United States v. Watts.

I am by no means prepared to say that if such had been the ruling of the English court, that I should feel justified in receiving it as an authority in giving a construction to our statute. But the report referred to shows clearly that the decision was based on another clause of the English statute. The facts were, substantially, that a testator, being the owner of certain freehold estate, directed it to be sold by his executors, and that from the proceeds, after payment of his debts, a legacy of £5,000 should be paid. The personal estate of the testator was more than sufficient to pay his debts and discharge the legacy, without selling the real estate as provided for in the will. The legatee, by some arrangement between the parties, took the real estate from which the legacy was to be paid. And the court held that the legatee could not evade the payment of the tax or duty, but was liable therefor, though the legacy was not in fact paid in money. But, as before remarked, this decision was made under the clause of the English statute imposing a tax or duty on legacies derived from real estate. And under that clause, the court was probably right in holding, that as the property was directed to be sold unconditionally for the satisfaction of the legacy, and the legatee was the recipient of the benefit of the legacy, they would consider that done which the will had directed to be done.

But a more recent case in the English courts is referred to by the counsel for the defendant in the case before the court, which applies to this question, and is a direct authority against the right of the government to claim a tax or duty on the legacies referred to, in the will of Mrs. Hoard. This case is noted in the recent work of Edwards on the Stamp Act of the United States, page 198, and the reference by the author is to the report in 9 Jur. 486, and 4 Hare, 315. These reports are not accessible to me, and I have not therefore read them. As stated by Edwards, the question was, whether real estate purchased with partnership assets, and used for partnership purposes, was liable to probate duty under the English statute on the

United States v. Watts.

death of a partner. The particular clause of the statute under which the tax or duty was claimed, is not stated in the abstract of the case as given by Edwards. Without taking the trouble to set forth the facts of the case, it will be sufficient to refer to the opinion of the court, as copied by Edwards, page 202. The court says: "In the simple case I have put, of land directed to be converted into money, I think the answer to the claim of the crown would be that the property in question was in fact real estate at the death of the testator, and as such not liable to probate duty, and that equity would not alter the actual nature of the property for the purpose only of subjecting it to fiscal claims to which at law it was not liable in its existing state, and certainly not intended to be made liable by the stamp act." And the court hold further, that the fact that the property in question was the property of a partnership made no difference in respect to its liability to probate duty.

This case clearly establishes the doctrine that by no construction of law can property be regarded within the scope and operation of our revenue law, as different from its real character. As a necessary result, in the absence of any statutory provision imposing a tax or duty on legacies arising out of real estate, there is no authority for the doctrine that such a legacy shall be treated as arising from personalty.

But, without stating other views pertinent to the question before the court, leading to the conclusion which has been' indicated, I am fully satisfied that by no construction of the statute can the defendant, as executor of Mrs. Hoard, be adjudged liable to pay a tax or duty on the legacies in question. The statute in its terms is too clear to admit of doubt as to its construction. If Congress think it expedient to legislate further on this subject, and declare that legacies arising from real estate shall be subject to a tax or duty, they will doubtless do so, in plain and intelligible terms. As the statute now stands, such an intention is clearly negatived.

Judgment will therefore be entered for the defendant.

United States v. One Hundred and Thirty Barrels of Whisky.

(DISTRICT COURT.)

THE UNITED STATES v. ONE HUNDRED AND THIRTY BARRELS OF WHISKY.

In a proceeding in the District Court of the United States against property seized as forfeited under the internal revenue laws, to which a claim is interposed, the claimant has a constitutional right to a trial by a jury. Congress has no power by legislation to provide for any other mode of trying a case, in which the right of trial by jury is secured by the constitution.

The provision of the statute, declaring that "the proceeding to enforce said forfeiture of said property shall be in the nature of a proceeding in rem,” is not to be construed as authorizing a trial on strict admiralty rules, and without the intervention of a jury.

Flamen Ball, District Attorney, and H. C. Whitman, for United States.

J. B. Stallo, for claimant.

OPINION OF THE COURT:

The motion before the court is for a trial by jury in four distinct informations, prosecuted in behalf of the United States, for the forfeiture of about one hundred and thirty barrels of whisky, alleged to have been manufactured and sold in violation of the internal revenue act of June 30, 1864. The whisky was seized in this district, and is now in the custody of the law. Claimants have intervened in each of the four cases, and in the answer and claim of each the reasons and ground of forfeiture alleged in the several informations are denied. The question is, whether these claimants are entitled, in the trial of the issues made, to the intervention of a jury.

It is insisted by the counsel for the United States, that these informations are before this court as cases in admiralty jurisdiction, and must be tried according to the known and settled usages of courts of admiralty, in which the trial by jury is unknown. On the other hand, it is claimed,

United States v. One Hundred and Thirty Barrels of Whisky.

that as the seizures of the property in question were on the land, they must be tried as cases at law, in which the right of a jury trial is secured by the constitution of the United States.

The seventh amendment to the constitution declares that "in suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved." And it is too clear to admit of doubt, that if these are cases at common law, they are within this clause of the constitution, and the parties are entitled to a trial by jury. It is equally clear that Congress has no power under the constitution to deprive a suitor of this right, by declaring that a case not properly within the jurisdiction of the admiralty, shall be treated and dealt with according to the known principles of courts of admiralty. In defining the judicial power of the national government, the constitution declares-article 3, section 7-among other things, that it shall extend "to all cases of admiralty and maritime jurisdiction." The Congress of the United States, in giving effect to this constitutional provision, have enacted that the district courts shall have exclusive original cognizance of all civil causes of admiralty and maritime jurisdiction, including all seizures made under the laws of import, trade, or navigation, on waters navigable from the sea by vessels of ten or more tons burden. These courts are also vested with exclusive original cognizance of all seizures on land, or other waters than as aforesaid. Sec. 9, act of September 24, 1789, 1 U. S. Stat. 73. The same section reserves to suitors the right of a common law remedy, where the common law is competent to give it; and also provides "that the trial of issues of fact in the district courts in all causes, except civil causes of admiralty and maritime jurisdiction, shall be by jury."

It is obvious that in this legislation Congress had in view the distinction between cases of proper admiralty jurisdiction and cases of seizure on land, or on water-courses, not properly within the scope of that jurisdiction. And in the

United States v. One Hundred and Thirty Barrels of Whisky.

latter class of cases, jurisdiction is vested in the district courts, not because they are courts of admiralty, but because they are courts created under the constitution. But in confining this jurisdiction, the statute is careful to reserve to suitors the right of trial by jury, in all cases of seizures which are not of admiralty cognizance.

Now the cases before the court arise under section 68 of the act of June 30, 1864, which imposes the penalty of a forfeiture for any refusal or neglect to comply with the law regulating the duties payable by the distiller of spirits. By such neglect or refusal, not only the vessels and machinery used in distillation, but the liquor manufactured, are subject to forfeiture. And at the close of the section it is provided, that "the proceedings to enforce said forfeiture of said property shall be in the nature of a proceeding in rem, in the circuit or district courts of the United States for the district where such seizure is made, or in any court of competent jurisdiction."

It is so clear as scarcely to need a word of argument, that Congress have not conferred, and did not intend to confer, on the courts named, admiralty jurisdiction in the sense of requiring that cases arising under section 68 should be tried as cases of strict admiralty jurisdiction. It would be an impeachment of the intelligence of that body to suppose they intended a seizure on land should be considered as one within the scope of such jurisdiction. In declaring that the proceedings should be in the nature of a proceeding in rem, nothing more was intended than to provide for a summary and effective mode of enforcing the act of Congress. The thing-the property subject to forfeiture is to be seized and held in possession subject to the action of the court. And this for the obvious reason, that a proceeding against the person merely would not give an available remedy for a fraudulent attempt to evade the law.

It is true the right to a forfeiture of the property in question is set forth in the form of a libel, a term used as appropriate to proceedings in admiralty. But this can not