Εικόνες σελίδας
PDF
Ηλεκτρ. έκδοση

delivery, &c., shall be entitled to notice of non-payment the same as regular indorsers, cannot apply to existing notes, for it would materially alter the contract relations of the parties: Cook v. Googins, 126 Mass. 410. But a law prohibiting the future making of contracts of a specified kind is not within the purview of the limitation Churchman v. Martin, 54 Ind. 380; nor is a law which makes valid a void contract: Welch v. Wadsworth, 30 Conn. 150. Nor was the constitutional prohibition intended to interfere with the legislation of the states in regard to their internal police. Hence a law declaring a certain day to be a legal holiday cannot be regarded as impairing the obligation of the contract contained in a promissory note, already existing, although its effect is to make such note payable one day earlier than it would otherwise have been: Barlow v. Gregory, 31 Conn. 261. Nor can a law which is in force at the time a contract is made be deemed to have this effect; for the parties are legally conusant of it, the contract is made with reference to it, and it is embodied in their agreement: Blanchard v. Russell, 13 Mass. 16. Neither can the limitation be extended to judicial decisions which declare a contract void because it contravenes the constitution: McClure v. Owen, 26 Iowa 243. Finally, it is competent only for the party whose rights are invaded to plead the nullity of a law as impairing the obligation of contracts: New Orleans Navigation Co. v. New Orleans, 12 La. An. 364.

IX. State Insolvent Laws.-It is settled that a state insolvent law, allowing the absolution of the debtor, is not unconstitutional as impairing the obligation of contracts, provided that it is not extended to pre-existing debts, but only to such as were contracted after the law went into effect, and provided that it shall only apply to citizens of the state and to such others as voluntarily place themselves within its control and jurisdiction for that particular purpose: Sturges v. Crowninshield, 4 Wheat. 122; Baldwin v. Hale, 1 Wall. 223; 1 Kent's Com. *422. And whereas this principle was at one time made to rest upon the ground that parties contracted with reference to existing insolvent laws and so made them a part of their contract, that theory seems to be rejected by the more recent cases, and an entirely different basis established. In the language of Judge GARDINER: "The permission by these laws accorded to a debtor to absolve himself is an act of sovereignty, induced by considerations of public expediency. It is the exercise of a power not derived from or dependent upon contract, but beyond

and in hostility to it. The public good or the exigencies of a state may require the taking of private property without the consent of the owner, or the discharge of a debt without the consent of the creditor; but the idea that the justification in either case rests on contract or depends upon the assent of the holder, has scarcely the merit of plausibility:" Donnelly v. Corbett, 3 Seld. 505.

Nothing can be more firmly established, however, than that a discharge of the debtor under the insolvent laws of his own state has no effect whatever upon contracts made with citizens of other states, or upon contracts not made within the state: Ogden v. Saunders, 12 Wheat. 213; Baldwin v. Hale, 1 Wall. 223: Felch v. Bugbee, 48 Me. 9; Guernsey v. Wood, 130 Mass. 503; Whitney v. Whiting, 35 N. H. 467; Pratt v. Chase, 44 N. Y. 597; Story on Conf. Laws, § 341. And in Guernsey v. Wood, supra, this principle was held to apply though the contract was made and to be performed in the state of the defendant, and even though made by the defendant with plaintiff's agent who was also a resident of that state and whom defendant supposed to be the principal, the fact of agency not being disclosed. These decisions proceed upon two well known and analogous rules of law; (1) that state laws have no extra-territorial force, (2) that the courts of a state have, generally, no jurisdiction over non-residents. It is therefore entirely in accordance with this principle to hold that foreign creditors may put themselves on a footing with citizens, and be equally bound by the debtor's discharge, by becoming parties to the proceedings, by proving their debts under the commission of insolvency, by accepting dividends, or by any other act which clearly shows their submission to the jurisdiction: Whitney v. Whiting, 35 N. II. 467; Pratt v. Chase, 44 N. Y. 597. But if the contract is made between citizens of the same state, the power to grant a discharge is not impaired by a subsequent removal of the creditor to another state : Stoddard v. Harrington, 100 Mass. 87.

X. Marriage not a Contract.-The constitutionality of legisla tive divorces has involved the question how far and to what purposes marriage may be considered a contract. A few sporadic cases have held that it is purely and simply a contract, and therefore within the constitutional limitation now under consideration; Ponder v. Graham, 4 Fla. 23; Bryson v. Bryson, 44 Mo. 232. But the overwhelming weight of authority is to the effect that, while certain contractual elements do indeed enter into the marriage rela

tion, it is more properly to be regarded as a status; and therefore an act of the legislature destroying the marital status of two persons is not a "law impairing the obligation of contracts:" Maguire v. Maguire, 7 Dana 183; Adams v. Palmer, 51 Me. 481; Cronise v. Cronise, 54 Penn. St. 255; Carson v. Carson, 40 Miss. 349; Noel v. Ewing, 9 Ind. 37; Story on Confl. Laws, § 108 and note; 2 Whart. on Cont. § 1069; 1 Bishop Mar. & Div. §§ 667, 669.

XI. Not Applicable to Actions on Torts.-It seems to be well settled that a claim founded upon a tort, whether it has passed into judgment or not, cannot be considered a contract under this clause of the federal constitution; because in either case, it lacks one of the vital elements of a contract, the assent of the parties; McAfee v. Covington (Sup. Ct. of Ga., 1884), 17 Reporter 552; Garrison v. New York, 21 Wall. 196; 2 Wharton on Cont. § 1070, and case cited.

XII. Distinction between Obligation and Remedy.-Of all the complications which have arisen under the general topic, and presented themselves for solution, there is perhaps none which has been productive of greater embarrassment and confusion than the distinction between the obligation of the contract and the remedy for its enforcement. We propose first to review the authorities which have taken this troublesome question in hand, and then to see what deductions can be drawn from them. In the first place, then, the obligation of a contract may be roughly defined as the duty of each of the contracting parties to perform his share of it, and the right (since right and duty are here correlative terms), of the party who keeps the agreement to exact specific performance, or compensation in damages, from the party who breaks it. The remedy is the means provided by the state for the enforcement of that right. Accordingly it was said at an early day, by Chief Justice MARSHALL: "The distinction between the obligation of a contract and the rem. edy given by the legislature to enforce that obligation, has been taken at the bar, and exists in the nature of things. Without impairing the obligation of the contract, the remedy may certainly be modified as the wisdom of the nation shall direct:" Sturges v. Crowninshield, 4 Wheat. 200. Then followed the case of Bronson v. Kinzie, 1 How. 311, where the court said: "And although a new remedy may be deemed less convenient than the old one, and may in some degree render the collection of debts more tardy and difficult, yet it will not follow that the law is unconstitutional. What

ever belongs merely to the remedy may be altered according to the will of the state, provided the alteration does not impair the obligation of the contract. But if that effect is produced, it is immaterial whether it is done by acting on the remedy or directly on the contract itself. In either case it is prohibited by the constitution." Soon after it was held that a certain law in regard to sales of property on execution so far obstructed the remedy as to impair the contract, and was therefore unconstitutional: McCracken v. Hayward, 2 How. 608. And see Gunn v. Barry, 15 Wall. 610; Green v. Biddle, 8 Wheat. 1; Butz v. Muscatine, 8 Wall. 575; Planters Bank v. Sharp, 6 How. 301. In the case of Van Hoffman v. Quincy, 4 Wall. 535, it was stated that if these doctrines were still open to discussion, the soundness of the distinction between obligation and remedy, might well be doubted. And a recent case (Edwards v. Kearzey, 96 U. S. 595), holds that the law of the remedy, as it exists at the making of the contract, enters into it and forms a part of its obligation, in so far that any subsequent change of remedy which tends to essentially lessen or impair the value of the contract, is unconstitutional. Turning now to the state reports we find a number of cases holding generally that whatever pertains to the remedy merely may be altered at the will of the legislature, provided a substantive remedy is left to the creditor, and no material rights are destroyed: Rathbone v. Bradford, 1 Ala. 312; Paschal v. Perez, 7 Texas 348; Holland v. Dickerson, 41 Iowa 367; Cutts v. Hardee, 38 Ga. 350. Again, it is held that a law changing the remedy and rendering it less speedy and convenient, is not invalid, if there be still a substantial remedy left: James v. Stull, 9 Barb. 482. But if the law imposes so many obstacles in the way of enforcing a class of contracts as to leave the right scarcely worth pursuing, it impairs their obligation: Oatman v. Bond, 15 Wis. 20; Smith v. Morse, 2 Cal. 524. And so a statute which takes away all remedy is clearly unconstitutional: Bruce v. Schuyler, 4 Gilm. 221; State v. Bank of the State, 1 S. C. 63. Another decision states that although the legislature cannot substitute a nugatory remedy for a good one, they can substitute another good one; parties have a vested right to some remedy substantially as good as the old one, but not to that particular one: Lock. ett v. Usry, 28 Ga. 345. Again, it is said that there is a distinction in favor of the constitutionality of an act which prolongs or revives a remedy, as compared with one which cuts off or takes

away the remedy: Caperton v. Martin, 4 West Va. 138. And whereas it is sometimes suggested that the contract is made with reference to all laws existing at the time, a Minnesota decision holds that only such laws become a part of the contract as would be enforced by courts of a foreign jurisdiction-such as have the full force of law wherever the contract is sought to be enforced-which of course excludes purely remedial legislation: Heyward v. Judd, 4 Minn. 483. And lastly, it is said that in determining whether a change in the remedy is reasonable and just, the courts must look behind the statute to the state of the country, and the causes which led to the enactment of the new remedy: Baumbach v. Bade, 9 Wis. 559.

It will have become apparent from the foregoing review that, notwithstanding some fluctuation of opinion, the United States courts (and, under their lead, the state courts,) have been led to the adoption of two positions not reconcilable without a compromise. First, that whatever pertains merely to the remedy is no part of the contract and may be modified at the will of the legislature. Second, that it is possible to alter the remedy in such a manner as to impair the obligation of the contract itself. As a resultant of these two positions, they have made the rule to rest on the extent to which the change in the law affects the remedy and, through it, the contract; holding that when the law destroys the remedy altogether, or renders it practically worthless, or invades it in a material point, or lessens the value of the contract, it is in contravention of the constitution. Although this has been repeatedly characterized as an "unhappy" distinction, it is, after all, the only possible means of escape from holding, on the one hand, that the remedy cannot be modified at all, or on the other hand, that it may be desiccated or destroyed. But that it opens up a very wide ground of debate will be sufficiently apparent from the following section.

Before proceeding further, however, it is important to be observed that if the parties to a contract include in it, in express terms, the remedy for its enforcement, subsequent legislation changing the remedial process which they have agreed upon is, as to them, inoperative. "If they do not prescribe the rule of remedy in their contract, the law-making power is free; but if they do, they become a law to themselves, and the legislature must let them alone:" Billmeyer v. Evans, 40 Penn. St. 324; Taylor v. Stearns, 18 Gratt.

« ΠροηγούμενηΣυνέχεια »