benefit of the canal fund.

Oil the 21st day of May, 1861, the lieutenant-governor, comptroller, treasurer, and attorney-general, who constituted the commissioners of the canal fund, authorized the comptroller to use $2,000,000 of the canal-fund money for military purposes until the 1st day of October following, and $1,000,000 until the 1st day of January, 1862, at 5 per cent, and of this amount the sum of $1,623,501.19 was used by the comptroller for the purpose of defraying the expense in raising and equipping troops as aforesaid.

On December 28, 29, and 31, 1861, the United States repaid to the State on account of moneys so expended the sum of $1,113,000, leaving the sum of $510,501.19 unpaid of the moneys which had been used from the canal fund, and which sum was placed to the canal fund, with interest, on April 4, 1862,

The total amount of interest on the money so used from the canal fund, during the time that it was used by the State for the public defense, in raising troops, was $48,187.13. But, during the same time, the State received interest on some portions of the money, while it was lying in bank, to the amount of $8,319.95, and the net deficiency of the State on account of interest on such moneys during the period which they were so used is $39,867.18, which sum was paid into the canal fund from the State treasury April 4,1862.

The order made by said State officers under and by virtue of which the money of the canal fund was appropriated is as follows:

“State or New York, Oakal DepartmeNt,
Albany, May 21, 1861.
“ The comptroller is to be permitted to use two millions of dollars of the canal fund monies for military purposes until the first day of October next, when the commissioners of the canal fund will invest one million dollars of the canal sinking fund under section 1, article 7, in the tax levied for military purposes until the 1st of July, 1862, at five per cent., and the comptroller may use one million of dollars of the tax levied to pay interest on the $12,000,000 debt until the 1st of January, 1862, when the commissioners will, if they have the means, replace that or as large an amount as they may have the means to do it with from the toll of the next fiscal year, so as that the whole advance from the canal fund on account of the tax be two millions of dollars. It is understood the comptroller will retain the taxes now in the process of collection for canal purposes until the above investments are made, paying the funds five per cent interest therefor.,
“Endorsed: We assent to the within-named arrangement, Albany, May 22, 1861.
R. Campbell,
“Lieut. Oovr.
“ Robert Dennison,
“P. Dorsheimer,
“ Ohs. G-. Myers,
Gomm’s of the Canal Fund.”

The amount of money actually paid as interest on the bonds issued is $91,320.84, and the amount of interest credited to and paid into the canal fund for the money used of said canal fund is $39,867.18; those two sums make in the aggregate the sum of $131,188.02, and for that amount this proceeding was commenced and is prosecuted.

Incident to the commencement of the civil war, which was inaugurated in its hostilities by the bombardment of Fort Sumter by the Confederate forces, there arose an emergency and crisis in the history and condition of the United States .which called for the most effective and vigorous measures of military preparation on the part of the Federal power to maintain its authority, and to preserve from dismemberment the union of the States. And although the requisition of the 75,000 troops provided for in the first proclamation of the President was thought to be adequate, the subsequent development and magnitude of the insurrection demonstrated the inability of that force fo accomplish the purpose of reestablishing the national supremacy in the States assuming to exercise the right of secession and the maintenance of that right by military force.

At the time of the commencement of the war Congress was not in session, and the executive department was compelled to avail itself of all the constitutional means within its power to deal with an existing state of hostility, and for that purpose, on the 15th of April, 1861, the President issued a proclamation calling for the militia of the several States, “ in order to suppress combinations and cause the laws to be duly executed.”

Upon the same day the legislature of New York passed an act making an appropriation of $3,000,000 to be applied in the expenditure for arms, supplies, and equipments for the soldiers mustered into the service of the United States in the suppres-8 ion of the rebellion; and every assurance was given by tbe executive branch of the Government that the State would be reimbursed in its expenditures in complying with the requirements of the President.

The same proclamation which called for 75,000 men called an extra session of Congress for the 4th day of July following; and in pursuance of that proclamation the first session of the Thirty-Seventh Congress was held.

On the 27 day of July, 1861, Congress passed an act entitled “An act to indemnify the States for expenses incurred by them in defense of the United States, as follows:

“That the Secretary of the Treasury be, and he is hereby, directed, out ofany moneys intheTreasury not otherwise appropriated, to pay to the governor of any State, or its duly authorized agents, the costs, charges, and expenses properly incurred by said State for enrolling, subsisting, clothing, supplying, arming, equipping, paying, and transporting, its troops employed in aiding in suppressing the present .insurrection against the United States, to be settled upon proper vouchers to be filed and passed upon by the proper accounting officers of the Treasury.” (12 Stat. L., 276.)

On the 8th of March, 1862, Congress passed a joint resolution as follows:

“ Whereas doubts have arisen as to the true intent and meaning of an act entitled ‘An act to indemnity the States for expenses incurred by them in defense of the United States,’ approved July 27th, 1861.
“JBe it resolved by the Senate and Souse of Representatives in Congress assembled, That the said act shall be construed to •apply to expenses incurred as well after as before the date of the approval thereof.”

Some question was made in the brief and oral argument of the counsel for the defendants as to proper pendency in this court of these proceedings because of the statute of limitations.

In the case of Finn v. The United States (123 U. S. R. 227) it is decided:

“ It is a condition or qualification of the right to a judgment against the United States in the Court of Claims that the claimant, when not laboring under any one of the disabilities named in the stat*e, voluntarily put his claim in suit or present it to the proper Department for settlement within six years after suit could be commenced thereon against the Umted States.”

The findings in the present ease show, that in 1802, in less than one year after the origin of the claim, the claimant presented it to the proper Department for adjudication and payment, and that from that time until the commencement of this case it was pending in the Department as an unadjusted claim. The State never abandoned it, and the United States through its proper officers never formally rejected it. It was pending in the Treasury Department, within the meaning of the decisions of the Supreme Court and this court, at the time it was transmitted under the order of the Secretary of the Treasury, as shown in the record.

It was not res judieataj.&nd does not come within the law laid down in the case of Jackson v. The United States (19 C. Cls. R., 504), and State of Illinois v. The United States (20, id. 342).

The court having jurisdiction of the claim, it must be disposed of on its merits.

It is manifest from the legislation that Congress intended to approve the action of the executive department in the assurance that the States would be reimbursed in their expenditures incident to the enrollment of the militia in defense of the national authority.

It is not necessary to examine and discuss the obligations of the States in such an unprecedented condition of the Federal Government. It is sufficient to assume that the liability of the defendants in this case depends upon the construction of the act of 18G1, and the joint resolution of 1862.

If the claim comes within the scope and terms of the act of 18G2, the plaintiff has the right to recover; if it does not, there is no liability.

The aggregate of the demand is $131,188.02, and is composed of two items, originating in different forms.

Ninety-one thousand three hundred and twenty dollars and eighty-four cents compose a claim for interest paid by the State on bonds issued by it for the purpose of raising money to defray the expense incident to the enrollment of the soldiers for the national service.

The findings show that the Treasury o$ the State of New York, at the time the call was made, was deficient in the funds requisite to meet the expense, and that it was necessary to negotiate bonds at 7 per cent interest to supply that deficiency. The said sum of $91,320 is the amount of interest paid on those bonds.

The other item, $39,867.18, of the claim is for an alleged expense growing out of the use of certain funds coming into the treasury of the State prior to October 1, 1861, and which were to be invested by the State officers, pursuant to the requirements of law and the constitution of the State, in securities for the benefit of the canal fund.

In connection with this item of claim it may be said that no interest was paid by the State of New York; it simply failed to realize for the benefit of the canal fund certain interest which by the investment of the money appropriated for the use of the defendants, it might otherwise have saved to that fund.

We will consider the rights of the claimants as to each demand separately. It is contended on the part of the claimant that both items come legitimately within “costs, charges, and expenses,” as provided by the act of July, 1861, while the defendants insist., that as to both items of claim it is an attempt to compel the United States to pay interest on an alleged obligation where they have not expressly agreed to do so.

Section 1091, Eevised Statutes, provides:

No interest shall be allowed on any claim up to the time of the rendition of judgment thereon by the Court of Claims, unless upon a contract expressly stipulating for the payment of interest.”

In the case of Tillson v. United States (100 U. S. R., 43) it was in substance decided:

“ Where the claim of a party for loss and damage growing out of the alleged failure of the United States to perform its contracts with him, as to time and manner of payment, is, by special act of Congress, referred to the Court of Claims, ‘ to investigate the same, and to ascertain, determine, and adjudge the amount equitably due, if any, for such loss and damage : ’ Held that the rules of law applicable to the adjudication of claims by that court in the exercise of its general jurisdiction must govern, and that interest, not having been stipulated for in the contracts, can not be allowed thereon.”

It is not necessary to speculate upon the question of the liability of the Government for the payment of interest as such. The statute and decisions are plain and uniform on that subject, and unless there is an express contract to that effect no interest can be recovered. If this demand is in law a claim for interest, in the common and judicial sense of that term, there being no express undertaking to pay interest in and by the words of the statute on which the suit is based and from which the obligation is deduced, no liability exists. It is contended by the claimant’s counsel that this is not a proceeding to recover interest as such, but that the demand comes within that clause of the statute providing indemnification to the State for “ costs, charges, and expenses ” incurred by it in furnishing troops under the call of the President.

A liability upon the part of the Government to pay interest can not arise from implication, for the reason that the statute defining the jurisdiction of the court expressly declares that no interest shall be allowed on any claim up to the rendition of the judgment thereon in the Court of Claims, unless upon a contract expressly stipulating for interest.

Regarding the statute as bavingAhe force of a contract, it has no provision from which by construction it can be inferred that the defendants assumed to pay the claimant any interest as such upon any advances made by it in defraying the expenses of the troops furnished the United States in pursuance to the proclamation of the President.

The law being, that the Government does not pay interest except where the contract or statute expressly provides for the payment of interest, it is unnecessary to examine the many cases referred to by the very able argument of the counsel for the Government. If this is a proceeding to enforce the payment of interest, then the authorities relied on by the defendants are conclusively decisive of this case, and the judgment must be for the defendants.

It was not the duty of the State of New York, as one of the States of the Federal Union, acting independently, to suppress the insurrection of 1801; but it was its duty to comply with all constitutional requisitions of the Central Government, in its efforts to maintain the authority of the United States, and to enforce the law of Federal jurisdiction.

The findings show, that, in responding to the call of the President for men and means, the authorities of the State did everything in their power to comply with the Federal requisition, and in so doing not only availed themselves of the taxing power of the State, but the public credit of the State government sought the money market to replenish the treasury of the State, in defraying the expenses incident to the call of the President.

In appreciation of the alacrity with which the authorities acted, Congress on the 27th of July, 1861, twenty-three days after the convention of the houses, passed the act upon which the claimant now seeks satisfaction and compensation.

It is alleged on the part of the claimant that—

“The act of July 27,1861, constitutes a statutory contract of indemnity on the part of the United States with the several States furnishing troops as therein specified, and the payments made by the State of New York, for which this claim is filed, having been actually and necessarily made for the purpose contemplated by that act, they became part of the expenditures made by the State which the Federal Government has obligated itself to reimburse.” (Huidekoper’s Lessee v. Douglas, 3 Cranch, R., 1-70.)

The demand of the claimant does not necessarily require that it should maintain the full legal import of this proposition, as the statute of our jurisdiction provides that this court shall have jurisdiction of “All claims founded upon the Constitution of the United States or on any- law of Congress.” (24 Stat. L., 505.)

If by the terms of the act of July, 1S62, Congress assumed to pay the claimant the kind and character of charges represented by the interest paid by the State, and have not done so, the right of the State to recover is clear and unquestionable; and the only question for us to decide in this connection is, whether the payment of interest on bonds issued by the claimant comes within the terms “costs, charges, and expenses properly incurred by said State.”

In determining that question, we must not lose sight of the fundamental proposition of law, that the Government is not liable for interest, unless it has expressly obligated itself to pay interest, and it is not pretended that it has done so in this matter. Whatever may be said in the construction of this statute, the fact remains that the claimant in the payment of interest to its bondholders disbursed and expended its money as effectually as though it had paid money directly from the treasury to some person from whom it had purchased clothing and munitions of war.

If the State of New York had limited its effort in complying with the request of the General Government to its actual resources of money in the treasury, it might have been the performance of its duty literally; but if the resources of its credit were opened to it, and it did not avail itself of that resource, the spirit of its obligation would have been violated to the detriment of the public service, and perhaps to the prejudice of the final success of the Federal power. The statute, it will be observed, is broad and liberal in the use of terms defining the obligation of the United States, “ costs, charges, and expenses.”

In the construction of a law somewhat similar to act of July, 1862, Mr. Wirt, Attorney-General of the United States, gave an opinion, stating,

In constructing this law, it is proper to advert to the principle on which it was founded and to the object which it proposes to effect. The principle is this: The United States are bound by the relation which subsists between the general and State governments to provide the means of .carrying on war, and, as a part of the business of war, to provide for the defense of the several States. When the United States fails to make such provision, and the States have'to defend themselves by means of their own resources, the expenditure thus incurred forms a debt against the United States which they are bound to reimburse. If the expenditures made for such purpose are supplied from the treasury of the States, the United States reimburse the principle without interest; but if, being itself unable, from the condition of its own finances to meet the emergency, such State has been obliged to borrow' money for the purpose, and thus to incur a debt on which she herself has had to pay interest, such debt is essentially a debt due by the United States, and both the principal and interest are to be paid by the United States. So that whenever a State has had to pay interest by reason of her talcing the place of the United States in time of war, such interest forms a just charge against the United States. If a State borrows the money at once, on the first occurrence of the emergency, and expends the specific money so borrowed, both the borrowing and the expenditure being flagrante bello, there seems to be no doubt that the claim, both for the principal and the interest which she would have paid upon such loan, would be a fair charge against the United States on the principle of this law? (1 Op. Atty. Gen., 723.)

Although this opinion was given before the statute forbidding the payment of interest was passed (March 3, 1863, Rev. Stat., 1091), it is important to be considered, in making a legal distinction, between interest actually paid and interest on funds in the Treasury at the time the requisition was made.

“ It has been the general rule of the officers of the Government in adjusting and allowing unliquidated and disputed claims against the United States to refuse to give interest. That this rule is sometimes at variance with that which governs the acts of private citizens in a court of justice would not authorize us to depart from it in this case. The rule, however, it not mere form, and especially is it not so in regard to claims allowed by special acts of Congress or referred by such acts to some Department or officer for settlement.” (McKee’s Case, 91 U. S. R., 442, and 11 C. Cls. R., 72.)

In the performance of the duty under the call, the officers of the State purchased the required munitions of war so long as they had funds; and when they had no money, the government still needing the supply, they paid out money for the use of money, in order that the State might fully discharge every possible duty in the restoration of Federal authority. The payment of interest was a cost properly incurred by the claimants under the requisition of the President, and comes within the letter of the act of July, 1862, and for that item the claimants have a right to recover.

The second item of claim for $39,867.18 originates in a different form. There was no absolute payment of interest. Under the State policy of New York a portion of the tax is devoted to what, is called the canal fund, and upon this fund the State is in the habit of receiving interest, the same being loaned for the benefit of that fund.

The appropriation of the canal fund for the purpose of defraying-the expense of equipping the troops of the United States was in the pursuance of the following order:

“ State oe New York, Canal Department,
“Albany, May 21, 1861.
“The comptroller is to be permitted to use two millions of dollars of the canal fund monies for military purposes until the first day of October next, when the commissioners of the canal fund will invest one million of dollars of the canal sinking fund under section 1, article 7, in the tax levied for military purposes until the 1st of July, 1862, at five per cent., and the comptroller may use one million of dollars of the tax levied to pay interest on the $12,900,000 debt until the 1st of January, 1862. when the commissioners will, if they have the means, replace that or as large an amount as they may have tbe means to do it with from the toll of the next fiscal year, so as that the whole advance from the canal fund on account of the t>ix be two millions of dollars. It is understood the comptroller will retain the taxes now in the process of collection for canal purposes until the above investments are made, paying the funds five .per cent, interest therefor.
.“Endorsed: We assent to the within-named arrangement.
Albany, May 22,18G1.
“ R. CAMPBELL,
" Lieut. Gov’t. “Robert Denniston,
“P. Dorsiietmek,
“Ohs. G-. Myers,
Comm’s of the Canal Fund.”

The amount of interest on the money so used of the canal fund during the time it was used by the State for the public defense in raising troops was $48,187.13. But during the same time the State had received interest on a portion of the funds while it was lying in a bank unused to the amount of $8,319.95, and the net deficiency to the State on account of the interest on such money is $39,867.18.

Upon the payment of the money into the treasury from which this interest would have accumulated it became the money of the State, and would have so remained after it became a part of the canal fund. While different departments are provided in the State as well as the National Government, they constitute a part of an indivisible unity; and transactions between the different departments are the official act of the same political power.

The money is transferred from one department to another, or from one fund to another, but it can not be said that by the transfer there is a lending of money, upon which by any fiction of law interest can be calculated. By the use of the canal fund for the purpose of defraying the expense of raising troops the State simply appropriated from a particular fund, which, if permitted to become a part of that fund, might have been loaned on interest. It can not be said that the United States borrowed the money at the agreed rate of interest which other customers would have paid the State, as there is no express or implied obligation to that effect. The State paid no money directly for the use of the money belonging to the canal fund. There may have been an accounting to that fund from some other financial resource of the State; but that transaction was entirely between the different departments of the government which constitute the political organization of the State of New York.

If an allowance is made for the loss on that fund, it is in effect an allowance of interest against the United Statps on an obligation in and by which they have not expressly agreed to pay interest. During the time the money was diverted from the canal fund to the purposes of the United States the State simply lost the use of that amount. The interest charged on the trust fund can not be said to be an “ expense incurred ” within the meaning of the law of 1862, as the State did not assume any liability, nor pay any money beyond the actual funds appropriated and paid in the purchase of materials, and the payment of the expenses of the transportation of troops. In the claim for $91,320.84 a different element exists.' The claimant actually paid that amount of money to creditors who had advanced money on the bonds of the State, which had been issued to defray the costs, charges, and expenses properly incurred “ by the State in enrolling, subsisting, clothing, supplying, paying, and transporting” troops employed by the defendants in suppressing the insurrection against the authority of the United States.

In the discussion and determination of the question of the liability of the United States to' remunerate the claimant we must not lose sight of what is so fundamental, not only in the laws of the United States and decisions of the Supreme Court, but in the jurisdiction of this court, that the defendants are not liable for interest as such unless they have expressly agreed to pay interest. In subordination to that well-established principle of the law the purpose and construction of the act of 1862 imfst be ascertained and determined. Whatever may be said of the liability of the defendants in the absence of said statute on the first item of claim, it is clear that for the second they would not be liable; because it is for interest upon an obligation in which they have not expressly agi eed to pay interest.

In the legal statement of a cause of action, founded upon the transactions of 1861, between the plaintiff and defendants, the pleading must necessarily allege that the $39,867.13 was interest upon certain advances made by the State, which interest was lost by the claimant because the money was not invested in interest-bearing obligations due the State. The' marked difference between the two items of claim is, that in one there was an actual payment of money by the State in complying with the requisition of the General Government; while in the other there was no payment, but a failure to receive interest because of a diversion of the fund as herein indicated.

It does not affirmatively appear that the f«nd upon which the claim of $39,867.18 is based could for the period of time it was used by the State for the benefit of the defendants have been loaned; and if during that period other money of that fund was unemployed, the said fund would have been a surplus in the treasury of the State, and no interest was lost to the claimant.

It* has been the rule of the Department and the policy of the Government not to pay interest upon claims against the United States, founded on the reason that the Government is always ready to pay all just claims, and if such claims are not paid it is the fault of the claimant in not presenting his claim in apt time, or in not presenting in such a way as to convince the officers of the Government of its lawfulness and justice.

It will be observed that Mr. Attorney-General .Wirt makes the distinction between the payment of interest upon money borrowed to enable the State to discharge its duty and fulfill its obligation, and interest upon funds in the treasury of the State appropriated for the use and benefit of the United States. The allowance of interest “ as expense charges and costs ” in the construction of the act is in derogation of the general policy of the Government in not paying interest, and should not be extended beyond the logical limits of the act of 1862.

The Chief Justice is of opinion that—

“The claimant is seeking indirectly to recover interest contrary to Revised Statutes, section 1091, which prohibits its allowance ‘unless upon a contract expressly stipulating for payment of interest.’
“The case was transmitted to this court by the Secretary of the Treasury as a claim for interest alone.
“Interest on temporary loans made to obtain money for equipping, etc., troops for the United States is no more a charge against the Government under the act of 1861 (12 Stat. L., 276) than is interest on long-time bonds issued by many States for the same purpose, computed to time of payment by the Government, for which it is conceded the United States are not liable.
“In either case interest paid constitutes no part of the ‘ costs, charges, and expenses properly incurred by said State for enrolling', subsisting, clothing, supplying, arming, equipping, and transporting its troops’ within the meaning of the act. It is paid for another purpose, to wit,' for the use of money raised to supply an empty treasury; an indirect expenditure, dependent upon collateral contingencies, upon the different conditions of the treasuries, and the different and uncertain legislation of the several States for raising money by taxation, obviously not within the contemplation of Congress, and never allowed by the Treasury Department to any State under this act.
“An unequal application of the statute in the different States could not have been intended by Congress.
“If the claim be not for interest within the intent and meaning- of the .Revised Statutes, section 1091, then, as one for the cost of supplying money to the State treasury, it is not unlike a claim for the cost of assessing and collecting taxes for the same object, sooner or later to be incurred, and which, whether incurred before or after the expenditures, it is apprehended nobody would contend could be maintained under the act of 1861.
“Decisions of the courts and opinions of the Attorneys-Geueral before the enactment of the prohibition against allowing interest, and before the passage of the act upon which this suit is founded, or independently of them, can have no bearing on this case which must be governed by the existing statutes and the intention of Congress.”
“The only Attorney-General’s opinion upon the interpretation of the act of 1861 is that of Attorney-General Brewster on this very claim, wherein he advised against its validity (17 Opinions Atty. Gen., p. 595).”

It is the judgment of the court that the claimant recover the sum of $91,320.84 and that the $39,867.13 be disallowed.

Nott, J.,

dissenting:

The term interest covers two distinct things — compensation for the use of money by express agreement; damages' allowed by law for the nonpayment of a debt after it has become due. It is the latter which is prohibited in this court in suits against the Government by the Revised Statutes, section 1091.

As to the ürst item of money expended in the payment of interest upon the bonds of the State which were sold to raise money for the General Government, I concur in the opinion of my brother Weldon. As to the second item, of money expended in the payment of interest upon a loan obtained from the canal commissioners for the use of the Government, I dissent.

The grounds upon which I dissent are: First, that in order to shield the defendants from making good this loss it is necessary to hold that a State government can do an unconstitutional act; or, to express it differently, that the unconstitutional act of State authorities must be deemed the act of the State itself; second, that a substantial loss has been incurred hereby the claimant, which the defendants are in honor and good conscience bound to make good, and the intent of the act of indemnity is that the loyal States, which acted on behalf of the General Government during the civil war, shall be reimbursed and made whole; third, that the restriction of the Eevised Statutes (§ 1091) prohibiting the recovery of interest as damages in suits against the Government is not applicable to this case, inasmuch as the contract loaning the money expressly provides for the payment of interest, and was ratified by the acceptance of the money and the payment of the principal.

In the application of the act of indemnity to the case, the initial fact of the transaction must be borne in mind. The State of New York was not a corporation whose business was to raise and equip troops for any Government that chanced to be engaged in a civil war, but, on the contrary, the President of the United States, in the awful crisis of the hour, went to its officers and asked that the resources of the State be given in aid of the General Government. The legislature was not then in session, and the State officers had no authority, constitutional or legal, to pledge the credit of the State or involve it in financial liability. From motives of the highest patriotism they assumed an enormous responsibility, and proceeded to act on behalf of the General Government. But in their action they were not the agents of the State, nor acting on its behalf, nor assuming to promote its interest. If they were anybody’s agents, they were the agents of the General Government, and for their unauthorized acts the General Government is in law and morals and under the terms of this act of indemnity bound to make good the losses which the unauthorized acts of these officers caused the State.

This, then, being the status of the parties, the governor and comptroller proceeded to borrow money, not for tbe use and benefit of the State nor by its authority nor at its request, but for the use and benefit and at the request of the General Government. They borrowed from two sources, from ordinary lenders who had money to invest, by selling them the interest-bearing bonds of the State, and from a board of trustees known as the commissioners of the canal fund, who had moneys in their hands to loan on interest-bearing securities and only on interest-bearing securities. In course of time these loaus matured, and the State assumed and paid them, principal and interest. The General Government, under the act of indemnity, has paid the principal which the State expended for its use, but has refused to pay the interest.

When the General Government requested the State officers to act in its behalf they might have proceeded in one of three different ways. They might have bought the military supplies on an indefinite credit, and «allowed the vendor to add the unknown and undetermined interest to the price; they might have purchased by contracts bearing interest, which would run until the price should be paid by the General Government; they might have borrowed monéy on interest and bought the goods at the lowest price for cash. As to the first method, there can be no question that if it had been pursued the Government would have been liable for the price paid. As to the second method, there can hardly be a question as to tbe Government’s liability for both principal and interest- As to the third method, it is the one which has occasioned the controversy of the present suit. Yet from a business point of view the first method was the worst, and the third, as every man of business knows, was the best. The eminent merchant who was then the governor of the State proceeded as he would have proceeded for a brother merchant. He raised the money and went into the market and purchased at the lowest cash price.

The money which the State of New York, through its officers, thus expended at the request and for the use of the United States was not in its own treasury, but was procured from two sources:

First, the State issued and sold its own bonds, bearing 7 per cent interest. The General Government lost nothing by that. The credit of the State was better than the credit of the General Government, and a saving was effected by the State loaning its own credit for the proenrement of the necessary funds. It was able at that time both to buy and to borrow on better terms than the principal for whom it was acting. It has charged nothing for the use of its credit thus loaned, and is merely seeking to be repaid the money which it expended.

The second source from which money was procured for the use of the United States was the canal fund of the State of New York. This fund was, so far as the State was concerned, a sinking fund for the reduction of a public debt; but it was also an interest-bearing trust fund, pledged to a designated class of creditors. I emphasize the statement that it was an interest-bearing fund; for it was in no sense an accumulation of idle money in one of the coffers of the State, but was in fact and in contemplation of law a mass of interest-bearing securities held and accumulated for the future liquidation of a specific debt, and was at the same time pledged to the holders of the debt. The commissioners ®f the fund had no right to hoard the money which came to their hands, and had no right to loan it without interest. The scope of their duties was to invest, and to invest at interest, and the purpose of the fund, the chief, if not the sole purpose, was that money from time to time accumulated for the extinction of the canal debt should not lie idle in the treasury of the State, but should be invested in securities which would yield, until the debt matured, that profit which we call interest.

If the State had issued more bonds than it did for money wherewith to serve the General Government, and the canal commissioners had gone into the market and bought these bonds, the circumlocution would doubtless have saved the State from the delay and vexation which beset this branch of the case, and would have made plain to all minds that the State had incurred obligations and loaned its credit and paid interest, not for its own use or benefit, but for the use and benefit of-the General Government. Yet this circuity of procedure would not have made the State any better off or the General Government any worse. The principle which would have governed and the result which would have been reached would have been the same.

If this charge of interest had been a mere act of the State officers, whereby the State made interest which otherwise it would not have made, the charge would be in the nature of a profit and beyond the scope of an instrument of indemnity. But in the actual case before the court the canal fund existed long before the General Government came to the State as a borrower. It had been created and was regulated by the constitution of the State. Whoever got money from the canal fund must take it on. the terms prescribed by the constitution. Neither the State officers nor the State legislature nor the General Government nor any power known to our constitutional system could take it upon any other.,terms or authorize it to be taken. Neither could it be applied to any purpose or business of the State; and whatever might be received from a loan in' the way of interest, did not go into the treasury of the State, but returned to the fund. The State itself had no power over the canal fund. Undoubtedly the State was directly interested in the fund as a public debtor, and undoubtedly the legal title to the fund was vested in the State; but beside the State was another party equally interested in the fund, the public creditors, who had loaned money upon the faith of it, and who were in law a cestui que trust and in equity the owners of the fund.

Accordingly, when the governor and comptroller of the State, who were practically acting as agents of the United States, sought a loan from the canal fund, to be expended for the uses and purposes of the General Government, they proposed and agreed to the constitutional condition of interest, and expressly agreed that the loan should bear interest at the rate of 5 per cent. The canal commissioners had no authority to make the loan without interest, and they did not assume to do so; and the State subsequently recognized the obligation which it owed to its creditors, and paid the interest on this specific loan out of money raised by taxation ; that is to say, the taxpayers of New York made good to the canal fund the interest which would otherwise have been realized from ordinary securities ; but the United States have not yet reimbursed them for the taxes that both in form and in fact were devoted to that purpose. These are in brief the ultimate facts of the transaction. The question of law involved is whether the act of indemnity extends to them.

The act of indemnity is not a statute to regulate the purchase of supplies or to restrict the compensation of purchasing agents. If the State of New York had been a merchant selling goods for the sate of profit, or a commission merchant rendering service in consideration of a percentage, it would bave to take the profits or losses which legally resulted. But the State rendered its service gratuitously; it had nothing to make, and as the result proves a risk to bear, and it acted at the request of the Government. The obligation which would rest upon an individual in such a case would be to make the other party whole, and it would be an obligation of the strongest character — legally, equitably, morally. The General Government has recognized this obligation and has passed this act of indemnity. The purpose of an act, as of an instrument, of indemnity is to make the injured party whole. It is not a grant; it is not one of thóse statutes m which doubtful words or phrases are to be strictly construed; an interpretation which leaves the injured party without the indemnity which he ought to have is an interpretation which fails to carry into effect the confessed purpose of the statute. If an individual or a body corporate had accepted the fruits of the loan and recognized the transaction by paying the principal, his acts would constitute a binding ratification. The act of indemnity must surely be as broad as the legal obligations of the United States.

As has been said, the State was called upon to act for the General Government, and acted by borrowing money to raise and equip troops. All of this money was expended in the business and on behalf of the United States. Some of it was borrowed from ordinary lenders, by the. State selling its own bonds; some of it was borrowed from a trust fund, of which the State was the trustee. When the interest on the bonds became due the State took the money of its taxpayers and paid it. When the interest on the other loan became due the State likewise took the money of its taxpayers and paid it also. To that extent the taxpayers of the State are just so much the worse off than they would be if the State officers had never touched the trust fund and borrowed from it for the use of the General Government. Both in form and in substance this interest was money paid. In form, the transaction complies with the terms of the act of indemnity; in substance, the distinction between interest lost and interest paid is too refined to be applied against the purpose of the statute.

And this distinction necessarily rests on the constructively illegal action of the State officers. That is to say, if the custodians of the fund acted in a constitutional and legal manner by loaning tbe trust moneys in tbeir charge to the United States through the intermediation of the governor and comptroller of the State at an agreed rate of interest, the refunding of the interest was an expenditure for the use of the Government 3 but if they acted in an unconstitutional and illegal manner, by diverting, misappropriating, or misapplying the trust fund to State purposes, then the State can not make money out of the transaction, and the General Government is not liable.

Scofield, J., was absent when this case was argued and took no part in the decision.  