Mutchler, John G.

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North Dakota Law Review Volume 28 Number 2 Article 9 1952 Statutes - Torts - Applicability of Anti-Assignment Act to Suits under F.T.C.A. John G. Mutchler Follow this and additional works at: https://commons.und.edu/ndlr  Part of the Law Commons Recommended Citation Mutchler, John G. (1952) "Statutes - Torts - Applicability of Anti-Assignment Act to Suits under F.T.C.A.," North Dakota Law Review: Vol. 28 : No. 2 , Article 9. Available at: https://commons.und.edu/ndlr/vol28/iss2/9 This Case Comment is brought to you for free and open access by the School of Law at UND Scholarly Commons. It has been accepted for inclusion in North Dakota Law Review by an authorized editor of UND Scholarly Commons. For more information, please contact und.commons@library.und.edu. NORTH DAKOTA LAW REVIEWWhether the use of such a device in North Dakota, in situations of theHermes v. Markham type, would be successful, is a question furnishing groundfor interesting speculation.JIM R. CARRIGANSTATUTES -TORTS -APPLICABILITY OF ANTI-ASSIGNMENT ACT TO SUITSUNDER F. T.C.A. - Plaintiffs brought an action under the Federal Tort ClaimsAct 1 for damages to realty bought by the plaintiffs after the damages hadoccurred. The assignor had leased part of the tract to the United StatesGovernment and the unleased portion had been damaged by the govern-ment's agents. Plaintiffs took title as a result of a tripartite contract to whichthe government was a party and which reserved to the plaintiffs the claimagainst the government. Plaintiffs joined the assignor as party defendant.The government contended that the assignment was void under the Anti-Assignment Act.2 The district court allowed recovery which the circuit courtaffirmed 3 on the ground that the assignment was a "mutual mistake of law"and equity would grant relief from the hardship that would otherwise ensue.The Supreme Court granted certiorari and held that the Anti-AssignmentAct made the voluntary assignment void. The court rejected the equitytheory and found that the claim did not fall within any of the exceptionscontemplated by the statute. The dissent felt that the Anti-Assignment Actshould not be a bar since all the parties were before the court and paymentof a just claim would be binding upon all parties so as to foreclose the possi-bility that any of the purposes of the Anti-Assignment Act would be violated.United States v. Shannon, 72 Sup. Ct. 281 (U.S. 1952).During the ninety-nine year history of the Anti-Assignment Act, 4 thecourts have recognized involuntary assignments as exceptions to the broadsweep of the statute (aside from voluntary assignments made in accordancewith the provisions of the statute 5 or waiver of the statute by the UnitedStates by payment to the assignee 6). Assignments by operation of law in-clude assignment in bankruptcy,7 by will or by death, 8 and by subrogation.9The early cases held that the statute applied to equitable and legal claimsalike, 1° and also that the assignment was void and unenforceable as be-1. 60 Stat. 842, 28 U.S.C. (1946) §§921-946, as amended, 28 U.S.C. (1946Supp. iii) §§1291, 1346(b), 1402(b), 1504, 2110, 2401(b), 2402, 2411, 2412, 2671-2680.2. 54 Stat. 1029 (1940), 31 U.S.C. §203 (1946).3. 186 F.2d 430 (4th Cir. 1951).4. 10 Stat. 170 (1853) R.S. §3477 (1875), as amended, 54 Stat. 1029 (1940) 31U.S.C. §203 (1946). The Act provides that "All transfers and assignments made of anyclaim upon the United States . . . shall be absolutely null and void, unless . . . made ...after the allowance of such a claim and ascertainment of the amount due and the issuingof a warrant in payment thereof."5. See note 4 supra.6. Freedman's Savings Co. v. Shepherd, 127 U.S. 494 (1888); Bailey v. United States,109 U.S. 432 (1883); Goodman v. Niblack, 102 U.S. 556 (1880); McKnight v. UnitedStates, 98 U.S. 179 (1878); Thayer v. Presser, 175 Mass. 225, 56 N.E. 5 (1900).7. National Bank of Commerce v. Downie, 218 U.S. 345 (1910); Erwin v. UnitedStates, 97 U.S. 392 (1878).8. See note 7 supra.9. United States v. Aetna Surety Co., 338 U.S. 366 (1949).10. Spofford v. Kirk, 97 U.S. 484 (1878); United States v. Gillis, 95 U.S. 407 (1877).RECENT CASEStween the parties." The modem trend is to the effect that the statute ispurely and simply for the protection of the Government and therefore theassignment will be enforceable as between the parties to it.12 The courtshave enforced the Anti-Assignment statute with equal vigor to cases involv-ing contract claims and those involving tort claims since the Anti-Assign-ment Act uses the unequivocal words "All transfers and assignments madeof any claim upon the United States." 13In the instant case, the Supreme Court has enumerated the basic prin-ciples which underlie the Anti-Assignment Act but it is difficult to see howthose principles apply to the facts in this case. The first purpose was to pre-vent persons of influence from buying up claims against the United States,which might then be improperly urged upon the officers of the government.14Here the claims were included as an incident or the purchase of the land.-5The second purpose was to prevent the possible multiple payment of claimsand to make unnecessary investigation of alleged assignments.'5 The dangerof this is obviated where all possible parties are before the court in a singlesuit 17 wherein all rights between them can be finally adjudicated. 1 8 Thethird purpose was to enable the government to deal only with the originalclaimant. In this case any damages proved could be paid to the vendorand impressed with a resulting trust or subjected to an equitable lien infavor of the assignee 19 since the assignment, though not valid against theUnited States 20 is valid between the parties. 2" The last purpose, of recentorigin, was to save to the United States any defenses which it has againstan assignor by way of set-off, counterclaim, etc., which might not be appli-cable to an assignee. 22 The Government made no allegations of counter-claim or set-off in the instant case.The Federal Tort Claims Act"3 declared the Government's liability forthe negligent acts of its employees "under circumstances where the UnitedStates, if a private person, would be liable to the claimant in accordance with11. National Bank of Commerce v. Downie, 218 U.S. 345 (1910); Spofford v. Kirk,.97 U.S. 484 (1878); Porter v. Title Guaranty and Surety Co., 21 Ida. 312, 121 Pac.548 (1912).12. McKenzie v. Irving Trust Co., 323 U.S. 365 (1944); Martin v. National SuretyCo., 300 U.S. 588 (1936) (equitable lien was imposed on money collected from thegovernment by second assignee who took with notice of prior assignment); Bank of Cali-fornia v. Commissioner of Internal Revenue, 133 F.2d 428 (9th Cir. 1943) (estate taxcase); In re Webber Motor Co., 52 F. Supp. 742 (D. N.J. 1943); People of State ofNew York v. Hanley Milling Co., 41 F. Supp. 844 (N.D. Ohio 1940); aff'd, 123 1.2d819 (6th Cir. 1940) (equitable assignment); York v. Conde, 147 N.Y. 486, 42 N.E.193 (1895), dismissed, 168 U.S. 642 (1897).13. 54 Stat. 1029 (1940), 331 U.S.C. §203 (1946).14. Goodman v. Niblack, 102 U.S. 556 (1880).15. Admittedly, the land could be bought as an incident to the assignment.16. See note 14 supra.17. 1 Ala. L. Rev. 308 (1948). Fed. R. Civ. P. 15, 18-21.18. This is, in effect, the doctrine of res judicata. See Cumberland Pipe Line Co. v.Spears, 208 Ky. 492, 271 S.W. 581 (1925); Good Health Dairy Products Corp. v. Emery,275 N.Y. 14, 9 N.E.2d 756 (1937); Silber v. First Catholic Slovak Union, 23 OhioApp. 198, 154 N.E. 350 (1926).19. Martin v. National Surety Co. 300 U.S. 588 (1936).20. McKenzie v. Irving Trust Co., 323 U.S. 365 (1944); Martin v. National SuretyCo., 300 U.S. 588 (1936); In re Webber Motor Co., 52 F. Supp. 742 (D. N.J. 1943)-21. See note 11 supra.22. United States v. Aetna Surety Co., 338 U.S. 366, 371 (1949).23. See note 1 supra.136 NORTH DAKOTA LAW REVIEWthe law of the place where the act or omission occurred." 24 The act alsoprovided that the Federal Rules of Civil Procedure should control the prac-tice and procedure of the suit under the Act.2 5 These rules require thesuit be brought by the real party in interest,26 and permit necessary 27 andpermissive 28 joinder of parties. Under modern statutes, valid tort claimsare transferable by assignment if they pass the test of survival 29 and theassignee may sue in his own name as the real party in interest. 30 The factthat the assignor was joined as party defendant raises the constitutional rightto a jury trial by the assignee. 31 But the Federal Rules of Civil Procedureare sufficiently elastic to try government issues to the court and private is-sues to the jury. 2 - Yet the possibility that the Federal Tort Claims Actmay be an exception to the Anti-Assignment Act by implication was notconsidered by the Supreme Court in the instant case.Although the reasons for enforcing the Anti-Assignment Act are absentfrom the instant case, the majority felt that recognizing the assignment asvalid when all parties are before the court would in effect, repeal the statuteby mere judicial construction in plain disregard of the unequivocal languageof the act.JOHN G. MUTCHLER.TRUSTS - BREACH OF CONTRACT OF AGENCY OR EMPLOYMENT - IMPoSI-TION OF CONSTRUCTIVE TRUSTS WHERE STATUTES MAKE ORAL CONTRACTSOF AGENCY VOID. - The plaintiff orally employed defendant, a real estateagent, to purchase certain land for him, but advanced no money. Defend-ant purchased the property but took title to the land in his own name.Plaintiff sued to impose a constructive trust on the property, contending thatdefendant had taken title to the property in fraudulent breach of their pur-chase agreement. Defendant's motion to dismiss was granted on the basisof a specific statute covering oral contracts with real estate brokers to pur-chase property and making such contracts void unless in writing.' Uponappeal, it was held, that the agreement created a relationship of trust andconfidence between the parties to which the statute did not apply and that24. 28 U.S.C. §1346 (b).25. 60 Stat. 844 (1946).26. Fed. R. Civ. P. 17 (a).27. Fed. R. Civ. P. 19 (a).28. Fed. B. Civ. P. 20 (a).29. Clark, Code Pleading p. 164 (2d ed. 1947).30. Clark, op. cit. supra at 165.31. See 59 Yale L.J. 1515 (1950).32. See note 30 supra.1. N.M. Ann. Stat. §75-143 (Supp. 1951): "§1. Any agreement entered into subse-quent to the first day of July, 1949, authorizing or employing an agent or broker to pur--chase or sell lands, tenements, or hereditaments or any interest in or concerning them,for a commission or other compensation, shall be void unless the agreement, or somememorandum thereof shall be in writing and signed by the person to be charged there-with, or some other person thereunto by him lawfully authorized. No such agreementor employment shall be considered exclusive unless specifically so stated therein." Alsosee N.D. Rev. Code §9-0604 (i943): "The following contracts are invalid, unless thesame or some note or memorandum thereof is in writing and subscribed by the partyto be charged, or by his agent . . . 4. An agreement . . . for the sale of real property.or of an interest therein . . ."

Statutes - Torts - Applicability of Anti-Assignment Act to Suits under F.T.C.A.

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Statutes - Torts - Applicability of Anti-Assignment Act to Suits under F.T.C.A.

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