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odd thousand in tbe State of Delaware? One state may sue an. other — that is, all the people of one state may sue all the people of another state. It is plain, then, that a state may be sued, and hence it plainly follows that suability and state sovereignty are not incompatible. But why should it be more imcompatible that all the people of a state should be sued by one citizen than by one hundred thousand, the process being the same, the consequence of the judgment the same.
But Chief Justice Jay closes his opinion by stating that he is not prepared to say that an individual may sue a state on bills of credit, issued before the constitution was established, and which were issued and received on the faith of the state when no idea of judicial interposition was contemplated.
In consequence of this case, Georgia passed an act against the service of such process in the state, making the penalty death. And the next day after the opinions were announced a member of congress from Massachusetts proposed the eleventh amendment, which was speedily adopted.
M'CULLOCH VS. MARYLAND.
In this case the question was presented to the court of the right of the states to charter a bank.
It was contended and argued with great earnestness that the power to create a corporation being a sovereign power, and not being delegated to the United States, was not within the power of the United States government. The greater part of a pretty long opinion of Chief Justice Marshall is devoted to showing that such power did exist; that the creation of a corporation was a mere means to an end, and that the power to create might properly be exercised under the constitution as a means of carrying out other powers.
The next question in the case was as to the right of a state to tax a branch of the United States bank established within its borders.
It was, of course, recognized as a general principle that a state could tax any property within its limits. There being no express prohibition against the taxation of such an institution as this, it was contended that the state might impose a tax.
In the argument of this question, Marshall, C. J., said that both
in maintaining the affirmative and the negative a splendor of eloquence and strength of argument, seldom if ever surpassed, had been displayed.
The only opinion is by Marshall. There are no authorities to be cited.
“But there is one principle,” he says, “which so entirely pervades the constitution, is so intermixed with the materials which compose it, so interwoven with its web, so blended with its texture as to be incapable of being separated from it without rending it into shreds. This great principle is that the constitution and the laws made in pursuance thereof are supreme.”
Starting with this one principle, and with the propositions, first, that the power to create implies the power to preserve; second, that a power to destroy, if wielded by a different hand, is hostile to and incompatible with these powers to create and preserve; third, that where this repugnancy exists that authority which is supreme must control, not yield to that over which it is supreme, he constructs an argument so solid and conclusive that it must have convinced all.
STURGIS VS. CROWNINSHIELD, 1819 OGDEN VS. SAUNDERS, 1827.
These two principal causes, involving the validity of state insolvent laws, are perhaps as interesting reading for the lawyer, except for practical purposes, as most of the modern cases. The arguments and opinions are too elaborate for consideration in this paper.
In the first cause the state insolvent law had been passed after the contract had been made. It was claimed that the statute was invalid upon two grounds; first, because it impaired the obligation of the contract; second, that the constitution having conferred upon congress the power to establish uniform laws on the subject of bankruptcy throughout the United States, such power was exclusive of the right of the state to legislate upon the subject.
In answer to this last objection it was argued, among other things, that there was a distinction between bankruptcy laws and insolvent laws. The court, while recognizing that such distinction existed, holds that the line of partition between them is not so distinctly marked as to enable any person to say, with positive precision, what belongs exclusively to the one and not to the other, and for the purposes of the case treats them substantially as one.
It was also argued that because the power of the states was not expressly prohibited, therefore it must be held to exist in the states. But this position was denied by the court, and the following principle was announced by the court: “Whenever the terms in which a power is granted to congress, or the nature of the power required that it should be exercised exclusively, the subject is as completely taken from the state legislatures as if they had been expressly forbidden to act.” (This prineiple certainly left a wide field for construction and differences of opinion.)
But it was to be noticed that the power given to congress was not merely to pass laws, the operation of which shall be uniform, but to establish uniform laws on the subject throughout the United States. The establishment of such uniformity would be incompatible with state legislation on that part of the subject to which the act of congress may extend. The argument in effect seems to be that this is a new independent power, for no state, nor any number of states, as such, could establish uniform laws on the subject throughout the United States. Therefore, the states were left as free as ever to pass bankrupt or insolvent laws, operating within their borders, providing they should not conflict with any law of congress.
However, when a law, passed subsequently to the contract, undertook to discharge the debtor, without payment, it undertook to impair the obligation of the contract and was a nullity.
But as the law existing at the time of the contract authorized the creditor to coerce payment by imprisonment of the debtor, did not the subsequent law authorizing his discharge without payment also violate the obligation of the contract? The court held that the right to coerce payment by imprisonment was merely a remedy and that the remedy might be changed. Perhaps in favor of the liberty of the citizens this principle of the right of the state to change the remedy was carried further than it would have been otherwise. Certainly it seems from recent decisions of the same court that this right of changing the remedy is more limited than it had been often supposed. It seems that none of the ordinary remedies now existing so vitally affecting the power of the creditor to enforce payment could be taken away.
In Ogden vs. Saunders, Mr. Webster argues that the power of congress to pass bankrupt laws is exclusive, and asks the court to reconsider the case of Sturgis vs. Crowninshield on this point.
He argues that the question is not so important in its bearing on private right as in its character of a public political question. "The constitution intended to accomplish a great political object. Its design was not so much to prevent injustice in one case or in a succession of single cases as it was to make general salutary provisions which in their operation would give security to all contracts, stability to credit, uniformity among all the states in those things which materially concerned the foreign commerce of the country and their own credit, trade and intercourse among themselves. The question is whether the constitution has not for general political purposes ordained that bankrupt laws should be es. tablished only by national authority.”
But upon this question it seems only one member of the court, Mr. Justice Washington, entertained the opinion that the power given to congress was exclusive, and he considered that question settled the other way by Sturgis vs. Crowninshield.
In this case it is held that the state insolvent laws, passed prior to the contract, is not invalid as impairing the obligation of a contract.
On this point the court was divided, Chief Justice Marshall, Story and Duvall dissenting.
It is also held that the certificate of discharge could not be pleaded in an action brought by a citizen of another state in the United States court, or of another state than where the discharge was obtained, and on this point three justices dissented, Washington, Thompson and Trimble.
One justice (Johnston), making the majority in favor of both propositions, ruled.
The argument in this case both by the counsel and by the different members of the court were very exhaustive.
I only notice a few of the points. It was urged that the laws of the place of the contract entered into and became a part of the contract the same as written therein. One answer to this was that if so, then the provision of the constitution probibiting the law, if it did so prohibit it, also entered into and became a part of the contract. But it was contended that the law did not become
a part of the contract. If the provision of the statute, to the effect that upon the surrender of all his property the debtor should be discharged from his obligation had been written into the contract, such opinion would have been valid and binding at all times and in all places, regardless of the continued existence or repeal of the statute. And this was evidently not so as the matter stood. There was much question as to what law fixed the obligation of the contract.
Webster claimed that it was fixed by what he termed “universal law.” But the answer to this was that if so the states would have but little, if any power to legislate upon the subject of contracts generally, i. e., to enact a statute of frauds, to fix the age of capacity to contract, etc.
I think the most closely reasoned opinion in favor of sustaining the statute is that of Mr. Justice Trimble. The contract, he says, is the sole act of the parties and depends wholly on their will. The obligation mentioned in the constitution is something not wholly depending on the will of the party. It is something which attaches to and lays hold of the contract, and which by some superior external power regulates and controls the conduct of the parties in relation to the contract. And this is not the universal or general law, but the law of the place. Under the law of nature men have the right of contracting engagements and the right to enforce performance. This is a natural right which is surrendered when men organize a civil government and submit to its control. The natural obligation ceases and the civil obligation attaches, and this civil obligation is such, and such only, as the law of the place annexes to the contract. Whatever that is, is protected by the constitution. But the constitution leaves to the states the right to fix that. It is not the supreme law upon the subject, because it has not spoken upon the subject as to what shall or shall not be the obligation of a contract.
It will be remembered that Trimble dissented upon the second point ruled.
His position was that the obligation as fixed by the law when the contract was made was that the debtor must perform the contract unless discharged under that law, but when so discharged the contract was not thereafter obligatory.
Mr. Justice Trimble was only on the bench for about two years.