VIII. COMPROMISE. § 307. In general. To sustain a settlement as a compromise of doubtful claims without any other consideration, the doubt must be such as a person of ordinary intelligence, familiar with the class of things which is the subject of the settlement, might be expected to entertain. City of Memphis v. Brown, 6 West. Jur., 495; 11 Am. L. Reg. (N. S.), 629; 1 Flip., 188. § 308. Where the amount of a debt due from the government is a matter of dispute between the government and the claimant, and the latter finally accepts the balance of the account as made out on the basis contended for by the government, and gives a receipt in full, such settlement concludes him from making any further demand. United States v. Clyde, 13 Wall., 35. § 309. An agreement made in a spirit of peace and compromise, for the settlement of unadjusted demands, will not, when executed with due caution, after deliberate consideration. by parties of intelligence and business experience, be questioned in a court of equity. On the contrary it is the duty of the court to uphold such an agreement, and protect and enforce the rights of both parties under it. May v. Le Claire, 11 Wall., 217. $310. Offer of compromise - Effect of.- A mere offer of compromise, by which a creditor deducts a certain amount from his bill, will not prejudice his right of recovery, especially where the debtor refuses to pay the balance after making such deduction. West v. Smith, 11 Otto, 263. § 311. Offers of compromise to pay a sum of money by the way of compromise, as a general rule, are not admissible against the party making the offer; but if admitted such offers are open to explanation, no matter whether it was by letter or by oral communication. Ibid. § 312. By implication.— Payment for one thing is not necessarily payment for another, provided the two things are so distinct as to form per se independent causes of action; but where a contractor, having been delayed for several years in the fulfillment of his contract by changes made in the plan of the work, puts in a claim for extra labor and effects a compromise in regard to such claim, he cannot afterwards maintain a suit for delay, insurance on his buildings, and tools, rent, interest on his capital, etc., such things being incident to the things already compromised and paid for. Swift v. United States,* 14 Ct. Cl., 208. 313. No general rule of compromises by implication exists in favor of the government; hence, to establish a compromise, there must be an agreement to that effect. Thus, where a dispute having arisen between a contractor and the quartermaster-general as to the value of horses delivered under contract, the quartermaster directed his officers to pay a part of the contract price as a compromise, but they negligently pay the amount as directed without exacting a release from the contractor for the balance of the contract price, held, that there was no compromise by implication, and that the contractor was not precluded from bringing suit for the balance of his claim. Wilcox v. United States,* 7 Ct. Cl., 586. § 314. Party claiming benefit of, must show performance.— A party cannot avail himself of the conditions of a compromise unless he can show a performance of its terms on his part. Accordingly where, by the terms of a compromise, certain notes were to be delivered up upon the payment of a prescribed amount, at the time and in the manner set forth in the agreement, but nothing was ever paid or tendered, nor anything ever done in fulfillment of the agreement, held, that such compromise was no defense to an action brought for the full face of the notes. Brown v. Spofford, 5 Otto, 474. 315. Under protest - Duress.- Where a party without force or intimidation, and with a full knowledge of all the facts of the case, accepts on account of an unliquidated and controverted demand a sum less than what he claims and believes to be due him, and agrees to accept that sum in full satisfaction, he cannot avoid his act on the ground of duress, and make a further demand. A provost guard having forcibly entered the office of parties having a claim against the government, and having seized their vouchers, business papers and private books of account and carried the same before a military commission appointed to report on unsettled claims, the commission indorsed on the vouchers the amount allowed by it, deducting a considerable sum from the claim. The commission also withheld the vouchers until the claimants signed a receipt or agreement providing that the payment of the amount allowed by the commission should be payment in full of all the claimants' demands against the United States, which was done by the latter under protest to obtain possession of their Vouchers. Subsequently the claimants received payment of the amount allowed by the commission, from the quartermaster, making no formal objection or protest. They were required to and did sign a receipt acknowledging the receipt of such reduced amounts "in full of the above account." Held, that such payment and receipt was a compromise and settlement in full, obtained without duress, and unaffected by the probability that the claimants were constrained to accept the reduced amount by the fear that bankruptcy would result from a re fusal of the sum offered, and the consequent delay in obtaining the money due them. United States v. Child & Co., 12 Wall., 232. § 316. With one debtor, does not affect other debtors.- Where a creditor, having obtained a decree against several defendants, compromises with some of them by taking fifty cents on the dollar, such compromise does not operate as a surrender of any of his rights as to the other defendants, or release them from any of their liabilities under the decree. Molyneaux v. Marsh, 1 Woods, 452. § 317. Sum less than debt received as payment in full.— Upon the plea of payment to an action of debt upon a bond conditioned to pay $500, evidence may be received of the payment of a smaller sum, with an acknowledgment by the plaintiff that it was in full of all demands; and from such evidence, if uncontradicted, the jury may and ought to infer payment of the whole. Henderson v. Moore, 5 Cr., 11. §318. Where a creditor, having full power and privilege to acquire information, agrees to accept, and actually receives, a less sum than the amount of his debt, there being no fraud on the part of the debtor, such agreement and acceptance is binding upon him. The binding force of the settlement does not depend upon ultimate results or the correctness of the judgment exercised by the creditor in the transaction. A., doubting the solvency of a certain bank, his debtor, accepted the offer of the latter to pay twenty-five per cent. of its indebtedness, and received that proportion of his claim as payment in full. Subsequently the bank proved able to pay larger dividends, some creditors receiving the entire amount of their claims. Held, that A. was precluded by his compromise and settlement from demanding anything further from the bank or its assets. In re Bank of North Carolina,* 19 N. B. R., 314. $319. An agreement to take a part of the debt for the whole, when the whole is due, as nudum pactum, is of no legal obligation. A. entered into a contract with the government to furnish muskets. The inspection of the muskets, when delivered, being delayed, the price of such muskets fell in the meantime, and the contract was referred by the government to a commission. A. then made a proposition as a compromise in order to obtain money, which, not being accepted, he made a reduced offer, which the commission accepted. Held, in accordance with the above principle, that A.'s last offer was not binding upon him, and, moreover, that the officers' refusal of the adjudication of A.'s claim, to which he was entitled, thus forcing from him the proposal he made as the only means of obtaining any part of the money due him, which he needed to meet his engagements for the guns, was legal duress, which voided the transaction made under it. Ramsdell v. United States,* 2 Ct. Cl., 508. § 320. Although, at common law, the payment of a less sum is not a sufficient consideration for an agreement to discharge a greater, under the code of Tennessee such contracts will be enforced when performed in good faith according to the intention of the parties. But an agreement by a debtor to deliver in satisfaction of a large sum his notes or money for a less sum will not operate as a discharge, although there be a consideration for the agreement, unless it be fully and fairly performed both as to time and amount. City of Memphis v. Brown, 6 West. Jur., 495; 1 Flip., 188. § 321. Composition with creditors.— It is generally true, in cases of composition, that the debtor who agrees to pay a less sum in the discharge of a contract, must pay punctually; for, until performance, the creditor is not bound. The reason is obvious; the creditor has the sole right of modifying the first contract, and of prescribing the conditions of its discharge. If the agreement stipulates for partial payments, and the debtor fails to pay, the condition to take part is broken, the second contract forfeited, and is no bar to the original cause of action. Clarke v. White, 12 Pet., 178. $322. In composition for a debt, by which one party agreed to deliver goods to the amount of seventy per cent., in satisfaction of a debt exceeding $10,000, and omitted to deliver within $1.41 of the amount, the mistake was too trivial to deserve notice. Ibid. $ 323. claim for negotiating — Fraud. Upon suit brought upon a promissory note given by the debtor, defendant, to plaintiff, the agent of one of defendant's creditors, for his services in effecting a compromise between defendant and his creditors, the court instructed the jury: 1st. That if the note was obtained from defendant by the threat of plaintiff to interfere and defeat defendant's proposed compromise unless defendant would give plaintiff this note, as a bonus to him, then said note was void in the hands of plaintiff as against defendant. 2d. That if it was expected or understood between plaintiff and defendant that plaintiff was not to disclose to other creditors the fact that he was specially retained by defendant, but was to urge the compromise, giving other creditors to understand that he was only acting in the interest of creditors, then the note was void. 3d. That if the plaintiff was, by his agreement with his firm. authorized to accept compensation from debtors for securing compromises in which the firm, upon certain conditions, were to share, the result of such an arrangement might be to give his firm an und ue preference over other creditors, and no contract to that end between plaintiff and a debtor could be enforced in a court of justice. Bullene v. Blain, 6 Biss., 22. $324. obtained by fraudulent concealments. A compromise entered into between a debtor and his creditors, by which the latter agree to accept a portion of the amount their due, in full settlement of their claims, may be treated as void, if brought about by the misrepresentations or fraudulent concealments of the former as to his means and ability to pay. The same is true, although the misrepresentations or concealments were made by an agent of the debtor in effecting the compromise, however innocent such agent may have been, provided that the real state of the facts at the time was known to the debtor. Elfelt v. Snow, 2 Saw., 94. § 325. Agreement to pay one creditor more than others - Validity thereof - Effect if fulfilled.— A creditor who, after having joined with other creditors in executing a composition deed discharging their common debtor, brings an action against such debtor on the original indebtedness, on the ground that the composition deed was procured by the misrepresentations and fraudulent concealments of the latter, is not precluded from asserting his claims by the fact that, by an agreement entered into previous to the composition deed, he received, unbeknown to the other creditors, a sum of money in excess of that stipulated in the deed. Ibid. § 326. The rule, that if a debtor, in compounding with his creditors, secretly promises to give to one more than to the others, in order to induce him to sign the instrument of composition, it is void, only applies to cases where the creditors are supposed mutually to agree with each other, as well as with the debtor. But when each creditor is separately compounded with, this principle of mutuality and equality does not apply. White v. Clarke, 5 Cr. C. C., 102. § 327. If, upon failure or insolvency, one creditor goes into a contract of general composition common to the others, at the same time having an underhand agreement with the debtor to receive a large per cent., such agreement is fraudulent and void. Clarke v. White, 12 Pet., 178. § 328. Where a debtor attempted to settle with his creditors at fifty cents on the dollar, but one creditor refused to sign the composition unless the debtor would give his note for ten per cent. more, thus making such creditor's share in the settlement sixty cents on the dollar, held, in an action by the debtor to recover such extra ten per cent. paid the creditor, to be a good defense that the composition itself was fraudulent, and that in making the settlement misrepresentations had been made and assets concealed by the debtor. Armstrong v. Mechanics' National Bank, 6 Biss., 520. $329. By seamen.- Where, after libel filed by seamen for wages, one of their number accepts, with the advice of his proctor, a certain sum in full settlement, such settlement will not be disturbed. The Hermon, 1 Low., 515. PEDIGREE. See EVIDENCE. PENAL STATUTES. See CONSTITUTION AND LAWS. 375 PENALTIES AND FORFEITURES. [See INFORMERS; MARITIME Law; Revenue; War.] I. IN GENERAL, SS 1-82. IV. DISTRIBUTION OF PROCEEDS, SS 176-194. I. IN GENERAL. § 1. When property forfeited vests in government.- Forfeitures made absolute by statute relate back to the time of the commission of the wrongful acts which the statute prohibits. In such case the title to the thing forfeited vests immediately in the government; but where more than one remedy is given and the government has an election to proceed for the forfeiture, or in some other way not involving a forfeiture, the title to the property does not vest in the United States prior to the seizure, or the performance of some other act which amounts to such an election. United States v. Sixty-Four Barrels of Distilled Spirits, 3 Cliff., 308. § 2. The court below instructed the jury, in the case at bar, that, if the goods were fraudu lently entered, it was no matter in whose possession they were when seized, or whether the United States had made an election between the penalties, and that the forfeiture took place when the fraud, if any, was committed, and the seller of the goods could convey no title to the purchaser. This instruction was right in respect to the sixty-eighth section of the act of 1799, as the penalty is the forfeiture without an alternative of their value; but wrong as the instruction applies to the sixty-sixth section of same act, as the forfeiture under it is either the goods or their value. Caldwell v. The United States, 8 How., 356. § 3. When the act has been done which the law declares to work a forfeiture of the property, the right of the government to seize the property and assert the forfeiture attaches at once, and may be pursued by the government whenever and in whose hands soever that property may be found. Thacher's Distilled Spirits, 13 Otto, 679. § 4. When property is forfeited it does not vest in the government until after a seizure, which then relates back to the time of the forfeiture. Clark v. Protection Ins. Co., 1 Story, 109. § 5. In point of law, no duties, as such, can legally accrue upon the importation of prohibited goods. They are not entitled to entry at the custom-house, or to be bonded; they are ipso facto forfeited by the mere act of importation. McLane v. United States, 6 Pet., 404. § 6. Where a statute denounces a forfeiture of property as the penalty for the commission of an offense, if the denunciation is in direct terms, and not in the alternative, that is, if the statute does not say that the forfeiture shall be of the property or its value, the forfeiture takes place at the time the offense was committed, and operates as a statutory transfer of the right of property to the government. United States v. Stevenson, 3 Ben., 119; United States v. One Copper Still, 8 Biss., 270. § 7. Whether or not a forfeiture is to take effect upon the happening of the act or only after due process of law depends upon the intention of congress, as evidenced by the language of the statute. Where such intention is uncertain the rules of the common law governing such cases may be resorted to. The Kate Heron, 6 Saw., 106. § 8. bona fide purchasers.-The title of the wrong-doer remains undisturbed until there is a condemation, and then the forfeiture relates back to the wrongful act, if there is no alternative remedy, and to the seizure if there is, in which latter case it does not overreach the title of an innocent purchaser whose interest was acquired after the commission of the wrongful acts, but before the condemnation. United States v. Sixty-Four Barrels of Distilled Spirits, 3 Cliff., 303. 9. It is a settled principle of the law that where a statute declares a forfeiture to be the penalty for a violation of law, the forfeiture takes place eo instanter the offense is committed. The title vests in the United States, and cannot afterwards be transferred even to a bona fide purchaser by the wrong-doer. United States v. One Hundred Barrels Spirits, 1 Dill., 49. § 10. Where the forfeiture is made absolute by statute, the decree of condemnation, when entered, relates back to the time of the commission of the wrongful acts, and takes date from the wrongful acts, and not from the date of the sentence or decree. Hence the purchase of goods before seizure by an innocent purchaser, without notice that they are forfeited under the statute, will not protect such purchaser, nor relieve the goods from forfeiture in his hands. Henderson's Distilled Spirits, 14 Wall., 44. § 11. A bona fide purchaser of the whole interest in a vessel, subsequent to a forfeiture incurred under the sixteenth section of the act of congress of December 31, 1792, by the sale or transfer to an alien of any interest in an American registered vessel, is not within the proviso of that section, and such purchase will not prevent the forfeiture, as said forfeiture takes place at the moment of the sale or transfer to an alien, and any subsequent judgment of forfeiture relates back to that time. The Florenzo, Bl. & How., 52. § 12. A purchase of goods which have become forfeited to the United States will not purge the forfeiture, when the purchase has been made under a full knowledge of the facts, or of such facts as were sufficient to put the party on inquiry. Brig Ploughboy,* 1 Gall., 41. § 13. Property which has become forfeited to the United States, and afterwards, and before seizure, while remaining in the possession of the vendor, is sold to a bona fide purchaser for a valuable consideration, without notice, will be protected in the hands of such purchaser against the claim of the United States. Brig Mars,* 1 Gall., 191. Reversed, United States v. The Brigantine Mars, 8 Cr., 418. $14. Where congress declares a forfeiture for violation of its laws, such forfeiture is absolute. Hence where goods are seized as forfeited and proceeded against, it is of no avail for claimants to urge that they were bona fide purchasers, having made advances in good faith upon the goods in question before seizure. Boyd v. United States, 14 Blatch., 317. § 15. The forfeiture of goods for the violation of the non-intercourse act of March 1, 1809, takes place upon the commission of the offense, and avoids a subsequent sale to an innocent purchaser, although there may have been a regular permit for landing the goods, and although the duties may have been paid. United States v. One Thousand Nine Hundred and Sixty Bags of Coffee, 8 Cr., 398. 16. In a proceeding in rem to ascertain a forfeiture it is not material whether the statute declares that the property shall be forfeited, or that the offender shall forfeit it. In either case, the date of the offense is the time to which the forfeiture relates. United States v. FiftySix Barrels of Whisky, 6 Am. L. Reg. (N. S.), 32; 1 Abb., 93. § 17. Where a statute in direct terms denounces a forfeiture of property as a penalty, the forfeiture takes place at the time the offense is committed, and operates as a statutory transfer of the right of property to the government. Therefore, in a proceeding for the condemnation of property, the fact that such property has passed into the hands of a bona file purchaser before the commencement of the suit will not avail the claimant. Ibid. § 18. When the law denounces an absolute forfeiture as the consequence of an act, the title of the United States accrues when the prohibited act is done, and holds as against an innocent purchaser. The Mary Celeste, 2 Low., 354. § 19. Forfeitures are always deemed odious in law, and courts will insist upon the forfeiture being made clearly apparent before enforcing it. Mt. Diablo M. & M. Co. v. Callison, 5 Saw., 439. $20. interest of mortgagee.- Property was seized as forfeited to the United States for violation of the revenue laws, and suit brought to enforce the forfeiture. Upon motion made by certain parties to bond a portion of the property in the hands of the marshal, as to which property they were mortgagees by a mortgage given before the forfeiture was incurred, held, that, as it was the offending thing that was forfeited, the entire right of property of all the world in the thing was cut off, and not merely the mortgagor's right of property therein, and that the motion must therefore be denied. All the Distilled Spirits, etc., 2 Ben., 453. 21. Not attachable by private creditors after commission of act which works forfeit. ure. A vessel was seized as forfeited under the act of May 22, 1794. At the time of the service of the monition by the marshal, the vessel was in the custody of a sheriff, under a process of attachment issued from a state court. Held, that whenever the forfeiture is made absolute by an act of congress, the forfeiture attaches at the time the wrongful act is committed, the owner is divested of all title eo instanti, and the same becomes vested in the United States; and, consequently, that the seizure by the marshal was a valid one, because the vessel, at the time of the attachment, was not attachable for the debts of the former owner, the property in such vessel having already vested in the United States. United States v. Reindeer, 2 Cliff., 57. $22. A levy on the property forfeited under the act of congress of December 31, 1792, under an execution against an alien purchaser, previous to the prosecution of the forfeiture, will not prevent the forfeiture. The Florenzo, Bl. & How., 52. § 23. Claims of seamen, etc., when preferred to claim of government.- A forfeiture under the act of congress of December 31, 1792, does not avoid the lien of seamen and material-men existing at the time of forfeiture. Ibid. § 24. The claims of seamen for wages, and of material-men for supplies, where the parties were innocent of all knowledge of, or participation in, the illegal voyage, are preferred to |