EXECUTIVE MANSION, _October 10, 1888_.
_To the Senate_.
I herewith return without approval Senate bill No. 2201, entitled "An
act for the relief of Laura E. Maddox, widow and executrix, and Robert
Morrison, executor, of Joseph H. Maddox, deceased."
An act of Congress approved July 2, 1864, provided among other things
that the Secretary of the Treasury, with the approval of the President,
might authorize agents "to purchase for the United States any products
of States declared in insurrection, at such price as should be agreed on
with the seller, not exceeding the market price thereof at the place of
delivery."
Under the authority of said act the Secretary of the Treasury, with the
approval of the President, prescribed rules and regulations to govern
the transactions thus permitted, and appointed one H.A. Risley an agent
to act for the United States in making such purchases.
On or about the 13th day of November, 1864, said Risley entered into a
written contract with Joseph H. Maddox and two other parties, whereby
the latter agreed to sell and deliver to Risley as such agent, at
Norfolk or New York, 6,000 boxes of tobacco, 350 barrels of turpentine,
and 700 barrels of rosin. It was also agreed that all products
transported under the contract should be consigned to said Risley as
agent and shipped on a Government transport, or, if not so shipped,
should be in the immediate charge of an agent of Risley's, whose
compensation and expenses should be paid by the sellers. Said products
were to be sold in New York or Baltimore under Risley's direction, and
one-fourth of the proceeds, after deducting certain expenses, costs, and
charges, were to be retained for the United States and three-fourths
paid to Maddox and his associates. It was expressly provided in said
contract as follows:
Nothing in this contract contained shall be construed as incurring
any liability on behalf of the United States.
It appears that Maddox, very soon after the contract was made, acquired
all the interest of his associates therein.
The President of the United States signed an order or permit for the
transportation of the goods, in fulfillment of the contract, and for the
passage of the parties selling such goods through the Federal military
lines, the permit declaring, however, that such transportation and
passage should be "with strict compliance with the regulations of the
Secretary of the Treasury, and for the fulfillment of said contract with
the agent of the Government."
Maddox and his associates were not at the time the contract was entered
into the owners of any of the property they agreed to sell and deliver;
but it is alleged that Maddox, as one of the parties to the contract and
as assignee of his co-contractors, purchased 4,042 boxes of tobacco,
worth at that time more than $735,000, for the purpose of fulfilling
this contract.
The tobacco was purchased by him within the rebel lines in the State of
Virginia. A part of it, he charges, was forcibly taken by the military
forces of the Government and converted to its use or destroyed while
being transported to its destination, and the remainder of it, having
been detained in storage at Richmond, Va., was afterwards appropriated
to the use of the United States or was destroyed in the fires at
Richmond upon the capture of the city by the United States forces in
1865.
An action predicated upon the contract with Risley was brought by Maddox
in the Court of Claims to recover the value of this property, but it was
held by the court that the contract was void.
On appeal to the Supreme Court of the United States the decision of the
Court of Claims was affirmed, upon the ground, as had been previously
decided by said court, that under the law, the Treasury regulations,
and the Executive orders concerning the purchase of products of
insurrectionary States a purchasing agent of the Government had no
authority to negotiate with anyone in relation to the purchase of such
products unless at the time of the negotiation the party either owned
or controlled them; that neither the law nor the regulations for its
execution protected a speculation wherein the products to be sold were
to be procured by the contractor within the rebel lines after the
contract was made; that private citizens were prohibited from trading at
all in the insurrectionary districts, and that the object of the law and
the regulations to carry it into effect was to encourage the insurgents
themselves to bring their products to agents of the Government.
With this adverse decision all chance of recovery upon legal grounds
of before the courts was dissipated. But recourse to Congress still
remained. As appears from a memorandum furnished in support of this
bill, the alleged equities of the case were presented to the
Forty-second, the Forty-third, the Forty-fourth, the Forty-fifth, the
Forty-sixth, the Forty-eighth, and the Forty-ninth Congresses. Two
adverse and more than two favorable committee reports have been made
upon the claim. No bill for the relief of the claimant has, however,
passed Congress until the present session, when a favorable condition
seems to have presented itself.
The bill herewith returned empowers and directs the accounting officers
of the Treasury to settle and pay to the representatives of Maddox the
amount found due him on account of the loss and damage he sustained by
the seizure by our military forces of the tobacco purchased by him under
the agreement referred to, excluding, however, the tobacco destroyed
by fire in the city of Richmond, and provides that said claim shall be
determined upon the evidence taken and now on file in the office of the
clerk of the United States Court of Claims and the War Department and
any other competent evidence.
I fail to appreciate the equities which entitle this claimant to further
hearing.
Every intelligent man should be charged with the knowledge that
as a general rule commercial intercourse with the enemy is entirely
inconsistent with a state of war, and that the law of 1864 had for its
object the encouragement of the insurgents themselves to bring their
products to us, and not the authorization of persons to roam through the
insurrectionary districts and purchase their products on speculation.
Even if the claimant did not understand these conditions, he certainly
knew that his contract was based upon a statute; that the agent with
whom he was contracting was a creature of statute, and that such statute
and certain regulations of the Secretary of the Treasury made thereunder
regulated the right and limited the action of all the parties to said
contract. These things sufficiently appear from the very terms of the
contract and the permit signed by the President. The privileges and
liberties contained in this permit are expressly granted "with strict
compliance with regulations of the Secretary of the Treasury."
If before or after entering into this contract the claimant had
examined these regulations, he would have found that they provided that
"commercial intercourse with localities beyond the lines of actual
military occupation by the United States forces is absolutely
prohibited."
He would have also found that such regulations expressly provided that
the power of the agent of the Government to make contracts should be
founded upon the statement that the contractor then owned or controlled
the products for which he contracted. And yet the permit of the
President, which so completely put the claimant upon inquiry as to what
he might or might not do, seems now to be relied upon as the source of
equities in his favor, and is pressed into his service under the guise
of a sanction of his unlawful proceedings.
Besides the general knowledge the claimant should have possessed of
the commercial disabilities consequent upon a state of war, and the
information afforded him by his contract and permit, a proclamation of
the President publicly issued September 24, 1864,[17] furnished abundant
notice of the kind of trading which would be permitted.
The property for which compensation is asked constitutes a part only of
that agreed to be furnished. None of it ever reached the possession of
the agent of the Government, but, as I understand the case, was at the
time of its seizure or destruction still in the territory of the enemy
and in rebellious possession. If in the circumstances detailed it was
treated by our military forces in like manner as other property in the
same situation, there would seem to be no hardship in holding that the
contractor assumed this risk as one arising from his unauthorized and,
if successful, his profitable venture.
Not being satisfied that there are any especial equities which entitle
this claim to more consideration than many others where equities might
be claimed in behalf of those who long ago violated our nonintercourse
laws, I am unwilling to sanction a precedent which if followed might
substantially work a repeal of these laws, regarded necessary and
expedient by those charged with legislation during the War of the
Rebellion, and who had in full view all the necessities of that period.