E 480 .U65 Copy 1 Book JlI_ o- 62d Congkess, I HOUSE OF REPRESENTATIVES, j Document M Session. \ t No. 449. SALE OF COTTON TO CONFEDERATE STATES GOVERNMENT. LETTER THE SECRETARY OF THE TREASURY, RELATING TO PERSONS WHO SOLD COTTON TO THE CONFEDERATE STATES GOVERNMENT. January 13, 19] 2. — Referred to the Committee on Expenditures in the Treasury Department and ordered to be printed. Treasury Department, Office of the Secretary, WasJiingfon, January 6, 1912. The Speaker of the House of Representatives. Sir: My attention has been called to House resolution 333, intro- duced by Mr. Jacoway December 9, 1911, and referred to the Com- mittee on War Claims, directing the Secretary of the Treasury to prepare from records in his possession, either those of the United States Government or those of the late Confederate States, a list of persons shown to have sold cotton to the Confederate States Govern- ment, or to have entered into any agreement to sell cotton to said Government, and also to House resolution 349, introduced by Mr. Candler December 19, 1911, and referred to the Committee on Expenditures in the Treasury Department, which calls for the prep- arati(m and transmission of all the information s])ecified in House resolution 333, and in addition requires information whether the cotton sold to the Confederate Government was subsequently taken possession of by officers of the United States Government; and if so, the disposition of the cotton, the gross and net proceeds realized from any sales thereof, and whether or not the proceeds now remain in the United States Treasury, and also to show the cotton for which claims have been filed in the Treasury Department, and the names of persons by whom such claims were filed. (5..,.*^^ 2-,. f 2 SALE OF COTTON. ' "^ .. . • The resolutions have a direct bearing upon the cotton claims which, under section 162 of the judicial code approved March 3, 1911 (36 Stat., 1139-1140), were referred to the Court of Claims for adjudica- tion, and as this department is now actively employed in the work of collecting and arranging information for tiie use of the court in the trial of pending cases, it would seem that neither the interests of the claimants nor of the Government would be subserved by diverting the limited available force of the department from the completion' of the information desired by the court, to engage in the preparation of the data specified in the resolutions. The additional information required by House resolution 349 intended to show the disposition of tlie cotton, the proceeds realized therefrom and now remaining in the Treasury with a report of all the claims for such cotton heretofore filed, would necessitate a further and separate examination of all Civil War records of the department pertaining to cotton transactions, and of all cotton claims heretofore filed in either the Treasury Department or the courts, to determine the claims in which the proceeds of the cotton were refunded by the Treasury Department under general and special laws authorizing such refunds, or paid to claimants upon judgments of the Court of Claims and other courts. The magnitude of the task suggested by the call for the mformation specified in the resolutions may be inferred from the fact that the records possessed by this department are very voluminous, and the task of preparing the proposed list of sales alone probably would require several months' time for its completion, as an exhaustive examination of all related records woidd be necessary to comply with that part of the resolutions directing that the statement shall show whether the sale was a completed one or only an agreement to sell and whether the price agreed upon had actually been paid by the Confederate Government. In explanation of this phase of the claims, it may be stated that when the sales were consummated the Confederate Government, not having storage facilities for the concentration of the cotton at depots, caused the sellers to contract to store and care for the cotton on their plantations and to deliver it at designated points on the order of the Confederate treasury department, and under such agreements the former owners have been regarded as bailees of the cotton. Much cotton of this character was thus in possession of the former owners at the time of the surrender of the military forces of the Con- federacy and was subsequently collected by agents of the United States and sold, and the proceeds placed in the Treasury. As payments for cotton purchased by the Confederate Government were largely made in Confederate bonds, rendered valueless as a result of the war, those persons who sold their cotton to the Confederate Government haA^e contended that the sale was incomplete in that they never parted with the possession of the cotton, and, moreover, that as the Confederate bonds received in payment were of no value, the sale was void as being without consideration. As most of these sales occurred in the years from 1861 to 1864 it may be observed that the department has no information of how the bonds were disposed of by those who received them, but it is probable that many of them were sold while such securities still retg-ined a marketable value. SALE OF COTTON". 3 Congress by the act of March 3, 1911, supra, has committed the adjudication of the cotton claims to the Court of Claims, and the fullest information as to sales of cotton by individuals to the Con- federate Government will be furnished to the Court of Claims from the records possessed by the department so as to present the facts pertaining to each individual case, and as section 164 of said act of March 3, 1911, authorizes the court to call upon this department for any information or papers necessary in the prosecution of its business it would seem that the law sending the claims to the court for adju- dication to be there proceded in as in other cases contemplated that the procuring of all necessary evidence from departmental records should be conducted in the manner indicated in the law and under the rules of the court. Evidence that the cotton for which a claim is filed was actually sold to the Confederate Government is matter of defense to be offered in court for the protection of the interests of the United States, as required by section 185 of the judicial code, and, in my opinion, com- pliance with the resolutions, in advance of the filing of such claims in the Court of Claims, by disclosing the details of the Government's defense against the claims, would be injurious to the public interests. The many controverted questions of fact and law involved in the sales of cotton to the Confederate Government will be determined by the Court of Claims in the exercise of the full jurisdiction given to the court to adjudge said cotton claims, and full information from the records of the department relating to such sales will be furnished to the court in response to its calls made under said section 164 of the act of March 3, 1911. As the provisions of the law for the submission of evidence from the records of this department direct to the Court of Claims appear to meet every requirement for the adjudication of the cotton claims, it is believed that the specific data, when furnished as called for and desired by the court, will supply all necessary information as to sales of cotton to the Confederate Government and of all other facts of record pertaining to the claims in such form and detail as to present the complete facts of each individual case. Respectfully, Franklin MacVeagh, Secretary. o m