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DELMAS v. INSURANCE COMPANY.

December 1, 1871

DELMAS
v.
INSURANCE COMPANY.



662 ERROR to the Supreme Court of Louisiana; the case being this: J. Menard, of New Orleans, gave to one Delmas an obligation, the consideration of which (as was said) was Confederate money. On this obligation Delmas obtained a judgment. Subsequent to the date of the obligation given, as above said, the State of Louisiana adopted a new constitution of government, the 127th article of which thus ordained: 'All agreements, the consideration of which was Confederate money, notes or bonds, are null and void; and shall not be enforced by the courts of this State.' So far as to Delmas and the debt to him. The same Menard, above mentioned, gave also, May 28th, 1857, to the Merchants' Insurance Company, a note payable at one year, and secured by mortgage. On the 16th March, 1866, the note was thus indorsed: 'The payment of this note is without novation extended to 1st of December, 1866. 'J. MENARD.' The mortgage also was reinscribed; but to neither the extension of the note nor to the reinscription of the mortgage was there any stamp affixed. The Stamp Act of June 30th, 1864,*fn1 it is here perhaps necessary to remind the reader, specifies in a schedule a great number of instruments of writing (not including, however, either the extension of the time of payment of a promissory note, or the 'reinscription' of a mortgage) on which stamps must be affixed, and prescribes the amount of the stamp; and says, also: 'Agreements or contracts other than those specified in this schedule, 5 cents.' In this state of things, one Henderson–having in his hands a sum of money belonging to Menard, on which both Delmas and the insurance company set up respectively liens under the judgment and mortgage above mentioned–filed a bill in one of the State courts of Louisiana, in the nature of an equitable bill of interpleader, to have it determined by the court to which of the claimants upon it the noney should rightfully be paid. Coming in to interplead, the insurance company, on the one hand, impeached the judgment of Delmas because it was based upon a contract the consideration of which was Confederate money; and Delmas, on the other, impeached the mortgage of the insurance company because neither the extension of the note nor the reinscription of the mortgage had a stamp affixed to it. The court where Henderson filed his bill decided both matters in favor of the insurance company; and the Supreme Court of Louisiana, where the matter went on appeal, did the same. As respected the matter of the consideration of Delmas's note, it said (assigning no other reason): 'His judgment was based on a contract or agreement the consideration of which was Confederate money. To render the decree asked for would be to enforce a prohibited agreement. (Article 127 Constitution.)' In thus stating the reasons of its judgment, the Supreme Court of Louisiana followed the Code of Practice of the State, which requires it to state those reasons by citing as exactly as possible the law on which it founds its opinions.*fn2 As respected the stamps, it decided that the extension of time on the note was not such an agreement as required stamps; nor the reinscription of the mortgage either. From this decision Delmas brought the case here, as within the 25th section of the Judiciary Act,*fn3 alleging that the validity of the article 127 of the Constitution of Louisiana had been drawn in question as impairing the provision of the Federal Constitution forbidding any State to pass a law violating the obligation of contracts, and that the Supreme Court had decided in favor of its validity, and also because the construction of an act of Congress about stamps had been drawn in question, and that the court below had decided that it was inapplicable.

The opinion of the court was delivered by: Mr. Justice Miller delivered the opinion of the court.

Mr. T. J. Durant, for the plaintiff in error:

The renewal of the note is clearly a new agreement, and comes under the head of 'Agreements other than those specified in this schedule.'

The same may be said of the reinscription of the mortgage. A mortgage to affect third persons must be publicly inscribed on records kept for that purpose.*fn4 This prescrves the mortgage during ten years. The effect ceases, even against the contracting parties, if the inscriptions have not been renewed before the expirations of their time, in the manner in which they were first made.*fn5 Nothing could come more completely within the meaning of the Stamp Act than such a reinscription; it is a renewal of the mortgage, and that is the case provided for in Schedule B.

Mr. A. G. Riddle, for the defendant in error:

The extension of the note did not require to be in writing at all, and neither the extension nor reinscription required a stamp.

On the other matter this court has no jurisdiction. In Bethel v. Demaret,*fn6 a writ taken under an assumption that the case was within the 25th section, seems to settle the case. The syllabus there is: 'The decision of a State court which simply held that promissory notes given for the loan of 'Confederate currency,' together with a mortgage to secure the notes, were nullities on the ground that the consideration was illegal according to the law of the State at the time the contract was entered into, is not a decision repugnant to the Constitution.'

The writ in that case was accordingly dismissed, as not within the 25th section. So we ask that this one may be. The judgment of the Supreme Court of Louisiana would have been the same if the article 127 had not been referred to.*fn7

The plaintiff in error relies upon two propositions ruled against him by the Supreme Court of Louisiana as bringing the case within the revisory power of this court.

1. The first of these is that the court below decided that a judgment in his favor, which was otherwise conceded to be a valid prior lien, was void because the consideration of the contract on which the judgment was rendered was Confederate money.

2. That the note under which the insurance company claimed had been extended as to time of payment, and the mortgage given to secure it reinscribed, without having the stamps affixed which such agreements required.

1. In regard to the first of these propositions this court has decided, in the case of Thorington v. Smith,*fn8 that a contract was not void because payable in Confederate money; and notwithstanding the apparent division of opinion on this question in the case of Hanauer v. Woodruff,*fn9 we are of opinin that on the general principle announced in Thorington v. Smith the notes of the Confederacy actually circulating as money at the time a contract was made may constitute a valid consideration for such contract.

The proposition involved in this conclusion, however, does not of itself raise one of those Federal questions which belong to this court to settle conclusively for all other courts. When a decision on that point, whether holding such contract valid or void, is made upon the general principles by which courts determine whether a consideration is good or bad on principles of public policy, the decision is one we are not authorized to review. Like in many other questions of the same character, the Federal courts and the State courts, each within their own spheres, deciding on their own judgment, are not amenable to each other.

Accordingly, in several cases coming here on writ of error to the State courts where the same question of the sufficiency of Confederate money and the sale of slaves as a consideration for a contract was the error complained of, we have dismissed the writ because it appeared that the State court had rested its decision on ...


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