
    DE BOW & CO.’S CASE.
    E. E. Norton, assignee of De Bow & Co., v. The United States.
    
      On the Proofs.
    
    
      On the 2ith June, 1865, restrictions on commercial intercourse between Neio Orleans and places on the roest bank of tlie Mississippi are removed by the President’s proclamation of that date. On the same day the Treasury agent in New Orleans, being ignorant of the issuing of the proclamation, exacts from the owner of cotton brought in from the west bank the one-fourth of the value thereof required by the Act 2d July, 1864, and the Treasury Regulations 9th May, 1865. The owner, likewise ignorant of the proclamation, pays the amount, executes the necessary papers, and receives the cotton. By the terms of the transaction the eotton is delivered to him freed from the payment of all fees and internal-revenue taxes. The claimant noto brings his action to recover back the moneys thus paid.
    
    I. It must be held from the nature of the decision that the Supreme Court intended to decide in La' Peyre’s Case (8 C. Cls. R., p. 165) that the claimant had primarily a good cause of action, i. e., that his payment of a bonus or fee to a Treasury agent for a license to bring cotton into New Orleans in June, 1865, under the non-intercourse acts was not a voluntary payment made in ignorance of law, all restrictions having then been abrogated by the President’s Proclamation 24i7i June, 1865, but the owner and agent being ignorant of the existence of the proclamation.
    II. A voluntary payment made in mutual mistake of law cannot be recovered back; but where a man’s goods are in the possession of an officer who has no authority to retain them, yet exacts the payment of a fee as a condition to restoring them, the payment, in contemplation of law, is not voluntary, though both parties believe it to be legal, in fact acting in ignorance of law.
    III. The fact that cotton was restored to the owner freed from all “fees ” and “taxes,” does not preclude him from recovering back a bonus or license-fee illegally exacted by the Treasury agents in New Orleans in June, 1865, and by them paid into the Treasury. If the Government lost a tax by the transaction which it was entitled to receive, the right may be asserted by set-off.
    
      IV. No action can be maintained to recover back the bonus or license-tee exacted as a condition to commercial intercourse under the Aot Sit July, 1864, (13 Stat. L., p. 769,) and the Treasury Regulations 9th May, 1865, so long as they continued in operation.
    
      The Reporters’ statement of the case:
    The court found the following facts:
    I. On the 12th June, 1865, there arrived at New Orleans, on the steamer Gray Eagle, from Vicksburgh, one hundred and twenty-five bales of cotton belonging to Samuel De Bow & Oo., the claimant’s assignors in bankruptcy. At that time no shipments of cotton to New Orleans were allowed, except such as were consigned to the purchasing-agent of the Treasury. On the 13th June, 1865, De Bow & Oo. executed a bill of sale of all the cotton to the purchasing-agent at an expressed consideration of $9,625.98, and the purchasing-agent executed to them another bill of sale of all the cotton at an expressed consideration of §12,834.64. De Bow & Oo. thereupon paid to the Treasury agent the difference, viz, $3,208.66, and received the cotton; such interchanged bills of sale and payment being in fact one transaction, intended to be in compliance with the provisions of the Act 2d July, 1864, (13 Stat. L., p. 375,) and the Treasury regulations thereunder of 9th May, 1865, relating to the “purchase of products of the insurrectionary Slates on Government accountP The Treasury agent also reported the said amount of $3,208.66 as being “25 per cent.' retained on Government account,” and it was duly accounted for by him and paid into the Treasury. When this sale and resale took place, neither De Bow & Oo. nor the Treasury agent had knowledge of the President’s proclamation 13th June, 1865, annulling restrictions upon trade east of the Mississippi.
    II. On the 13th June, 1865, there also arrived at New Orleans, on the steamer Nina Simms, from some point west of the Mississippi, twenty bales of cotton also belonging to De Bow & Oo. At that time no shipments of cotton to New Orleans were allowed] except such as were consigned to the purchasing-agent of the Treasury. On the 14th June, 1S65, De Bow & Oo. executed a bill of sale of the twenty bales of cotton to the Treasury agent, (there being no expressed consideration;) and the Treasury agent executed to them another bill of sale (also without au expressed consideratiou) of fifteen, bales thereof. De Bow & Co. thereupon received the fifteen bales, and the Treasury agent retained the five bales, such interchanged bills of sale likewise being in fact but one transaction, intended to be in compliance with the Act 2d July, 1864, and the Treasury regulations thereunder. The agent subsequently sold the five bales of cotton retained by him, and the proceeds, amounting to $137.74 per bale, have been paid into the Treasury. When the five bales were retained on the 14th June, 1865, as aforesaid, neither DeBow nor the Treasury agent had knowledge of the President’s proclamation 13th June, 1865, annulling restrictions upon trade east of the Mississippi.
    
      Messrs. E. <& A. O. Jarán for' the claimant:
    We submit that the fact that the steamer bringing the cotton took her departure from a point on the east of the river, is sufficient prima-facie proof that the cotton was brought from that side. If this be so, then the case of these one hundred and twenty-five bales is brought within the effect of the presidential proclamation of June 13,1865, which took effect on the earliest moment of that day which was the date of the transaction here in question. • {La Peyre v. United States, 17 Wall., 191.)
    This proclamation (13 Stat. L'., 763) provided, among other things, as follows:
    “Now, therefore, be it known that I, Andrew Johnson, President of the United States', do hereby declare that all restrictions upon internal, domestic, and coastwise intercourse and trade, and upon the removal of products of States heretofore declared in insurrection, # * * heretofore imposed in the territory of the United States east of the Mississippi Biver, are annulled, and I do hereby direct that they be forthwith removed.”
    In consequence of this proclamation the collection of the aforesaid sum of $3,208.66 from De Bow So Co., on June 13, 1865, was illegal. New Orleans and Yicksburgh being both points east of the Mississippi, the case of these one hundred and twenty-five bales is clear, provided the cotton came from the east of the river.
    
      Mr. John S. Blair for the defendants:
    The proclamation of 13th of June, 1865, while it removed all restrictions, with certain exceptions east of the Mississippi, did not repeal the eighth section of the act July 2,1864, nor did it affect or lessen the power of the purchasing-agent to buy cotton from those who were willing to sell at snch price as might be agreed on with the seller. It did not declare that the insurrection had been suppressed east of the Mississippi, (except in Tennessee,) but merely from that day removed the restrictions which were enumerated and increased in sections four and nine of the act of July 2,1874.
    The sale to the United States of this cotton was so far advanced by June 13, 1865, that the claimants had no option in the matter, and if they had known of the proclamation on that or the succeeding day, they would not have been at liberty to recede from their covenants in the transaction.
    The sale of the one hundred and twenty-five bales to Cutler was a complete transaction, in strict accordance with section 8, and vesting the cotton in the Government. The subsequent resale did not in any way change its character. What price they could have got for their cotton, had they been aware of their privilege of selling in the market, is not shown, nor is it at all material.
    In Elliott v. Sioartout, (10 Pet., 137,) Thompson, J., (p. 153,) held that no action would lie to recover money voluntarily paid under mutual mistake of law. In Benson v. Monroe (7 Cush., 125) it was held that money paid under a statute of Massachusetts, afterward declared unconstitutional, could not be recovered. See, also, Folsom's Case, (4 O. Cls. fí., p. 366.) But, in any view of the case, the mistake was one of law and not of fact. That ignorance of law is identical with mistake of law, see tíchlesinger's Oase, (1 C. Cls. It., p. 16.) There is no difference between ignorance of the enactment and ignorance of the repeal of a statute, and inasmuch as Cutler’s rights, powers, and liabilities were created by law, the limitation -of them, except by his displacement, or by orders to discontinue his work, would be by altering the law. Ignorance of his displacement or resignation would be mistake of fact; ignorance of an alteration of the law governing his actions would be mistake of law. For such a mistake, equity does not relieve in an executed contract, nor does the law confer a right of action for money paid thereunder.
   Nott, J.,

delivered the opinion of the court:

The counsel for the claimant insists that the facts in this case are substantially identical with those in La Peyre's Case, (8 C. Cls. R., p. 165,) and that the decision of this court must necessarily follow that of the Supreme Court in that case. The counsel for the defendants is understood to concede the substantial identity of the facts, but to insist that the legal ground upon which the defense is now placed was not taken by the defendants’ counsel in the case of La Peyre, and probably escaped the attention of the Supreme Court when deciding that case.

The former case singularly divided two courts, and was ordered to be re-argued on the same point in each. That point involved a determination of the time when the Proclamation June 24,1865, (13 Stat. L., p. 769,) took effect — a proclamation which terminated restrictions upon commercial intercourse in the insurrectionary districts, and virtually brought the Won-intercourse Act (12 Stat. L., p. 257) to an end. The immediate question before the two courts was whether a proclamation takes effect on the day of its date or on the day of its publication ; but the ultimate question which concerned the case, and determined the decision, was whether restrictions, upon commercial intercourse had ceased at New Orleans on the 24th of June, 1865 — the day when the transaction between the claimant and the Government was consummated. ■ Upon the former question, four judges of the Court of Claims, after re-argument, stood equally divided, and judgment pro forma for the purposes of an appeal was rendered against the claimant. In the Supreme Court also,'after re-argument, five judges were for reversal and four for affirmance, and the judgment was accordingly reversed, with instructions to enter a judgment in favor of the claimant.

For the better understanding of the significance of this judgment of reversal, we now advert to the law and facts upon which the former case went up.

The non-intercourse enjoined by the Act 13 July, 1861, (12 Stat. L., p. 237,) was to continue only so long as hostilities existed, and was to end whenever the President by proclamation should declare that they had ended. Within the general rule of non-intercourse there was, nevertheless, allowed an exceptional restricted commercial intercourse which was regulated, so far as these cases were involved, by the Act 2 July, 1864, (13 Stat. L., p. 375, § -8,) and the Treasury Regulations, 9th May, 1865. The effect of the existing statutes and regulations was that cotton could not be brought into New Orleans except upon the payment of a bonus for the right thus to trade, which bonus was one-fourth of the cotton or of its value. In some instances, as in La Peyre’s Case, the bonus was paid in kind, by the actual retention of one-fourth of the cotton; in others, as in the case now before us, the payment was madein cash. In either case the form of the transaction was by a sale and resale of the cotton. Thus the owner here sold the cotton to the Treasury agent at a nominal consideration of $9,625.98, and the Treasury agent immediately sold it back to the owner at a nominal consideration of $12,834.64, and the owner thereupon paid the difference, viz, $3,208.66, the sale and resale constituting in fact but one transaction. It is to be noted that at the time of this transaction the cotton was in the possession or under the control of the agent, and that an owner or importer could obtain control and possession only by going through the form of this transaction and paying the bonus which the regulations imposed. On the other hand, it is also to be noted that the cotton thus sold and resold was thereby freed from the payment of “all fees” and internal-revenue “taxes.”

When the case of La Peyre came up for consideration, it is apparent that two primary questions were involved, both of which must have been determined before it could have become necessary for the Supreme Court to proceed to the determination of the vexed and doubtful question of the proclamation. First, if the regulations were illegal and imposed no valid restriction upon this commercial intercourse, it was manifestly needless to determine whether they were abrogated on the 24th of June by the proclamation. This court in Block's Case (8 C. Cls. R., p. 461) expressed this opinion as to the action of the Supreme Court in La Peyre’s Case, and that court has more recently held, in McClelland's Case, (10 C. Cls. R., p. 68,) that kindred regulations affecting this species of traffic were lawful and obligatory. The second of these primary questions was whether La Peyre had a case which could be sustained upon his own theory of the law — whether he could recover back the money paid into the Treasury if the restrictions upon commercial intercourse were, as he claimed, at an end. For, unless this primary question was determined in favor of La Peyre, manifestly it was needless to order a re-argument upon what was only a resulting question — the time when the proclamation took effect — the time when restrictions upon commercial intercourse ceased.

It is true that a primary question of this character is sometimes overlooked by a court when it has not been discussed at the bar, but in view of the protracted consideration which the case of LaPeyre received, and the unusual pains bestowed upon it by the Supreme Court, we do not feel warranted in ascribing any such oversight to the deliberations of that tribunal. Apart from the factof are-argument, there was also the important circumstance of a nearly equally divided court. Four of the nine judges thought that the claimant should not recover, but they rested their dissent exclusively upon the effect to be given to the proclamation. Upon all other points and questions the members of the court stood unanimous in his favor. The concurrence of the minority as to the primary rights of La Peyre is thus announced in the dissenting opinion of Mr. Justice Hunt:

“If it [the proclamation] had vitality or existence on the24th day of June, the Government agent had no authority to retain the one hundred and nineteen bales of cotton by virtue of the law of 1864. If it had not existence on that day, he had authority, and the present claim is without foundation.”

The counsel for the defendants places the defense of this case upon the general rule that a voluntary payment made in mutual mistake of law cannot be recovered back. As to the rule there can be no question; but whether the payment in this case was in legal effect voluntary is by no means free from doubt. The claimant’s goods were in the possession of the Treasury agent; he, in the language of Mr. Justice Hunt, “ had no authority to retain ” them; yet he exacted a payment equal to one-fourth of their value as a condition to restoring them to the possession of the owner. In some cases it has been held that such a payment must be deemed to have been made under a moral duress, (Astley v. Reynolds, Str. R., 915; Close v. Phipps, 7 Mann. & Gr., 586; Shaw v. Woodcock, 7 Barn. & Cress., 73; Atlee v. Backhouse, 3 Mees. & Wels., 633; Oates v. Hudson, 6 Wels., H. & G., 346;) in others it has been held that the payment of an illegal tax, or impost, or official charge is not voluntary, though no protest be made. (Adams’ Case, 1 C. Cls., R., p. 306; Boston & Sandwich Glass Co. v. City of Boston, 4 Met., 181; Amesbury Woolen Co. v. Inhabitants of Amesbury, 17 Mass., 461; Preston v. Boston, 12 Pick., 7; Ripley v. Gelston, 9 Johns., 201; Clinton v. Strong, id., 370; Steele v. Williams, 20 Eng. Law & Eq., 319.) In short, there is a current of authorities which hold (apart from some statutory requirement of protest at the time of payment) that a payment made to a public officer who has the power of compulsion behind him, or a jiayment exacted by an officer colore officii as a condition to the delivery of a man’s property, is never to be considered a voluntary act. As was -said by the court in one of these cases, (Clinton v. Strong,) “It would lead to the grossest abuse to hold a payment made under such circumstances a voluntary payment, precluding a party from contesting it afterwards.” And, as was said by Baron Martin in another, (Steele v. Williams:) “As to whether the payment was voluntary, that has in truth nothing to do. with the case; * * * to call it a voluntary payment is an abuse of language. * * * Where a party says, ‘I charge you such a sum by virtue of an act of Parliament/ it matters not whether the money is paid before or after the service- was rendered; if he is not entitled to claim it, the money may be recovered back.”

Therefore, without passing upon the applicability of the doctrine of involuntary payments exacted colore officii, there is abundant reason for saying that the Supreme Court might well have decided as it did, and that if any judicial inadvertence •existed, it is for the Supreme Court, and not this, to correct the error.

It is also said by the counsel for the Government that the owners receipt of their cotton freed from the payment of all “fees” and internal-revenue “taxes” constituted a sufficient consideration to support the transaction. But such was the fact in the case of La Peyre, and it would seem that if the Supreme Court really held that the Treasury agent had no authority to exact anything from the owner, his illegal conduct could not be cured by Ms relinquishing a portion of the exaction, though put in the guise of a release from -fees and- internal-revenue taxes. If the Government lost a tax by the transaction which it is entitled to receive, the.modern English case of De Lancey v. The Queen (6 L. R. Exch., p. 286) is authority for saying that its right might have been asserted in this action by way of set-off.

A second cause of action is set up in the petition, viz, for the bonus exacted on other cotton brought in from the west banlc of the Mississippi before the proclamation restoring commercial' intercourse with territory on that side of the river had been issued. We think that demand is answered by the construction hereinbefore given to the decision of the Supreme Court in La Peyre’s Case, and by its decision in McClelland’s, (10 C. Cls. R., p. 68.)

The .judgment of the court is that the claimant recover $3,208.66, exacted from him on the 13th June, 1865, for cotton brought from the east bank of the Mississippi, and that his claim founded on cotton brought in on the same day from the-west bank of the Mississippi be dismissed.

Eichardson, J., was absent when the decision was announced,, but had taken part in the consideration of the case and agreed in the conclusion of the court.

Under the decision above rendered in the case of Norton, assignee of De Bow & Co., v. The United States, the following judgments were entered:

In the case of White & Montgomery v. The United States, judgment in favor of the claimants for $3,443.50.

In the case of J. R. Bonnafon v. The United States, judgment in favor of the claimant for $2,066.10.

In the case of Norton, assignee of B. P. Ethell, v. The United States, judgment in favor of the claimant for $3,856.72.  