
    Michael Daily v. The United States.
    
      On the Proofs.
    
    
      A manufacturer of matches furnishes to the Commissioner of Internal Revenue his own (lie for revenue stamps, lie then purchases at various times stamps from, his own die and each purchase exceeds in amount $500. The Commissioner allows hi?n 5 per cent, on §500 and 10 on all in excess. JTe claims, under the statute, 10 per cent on the entire amount.
    
    I. Where a manufacturer furnishes his own die for stamps under th e Internal revenue Act, (13 Stat. L., p. 223, § 161,) the transaction, so far as the commission to he allowed him is involved, is in the nature of contract and not of tax. Therefore the Court of Claims has jurisdiction of an action to recover the eonnnisison.
    II. Under the Internal-revenue Act, (13 Stat. L.,p. 223, § 161,) which provides that if a manufacturer furnish his own die or design for stamps there shall he allowed to him this commission: “ on amounts purchased at one time of not less than §50 nor more than §500, 5 per centum,; on amounts over §500 10 per centum,” the manufacturer is entitled to 10 per cent, on the entire amount if it he over §500 and the 10 per cent, is not limited to the part in excess of §500.
    
      Mr. Chas. JE. Kovey for the claimant:
    By this suit claimant seeks to obtain the sum of $350 from the United States, which, he claims to he due to him as commissions on amounts of internal-revenue stamps purchased by him in pursuance of act of June 30, 1864, sec. 161.
    There is, in this case, a preliminary question of jurisdiction to be considered.
    The claim suggested by the petition is founded upon a “ law of Congress,” and upon a ‘‘regulation of an Executive Department,” and upon “ a contract, express or implied, (statutory,) with the Government of the United States,” either of which vests jurisdiction in this court; and the question is, has such jurisdiction been divested in the present case?
    It is understood that the decision in JNieoll v. The United States, 7 Wall. 122, will be relied upon to show that it has; and if the petition suggested a case as to the validity of the assessment or collection of a tax, or of tbe correction of errors where the revenue laws have prescribed a particular mode of redress, there can be no question but that the principle laid down in that decision would bar jurisdiction here. But, although the case arises under a clause in the revenue laws, this clause has no necessary connection therewith, and might as well, or better, have been inserted in the banking laws, for the real thing it provides is a currency — something with which the citizen may pay a debt.
    Therefore petitioner’s claim is not within the principle laid down in Niooll v. The United States—
    1st. Because the purchase of stamps is in no sense the payment of a tax, and does not affect the revenue one way or the other; and—
    2d. Because the claim arises under a statutory contract, and the revenue laws provide no mode whereby the aggrieved citizen — one of the parties to the contract— can “ test ” its meaning before a court.
    The law authorizes the Commissioner to sell stamps to any person, and provides that the purchaser shall be entitled to certain commissions on the amount purchased.
    The petitioner had purchased stamps, as stated in his petition, and claims that he was entitled to a commission of 10 per centum upon the full amount. Previous to April 1, 1870, he had been allowed the commissions claimed. The regulation which reduced the commissions was issued without any change of the law and at a time when Congress was engaged in devising ways and means to reduce internal taxes, and it is a significant fact that, as soon as this regulation was brought to the attention of Congress, it was revoked by express legislation. (Section 4, act of July 14, 1870.) It may also be mentioned that the manufacturers of matches were taxed over 400 per cent, on the cost of their goods — the highest tax known to the law.
    The deduction made by the Commissioner’s ruling amounted to $25 on each order in excess of $500, and this deduction petitioner claims was not authorized by law.
    In the purchase and sale of these stamps no collector intervenes between the purchaser and the Commissioner, and for this reason the remedy provided for the correction of erroneous and illegal assessments fails. It is not really a question of tax, but whether the commissions fixed by law upon a purchase of stamps have been allowed. The Commissioner certainly could have had no right to deprive the petitioner of a benefit conferred upon him by statute.
    In this case the money .of the petitioner for the purchase of these stamps was not paid to a' collector, but deposited to the credit of the Treasurer of the United States, and a certificate sent to the Commissioner with the order for the stamps.
    
      Mr. Alexander Johnston (with whom was the Assistant Attorney-General) for the defendants.
   Drake, Ch. J.,

delivered the opinion of the court:

This action calls for the interpretation of the following clause of section 161 of the internal-revenue' act of June 30, 1864, (13 Stat. L., 223:)

“That any proprietor or proprietors of articles named in Schedule C who shall furnish his or their own die or design for stamps, to be used especially for his. or their own proprietary articles, shall be allowed the following commission, namely: On amounts purchased at one time, of not less than $50 nor more than $500, 5 per centum; on amounts over $500,10 per . centum.”

Among the articles enumerated in Schedule' C are friction-matches.'

The claimant was a manufacturer of matches, and furnished to the Commissioner of Internal Eevenue a die for stamps to be used on his matches, under the above provision.

Fourteen different times between April 1 and October 1,1870, he purchased stamps from the Commissioner of Internal Eevenue, struck from his die, each time in amount exceeding $500.

Upon all the purchases so made, the Commissioner paid him 10 per cent, commission on the excess' over $500, but refused to allow him more than 5 per cent, on the first $500; which was in each case paid him.

He sues for an additional 5 per cent, on the first $500 in each of the fourteen purchases, amounting in the aggregate to $350.

Two questions only are presented: 1. Whether this court has jurisdiction of this action; and, 2. If it has, whether the interpretation given by the Commissioner of Internal Bevenue to the clause in question is correct.

The defendants deny the jurisdiction, and in support of their position rely on the case of Nicoll v. United States, (7 Wallace, 122,) and The Portland Company's Case, decided by this court, (5 C. Cls. R., 441,) the former of which denied the jurisdiction of this court of an action to recover back duties paid on imported merchandise; and the latter, upon the authority of the former, disclaimed our jurisdiction of an action to recover the amount of a drawback allowed by the internal-revenue act upon certain articles, when exported, upon which a tax had been paid.

Without going into an examination of the facts and doctrines of those cases, it is sufficient to say that this case is not like either of them, and that the positions taken in them have no bearing here. Those cases presented points arising in connection with the collection of duties and taxes, and requiring the ascertainment and settlement of facts, and the exercise of judicial decision upon those facts by the Secretary of the Treasury or the Commissioner of Internal Bevenue.

This case has no such features, nor does a single reason given by the Supreme Court in NicolVs Case have any bearing upon or relation to the matter here involved. This case,-like that of Patton, decided at the present term of this court, is one merely for compensation which the law contracts for the Government to pay — the simplest form of direct contract.

The Government, believing it to be its interest to increase and facilitate the sale of stamps, allowed parties using them upon certain articles manufactured by them to provide the dies therefor, and deposit the same with the Commissioner of Internal Bevenue; and, by law, agreed with every such person to pay him a certain commission for every amount of these stamps over $50 which he should at any one time purchase.

“ Commission,” in such a case, is the synonym of “ compensation.” The law, therefore, bound the Commissioner of Internal Bevenue to allow the claimant a compensation for making his purchases in sums exceeding $50. When, therefore, he made those purchases, it was a simple contract of bargain and sale of that which the Government offered for sale at a certain price, agreeing to pay back a certain per centum of the price. The transaction had no connection with the assessment or collection of tbe revenue, involved no' exercise of discretionary authority on the part of the Commissioner, made no interruption in the routine of his office, had no consequences to be foreseen or guarded against, demanded no “red tape,” but was the simple matter of exchanging one description of stamped paper for another description of stamped paper, with the promise on one side to give, and the right on the other side to demand, a compensation for making the exchange in a certain amount.

This is an express contract on the part of the United States, and, therefore, within the defined jurisdiction of this court, though it be created by a revenue law.

Upon the question of the rate per centum which the claimant was entitled to as commission, we are equally clear that the action of the Commissioner of Internal Bevenue was based on an erroneous interpretation of the clause in question. The error probably arose from omitting to observe that the final member of that clause is elliptical. If written in full, without the ellipsis, it would read: “ On amounts purchased at one time over $500, 10 per centum.” That is its legitimate meaning as it now stands in the statute, and it required the payment to the claimant of 10 per centum on the whole amount of each ■of his fourteen purchases. Whatever doubt we might have had of the correctness of this conclusion is removed by the subsequent action of Congress in adding to the clause in question the words, “on the whole amount purchased.”

Judgment will be entered in favor of the claimant for $350.  