On July 31, 1930, an American motorboat, the Wanda, had on board a cargo of intoxicating liquors. The collector of the port of New York seized the vessel and arrested the crew for an offense against the National Prohibition Act (27 USCA § 1 et seq.). Thereupon the respondent Mack, claiming to be the owner of the vessel, gave a bond as principal with the other respondent as surety in the sum of $2,200, double the value of the vessel, conditioned that the bond should be void if the vessel was returned to the custody of the collector on the day of the criminal trial to abide the judgment of the court. A copy of the bond is printed in the margin. The members of the crew were brought to trial on January 26, 1931, and upon a plea of guilty were sentenced. The vessel, however, was not returned by the owner, either then or at any other time, to the custody of the collector. Accordingly, on July 19, 1933, the United States of America filed its complaint against principal and surety to recover upon the bond, claiming $1,100, the value of the vessel, with interest from the date of the breach of the condition. A motion to dismiss the complaint was made in April, 1934, the defendants contending that through the repeal of the Eighteenth Amendment on December 5, 1933, liability on the bond had ended. The motion was granted by the District Court, 6 F.Supp. 839, and the Court of Appeals for the Second Circuit affirmed, 73 F.(2d) 265. A writ of certiorari brings the case here. 294 U.S. 704, 55 S.Ct. 546, 79 L.Ed. --.
Penalties and forfeitures imposed by the National Prohibition Act for offenses committed within the territorial limits of a state fell with the adoption of the Twenty-First Amendment. United States v. Chambers, 291 U.S. 217, 54 S.Ct. 434, 78 L.Ed. 763, 89 A.L.R. 1510. Our holding to that effect was confined to criminal liabilities, and had its genesis in an ancient rule. On the other hand, contractual liabilities connected with the act continued to be enforceable with undiminished obligation, unless conditioned by their tenor, either expressly or otherwise, upon forfeitures or penalties frustrated by the amendment. The courts below have held that liability upon the bond in suit was conditioned by implication upon the possibility in law of subjecting the delinquent vessel to forfeiture and sale, and that the possibility must be unbroken down to the recovery of judgment against the delinquent obligors. In opposition to that holding the government contends that the bond is a contract to be enforced according to its terms; that liability became complete upon the breach of the express condition for the return of the delinquent vessel; and that the liability thus perfected was not extinguished or diminished by the loss of penal sanctions. We think the government is right.