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The duplicate originals of the final award and the duplicate originals of the particular awards were delivered by the commission, through its secretary, to the respective governments, together with duplicate journals of the entire proceedings, kept by the secretary and certified from day to day by the pre⚫siding commissioner.

The final award of the commission is as follows:

"OFFICE OF THE MIXED COMMISSION ON

"BRITISH AND AMERICAN CLAIMS,
"UNDER THE TREATY OF MAY 8, 1871,

"Newport R. I., September 25, 1873. "The undersigned Commissioners appointed under the XIIth Article of the Treaty signed at Washington on the 8th day of May 1871, between the United States of America and Her Britannic Majesty, do now make their

"FINAL AWARD

of and concerning the matters referred to them by said Treaty as follows, that is to say:

"We award that the Government of the United States of America shall pay to the Government of Her Britannic Majesty, within twelve months from the date hereof, the sum of 1,929,819 dollars, in gold, subject to the deduction provided for by Article XVI. of the Treaty aforesaid, for and in full satisfaction of the several claims on the part of corporations, companies, or private individuals, subjects of Her Britannic Majesty, upon the Government of the United States, arising out of acts committed against the persons or property of subjects of Her Britannic Majesty, during the period between the 13th day of April 1861 and the 9th day of April 1865, inclusive: said sum being the aggregate of the several separate awards upon such claims, made in writing, in duplicate, and signed by us or such of us as assented to said separate awards.

"And all other such claims on the part of subjects of Her Britannic Majesty against the United States which have been presented and prosecuted for our award, have been and are hereby disallowed or dismissed, in manner and form as will appear by the several separate awards in writing concerning the same, signed as aforesaid.

"Certain other claims on the part of subjects of Her Britannic Majesty against the United States were also presented, but were afterwards, and before any award was made thereon, withdrawn by the Agent of Her Britannic Majesty, as will appear by the record of the proceedings of the Commission, kept in duplicate, and which will be delivered to each Government herewith.

"And we award that all claims on the part of corporations, companies, or private individuals, citizens of the United States,

upon the Government of Her Britannic Majesty, arising out of acts committed against the persons or property of citizens of the United States, between the 13th day of April 1861 and the 9th day of April 1865, inclusive, not being claims growing out of the acts of vessels referred to in the Ist Article of said Treaty, have been and are hereby disallowed: separate awards upon each of said claims having been made in writing in duplicate, and signed by us, or such of us as assented to such separate awards.

"And we refer to the several separate awards made and signed as aforesaid, as a part of this our final award-it being our intent that the proceedings of this Commission shall have the force and effect named and provided in the XVIIth Article of said Treaty.

Payment of Final
Award.

Case of Phelps v.
McDonald.

"L. CORTI,
"RUSSELL GURNEY,
"JAS. S. FRAZER,

"Commissioners."

The amount specified in the final award as due from the United States to Great Britain as the result of the decisions of the commission was duly paid in accordance with the terms of the treaty.1 Among the British subjects to whom awards were made by the commission was Augustine R. McDonald, who obtained an allowance of $197,190 on a cotton claim. Subsequently a bill in equity was filed against him in the supreme court of the District of Columbia by Thomas J. Phelps, and afterward by amendment William White was made a party defendant. It appeared that in 1868 McDonald became a voluntary bankrupt in the United States, and that Phelps was his assignee. In a schedule of assets filed in February 1869 there was a "claim against General Osborne, of U. S. Army, and others," for burning 1,000 or 2,000 bales of cotton belonging to McDonald in Arkansas and Louisiana in January and February 1865. In a duplicate schedule the quantity was stated as 7,000 or 8,000 bales. This claim was designated in the schedule as "worthless." In March 1869 McDonald obtained his discharge, and afterward Phelps, as his assignee, sold at public sale, under an order of court, a lot of his accounts, notes, and judgments. At this sale White purchased for McDonald, with money furnished by him, all the uncollected accounts, including the cotton claim described in the schedule, for the sum of $20.

'For. Rel. 1874, 570-572; Id. 1875, I. 655.

In his memorial to the commission McDonald alleged that he purchased the cotton in the insurrectionary States under permits from the Secretary of the Treasury and letters from the President of the United States; that the laws authorizing such permits were repealed before he could remove the cotton, and that in consequence it was destroyed by the Federal Army. These facts were not disclosed in the bankruptcy proceedings. The bill in equity alleged that the claim thus presented to and allowed by the commission, as arising from an apparent breach of obligation by the United States, was not that described in the schedule of assets; that the description in the schedule and the designation of the claim as worthless were calculated to mislead; that though the rules of the commission required all assignments of claims to be stated, none was mentioned in the memorial, and that McDonald in fact recovered on his original title and obtained the award upon it, and not on that derived by purchase through White from Phelps as assignee, and that the award ought to be paid to the assignee for the benefit of the creditors.

The bill also set forth that McDonald had assigned the award to White, and prayed for an injunction restraining them or either of them from receiving the money, and for a decree that the fund be held in trust for the creditors of McDonald, subject to the rights of the assignee in bankruptcy.

Process was served on both McDonald and White. They answered, and the complainant filed a replication; and a temporary injunction was awarded. Subsequently, by consent of parties, a decree was made directing that one-half of the award be received by the respondents to pay the expenses of prosecuting the claim, and that the other half be placed in the hands of George W. Riggs as receiver. By consent of parties the money was paid to him by the British agent, who was not a party to the litigation and acted in the matter voluntarily.

The respondents then withdrew their answer and demurred to the bill. The demurrer was sustained and the receiver was directed to pay over to respondents the money in his hands. From this decree the complainant took an appeal.

Before the Supreme Court of the United States the respondents, supporting the judgment of the court below, argued (1) that the sale of the claim to White and the latter's transfer of it to McDonald were valid; (2) that at the time of the sale the claim was worthless, having only a possibility of value; (3)

that as the fund must be considered as being in England, no interest in it passed to the assignee in bankruptcy; (4) that the fund was under the control of the British Government for purposes of distribution, and that the decree of a court of equity in the United States could not operate upon it.

The appellant maintained (1) that McDonald had at the time of his bankruptcy a valid claim against the United States; (2) that this claim passed by the assignment; (3) that even if the fund had been in England and in the hands of the British Government, the parties were subject to the jurisdiction of the court and could be compelled by process in personam to obey its decree.

The court, Mr. Justice Swayne delivering the opinion, held (1) that the claim passed by the assignment in bankruptcy, which under the law included "all the estate, real and personal, of the bankrupt;" and (2) that without regard to the question whether the order of sale of 1869 embraced the claim under consideration, the sale was under the circumstances invalid.

As to the objection that the suit was in effect a suit against the British Government, the court said that the objection assumed facts which had "no existence;" that that government was not, either in form or in substance, a party to the record; that no final or coersive action was sought except against McDonald and White; that though a receiver had been appointed, he "could do nothing without the voluntary concurrence" of the British agent; that the money had been delivered to the receiver by consent of parties; that no objection had been heard "from any quarter" to placing the money in his hands, and "certainly none" "in behalf of the sovereignty whose rights are said to have been invaded." But even supposing, said the court, that, as had been suggested, "the money were in the British exchequer, at the seat of the home govern ment, still the court below acquired jurisdiction of the parties and of the cause, and had an important duty to perform." International commissions usually decided only as to the validity of the claim and the amount to be paid, and not as to the ownership of the claim. "The validity of the claim," said the court, depends upon the law of nations; its ownership, upon the local jurisprudence where the transfer is alleged to have been made." Wherever the money was, the assignee was entitled to have the question finally settled whether he or

*

McDonald had the better right. "Where the necessary parties," the court concluded, "are before a court of equity, it is immaterial that the res of the controversy, whether it be real or personal property, is beyond the territorial jurisdiction of the tribunal. Without regard to the situation of the subject matter, such courts consider the equities between the parties, and decree in personam according to those equities, and enforce obedience to their decrees by process in perThe decree of the court below will be

sonam.

reversed."

Mr. Justice Miller, with the concurrence of Mr. Justice Field, dissented, on the ground (1) that the money in question was awarded to Great Britain under the treaty; (2) that the courts of the United States had no control "over the British Government or its agents in the distribution of the fund awarded to them;" (3) that the record did not show that the fund in controversy had ever been "voluntarily paid into court by the agent of that government;" and (4) that the case constituted "an indelicate attempt" by the courts of the country "to seize in transitu, for its own citizens," what the government had by treaty "agreed to pay to another government for its subject."

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