United States v. Padelford

The citation for this case is 76 US [9 Wall.] 531. This 1870 case arose from the confederate government’s issuing bonds at the beginning of the war. “The first bond issue of the Confederacy was authorized on February 28, 1861. It was in the amount of $15 million, and its sale was accomplished within the year of its passage. The sale of these bonds was primarily to banks and bankers. One of these bankers was Edward Padelford, who purchased a substantial quantity of the bonds. Padelford lived in Savannah, Georgia, and was an officer and one of the larger shareholders in the Marine Bank of the city of Savannah. The bank was owned by Northern shareholders, and Padelford acted as their representative in Savannah. The Marine Bank purchased $100,000 worth of the bond issue.” [Robert Bruce Murray, Legal Cases of the Civil War, p. 144] Padelford entered into a partnership with Randolph Mott to buy cotton, which they did for almost the entire war, until Major General William T. Sherman entered the city of Savannah in December of 1864. The following month, Padelford took the amnesty oath. “After Padelford took the oath, the Northern forces took possession of Mott and Padelford’s cotton, which consisted of 1,293 bales. The cotton was turned over to a U.S. Treasury agent and was sold under the provisions of the Abandoned and Captured Property Act of March 12, 1863. The proceeds, $246,277.77, were paid into the Treasury of the United States.” [Ibid., p. 145] Mott and Padelford separately sued to claim they were the rightful owners and each deserved half the proceeds of the sale. “To prevail in the Court of Claims, Padelford was required to prove to the court his ownership of the cotton, its capture by the Union army, the receipt of the proceeds of the sale of the cotton by the U.S. Treasury, and that he had remained loyal to the United States. All of these matters were easy for Padelford’s attorneys to establish except the requirement that he had remained loyal to the United States during the war. The government, which would be entitled to the funds if he did not successfully establish his claim, challenged Padelford, asserting that he had not remained loyal to the United States because of the fact that Padelford, and his Marine Bank, had given aid and comfort to the Rebellion by investing in Confederate bonds. In addition, the government introduced evidence that Padelford, as a banker, had become the surety on the official bonds of several of his friends, which permitted them to become officers in the Confederate government.” [Ibid., pp. 145-146] Padelford introduced evidence that the public pressure to buy bonds was such that he feared for his personal safety if he didn’t purchase bonds himself, and the bank also was forced to invest under threat of being physically destroyed by mobs in the city. The Court of Claims ruled in favor of Padelford, and the US Government appealed, with the case making its way to the Supreme Court of the United States.

The case was argued on April 21, 1870, with the decision delivered on April 30, 1870. Chief Justice Salmon P. Chase delivered the unanimous opinion. In reciting the facts of the case, he wrote, “In April, 1861, after the breaking out of the rebellion, a subscription for a loan of $15,000,000 to the Confederate government was opened in the City of Savannah, and all persons were expected and required to subscribe to it who were able to do so, and declarations and threats were publicly made, that all who did not subscribe voluntarily should be made to subscribe. These threats were openly made at the place of subscription, and by persons influential with the populace. Padelford’s name was mentioned, his absence was remarked upon, and inquiries were made as to where he was, and it was publicly threatened that if the Marine Bank, of which he was a director, did not subscribe liberally, it should be pulled down. Padelford was informed of these things, and advised to subscribe to the loan because of them, by friends, loyal as well as rebel; and under these threats and the pressure of circumstances stated, he subscribed $5,000 to the loan, and declared he did it unwillingly and because of the public excitement, and he sold out the stock he had subscribed for in two weeks after. The Marine Bank of the City of Savannah was, in 1861, under the direction of Northern men, and Padelford was one of its most influential directors and largest stockholders. When the other banks of Savannah increased their capital stock and lent their funds to the aid of the Confederacy by exchanging them for Confederate notes and securities, the Marine Bank objected to doing so, and instead contracted its business for its own security. This conduct and the known loyalty of many of the directors of the bank subjected it to public odium, and it was nicknamed the Yankee Bank. At the time the subscription to the loan was opened in Savannah, the political excitement was at its highest point, and it was, as has been stated, publicly threatened that if the bank did not subscribe liberally, it should be pulled down. Under these threats and the pressure of the circumstances stated, the bank subscribed $100,000 to the Confederate loan. This was the least it could subscribe according to its capital, and its refusal to subscribe would have endangered the bank and its directors; but Padelford opposed the loan made, and from that time absented himself for the most part from the meetings of the directors, on the ground that the course of the bank was controlled by outside pressure.” [76 US 531, 531-532]

In his ruling, Chief Justice Chase said, “The findings of the court show clearly enough that the petitioner disapproved of the rebellion, opposed it as far as he thought opposition prudent or safe, and was gratified by the restoration of the national authority. It appears further that on the 18th of January, 1865, he testified his adhesion to the constitutional government of the Union by taking the oath prescribed by the proclamation of pardon issued by President Lincoln on the 8th of December, 1863, that he was not within any of the exceptions of the proclamation, and that he has faithfully kept his oath. This proclamation, if it needed legislative sanction, was fully warranted by the Act of July 17, 1862, which authorized the President, at any time thereafter, to extend pardon and amnesty to persons who had participated in the rebellion, with such exceptions as he might see fit to make. That the President had power, if not otherwise yet with the sanction of Congress, to grant a general conditional pardon has not been seriously questioned. And this pardon, by its terms, included restoration of all rights of property except as to slaves and as against the intervening rights of third persons. Now we have already seen that at the time when the petitioner took the prescribed oath, no right of any third party had intervened, for even if it could be admitted that a right of the government derived from capture is an intervening right of a third person within the meaning of the proclamation, it is certain that no such right accrued to the government until actual seizure, which was after the pardon had taken full effect. In the case of Garland, this Court held the effect of a pardon to be such ‘that in the eye of the law the offender is as innocent as if he had never committed the offense,’ and in the case of Armstrong’s Foundry, we held that the general pardon granted to him relieved him from a penalty which he had incurred to the United States. It follows that at the time of the seizure of the petitioner’s property, he was purged of whatever offense against the laws of the United States he had committed by the acts mentioned in the findings, and relieved from any penalty which he might have incurred. It follows further that if the property had been seized before the oath was taken, the faith of the government was pledged to its restoration upon the taking of the oath in good faith. We cannot doubt that the petitioner’s right to the property in question, at the time of the seizure, was perfect, and that it remains perfect notwithstanding the seizure.” [76 US 531, 542-543]

As to whether or not Padelford had to prove he never voluntarily gave aid and comfort to the rebels, Chase wrote, “The sufficient answer to it is that after the pardon, no offense connected with the rebellion can be imputed to him. If in other respects the petitioner made the proof which, under the act, entitled him to a decree for the proceeds of his property, the law makes the proof of pardon a complete substitute for proof that he gave no aid or comfort to the rebellion. A different construction would, as it seems to us, defeat the manifest intent of the proclamation and of the act of Congress which authorized it. Under the proclamation and the act, the government is a trustee, holding the proceeds of the petitioner’s property for his benefit, and having been fully reimbursed for all expenses incurred in that character, loses nothing by the judgment, which simply awards to the petitioner what is his own.” [76 US 531, 543]

The Court ruled that the Court of Claims decided correctly, and they affirmed the judgment. Padelford was paid his $123,138 from the sale of the cotton. To me, there are two salient points made in the case. First, that when a person was forced to give aid and comfort to the enemy, they are not held responsible for that action, and second, that when a person is pardoned for whatever offense they may or may not have committed, their record is cleared and they are treated as though they had never committed that offense.

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