Nutt v. Knut

Background

An attorney sued to collect fees that he claimed under a contract connected to a claim against the United States. The estate of a deceased man named Nutt (represented by his executrix) defended, arguing a federal statute barred transfers or liens on claims against the Government before those claims were allowed and paid. The Mississippi courts reached differing views at earlier stages about whether the contract violated that federal statute and whether the attorney’s work was the kind of lobbying services that courts will not enforce.

Reasoning

The central question was whether the contract created an unlawful assignment or lien on a claim against the United States before the claim was allowed. The Court explained that a clause giving the attorney a lien or an interest in any government payment before allowance would violate the statute. But the Court found another part of the 1882 contract — an agreement by Nutt’s executrix to pay the attorney one-third of any amount allowed — did not create a lien on the government claim and was lawful. The Supreme Court accepted the Mississippi high court’s view that the record did not prove impermissible lobbying and that the decree merely enforced the estate’s contractual obligation, not a prior assignment of the government claim.

Real world impact

The decision makes clear that third parties cannot take enforceable interests in a government claim before it is allowed, while preserving the ability to enforce an agreed payment obligation against a decedent’s estate after collection. The ruling affirms the state court outcome without creating a broader change beyond the parties here.