Newman v. Moyers

Mr. Chief Justice Smyth

dissenting:

I regret that I am not able to concur in the judgment of the court: First, because of my very high regard for the opinion of my associates formed in the light of their wide juridical ex-*121peri enees; and, second, because T think the appellees Lave earned the money which they claim; but T cannot of course permit the.se considerations to affect the performance of my duty as f see it.

We are asked to declare section 4 of the Act of Congress of March 4, 3!) 15, invalid for want of constitutional power to pass it. The question of Congressional authority, then, is the question at issue1. No other question is presented by Secretary Mc-Adoo and Treasurer Burke1, and they are the only appellants who appear in this court. Before we proceed to the solution of the1 problem thus raised, we must ascertain the meaning- of the attached section; and in doing- this it is our duty, if it has more than one signification, to give to it such interpretation, if possible, as will sustain its constitutionality. The Supreme Court of the United States has said: “If the section admits of two interpretations, one of which brings it within, and the other presses it beyond, the constitutional authority of Congress, it will become our.duty to adopt the former construction ; because1 a presumption never ought to be indulged that Congress meaut to exercise! or usurp any unconstitutional authority, unless that conclusion is forced upem the court hv language altogether unambiguous.” United States v. Coombs, 12 Pet. 72-75, 9 L. ed. 1004—1006. If possible a, construction shonld be given to the act “that will residen1 it free from constitutional objection.” Marshall v. Grimes, 41 Miss. 27—31, approved in Grenada County v. Borgden (Grenada County v. Brown), 112 U. S. 261-266, 28 L. ed. 704-706, 5 Sup. Ct. Rep. 125. “The elementary rule is that every reasonable construction must be resorted to in order to save a statute from unconstitutionality.” Hooper v. California, 155 U. S. 648—657, 39 L. ed. 297—301, 5 Inters. (Arm. Rep. 610, 15 Sup. Ct. Rep. 207. “We cannot attribute to the legislature, unless compelled to do so by its plain words, a purpose to pass an act in conflict with an act of Congress on a subject over which Congress is given authority by the Constitution of tlie United States.” Presser v. Illinois, 116 U. S. 252-269, 29 L. ed. 615-620, 6 Sup. Ct. Rep. 580.

Guided by this rule, and reading section 4 in connection with its cognate section, let us see what the section means. Section 1 *122of the same act provides that the Secretary of the Treasury is •'authorized and directed to pay out of any money in the Treasury not otherwise appropriated, to claimants in this act named 1ho several sums appropriated herein.” [38 Stat. at L. 962, chap. 140.] Section 4 says that “no part of the amount of any item appropriated in this bill in excess of 20 per cent thereof shall be paid or delivered to or received by any agent or agents, attorney or attorneys on account of services rendered or advances 3nade in connection with said claisn.” “Shall be paid” by whom ? Manifestly, by the Secretary of the Treasury. He is first directed to pay the money to the claimant named in the act, and then commanded not to pay any part of the appropriation in excess of 20 per cent thereof to “any agent or agents, attorney or attorneys, on account of any services rendered or advances made in connection with said clgisis.” No money can be paid out of the Treasury of the United States except in accordance with an act of Congress, and when Congress says to the Secretary of the Treasury that ho shall pay a given sum to a named person and forbids him to pay it to anybody else, it would seem that it was acting within its constitutional power, and that the Secretary of the Treasury was bound to obey. None the less Ihe lower court by its judgment, which a majority of this court affirms, directed the Secretary of the Treasury to pay this-money, not to the claimant, but to another person, and then required that person to pay a part of it to the appellees, thus in e-lfect commanding the Secretary of the Treasury to ignore an explicit act of Congress. It is judgment that, in doing so, the court exceeded its authority.

But it may be urged that this is too narrow a basis upon which to place a judgment. I do not think so. But assume for ihe moment that it is, and that the act should be considered from another angle, namely, that it prohibits the claimant from paying anything in excess of the 20 per cent to the attorneys j that they are forbidden to receive snore than 20 per cent, and that any contract purporting to authorize, them to receive more is by virtue, of the act invalid. So considering it, does the act render the contract unenforceable for all purposes, or merely as to the. appropriation made by the act? Here we need again to invoke *123the rulo of interpretation mentioned above. Wc think that a corroer construction of the act, certainly a permissible one, would bo that the prohibition relates to the appropriation only. Congress was dealing with the appropriation,- and nothing else. The first sentence of section 4 prohibits any payment out of the appropriation except as therein provided. The second sentence declares it unlawful for any person to withhold or receive any sum out of the appropriation over and above 20 per cent, and makes invalid any contract to the contrary. Clearly then, in my judgment, the prohibition relates to the appropriation, and to nothing- else. So far as it is concerned, the contract has no efleet; but, as to any other resources which the client may have, there- is'-nothing in the act which prohibits the enforcement of the contract. Nutt v. Knut, 200 U. S. 12—20, 50 L. ed. 348—352, 26 Sup. Ct. Rep. 216; Wright v. Tebbitts, 91 U. S. 252, 253, 23 L. ed. 320, 321.

This brings ns to tbe inquiry as to whether or not Congress possessed tbe power to say upon what conditions it would pay the claim for which the appropriation was made. To answer we are not required, or permitted, to consider the wisdom or the justice of the claim itself or of the condition attached. The power of Congress doe-s not depend upon such things. If it had the power to attach the condition, it was the sole judge of the wisdom or justice of the condition. Congress had the power to pay a part of this claim or to refuse to pay any of it. This cannot he successfully denied. And having that power, it must also have had the other power to say upon what conditions it would pay. The whole; includes the part.

Statutory provisions similar to the one under review have been sustained by the courts. In Davis v. Com. 164 Mass. 241— 243, 30 L.R.A. 743, 41 N. E. 292, a case in which Mr. Justice Holmes, now of the Supreme Court of the United States, participated, the court was called upon to consider such a provision. Congress had passed an act to reimburse to the States and territories certain taxes collected under a former statute of the United States, and provided that no part of the money appropriated “shall be paid out * * * to any attorney or agent under any contract for services not existing or heretofore made between the *124representative of any State or territory and any attorney or agent.” The State of Massachusetts employed the plaintiff to present its claim, and agreed to pay him for his services 2 per cent of the amount -which he should collect. He sued to recover the contract fee, and thus was raised the effect of the prohibitory clause just set out. The court, speaking to this point, said: “It may be conceded that Congress in appropriating money to be paid out of the Treasury of the United States to the States can impose upon it any trust which it sees fit, and the Sta tes, if they accept the money, are bound to carry these trusts into effect.” It was further said that, since the clause of the plaintiff’s contract providing for compensation was “a subordinate and separate part” thereof, it might be “waived or modified without a cancelation or avoidance of the whole contract.” The effect of the decision, as I read it, is that while plaintiff, by reason of the Congressional prohibition, could not recover anything from the fund created by the act of Congress, his contract was not void in ioto, but could be enforced against any other fund that might be available.

Ball v. Halsell, 161 U. S. 72, 40 L. ed. 622, 16 Sup. Ct. Rep. 554, is a pioneer case upon the subject. The plaintiff was employed in 1874 to prosecute a claim against the United States on account of Indian depredations, and was by his contract authorized “to receive, make, and sign, and give all necessary acquittances and receipts for one half of all money”collected, it being stated that the one half thus provided for was “the amount agreed” upon as his fee for services rendered in prosecuting the claim. He presented the claim to the Department of the Interior, and in 1875 secured from it a recommendation for the payment of a certain sum. No appropriation was made by Congress to pay the sum so awarded. On March 6, 1891, after the .passage by Congress of an act (26 Stat. at L. 851, chap. 538) wdtielr authorized the adjudication of such claims by the court of claims, the plaintiff, acting under his contract, brought suit in that court to recover the sum awarded by the Department of the Interior, and secured a judgment for $17,-720, which provided that out of this sum $1,500 should be paid to him. He claimed one half of the $17,720, and sued to recover *125it. The act of Congress last mentioned declared that “all contracts heretofore made for feos and allowances to claimant’s attorneys are hereby declared void.” It will be noticed that this act was passed long after the plaintiff had made his contracts, and long after he had secured from the Department of the Interior a recommendation for the payment of the claim. Plaintiff asserted that the provision in question was void because, among other things, it impaired the obligation of a lawful contract, and deprived the plaintiff of his property without due process. The court, in considering this objection, reviewed many decisions on related subjects, and then said: The “provision was a wise, reasonable, and just provision for the protection of suitors; and it was clearly within the constitutional power of Congress.” In the ease at bar the contract does not provide in terms that the attorney is to be paid out of money recovered from the United States, but the theory of the appellees is that it does so in effect, and for that reason they ask for the relief sought in this suit. Ball’s contract was in existence, and he had performed valuable services under it at the time the Congressional act limiting fees was passed. None the less the court held that he could not recover the contract fee out of the ■fund appropriated. This case cannot be distinguished from the one before us on the ground that the plaintiff had elected to prosecute his client’s case in the court of claims, rather than by pursuing some other method, because the record does not show that he had any other effective means of enforcing it, and the doctrine of election does not apply except where such means exist. Omaha v. Redick, 61 Neb. 163, 85 N. W. 46.

Chief Justice Taney in Beers v. Arkansas, 20 How. 527-529, 15 L. ed. 991, 992, said that it was “an established principle of jurisprudence * * * that the ¡Sovereign cannot be sued in its own courts * * * without its consent and permission, * * * and as this permission is altogether voluntary on the part of the Sovereignty it follows that it may prescribe the terms and conditions on which it consents to be sued, and the manner in which the suit shall be conducted.” Re Ayers, 123 U. S. 443—505, 31 L. ed. 216—229, 8 Sup. Ct. Rep. 164; Hans v. Louisiana, 134 U. S. 1—17, 33 L. ed. 842-848, 10 Sup. *126Ct. Rep. 504. Tlie right to bo heard in a court of justice is in quality closely related to the right to have paid a just debt; and if the Sovereignty, speaking through Congress, “may prescribe the terms and conditions upon which it consents to be sued,” may it not by a parity of reasoning prescribe the terms and conditions on which it will pay a debt ?

The plaintiff, in Spalding v. Vilas, 161 U. S. 483—490, 40 L. ed. 780-783, 16 Sup. Ct. Rep. 631, alleged that he was employed in 1871 by a number of postmasters to obtain a review and readjustment of their salaries, and that they authorized him to prosecute any claim which they might have against the government, and “to receive the drafts which might be issued in payment therefor.” Several acts of Congress were passed making appropriations for the payments of the claims. ■ The one construed by the court was approved August 4, 1886, and provided that payment of all sums thereby appropriated “shall be payable by warrant * * * and payable to the order of and transmitted to the persons respectively entitled thereto.” The court said of this provision: “Whatever may have been the value of any services rendered by the plaintiff for his clients; even if the readjustment of their salaries was wholly due to his efforts To procure mandatory legislation by Congress, pressing, such legislation by all lawful means in his power,’ through many years, it was competent for the legislative branch of the government to provide that any sums ascertained to be due to claimants should be paid directly to them. * * No one will question the power of Congress to enact legislation that would effect such an object. Ball, v. Halsell, supra. If such legislation worked injury to the plaintiff in that it gave his clients an opportunity to evade, for a time, the payment of what they may have agreed to allow him, it was an injury from which no cause of action could arise. This view is so clear that no argument in its support is necessary.” If it was competent for the legislative branch of the1, govennnent to provide in that case that any sum ascertained to lie due to the claimants should he paid directly to them, and that no one will question the power of Congress to enact legislation to that effect, what boo--mes of the argument here, that Congress did not have the power to *127direct that the money appropriated should bo paid directly to the claimants, except 20 per cent thereof ? And may I not say here as was said there that, if such legislation worked injury to the plaintiffs in that it gave their clients an opportunity to evade for a time the payment of what she has agreed to allow them, it was an injury from which no cause of action could arise.

The supreme court of Arkansas in Ralston v. Dunaway, 123 Ark. 12, 184 S. W. 425, sustained the constitutionality of section 4, saying: “It is manifest from the contract that the. parties realized that the claim could only be paid by an appropriation voluntarily made by the government, and necessarily com traded with reference to such appropriation and the terms thereof.”

It is no longer debatable that Gongress in the exercise of a conceded power may declare invalid contracts lawful at the time they were made, which in any way impair the free exercise of that power. In illustration of this reference may be had to the Sherman Anti-Trust Statute of 1890, in which contracts in restraint of trade are declared to be illegal; Federal Employers’ Liability Act of 1.908 making unenforceable contracts providing that acceptance by employees of benefits from relief departments of railroads should not release the railroad company from liability for injuries inflicted: and the Statute of 1906 invalidating contracts providing for compensation different in kind from that mentioned in the public tariff schedules of railroad rates. Standard Oil Co. v. United States, 221 U. S. 1, 55 L. ed. 619, 34 L.R.A.(N.S.) 834, 31 Sup. Ct. Rep. 502, Ann. Cas. 1912D, 734; Louisville & N. R. Co. v. Mottley, 219 U. S. 467, 55 L. ed. 297, 34 L.R.A.(N.S.) 671, 31 Sup. Ct. Rep 265; Philadelphia, B. & W. R. Co. v. Schubert, 224 U. S. 603, 56 L. ed. 911, 32 Sup. Ct. Rep. 589, 1 N C. C. A. 892. In the Mottley Case, Mr. Justice Harlan, speaking for the court, said: “The agreement between the railroad company and the Motleys must necessarily be regarded as having been made subject to the possibility that, at some future time, Gongress might so exert its whole constitutional power in regulating interstate commerce as to render that agreement unenforceable or to impair its value. That the exercise of such power may be hampered or restricted to any *128extent by contracts previously made between individuals or corporations is inconceivable. The framers of the Constitution never intended any such state of things to exist.” Mr. Justice Hughes spoke to the same effect in the Schubert Case. Congress has the power to pay the debts of the United States, to adjust claims against it, and to appropriate money out of the Treasury for such purposes as it may think will serve the general welfare. If in the exorcise of this power it finds its wray impeded by a contract of individuals such as the one at bar, it may brush it aside as ineffectual; otherwise the constitutional authority of Congress could be limited by the act of individuals. Is it possible, to paraphrase the language of Mr. Justice Miller speaking for the Supreme Court of the United States, that by making a contract with their client the appellees could prevent the government from settling with the client on any terms it thought proper? Kendall v. United States, 7 Wall. 113—117, 19 L. ed. 85, 86. The contracts of the appellees with their client in the case at bar were made subject to this Congressional authority, and must be read as if they provided in terms that they were conditioned upon the power of Congress to make, in the act appropriating money for the claim, such provisions with respect to attorneys’ fees as it might think suitable.

Much is said about, the justness of the claim presented by appellees’ -client. Its justice may be conceded, and I add; Congress has made, provision for the payment of every penny of the claim. But as I have observed at the outset the justice of the. claim has no tendency to advance the argument on behalf of the appellees. Congressional authority is not measured by the quality of the justice which its act embraces, nor have the courts any warrant to inquire into the right or wrong of such an act and declare it valid or void as they may regard its ethical character. In this connection, however, it may be observed that the claims in the Massachusetts and Spalding Cases, supra, were also just, but that did not make void the prohibitory condition attached by Congress to the act providing for their payment. Back pay for soldiers of the War of the Rebellion was provided for by the Act of 1911 (37 Stat. at L. 47, cliap. O'), and there was also a provision limiting the amount which might be paid *129to attorneys. A claim for back pay dun for service on tbe battlefield should be as sacred as a claim for property taken. Even if we inquire into tbe merits of the attorneys’ claims for fees in each of the aforementioned oases, it will he discovered that they were as sound as those of the one before ns.

Acts of Congress making appropriation for claims are cited in which the integrity of existing contracts is preserved. If i líese are referred to for the purpose of showing Congress’s estimate of its own power in the circumstances, it seems to me they militate against, rather than aid, appellees; for if Congress did not believe tliat it, had the authority to affect pre-existing contracts, why a clause saving them from its acts? The Act of 1853 (.10 Stat. at L. 170, chap. SI), the Act of 1878 (20 Stat. at L. 243, chap. 307), and the Act of 1911 (37 Stat. at L. 47, chap. 0) contained conditions like section 4. The former, albeit repeatedly before the Supreme Court of the United States, has always been sustained; and no like provision, there being many of them, lias ever been held void by that tribunal.

Believing section 4 of tbe act under examination to be clearly within the purview' of Congressional power, I think the judgment of the lower court should be reversed, with costs, and cause remanded, with directions to dismiss the bill.

A petition for the allowance of an appeal to the Supreme Court of the United States was granted February 25, 1918.