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Sherlock v. Alling/Opinion of the Court

In December, 1858, the defendants were the owners of a line of steamers employed in navigating the river Ohio between the port and city of Cincinnati, in the State of Ohio, and the port and city of Louisville, in the State of Kentucky, for the purpose of carrying passengers, freight, and the United States mail. On the 4th of that month, at night, two boats of the line, designated, respectively, as the 'United States' and the 'America,' collided at a point on the river opposite the mainland of the State of Indiana. By the collision, the hull of one of them was broken in, and a fire started, which burned the boat to the water's edge, destroying it, and causing the death of one of its passengers, by the name of Sappington, a citizen of Indiana. The administrator of the deceased brought the present action for his death in one of the courts of common pleas of Indiana, under a statute of that State, which provides, 'that when the death of one is caused by the wrongful act o omission of another, the personal representatives of the former may maintain an action therefor against the latter, if the former might have maintained an action, had he lived, against the latter for an injury for the same act or omission.'

The complaint in the action alleged that the collision occurred within the territorial jurisdiction of Indiana, above the line of low-water mark of the river, and charged it generally to the careless and negligent navigation of the steamboat 'United States,' by the defendants' servants, and officers of the vessel, but especially to the carelessness of the pilot, in running the same at too great a speed down the stream; in giving the first signal to the approaching boat as to the choice of sides of the river contrary to the established custom of pilots navigating the Ohio, and the rules prescribed by the act of Congress; and in not slackening the speed of the boat and giving a signal of alarm and danger until it was too late to avoid the collision.

To defeat this action, the defendants relied upon substantially the following grounds of defence: 1st, that the injuries complained of occurred on the river Ohio, beyond low-water mark on the Indiana side, and within the limits of the State of Kentucky; and that, by a law of that State, an action for the death of a party from the carelessness of another could only be brought within one year from such death, which period had elapsed when the present action was brought; and, 2d, that at the time of the alleged injuries the colliding boats were engaged in carrying on inter-State commerce under the laws of the United States, and the defendants, as their owners, were not liable for injuries occurring in their navigation through the carelessness of their officers, except as prescribed by those laws; and that these did not cover the liability asserted by the plaintiff under the statute of Indiana.

Under the first head, no question is presented for consideration of which we can take cognizance. It is admitted that the territorial limits of Indiana extend to low-water mark on the north side of the river, and the jury found that the collision took place above that mark. It is, therefore, of no moment to the defendants that the Supreme Court of Indiana held that the State possessed concurrent jurisdiction with Kentucky on the river, under the act of the Commonwealth of Virginia of 1789, providing for the erection of the district of Kentucky into an independent State, and that the legislation of Indiana could, for that reason, be equally enforced with respect to any matters occurring on the river, as with respect to similar matters occurring within her territorial limits on the land.

The questions for our consideration arise under the second head of the defence. Under this head it is contended that the statute of Indiana creates a new liability, and could not, therefore, be applied to cases where the injuries commplained of were caused by marine torts, without interfering with the exclusive regulation of commerce vested in Congress. The position of the defendants, as we understand it, is, that as by both the common and maritime law the right of action for personal torts dies with the person injured, the statute which allows actions for such torts, when resulting in the death of the person injured, to be brought by the personal representatives of the deceased, enlarges the liability of parties for such torts, and tht such enlarged liability, if applied to cases of marine torts, would constitute a new burden upon commerce.

In supposed support of this position numerous decisions of this court are cited by counsel, to the effect that the States cannot by legislation place burdens upon commerce with foreign nations or among the several States. The decisions go to that extent, and their soundness is not questioned. But, upon an examination of the cases in which they were rendered, it will be found that the legislation adjudged invalid imposed a tax upon some instrument or subject of commerce, or exacted a license fee from parties engaged in commercial pursuits, or created an impediment to the free navigation of some public waters, or prescribed conditions in accordance with which commerce in particular articles or between particular places was required to be conducted. In all the cases the legislation condemned operated directly upon commerce, either by way of tax upon its business, license upon its pursuit in particular channels, or conditions for carrying it on. Thus, in The Passenger Cases, 7 How. 445, the laws of New York and Massachusetts exacted a tax from the captains of vessels bringing passengers from foreign ports for every passenger landed. In the Wheeling Bridge Case, 13 id. 518, the statute of Virginia authorized the erection of a bridge, which was held to obstruct the free navigation of the river Ohio. In the case of Sinnot v. Davenport, 22 id. 227, the statute of Alabama required the owner of a steamer navigating the waters of the State to file, before the boat left the port of Mobile, in the office of the probate judge of Mobile County, a statement in writing, setting forth the name of the vessel, and of the owner or owners, and his or their place of residence and interest in the vessel, and prescribed penalties for neglecting the requirement. It thus imposed conditions for carrying on the coasting trade in the waters of the State in addition to those prescribed by Congress. And in all the other cases where legislation of a State has been held to be null for interfering with the commercial power of Congress, as in Brown v. Maryland, 12 Wheat. 425, State Tonnage Tax Cases, 12 Wall. 204, and Welton v. Missouri, 91 U.S. 275, the legislation created, in the way of tax, license, or condition, a direct burden upon commerce, or in some way directly interfered with its freedom. In the present case no such operation can be ascribed to the statute of Indiana. That statute imposes no tax, prescribes no duty, and in no respect interferes with any regulations for the navigation and use of vessels. It only declares a general principle respecting the liability of all persons within the jurisdiction of the State for torts resulting in the death of parties injured. And in the application of the principle it makes no difference where the injury complained of occurred in the State, whether on land or on water. General legislation of this kind, prescribing the liabilities or duties of citizens of a State, without distinction as to pursuit or calling, is not open to any valid objection because it may affect persons engaged in foreign or inter-State commerce. Objection might with equal propriety be urged against legislation prescribing the form in which contracts shall be authenticated, or property descend or be distributed on the death of its owner, because applicable to the contracts or estates of persons engaged in such commerce. In conferring upon Congress the regulation of commerce, it was never intended to cut the States off from legislating on all subjects relating to the health, life, and safety of their citizens, though the legislation might indirectly affect the commerce of the country. Legislation, in a great variety of ways, may affect commerce and persons engaged in it without constituting a regulation of it, within the meaning of the Constitution.

It is true that the commercial power conferred by the Constitution is one without limitation. It authorizes legislation with respect to all the subjects of foreign and inter-State commerce, the persons engaged in it, and the instruments by which it is carried on. And legislation has largely dealt, so far as commerce by water is concerned, with the instruments of that commerce. It has embraced the whole subject of navigation, prescribed what shall constitute American vessels, and by whom they shall be navigated; how they shall be registered or enrolled and licensed; to what tonnage, hospital, and other dues they shall be subjected; what rules they shall obey in passing each other; and what provision their owners shall make for the health, safety, and comfort of their crews. Since steam has been applied to the propulsion of vessels, legislation has embraced an infinite variety of further details, to guard against accident and consequent loss of life.

The power to prescribe these and similar regulations necessarily involves the right to declare the liability which shall follow their infraction. Whatever, therefore, Congress determines, either as to a regulation or the liability for its infringement, is exclusive of State authority. But with reference to a great variety of matters touching the rights and liabilities of persons engaged in commerce, either as owners or navigators of vessels, the laws of Congress are silent, and the laws of the State govern. The rules for the acquisition of property by persons engaged in navigation, and for its transfer and descent, are, with some exceptions, those prescribed by the State to which the vessels belong; and it may be said, generally, that the legislation of a State, not directed against commerce or any of its regulations, but relating to the rights, duties, and liabilities of citizens, and only indirectly and remotely affecting the operations of commerce, is of obligatory force upon citizens within its territorial jurisdiction, whether on land or water, or engaged in commerce, foreign or inter-State, or in any other pursuit. In our judgment, the statute of Indiana falls under this class. Until Congress, therefore, makes some regulation touching the liability of parties for marine torts resulting in the death of the persons injured, we are of opinion that the statute of Indiana applices, giving a right of action in such cases to the personal representatives of the deceased, and that, as thus applied, it constitutes no encroachment upon the commercial power of Congress. United States v. Bevans, 3 Wheat. 337.

In the case of The Steamboat Company v. Chase, reported in the 16th of Wallace, this court sustained an action for a marine tort resulting in the death of the party injured, in the name of the administrator of the deceased, under a statute of Rhode Island, similar in its general features to the one of Indiana. There the deceased was killed whilst crossing Narraganset Bay in a sail-boat by collision with a steamer of the company; and though objections were taken, and elaborately argued, against the jurisdiction of the court, it was not even suggested that the right of action conferred by the statute, when applied to cases arising out of marine torts, in any way infringed upon the commercial power of Congress.

In addition to the objection urged to the statute of Indiana, the defendants also contended, that, as owners of the colliding vessels, they were exempt from liability to the deceased, as a passenger on one of them, and, of course, to his representatives, as the collision was caused, without any fault of theirs, by the negligence of the pilots; and they relied upon the thirtieth section of the act of Congress of March 30, 1852, to provide for the better security of the lives of passengers on board of vessels propelled in whole or part by steam. That act was in force when the injuries complained of in this case were committed, and its principal features have been retained in subsequent legislation. The section provided, 'that whenever damage is sustained by any passenger or his baggage, from explosion, fire, collision, or other cause, the master and the owner of such vessel, or either of them, and the vessel, shall be liable to each and every person so injured to the full amount of damages, if it happens through any neglect to comply with the provisions of law herein prescribed, or through known defects or imperfections of the steaming apparatus or of the hull; and any person sustaining loss or injury through the carelessness, negligence, or wilful misconduct of an engineer or pilot, or their neglect or refusal to obey the provisions of law herein prescribed as to navigating such steamers, may sue such engineer or pilot, and recover damages for any such injury caused as aforesaid by any such engineer or pilot.' 10 Stat. 72.

It was argued, that by this section Congress intended the exemption claimed. And confirmation of this view was found in the fact, that the owners were obliged to take a pilot, and were restricted in their choice to those licensed by the government inspectors. It was supposed that the relation between owner and pilot, as that of master and employ e, was thus changed, and that, with the change, the responsibility of the former for the negligence of the latter ceased. The court, however, proceeded through the trial upon a different theory of the position of the defendants. It held, that, as owners, they were responsible for the conduct of all the officers and employees of the vessels, and that it was immaterial whether the vessels were or not at the time of the collision under the exclusive charge of the pilots. The instructions to the jury, at least, went to that extent. They, in substance, declared that, if the collision occurred within the territorial jurisdiction of Indiana, and was caused, without fault of the deceased, by the carelessness or misconduct of the defendants, or any of their agents, servants, or employees, in navigating and managing the steamers, or either of them, the plaintiff was entitled to recover.

In support of the exemption, the counsel of the defendants called to our attention an opinion of the Supreme Court of Kentucky, in a similar case arising upon the same collision, where such exemption was upheld. The opinion is marked by the usual ability which characterizes the judgments of that court; but, after much hesitation and doubt, we have been compelled to dissent from its conclusions. The statute appears to us to declare, that the owners and master of a steam-vessel, and the vessel itself, shall be liable for all damages sustained by a passenger or his baggage, from any neglect to comply with the provisions of the law, no matter where the fault amy lie; and that, in addition to this remedy, any person injured by the negligence of the pilot or engineer may have his action directly against those officers.

The occasions upon which a pilot or engineer would be able to respond to any considerable amount would be exceptional. The statute of England, which exempts the owners of vessels and the vessels from liability for faults of pilots,-pilotage there being compulsory, and pilots being licensed,-has not met with much commendation from the admiralty courts, and the general tendency of their adjudications has been to construe the exemption with great strictness. This course of decision is very fully stated in the exposition of the law made by Mr. Justice Swayne, in the case of The China, 7 Wall. 53, where this court declined to hold that compulsory pilotage relieved the vessel from liability. In the case of The Halley, Law Rep. 2 Adm. & Ecc. 15, decided as recently as 1867, Sir Robert Phillimore strongly questioned the policy of the statute, and said that it appeared to him difficult to reconcile the claims of natural justice with the law which exempted the owner who had a licensed pilot on board from liability for the injuries done by the bad navigation of his vessel to the property of an innocent owner; and observed, that no one acquainted with the working of the law could be ignorant that it was fruitful in injustice. The doctrine, that the owners are responsible for the acts of their agents and employees, ought not to be discarded; because the selection of a pilot by the owner is limited to those who, by the State, have been found by examination to possess the requisite knowledge of the difficulties of local navigation, and the requisite skill to conduct a vessel through them. 'As a general rule,' says Mr. Justice Grier, 'masters of vessels are not expected to be, and cannot be, acquainted with the rocks and shoals on every coast' (and, we may add, with the currents and shoals of every river), 'nor able to conduct a vessel safely into every port. Nor can the absent owners, or their agent the master, be supposed capable of judging of the capacity of persons offering to serve as pilots. They need a servant, but are not in a situation to test or judge of his qualifications, and have not, therefore, the information necessary to choice. The pilot laws kindly interfere, and do that for the owners which they could not do for themselves.' Smith v. The Creole and The Sampson, 2 Wall. Jr. 515. And the learned Justice observes, that in such cases, where a pilot is required to be taken from those licensed, the relation of master and servant is not changed; that the pilot continues the servant of the owners, acting in their employ, and receiving wages for services rendered to them, and that the fact that he is selected for them by persons more capable of judging of his qualifications cannot alter the relation.

And, in the case of The Halley, Sir Robert Phillimore upon this subject says: 'I do not quite understand why, because the State insists, on the one hand, upon all persons who exercise the office of pilot, within certain districts, being duly educated for the purpose, and having a certificate of their fitness, and insists, on the other hand, that the master shall, within these districts, take one of these persons on board to superintend the steering of his vessel, the usual relation of owner and servant is to be entirely at an end; and still less do I see why the sufferer is to be deprived of all practical redress for injuries inflicted upon him by the ship which such a pilot navigates.'

By the common law, the owners are responsible for the damages committed by their vessel, without any reference to the particular agent by whose negligence the injury was committed. By the maritime law, the vessel, as well as the owners, is liable to the party injured for damages caused by its torts. By that law, the vessel is deemed to be an offending thing, and may be prosecuted, without any reference to the adjustment of responsibility between the owners and employees, for the negligence which resulted in the injury. Any departure from this liability of the owners or of the vessel, except as the liability of the former may be released by a surrender of the vessel, has been found in practice to work great injustice. The statute ought to be very clear, before we should conclude that any such departure was intended by Congress. The section we have cited would not justify such a conclusion. Its language readily admits of the construction we have given, and that construction is in harmony with the purposes of the act.

Judgment affirmed.

title: Sherlock v. Alling/Opinion of the Court


text: Talk:Sherlock v. Alling/Opinion of the Court

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Board of Commissioners of Tippecanoe County v. Lucas

ERROR to the Supreme Court of the State of Indiana.

By an act of the legislature of Indiana, passed on the twelfth day of May, 1869, counties and townships in that State were authorized to aid in the construction of railroads, by taking stock in railroad companies, and making donations to them. Before giving the aid, it was necessary for the officers of the county, the board of commissioners, to consult the electors of the county upon the subject, and obtain their approval of the proceeding at an election called for that purpose. Such approval having been obtained from the electors of Tippecanoe county, the board of commissioners of the county, during the years 1871, 1872, and 1873, subscribed and paid for stock in the Lafayette, Muncie, and Bloomington Railroad Company, a corporation organized under the laws of the State, and engaged at the time in building a railroad passing through the county. The stock thus subscribed and paid for amounted to six thousand six hundred and ten shares, of the par value of fifty dollars a share; and for them the company issued its certificates to the commissioners. The money with which the stock was paid was collected by a special tax levied for that purpose. The act provided for collecting the money before the subscription could be made.

Afterwards, on the 17th of December, 1872, the legislature passed an act 'to require railroad companies to issue stock, paid for by taxes voted in aid of the construction of their railroads, to the tax-payers or their assigns, and to issue unclaimed stock for the benefit of the common-school fund.' This act provided, that, in all cases where stock had been taken by counties and paid for from taxes levied and collected under the act of May, 1869, it should be the duty of the treasurer of the proper county, upon request prior to Jan. 1, 1874, to issue to the several tax-payers living, and to the personal representatives of such as may have died, a certificate, stating the amount of tax paid by them respectively, the date of payment, and the name of the company in aid of which the tax was paid, as the fact should appear from the proper tax duplicates and record in his office.

The certificates thus issued were made assignable, and any lawful holder could present and surrender them to the proper company previous to Jan. 1, 1874, in sums equal in amount to any number of shares, and it was made the duty of the company to issue a certificate of paid-up capital stock to the amount of the certificate of taxes paid which was surrendered. For the stock unclaimed within the time designated a certificate was to issue to different townships in the county, for the benefit of the common-school fund. The act declared that the issuing of the stock to individuals or townships, as thus provided, should operate to cancel pro tanto the stock held by the county under the provisions of the act of May, 1869.

The present complaint was filed by the commissioners of the county in the Tippecanoe Civil Circuit Court, to restrain the treasurer of the county from issuing to tax-payers the certificates of taxes paid, as provided by the act of 1872. The treasurer had previously, against the remonstrance of the commissioners, issued a number of certificates to different parties, and declared his intention to issue certificates to all parties applying who were entitled to receive them under the act. In the complaint, the commissioners denied the power of the State to take the stock, or any part of it, from them, and give it to individuals for their private benefit; and alleged, that by the issuing of the certificates their right was made questionable, a cloud was cast upon their title, and the market value of the stock held by them was destroyed, and that they were deprived of their rights as stockholders in the company. They, therefore, prayed that a temporary injunction be granted against the treasurer, and that it might be made perpetual on the hearing.

The complaint was verified; and, after notice and argument of counsel, an order was made granting a temporary injunction, as prayed. On appeal to the Supreme Court of the State, the order, or the judgment, as it is termed in the language of the record, was reversed, and the cause remanded to the lower court, with instructions to dismiss the complaint. From this judgment the cause is brought to this court on a writ of error.

Mr. Z. Baird, for the plaintiff in error.

Under the Indiana Code of Procedure, the judgment of the Supreme Court, reversing that of the inferior court, and remanding the cause with instructions to dismiss the complaint, determined the merits of the controversy. It was, therefore, a final judgment within the meaning of the act of Congress. Whiting v. The Bank of the United States, 13 Pet. 15; Forgay et al. v. Conrad et al., 6 How. 202; French v. Shoemaker, 12 Wall. 86; Atherton et al. v. Fowler et al., 91 U.S. 143.

The plaintiff in error is a municipal corporation, exercising delegated powers, legislative, executive, and judicial. 1 Gavin & Hord, 247 et seq. It lawfully acquired the stock in controversy, and became the owner thereof in its corporate name, and cannot be deprived of it in the manner prescribed by the act of Dec. 17, 1872.

Where corporate powers are conferred, there is an implied contract between the State and the corporators that the property held under their charter shall not, without their consent, be taken and appropriated to other uses. Trustees of Dartmouth College v. Woodward, 4 Wheat. 518; Cooley on Const. Lim. 235; Dillon on Mun. Corp. 8; Armstrong et al. v. The Board of Commissioners of Dearborn County, 4 Blackf. 208; Edwards v. Jaggers et al., 19 Ind. 406; Terrett v. Taylor, 9 Cranch, 43.

Under the constitution of Indiana, and the peculiar powers conferred by law upon the board of county commissioners, the latter, as to certain of such powers,-including that to acquire railroad stock,-is a private corporation. In levying the tax to create a fund with which to take the stock, it exercised power as a public corporation; but in making the subscription and acquiring the stock, for its advantage and emolument, it acted as a private corporation. It certainly does not hold the stock for public purposes in the sense that the power of the legislature over it is without limit, but, on the contrary, as a trustee for the benefit of the whole people of the country in their aggregate capacity. Its title is as valid as if the stock had been purchased with the funds collected for general purposes, if such funds could be lawfully applied thereto, or as if it had been acquired by gift, bequest, or in any other legitimate mode. The act in question attempts to divest that title, and vest it in individuals. It is, therefore, clearly beyond the scope of the legislative power. Town of Milwaukee v. City of Milwaukee, 12 Wis. 93; State of Wisconsin, ex rel., &c., v. The County Court, 34 id. 546; Trustees of Dartmouth College v. Woodward, supra; Terrett v. Taylor, supra; State of Wisconsin, ex rel., &c., v. Haben, Treasurer, &c., 22 Wis. 660; Bailey v. The Mayor, &c., 3 Hill, 531; Atkins v. Town of Randolph, 31 Vt. 266.

Powers granted exclusively for public purposes are vested in the corporation in its public, political, or municipal character; but if the grant is for the purpose of private advantage and emolument, though the public may derive a common benefit therefrom, the corporation, quoad hoc, stands on the same footing as any individual or body of persons upon whom the like special franchises have been conferred. Trustees of Dartmouth College v. Woodward, supra; Philips v. Berry, 1 Ld. Raym. 8; S.C.. 2 T. R. 352; Allen v. McKean, 1 Sumn. 297; The People v. Morris, 13 Wend. 331; 2 Kent, Com. 275 (4th ed.); United States Bank v. Planters' Bank, 9 Wheat. 907; Clark v. Corporation of Washington, 12 id. 40; Moodalay v. East India Co., 1 Bro. Ch. 469.

As the act of Dec. 17, 1872, invades the right of private property and impairs the obligations of a contract, it is in violation of the Constitution of the United States, and void.

Mr. H. W. Chase and Mr. J. R.Coffroth for the defendant in error.

1. The judgment of the Supreme Court of Indiana is not final. The order of the Circuit Court awarding an injunction was merely interlocutory, passed at a preliminary state of the proceedings, and not upon the final hearing of the case, and the action of the Supreme Court was had upon that order.

2. A county, being a political organization for public purposes, is under the complete control of the State. Within the expressed constitutional restrictions, it or its property may be dealt with by the legislature as it deems wise and expedient, provided that the property be secured for the uses of those for whom and at whose expense it was originally purchased. Darlington v. Mayor, &c., 31 N. Y. 164; Lycoming v. Union, 15 Penn. St. 166; Grim v. Weissengery, 57 id. 433; Philadelphia v. Fox, 64 id. 169; County v. County, 12 Ill. 1; Dennis v. Maynard, 15 id. 477; Love v. Schenck, 12 Ired. 304: ''Louisville, &c. Railroad Co. v. County Court, &c., 1 Sneed, 637; Sharp v. Contra Costa Co., 34 Cal. 288; State v. St. Louis Co.'', 34 Mo. 546; City of Augusta v. North, 57 Me. 392; Wade v. Richmond, 18 Gratt 583; State v. Votaw, 8 Blackf. 2; Sloan v. State, id. 364; State Bank v. Madison, 3 Ind. 43; Goodrich v. Winchester, 26 id. 119; Maryland v. Baltimore & Ohio Railroad Co., 3 How. 534; East Hartford v. Hartford Bridge Co., 10 id. 511; Mulligan v. Corbins, 7 Wall. 487.

3. The stock in question was purchased by a fund raised for that specific purpose by the exercise of the taxing power. Dividing it among the tax-payers, in proportion to the amount by them severally contributed, conflicts with no constitutional provision. The board had but a naked legal title. The individual tax-payers were alone beneficially interested. The road having been completed, all participation in the management of the company was wisely withdrawn from the county board, which was organized solely for the administration of the affairs of the county.

MR. JUSTICE FIELD, after making the foregoing statement of the case, delivered the opinion of the court.


text: Talk:Board of Commissioners of Tippecanoe County v. Lucas


text:
Board of Commissioners of Tippecanoe County v. Lucas/Opinion of the Court

It is objected, in limine, that this court has no jurisdiction of the cause, on the alleged ground that the judgment rendered is not a final judgment. The order of the Circuit Court, granting a preliminary injunction, was, it is true, interlocutory, and, if the judgment of the Supreme Court of the State had been limited to a simple reversal, the objection would have been tenable. The cause would then have remained in the Circuit Court for further proceedings. But the direction to that court, accompanying the reversal of its order to dismiss the complaint, made a final disposition of the cause. With the entry of that judgment the cause was at an end. With the peculiarities of the practice of the Indiana courts we have nothing to do. If, upon an appeal from an interlocutory order, a final disposition of the merits of a cause can be made in that State, it is no concern of ours. If, by any direction, the entire cause is, in fact, determined, the decision, when reduced to form and entered in the records of the court, constitutes a final judgment, subject in a proper case to our review, whatever may be its technical designation. The course adopted in this case was evidently pursued, from the fact that the whole merits of the controversy had been considered on the motion for the preliminary injunction. The application was founded upon the alleged invalidity of the act of 1872; no other matter was discussed, and all objections of form in the proceeding were waived, that the validity of the act might be considered and determined. Being determined against the view advanced by the plaintiffs, the cause, so far as the State courts were concerned, was practically at an end.

In this court, also, the validity of the act of 1872 is the sole question presented. The act is assailed here, as in the court below, as authorizing an invasion of the right of private property, and as impairing the obligation of an executed contract. Were the transaction one between the State and a private individual, the invalidity of the act would not be a matter of serious doubt. Private property cannot be taken from individuals by the State, except for public purposes, and then only upon compensation, or by way of taxation; and any enactments to that end would be regarded as an illegitimate and unwarranted exercise of legislative power. And any attempt by the legislature to take private property from its grantee, and restore it to its grantor, would be in conflict with the constitutional inhibition against impairing the obligation of contracts.

But between the State and municipal corporations, such as cities, counties, and towns, the relation is different from that between the State and the individual. Municipal corporations are mere instrumentalities of the State, for the convenient administration of government; and their powers may be qualified, enlarged, or withdrawn, at the pleasure of the legislature. Their tenure of property, derived from the State for specific public purposes, or obtained for such purposes through means which the State alone can authorize,-that is, taxation,-is so far subject to the control of the legislature, that the property may be applied to other public uses of the municipality than those originally designated. This follows from the nature of such bodies, and the dependent character of their existence. But property, derived by them from other sources, is often held, by the terms of its grant, for special uses, from which it cannot be diverted by the legislature. In such cases, the property is protected by all the guards against legislative interference possessed by individuals and private corporations for their property. And there would seem to be reasons equally cogent, in abstract justice, against a diversion by the legislature from the purposes of a municipality of property raised for its use by taxation from its inhabitants. There are probably provisions in the constitutions of the several States which would prevent any marked diversion in that way; but whether a contract between the State and the municipality, within the protection of the Federal Constitution, is implied in such cases, that the property acquired shall not be diverted from the purposes of the municipality and appropriated to other uses, is a question we are not now called upon to determine. In the present case, it is not necessary for us to go over the ground, so ably explored by the judges of the Supreme Court of Indiana, and attempt to mark the line within which the State may control and dispose of property held by a municipal corporation, and beyond which its action is subject to the same restraints as are its dealings with the property of individuals. It is enough that the present case is free from difficulty. Here there is no attempted diversion of the property from the purpose for which it was acquired: that purpose has been accomplished. The money having been obtained by compulsory contribution from the inhabitants, the legislature could undoubtedly have directed its restitution to them at any time before the subscription was made. If the road had been previously built, and the aid contemplated had thus become unnecessary, such restitutipn would have been proper and just. Numerous cases might be named where the return of taxes collected would be the only just proceeding to be taken. Money raised for a special emergency may not be required by the emergency ceasing.

The changed condition of the property collected in this case, by its use in paying for the stock subscribed, could not affect the power of the State: it only made the subsequent distribution of the property to the tax-payers a matter of greater difficulty Nor could the fact, that the commissioners of the county took the certificate in their name for the stock subscribed, remove the property from the control of the State. The commissioners took the stock, not to hold as an investment which was to yield an annual revenue to the county, but to aid in the construction of a work in which the public were interested,-a railroad through the county. As justly observed by counsel, the management of the affairs of a railroad company is no part of the proper business of a county; and, when the purpose designed by the subscription was accomplished, it was sound policy to relieve the county officers from any participation in such management. Of the power of the State to direct a restitution to tax-payers of a county, or other municipal corporation, of property exacted from them by taxation, into whatever form the property may be changed, so long as it remains in possession of the municipality, we have no doubt. The exercise of the power infringes upon no provision of the Federal Constitution. Further than this, it is not necessary for us to go for the disposition of this case.

Judgment affirmed.


text: Talk:Board of Commissioners of Tippecanoe County v. Lucas/Opinion of the Court


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Home Insurance Company v. City Council of Augusta

ERROR to the Supreme Court of the State of Georgia.

A statute of the legislature of Georgia, to regulate insurance business and insurance agencies in the State of Georgia, passed March 19, 1869, enacts as follows:--'SECTION 1. That it shall not be lawful for any insurance company, or agent of the same, excepting masonic, odd fellows, and religious mutual aid societies, already chartered by this State, to transact any business of insurance, without first procuring a certificate of authority from the comptroller-general of this State; and, before obtaining such certificate, such company must furnish the comptroller-general with a statement, under oath, specifying,--

'First, The name and locality of the company.

'Second, The condition of such company on the thirty-first day of December then next preceding, exhibiting the following facts and items, in the following form: namely,-1st, capital stock; 2d, assets, detailed; 3d, liabilities, detailed; 4th, income preceding year, detailed; 5th, expenditures preceding year, detailed; 6th, greatest risk; 7th, certified copy of charter.

'SECT. 2. The said statement shall be filed in the office of the comptroller-general, and the company shall show possession of at least $100,000 cash capital.

'SECT. 3. Upon filing such statement as aforesaid, the comptroller-general, when satisfied that the statement is correct, and that the company has fully complied with the provisions of this act, shall issue a certificate of authority to transact business of insurance in this State to the company applying for the same, and to all agents such company may appoint and commission.

'SECT. 4. Said statement must be renewed annually on the first day of January in each year, or within sixty days thereafter; and if the comptroller-general is satisfied that the capital, securities, and investments remain secured as at first, he shall furnish a renewal of the certificates. Insurance companies shall not be required to furnish but the single statement annually. The comptroller-general shall be entitled to a fee, for examining and filing each statement of such companies, of seven and one-half dollars, and for certificates to agents, of two and one-half dollars,-which fee shall be paid by the company or agent filing said statements, and to whom certificates are to be issued.'

'SECT. 6. That all persons violating the provisions of this act shall be liable to indictment, and, on conviction, shall be fined not less than one hundred dollars, nor more than five hundred dollars, at the discretion of the jury and court trying the same.'

The plaintiff in error, a corporation organized under the laws of the State of New York, had an agency in the city of Augusta. On furnishing the required statement, it received the certificate of the comptroller-general authorizing it to conduct the business of insurance in that city for one year from Jan. 1, 1874. Under a general law, it paid a tax of one per cent upon the gross amount of premiums received, and, under a city ordinance, a tax of one and a quarter per cent thereon.

On the 5th of January, 1874, the city council passed an ordinance, the first section of which provides, that, from and after that date, 'the annual license tax on insurance companies shall be as follows: 1. On each and every life-insurance company located, having an office or doing business within the city of Augusta, $100. 2. On each and every fire, marine, or accidental insurance company located, having an office or doing business within the city of Augusta, $250.

The legislature, by an act passed Feb. 26, 1874, validated all existing ordinances of said city council imposing taxes for the support of its municipal government for 1874. Thereupon the plaintiff in error filed its bill in the Superior Court of Richmond County, to enjoin the council from collecting the license tax for that year imposed upon it, and claimed, as a ground of relief, that said ordinance impaired the obligation of the contract between the company and the State, whereby the former was authorized to transact the business of insurance therein, and thus violated that clause of the Constitution of the United States which declares that no State, and, a fortiori, no political subdivision of a State, 'shall pass any law impairing the obligation of contracts.'

The Superior Court refused the injunction prayed for, and dismissed the bill; and the decree having been affirmed by the Supreme Court of the State, the company brought the case here.

Mr. William M. Evarts, and Mr. Salem Dutcher, for the plaintiff in error.

An ordinance of a municipal corporation of a State is the exercise of an authority under that State. Weston v. City Council of Charleston, 2 Pet. 449.

A final judgment in any suit in the highest court of a State, in which a decision could be had affirming the validity of an ordinance of a municipal corporation of that State, which was drawn in question on the ground of its repugnance to the Constitution of the United States, is subject to review by this court. Weston v. City Council of Charleston, supra; Osborne v. Mobile, 16 Wall. 479; Cannon v. New Orleans, 20 id. 577. The ordinance was the point on which the controversy turned, and the decision of the Supreme Court of the State was in favor of its validity.

The compliance of the company with the terms of the act of 1869 and the action of the State thereunder, form a contract within the meaning of art. 1, sect. 10, clause 1, of the Constitution of the United States. It is identical in principle with, although differing in form from, that in Fletcher v. Peck, 6 Cranch, 87. The considerations are, to the former, authority to do business in the State for a specified period; to the latter, the public advantages arising from the operations in the State of a corporation coming up to the prescribed standard of usefulness, solvency, and reliability.

'The word 'license' means permission or authority; and a license to do any particular thing is a permission or authority to do that thing, and, if granted by a person having power to grant it, transfers to the grantee the right to do whatever it purposes to authorize. It certainly transfers to him all the right which the grantor can transfer to do what is within the terms of the license.' Gibbons v. Ogden, 9 Wheat. 563(580); State Tonnage Tax Cases, 12 Wall. 204(215). A license is a contract. 'It is a right given by some competent authority to do an act which, without such authority, would be illegal.' Bouvier, Law Dict.; ''Mayor, &c. of Rome v. Lumpkin, 5 Ga. 447; Chastain v. Town Council of Calhoun'', 29 id. 333; Adams v. Mayor of Albany, 29 id. 56; Wood v. City of Brooklyn, 14 Barb. 425; Martin v. O'Brien, 34 Miss. 21; Leonard v. City of Canton, 35 id. 189; Boyd and Jackson v. The State, 46 Ala. 329; Martin v. O'Brien, 34 Miss. 21; Philadelphia Association v. Wood, 39 Penn. St. 73.

It is submitted that the license tax imposed after the required authority had been conferred by the State, on a full compliance by the company with the stipulated conditions in question, cannot be sustained, and that the city could not, during the year 1874, limit, burden, or obstruct, in any way, the exercise by the company of its right to transact its legitimate business,-a right secured by the contract with the State. The amount of 'license tax' exacted is immaterial. Brown v. Maryland, 12 Wheat. 419; ''Mayor, &c. of Rome v. Lumpkin et al., 5 Ga. 447; Adams v. Mayor of Albany'', 29 id. 56; Chastain v. Town Council of Calhoun, 29 id. 333; Sanders v. Town Commissioners of Butler, 30 id. 679; ''Mayor, &c. of Savannah v. Charlton'', 36 id. 460; ''Mayor, &c. of New York v. Nichols, 4 Hill, 209; Wood v. City of Brooklyn'', 14 Barb. 425; Stein v. ''Mayor, &c. of Mobile'', 49 Ala. 362; ''Mayor, &c. of New York v. Second Avenue R. R. Co., 32 N. Y. 261; Leonard v. City of Canton'', 35 Miss. 189; Martin v. O'Brien, 34 id. 21; Boyd and Jackson v. The State, 46 Ala. 329; Philadelphia Association v. Wood, 39 Penn. St. 73; Prince v. City of St. Paul, 19 Minn. 267.

Mr. William Brown, contra.

MR. JUSTICE SWAYNE delivered the opinion of the court.


text: Talk:Home Insurance Company v. City Council of Augusta


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Home Insurance Company v. City Council of Augusta/Opinion of the Court

Under an act of the legislature of Georgia, of the 19th of March, 1869, the insurance company procured the requisite authority to transact, by itself or agents, the business of insurance for one year, from the 1st of January, 1874, and, at the option of the company, for sixty days longer.

The company thereupon established an office and agency in the city of Augusta, and thereafter transacted business at that place. A general law of the State imposed a tax of one per cent upon the gross amount of premiums received. An ordinance of the city imposed a tax of one and a quarter per cent upon such receipts. These taxes were paid by the company without objection. On the 5th of January, 1874, the city council passed an ordinance which imposed, further, a license tax of $250 'on each and every fire, marine, or accidental insurance company located, having an office, or doing business within the city of Augusta.' The bill was filed to enjoin the collection of this tax. The Superior Court of Richmond County sustained the validity of the tax, and dismissed the bill. The Supreme Court of the State affirmed the decree. The complainant thereupon sued out a writ of error, and removed the case to this court.

In the argument here, it was insisted by the defendant in error that this court has no jurisdiction of the case. We will first consider this objection. The bill alleges that the ordinance imposing the tax in question is void for many reasons, and, among them, that it is in conflict with the contract clause of the Constitution of the United States.

Where a judgment or decree is brought to this court by a writ of error to a State court for review, the case, to warrant the exercise of jurisdiction on our part, must come within one of three categories:--

1. There must have been drawn in question the validity of a treaty or statute of, or authority exercised under, the United States; and the decision must have been against the claim which either was relied upon to maintain.

2. Or there must have been drawn in question a statute of, or authority exercised under, a State, upon the ground of repugnance to the Constitution, or a law or treaty of, the United States; and the decision must have been in favor of the validity of the State law or authority in question.

3. Or a right must have been claimed under the Constitution, or a treaty, or law of, or by virtue of a commission held or authority exercised under, the United States; and the decision must have been against the right so claimed. Rev. Stat. 132, sect. 709; Sevier v. Haskell, 14 Wall. 15; Weston v. City Council of Charleston, 2 Pet. 449; McGwyre v. The Commonwealth, 3 Wall. 385.

Here there was drawn in question the authority exercised by the city council under the State in passing the ordinance imposing the tax complained of. The question raised was as to its repugnancy to the Constitution of the United States; and the decision was in favor of the validity of the authority so exercised. A right was also claimed under the Constitution of the United States. The decision was adverse to the claim. The case is, therefore, within two of the categories we have stated. The jurisdictional objection cannot be maintained.

This brings us to the consideration of the case upon its merits. Whether the claims which give us jurisdiction are well founded, is the question to be considered.

The national Constitution (art. 1, sect. 10, clause 1) declares that 'no State shall pass any law impairing the obligation of contracts.'

The act of 1869, before mentioned, forbids any company to do the business of insurance in the State, without first obtaining a certificate from the comptroller-general of the State. Before obtaining such certificate, every company is required to furnish a sworn statement, setting forth certain specified particulars. Upon being satisfied of the truth of the statement, he is required to issue the certificate. He is entitled to a fee of seven dollars and a half for examining and filing each statement, and a fee of two dollars and a half for each certificate. The fifth section declares that whatever deposits, taxes, penalties, certificates, or license-fees are exacted from Georgia companies in any other State, shall be exacted from the companies of such State in Georgia. It does not appear by the record that any Georgia insurance company was doing business in New York in the year 1874. This section, therefore, does not affect the case in hand. The act contains no other allusion to the subject of taxation. It does not, therefore, circumscribe in any degree the taxing power of the State, or of any municipality within the State clothed with such authority. It left both, in this respect, standing just where they would have stood if this act had not been passed. It contained no stipulation, express or implied, that either should be thereby in any wise limited or restrained.

If it were competent for the State to impose the tax of one per cent upon the gross amount of premiums received, would it not have been equally so for the State to impose a further tax, the same with that in question, and in the same way? And if it were competent for the city council to impose the tax of one and a quarter per cent upon the same receipts, why might it not impose the further burden here in question? If the State could impose the further tax, why not the municipality? Is there any sensible ground of contract prohibition upon which the claim of exemption from either can be placed? This question must necessarily be answered in the negative. We find no semblance of a contract that additional taxes should not be imposed.

In The License Cases, 5 Wall. 462, the nature of the tax exaction here in controversy was carefully considered by this court. There the revenue laws of the United States required payment in advance to be made for permission to carry on the business of selling liquor, and of selling lottery-tickets. It was provided that no license so granted, or special tax so laid, should be construed to authorize any business within a State forbidden by the laws of such State, or so as to prevent the taxation by the State of the same business.

This court held that the payment required was a special tax, levied in the manner prescribed; that the penalty provided was a mode of enforcing its payment; and that the license, when issued, was only a receipt for the tax. It was held further, that, as regards the reservation of power in favor of the States, the result would have been the same if the acts of Congress had been silent upon the subject. This was necessarily so, because the objects taxed belonged to the internal commerce of the States, and were within their police power, and the right of Congress and the States to tax was concurrent. Congress could, therefore, no more restrict the power of a State than the State could restrict that of Congress.

What is said there as to license taxes is applicable to the case before us. There is no difference in principle between such a tax and those which have been paid by the plaintiff in error to the defendant in error, and to the State, without objection.

In the ordinance in question the tax is designated 'a license tax,' but its payment is not made a condition precedent to the right to do business. No special penalty is prescribed for its non-payment, and no second license is required to be taken out. Had the ordinance been otherwise in these particulars, we have seen, viewing the subject in the light of the License Tax Cases, that the result would have been the same.

The case in all its aspects was ably and elaborately examined by the Supreme Court of the State. Their conclusion upon the 'Federal question' we have considered is the same with ours. There being no other such question raised in the record, our duty is thus terminated. We have no authority to look further into the case.

Judgment affirmed.


text: Talk:Home Insurance Company v. City Council of Augusta/Opinion of the Court


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County of Calhoun v. American Emigrant Company

APPEAL from the Circuit Court of the United States for the district of Iowa.

The facts are stated in the opinion of the court.

Submitted on the record by Mr. James Grant for the appellants, and on printed arguments by Mr. C. C. Nourse for the appellee.

MR. JUSTICE CLIFFORD delivered the opinion of the court.


text: Talk:County of Calhoun v. American Emigrant Company


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County of Calhoun v. American Emigrant Company/Opinion of the Court

Power is vested in the Circuit Court to enjoin the collection of a municipal tax, where it appears that the assessors acted without authority of law, and in violation of a special contract between the municipality imposing the tax and the tax-payer.

Swamp-lands were owned by the county of Calhoun, and the record shows that the proper authorities of the county contracted to sell the same to the American Emigrant Company, the county stipulating that they would not assess any taxes against the lands until after the time the lands should be conveyed to the company.

Pursuant to that contract, the supervisors of the county made a deed of the lands to the Emigrant Company; but they recited in the instrument that the deed was deposited with the clerk of their board as an escrow, and that it was not to be delivered to the grantees until they should execute a mortgage back to the county, conditioned to secure the full performance of the contract. Such a mortgage was never executed; but the evidence shows that the deed, by some means or agency not explained, was filed for record, and that it was duly recorded. Controversy ensued, and the county instituted a suit to set aside the contract and the deed. Pending the suit, the parties made a settlement; and, as a part of the terms of the same, the county, in consideration of certain moneys paid by the other party, consented to a decree, declaring the title to the swamp-lands, and swamp-land interests of the county, to be in the Emigrant Company.

Sufficient also appears to show, that the Emigrant Company complied with all the terms of the settlement, and that the Circuit Court, where the suit was pending, entered a decree, by consent of the parties, dismissing the bill of complaint, and decreed that the decree of dismissal should for ever operate as a bar and estoppel upon the county to set up any right or title to the lands in controversy. Prior to that decree, which bears date the 20th of May, 1872, the lands described in the contract had not been assessed for the two preceding years, as is averred in the bill of complaint and admitted in the answer.

Public property is not subject to taxation by the law of the State, and consistency forbade the county to assess the lands pending the controversy, as the deed had never been sanctioned or approved by the county or their proper officers. Instead of that, it appears that the authorities of the county uniformly maintained that the possession of the deed for registry was surreptitious and wrongful, and that the title to the lands was still in the county. They accordingly withheld the lands from taxation during those years; and the complainants charge that the treasurer, subsequent to the settlement and decree, caused the lands described in the two schedules set forth in the record to be listed and entered in the tax duplicates, and pretended to extend a computation of taxes, interest, penalties, and costs thereon, according to the rates of levy of the two preceding years, amounting to the sum set forth in the record, whereas the complainants aver that the title was decreed to them at the time of the settlement, with the full understanding that no taxes was payable on the lands for those two years, and that the acts of the treasurer in listing the lands and assessing the taxes were without authority of law, and they pray that the pretended assessment and levy of the taxes may be decreed to be illegal, null, and void, and that the county treasurer and his agents and successors may be for ever enjoined from selling the lands, or in any manner enforcing the collection of said pretended taxes.

Process was duly issued and served, and the proper authorities of the county appeared and filed an answer, setting up the following defences: 1. That the complainants are the legal owners of the lands described in the contract, by virtue of the deed from the county. 2. That the county had no right to exempt the lands from taxes. 3. That the agreement was unauthorized and in violation of the laws of the State, and is null and void.

Certain admissions of the respondents are also contained in the answer, which it is important to notice: 1. That the deed was deposited as an escrow until a mortgage back should be executed; but the respondents aver that it was the fault of the complainants that it was not executed, and they insist that the complainants cannot claim any benefit from their own neglect. 2. That the settlement and decree were made as alleged; but the respondents aver that the settlement ratified the deed, and gave complainants a legal title relating back to the date of the execution of the same. 3. That the officers of the county did not assess taxes on the lands pending the suit; but the respondents aver that the failure of the officers to do so did not waive the right of the county to assess the lands and collect the taxes. 4. That the title to the lands in the other schedule is in the United States; but the respondents aver, that if that be so, then no sale of the same for taxes will be of any validity.

Proofs having been duly taken and the parties fully heard, the court entered a decree in favor of the complainants, and the respondents appealed to this court.

Enough appears in the pleadings in this case to show that the deed from the county to the complainants was never delivered to the grantees until the settlement and decree; and it is settled law, of universal application, that a deed takes effect only from the time of delivery, even though it may have been fully executed at a much earlier period. Hopkins v. Leek, 12 Wend. 105; Hardenberg v. Schoonmaker, 2 Johns. 23.

Beyond doubt, the deed of the lands was delivered to the clerk of the respondents as an escrow, and subject to the condition that it should not be delivered to the grantees until they gave back a mortgage to secure the full performance of the agreement under which the deed was executed; but it is equally clear that the condition required to be fulfilled before the delivery could be made was never performed, and the rule is established by repeated decisions, that, where a deed is delivered as an escrow, nothing passes by the deed unless the condition is performed. Hinman v. Booth, 21 Wend. 267; Green v. Putnam, 1 Barb. 500; Russell v. Rowland, 6 Wend. 666; Pendleton v. Hughes, 65 Barb. 136; S.C.. 53 N. Y. 626.

Cases may be found where it is held that a deed delivered as an escrow, when the condition is performed, relates back to the time of its execution; and that proposition may be correct under certain circumstances, where the ends of justice require its application. Beekman v. Frost, 18 Johns. 544; S.C.. 1 Johns. Ch. 288.

Much would depend in such a case upon the intent of the parties, to be collected from the nature of the transaction; but it is clear that the rule cannot apply in this case, for several reasons: 1. Because the condition inserted in the instrument never was performed. 2. Because the county never relinquished their title to the lands until the settlement and decree. 3. Because the county could not assess the lands while they remained public property. 4. Because the written agreement stipulated that no taxes should be levied on the lands until after the lands should be conveyed to the complainant.

Responsive to that, the respondents suggest that it is the fault of the complainants that the deed was not delivered; but it must not be overlooked that it was the respondents or their agents who inserted the stipulation in the instrument that it should be deposited as an escrow with their clerk until a mortgage back should be executed to secure the full performance of the terms of the written agreement.

Nothing is contained in the written agreement to warrant the respondents in requiring a mortgage back before delivering the deed; but it is expressly stipulated therein that the respondents will not assess any taxes against the lands until after the time the lands shall be conveyed to the complainants. Nor does it affect the question that the deed was previously recorded, as it is clear that the theory of the respondents throughout was that it was wrongfully procured for registry; and nothing appears to controvert their theory in that regard. By what means it was procured does not appear; but it does appear that the complainants are unable to explain the matter, for the reason that their agent who transacted the negotiations on their part is deceased.

Other suggestions failing, the respondents contend that the agreement not to tax the land before the conveyance was made is without authority of law, and is null and void; but the court here is not able to concur in that proposition, as the lands were held by the county in their proprietary right, and as such were as much subject to bargain and sale as lands held by an individual. Counties have no right to tax public property by the laws of the State; and the restriction in this case only extended to the time the conveyance should be made, in view of which the better opinion is, that, as between these parties in respect to the right of taxation, the title did not pass until the settlement and decree.

Argument is not required to prove that the respondents agreed not to tax the lands before they were conveyed, nor to prove that the deed was deposited as an escrow, nor that the taxes were levied by the treasurer subsequent to the settlement and decree, for the reason, that all three of these propositions are admitted by the answer.

Taxes imposed against those lands for the two years preceding the settlement and decree cannot be sustained in view of those admissions, especially as it also appears that the respondents, early in the month of April, 1869, instituted a suit in equity, in which they set up title to the lands, and prayed for a decree to set aside the written agreement and the deed, and that they continued to prosecute that suit from the time it was commenced to the date of the settlement and decree.

Throughout the whole period, the county claimed the fee-simple title in these lands, and maintained the theory that the complainants were not entitled thereto, and that the deed had been illegally recorded; and it appears that they never occupied any other position in the controversy until the settlement and the decree of the Circuit Court, to which the suit was removed pending the litigation.

By that settlement, the complainants agreed to pay to the respondents the sum of $2,300 cash, and to pay all costs and expenses of the suit, including a described portion of the counsel fees of the respondents; and it is not controverted that the complainants fulfilled all the terms of the adjustment.

Viewed in the light of these suggestions, it is clear that the respondents are estopped to set up any such claim against the complainants.

Taken as a whole, the circumstances disclosed in the record satisfy the court that the settlement was made with a full understanding between the parties, that no taxes were payable on the lands for the two years next preceding the date of the decree, and that the respondents are estopped to set up any different theory in the present controversy.

Where a municipal corporation sells a tract of land, and their authorized agents represent that there are no municipal taxes assessed against the same, neither the municipality nor its proper officers can collect from the grantees taxes for preceding years, if assessed subsequently to the conveyance. Omissions resulting from inadvertence or mistake of the assessors may doubtless be corrected, and such an assessment, it is not doubted, is legal, and may be collected; but good faith forbids such an assessment as the one before the court, which was made in violation of a written agreement and of an explicit understanding between the parties in the adjustment of a pending controversy.

Decided support to the views here expressed is found in the decisions of the Supreme Court of the State, to which reference is made. Iowa Land Co. v. Story County, 36 Iowa, 50. Circumstances substantially similar were disclosed in that case, and the court say, 'We do not stop to inquire what would be the rule respecting liability for taxes as between vendor and purchaser, in cases where the latter, by performance of his contract, has become the owner, though the legal title is in the former; because we ground our support of the plaintiff's case upon this plain rule of fair dealing and the broad principles of equity, that a party shall not wrongfully withhold the title to property and the benefits of ownership thereof from one entitled thereto, and at the same time subject the property to burdens, for the benefit of the party thus wrongfully withholding the title.' In other words, the county having during those years denied the right and title under which the plaintiff claims, is now equitably estopped from asserting that the plaintiff then had the title in order to give validity to the burden imposed. Davidson v. Follett, 37 Iowa, 220; Adams Co. v. Railroad, 39 id. 511; Lucas v. Hart, 5 id. 419; Swain v. Seamens, 9 Wall. 274.

Corporations, quite as much as individuals, are held to a careful adherence to truth and uprightness in their dealings with other parties; nor can they be permitted, with impunity, to involve others in onerous obligations, by their misrepresentations on concealments, without being held to just responsibility for the consequences of their misconduct or bad faith.

Decree affirmed.


text: Talk:County of Calhoun v. American Emigrant Company/Opinion of the Court


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Claflin v. Houseman Assignee

ERROR to the Supreme Court of the State of New York.

This action was brought in May, 1872, in the New York Supreme Court, county of Kings, by Julius Houseman, as assignee in bankruptcy of Comstock and Young, against Horace B. Claflin, under the thirty-fifth section of the Bankrupt Act, to recover the sum of $1,935.57, with interest, being the amount collected by Claflin on a judgment against the bankrupts, recovered within four months before the commencement of proceedings in bankruptcy. The ground of the action, as stated in the complaint, was that they (the bankrupts) suffered the judgment to be taken by default, with intent to give Claflin a preference over their other creditors, at a time when they were insolvent, and when he knew, or had reasonable cause to believe, that they were insolvent, and that the judgment was obtained in fraud of the bankrupt law. The defendant demurred to the complaint, assigning as cause, first, that the court had no jurisdiction of the subject of the action; secondly, that the complaint did not state facts sufficient to constitute a cause of action. Judgment was rendered for the plaintiff on the thirteenth day of January, 1873, and was subsequently affirmed both by the general term of the Supreme Court and by the Court of Appeals. This judgment is brought here by writ of error, under the second section of the act of Feb. 5, 1867 (14 Stat. 385).

Argued by Mr. William Henry Arnoux for the plaintiff in error.

Where Congress has an exclusive right to legislate, the Federal courts have an exclusive power to adjudicate. United States v. Ames, 1 W. & M. 76; United States v. Bailey, 9 Pet. 261; United States v. Cornell, 2 Mason, 91; Osborn v. U.S. Bank, 9 Wheat. 818.

Where a State cannot legislate, its courts cannot adjudicate. United States v. Lathrop, 17 Johns. 4; Martin v. Hunter's Lessee, 1 Wheat. 304; Rose v. Hinely, 4 Cranch, 241; McLean v. Lafayette Bank, 3 McLean, 191; Stearns v. United States, 2 Paine, 311; Shearman v. Bingham, 7 N. B. R. 490.

The jurisdiction of the courts of the United States is exclusive in all cases arising under the Constitution, laws, or treaties of the United States. Const. U.S., art. 3, sects. 1, 2; 2 Story on Const., sect. 1754; Martin v. Hunter's Lessee, supra; Ex parte Cabrera, 1 Wash. C. C. 232; Griffin v. Domingues, 2 Duer, 576; Mannhardt v. Joderstron, 1 Binn. 138; Commonwealth v. Kostaff, 5 Serg. & R. 545; Davis v. Packard, 7 Pet. 276; Houston v. Moore, 5 Wheat. 1.

The Bankrupt Act of March 2, 1867, by a just construction of its terms, confers exclusive jurisdiction upon the district and circuit courts of the United States. Goodall v. Tuttle, 7 N. B. R. 193; In re Alexander, 3 id. 6; Shearman v. Bingham, 7 id. 490; Ex parte Christy, 3 How. 292; Mitchell v. Great Milling Works Co., 2 Story, 656; Peck v. Jenness, 7 How. 621; McLean v. Lafayette Bank, 3 McLean, 190; Moore v. Jones, 23 Vt. 746.

The right of an assignee to bring suits for the collection of the assets of a bankrupt is a new right conferred upon him by an act of Congress. Cook v. Whipple, 55 N. Y. 150. Therefore the remedy afforded by the statute is exclusive. Dudley v. Mayhew, 3 N. Y. 15; Jordan Plank Road v. Morley, 23 id. 554; Thurber v. Blanck, 50 id. 80; Hollister v. Hollister Bank, 2 Keyes, 248; Almy v. Harris, 5 Johns. 175; Rex v. Robinson, 2 Burr. 799.

The fact that an assignee in bankruptcy is dependent upon the national tribunals, and independent of those of the States, is conclusive against the jurisdiction of the latter, over statutory actions brought by him as an officer appointed under the laws of the United States. The State courts can neither interfere with, or interrupt, the exercise of the authority with which he is clothed, nor aid in enforcing it. McKim v. Voorhies, 7 Cranch, 279; Slocum v. Mayberry, 2 Wheat. 1; McClung v. Silliman, 6 id. 598; United States v. Barney, 3 Hall's L. J. 128; United States v. Peters, 5 Cranch, 115; McNutt v. Bland, 2 How. 17; Hopkins v. Stockton, 2 Watts & S. 163.

The United States and the States are distinct and independent autonomies in their sovereign capacity, and their laws are foreign to each other, except in their surrendered powers. Ohio L. & T. Co. v. DeBolt, 16 How. 428; Buckner v. Finley, 2 Pet. 590; Bank of Augusta v. Earle, 13 id. 520. Therefore the State courts have no jurisdiction over an action brought by a person acting in a representative capacity, who 6 Barb. 429; Parsons v. Lyman, 20 N. Y. 103; Williams v. Storrs, 6 Johns. Ch. 353; Doolittle v. Lewis, 7 id. 45; Vroom v. Van Horn, 10 Paige, 549; Morrell v. Dickey, 1 Johns. Ch. 153; Brown v. Brown, 1 Barb. Ch. 189; Petersen v. Chemical Bank, 32 N. Y. 21; Matter of Estate of Butler, 38 id. 400; Mosselman v. Caen, 34 Barb. 66; Abraham v. Plestero, 3 Wend. 538; Willetts v. Waite, 25 N. Y. 577; Harrison v. Sterry, 5 Cranch, 299; Johnson v. Hunt, 23 Wend. 87; Hoyt v. Thompson, 5 N. Y. 340; Peale v. Phipps, 14 How. 368; Orr v. Amory, 11 Mass. 25; Booth v. Clark, 17 How. 322.

Submitted on printed arguments by Mr. B. F. Lee for the defendant in error.

MR. JUSTICE BRADLEY delivered the opinion of the court.

title: Claflin v. Houseman Assignee


text: Talk:Claflin v. Houseman Assignee

title: Talk:Claflin v. Houseman Assignee


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278 coming into fashion, and was played by quite young boys and girls, who received lessons in whist at a guinea each from masters in the art.

The universal habit of gambling led to duels. By an unwritten code of the times, men held that all shortcomings should be atoned for at the point of the sword or the mouth of the pistol. Thus brawls and squabbles of the coffee-house, disputed love-affairs, political strife or irritation produced by gaming or racing losses—all were settled by this "reigning curse," as it has been called. Duels took place in the open street, in the ballroom, the pit of the theatre, on Wimbledon Common, the Ring at Hyde Park, or the empty room of a coffee-house. If a man was not actually killed he bore the scars of his wounds till he died, testifying to the fact that he was a man of honour.

These wounds were very indifferently treated by the surgeons and physicians of the day, for medical knowledge was still at a low ebb in the early eighteenth century and quackery was yet rampant.

"I tell you," says a contemporary, "'tis an easie thing for a Man of Parts to be a Surgeon; do but buy a Lancet, Forceps, Saw; talk a little of


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Claflin v. Houseman Assignee/Opinion of the Court

The point principally relied on by the plaintiff in error is, that an assignee in bankruptcy cannot sue in the State courts.

It is argued that the cause of action arises purely and solely out of the provisions of an act of Congress, and can only be prosecuted in the courts of the United States, the State courts having no jurisdiction over the subject. It is but recently settled that the several district and circuit courts of the United States have jurisdiction, under the bankrupt law, of causes arising out of proceedings in bankruptcy pending in other districts. There had been much doubt on the subject, but it was finally settled at the last term of this court in favor of the jurisdiction. Lathrop, Assignee, v. Drake et al., 91 U.S. 516. Had the decision been otherwise, as for a long period was generally supposed to be the law, assignees in bankruptcy, if the position of the plaintiff in error is correct, would have been utterly without remedy to collect the assets of the bankrupt in districts other than that in which the bankruptcy proceedings were pending. Neither the State courts nor the Federal courts could have entertained jurisdiction. The Revised Statutes, whether inadvertently or not, have made the jurisdiction of the United States courts exclusive in 'all matters and proceedings in bankruptcy.' Sect. 711. Whether this regulation will or will not affect the cognizance of plenary actions and suits, it is not necessary now to determine. At all events, the question of such cognizance must be met in this case; and, being important in the principles involved, would require much deliberate consideration, had it not been already in effect decided by the court.

In the opinion of the court, in Lathrop, Assignee, v. Drake et al., it was taken for granted, and stated, that the State courts had jurisdiction (p. 518); but as the question was not directly involved in that case, it was more fully considered in Eyster v. Gaff et al., 91 U.S. 521, and it was there decided that a State court is not deprived of jurisdiction of a case by the bankruptcy of the defendant, but may proceed to judgment without noticing the bankruptcy proceedings, if the assignee does not cause his appearance to be entered, or proceed against him if he does appear. If there were any thing in the Constitution to incapacitate the State courts from taking cognizance of causes after the bankruptcy of the parties, as the constitutional argument of the plaintiff in error supposes, the proceedings in bankruptcy would ipso facto determine them. But on this subject, in Eyster v. Gaff et al., the court say: 'It is a mistake to suppose that the bankrupt law avoids, of its own force, all judicial proceedings in the State or other courts the instant one of the parties is adjudged a bankrupt. There is nothing in the act which sanctions such a proposition.' Again: 'The debtor of a bankrupt, or the man who contests the right to real or personal property with him, loses none of those rights by the bankruptcy of his adversary. The same courts remain open to him in such contests, and the statute has not divested those courts of jurisdiction in such actions. If it has, for certain classes of actions, conferred a jurisdiction for the benefit of the assignee in the circuit and district courts of the United States, it is concurrent with, and does not divest that of, the State courts.' pp. 525, 526.

The same conclusion has been reached in other courts, both Federal and State, which hold that the State courts have concurrent jurisdiction with the United States courts of actions and suits in which a bankrupt or his assignee is a party. See Samson v. Burton, 4 Bank. Reg. 1; Payson v. Dietz, 8 id. 193; Gilbert v. Priest, 8 id. 159; Stevens v. Mechanics' Savings Bank, 101 Mass. 109; Cook v. Whipple, 55 N. Y. 150; Brown v. Hall, 7 Bush, 66; Mays v. ''Man. Nat. Bank'', 64 Penn. 74. There are contrary cases, it is true, as Brigham v. Claflin, 31 Wis. 607, Voorhees v. Frisbie, 25 Mich. 476, and others; but we think that the former cases are founded on the better reason.

The assignee, by the fourteenth section of the Bankrupt Act (Rev. Stat. sect. 5046), becomes invested with all the bankrupt's rights of action for property, and actions arising from contract, or the unlawful taking or detention of or injury to property, and a right to sue for the same. The actions which lie in such cases are common-law actions, ejectment, trespass, trover, assumpsit, debt, &c., or suits in equity. Of these actions and suits the State courts have cognizance. Why should not an assignee have power to bring them in those courts, as well as other persons? Aliens and foreign corporations may bring them. The assignee simply derives his title through a law of the United States. Should not that title be respected by the State courts?

The case is exactly the same as that of the Bank of the United States. The first bank, chartered in 1791, had capacity given it 'to sue and be sued. . . in courts of record, or any other place whatsoever.' It was held, in The Bank v. Deveaux, 5 Cranch, 61, that this did not authorize the bank to sue in the courts of the United States, without showing proper citizenship of the parties in different States. The bank was obliged to sue in the State courts. And yet here was a right arising under a law of the United States, as much so as can be affirmed of a case of an assignee in bankruptcy. The second bank of the United States had express capacity 'to sue and be sued in all State courts having competent jurisdiction, and in any Circuit Court of the United States.' In the case of Osborn v. The Bank, 9 Wheat. 738, 815, it was objected that Congress had not authority to enable the bank to sue in the Federal courts merely because of its being created by an act of Congress. But the court held otherwise, and sustained its right to sue therein. No question was made of its right to sue in the State courts.

Under the bankrupt law of 1841, with substantially the same provisions on this subject as the present law, it was held that the assignee could sue in the State courts. Ex parte Christie, 3 How. 318, 319; Nugent v. Boyd, id. 426; Wood v. Jenkins, 10 Met. 583.

Other analogous cases have occurred, and the same result has been reached; the general principle being, that, where jurisdiction may be conferred on the United States courts, it may be made exclusive where not so by the Constitution itself; but, if exclusive jurisdiction be neither express nor implied, the State courts have concurrent jurisdiction whenever, by their own constitution, they are competent to take it. Thus, the United States itself may sue in the State courts, and often does so. If this may be done, surely, on the principle that the greater includes the less, an officer or corporation created by United States authority may be enabled to sue in such courts. Nothing in the Constitution, fairly considered, forbids it.

The general question, whether State courts can exercise concurrent jurisdiction with the Federal courts in cases arising under the Constitution, laws, and treaties of the United States, has been elaborately discussed, both on the bench and in published treatises,-sometimes with a leaning in one direction and sometimes in the other,-but the result of these discussions has, in our judgment, been, as seen in the above cases, to affirm the jurisdiction, where it is not excluded by express provision, or by incompatibility in its exercise arising from the nature of the particular case.

When we consider the structure and true relations of the Federal and State governments, there is really no just foundation for excluding the State courts from all such jurisdiction.

The laws of the United States are laws in the several States, and just as much binding on the citizens and courts thereof as the State laws are. The United States is not a foreign sovereignty as regards the several States, but is a concurrent, and, within its jurisdiction, paramount sovereignty. Every citizen of a State is a subject of two distinct sovereignties, having concurrent jurisdiction in the State,-concurrent as to place and persons, though distinct as to subject-matter. Legal or equitable rights, acquired under either system of laws, may be enforced in any court of either sovereignty competent to hear and determine such kind of rights and not restrained by its constitution in the exercise of such jurisdiction. Thus, a legal or equitable right acquired under State laws, may be prosecuted in the State courts, and also, if the parties reside in different States, in the Federal courts. So rights, whether legal or equitable, acquired under the laws of the United States, may be prosecuted in the United States courts, or in the State courts, competent to decide rights of the like character and class; subject, however, to this qualification, that where a right arises under a law of the United States, Congress may, if it see fit, give to the Federal courts exclusive jurisdiction. See remarks of Mr. Justice Field, in The Moses Taylor, 4 Wall. 429, and Story, J., in Martin v. Hunter's Lessee, 1 Wheat. 334; and of Mr. Justice Swayne, in Ex parte McNeil, 13 Wall. 236. This jurisdiction is sometimes exclusive by express enactment and sometimes by implication. If an act of Congress gives a penalty to a party aggrieved, without specifying a remedy for its enforcement, there is no reason why it should not be enforced, if not provided otherwise by some act of Congress, by a proper action in a State court. The fact that a State court derives its existence and functions from the State laws is no reason why it should not afford relief; because it is subject also to the laws of the United States, and is just as much bound to recognize these as operative within the State as it is to recognize the State laws. The two together form one system of jurisprudence, which constitute the law of the land for the State; and the courts of the two jurisdictions are not foreign to each other, nor to be treated by each other as such, but as courts of the same country, having jurisdiction partly different and partly concurrent. The disposition to regard the laws of the United States as emanating from a foreign jurisdiction is founded on erroneous views of the nature and relations of the State and Federal governments. It is often the cause or the consequence of an unjustifiable jealousy of the United States government, which has been the occasion of disastrous evils to the country.

It is true, the sovereignties are distinct, and neither can interfere with the proper jurisdiction of the other, as was so clearly shown by Chief Justice Taney, in the case of Ableman v. Booth, 21 How. 506; and hence the State courts have no power to revise the action of the Federal courts, nor the Federal the State, except where the Federal Constitution or laws are involved. But this is no reason why the State courts should not be open for the prosecution of rights growing out of the laws of the United States, to which their jurisdiction is competent, and not denied.

A reference to some of the discussions, to which the subject under consideration has given rise, may not be out of place on this occasion.

It was fully examined in the eighty-second number of 'The Federalist,' by Alexander Hamilton, with his usual analytical power and far-seeing genius; and hardly an argument or a suggestion has been made since which he did not anticipate. After showing that exclusive delegation of authority to the Federal government can arise only in one of three ways,-either by express grant of exclusive authority over a particular subject; or by a simple grant of authority, with a subsequent prohibition thereof to the States; or, lastly, where an authority granted to the Union would be utterly incompatible with a similar authority in the States,-he says, that these principles may also apply to the judiciary as well as the legislative power. Hence, he infers that the State courts will retain the jurisdiction they then had, unless taken away in one of the enumerated modes. But, as their previous jurisdiction could not be possibility extend to cases which might grow out of and be peculiar to the new constitution, he considered that, as to such cases, Congress might give the Federal courts sole jurisdiction. 'I hold,' says he, 'that the State courts will be divested of no part of their primitive jurisdiction, further than may relate to an appeal; and I am even of opinion, that in every case in which they were not expressly excluded by the future acts of the national legislature, they will, of course, take cognizance of the causes to which those acts may give birth. This I infer from the nature of judiciary power, and from the general genius of the system. The judiciary power of every government looks beyond its own local or municipal laws, and, in civil cases, lays hold of all subjects of litigation between parties within its jurisdiction, though the causes of dispute are relative to the laws of the most distant part of the globe. . . . When, in addition to this, we consider the State governments and the national government, as they truly are, in the light of kindred systems, and as parts of ONE WHOLE, the inference seems to be conclusive, that the State courts would have concurrent jurisdiction in all cases arising under the laws of the Union, where it was not expressly prohibited.' These views seem to have been shared by the first Congress in drawing up the Judiciary Act of Sept. 24, 1789; for, in distributing jurisdiction among the various courts created by that act, there is a constant exercise of the authority to include or exclude the State courts therefrom; and where no direction is given on the subject, it was assumed, in our early judicial history, that the State courts retained their usual jurisdiction concurrently with the Federal courts invested with jurisdiction in like cases.

Thus, by the Judiciary Act, exclusive cognizance was given to the circuit and district courts of the United States of all crimes and offences cognizable under the authority of the United States; and the same to the district courts, of all civil causes of admiralty and maritime jurisdiction, of all seizures on water under the laws of impost, navigation, or trade of the United States, and of all seizures on land for penalties and forfeitures incurred under said laws. Concurrent jurisdiction with the State courts was given to the district and circuit courts of all causes where an alien sues for a tort only in violation of the law of nations or a treaty of the United States, and of all writs at common law where the United States are plaintiffs; the same to the circuit courts, where the suit is between a citizen of the State where the suit is brought and a citizen of another State, where an alien is a party, &c. Here, no distinction is made between those branches of jurisdiction in respect to which the Constitution uses the expression 'all cases,' and those in respect to which the term 'all' is omitted. Some have supposed that wherever the Constitution declares that the judicial power shall extend to 'all cases,'-as, all cases in law and equity arising under the Constitution, laws, and treaties of the United States; all cases affecting ambassadors, &c.,-the jurisdiction of the Federal courts is necessarily exclusive; but that where the power is simply extended 'to controversies' of a certain class,-as, 'controversies to which the United States is a party,' &c.,-the jurisdiction of the Federal courts is not necessarily exclusive. But no such distinction seems to have been recognized by Congress, as already seen in the Judiciary Act; and subsequent acts show the same thing. Thus, the first patent law for securing to inventors their discoveries and inventions, which was passed in 1793, gave treble damages for an infringement, to be recovered in an action on the case founded on the statute in the Circuit Court of the United States, 'or any other court having competent jurisdiction,' meaning, of course, the State courts. The subsequent acts on the same subject were couched in such terms with regard to the jurisdiction of the circuit courts as to imply that it was exclusive of the State courts; and now it is expressly made so. See Patent Acts of 1800, 1819, 1836, 1870, and Rev. Stat. U.S., sect. 711; Parsons v. Barnard, 7 Johns. 144; Dudley v. Mayhew, 3 Comst. 14; Elmer v. Pennel, 40 Me. 434.

So with regard to naturalization,-a subject necessarily within the exclusive regulation of Congress,-the first act on the subject, passed in 1790, and all the subsequent acts, give plenary jurisdiction to the State courts. The language of the act of 1790 is, 'any common-law court of record in any one of the States,' &c. 1 Stat. 103. The act of 1802 designates 'the Supreme, Superior, District, or Circuit Court of some one of the States, or of the territorial districts of the United States, or a circuit or district court of the United States.' 2 Stat. 153.

So, by acts passed in 1806 and 1808, jurisdiction was given to the county courts along the northern frontier, of suits for fines, penalties, and forfeitures under the revenue laws of the United States. 2 Stat. 354, 489. And by act of March 3, 1815, cognizance was given to State and county courts, generally, of suits for taxes, duties, fines, penalties, and forfeitures arising under the laws imposing direct taxes and internal duties. 3 Stat. 244.

These instances show the prevalent opinion which existed, that the State courts were competent to have jurisdiction in cases arising wholly under the laws of the United States; and whether they possessed it or not, in a particular case, was a matter of construction of the acts relating thereto. It is true that the State courts have, in certain instances, declined to exercise the jurisdiction conferred upon them; but this does not militate against the weight of the general argument. See United States v. Lathrop, 17 Johns. 4. See, especially, the able dissenting opinion of Mr. Justice Platt, id. 11.

It was, indeed, intimated by Mr. Justice Story, obiter dictum, in delivering the opinion of the court in Martin v. Hunter's Lessee, 1 Wheat. 334-337, that the State courts could not take direct cognizance of cases arising under the Constitution, laws, and treaties of the United States, as no such jurisdiction existed before the Constitution was adopted. This is true as to jurisdiction depending on United States authority; but the same jurisdiction existed (at least to a certain extent) under the authority of the States. Inventors had grants of exclusive right to their inventions before the Constitution was adopted, and the State courts had jurisdiction thereof. The change of authority creating the right did not change the nature of the right itself. The assertion, therefore, that no such jurisdiction previously existed, must be taken with important limitations, and did not have much influence with the court when a proper case arose for its adjudication. Houston v. Moore, decided in 1820, 5 Wheat. 1, was such a case. Congress, in 1795, had passed an act for organizing and calling forth the militia, which prescribed the punishment to be inflicted on delinquents, making them liable to pay a certain fine, to be determined and adjudged by a court-martial, without specifying what court-martial. The legislature of Pennsylvania also passed a militia law, providing for the organization, training, and calling out the militia, and establishing courts-martial for the trial of delinquents. The law in many respects exactly corresponded with that of the United States, and, as far as it covered the same ground, was for that reason held to be inoperative and void. Houston, a delinquent under the United States law, was tried by a State court-martial; and it was decided that the court had jurisdiction of the offence, having been constituted, in fact, to enforce the laws of the United States which the State legislature had reenacted. But the decision (which was delivered by Mr. Justice Washington) was based upon the general principle that the State court had jurisdiction of the offence, irrespective of the authority, State or Federal, which created it. Not that Congress could confer jurisdiction upon the State courts, but that these courts might exercise jurisdiction on cases authorized by the laws of the State, and not prohibited by the exclusive jurisdiction of the Federal courts. Justices Story and Johnson dissented; and, perhaps, the court went further, in that case, than it would now. The act of Congress having instituted courts-martial, as well as provided a complete code for the organization and calling forth of the militia, the entire law of Pennsylvania on the same subject might well have been regarded as void. Be this as it may, it was only a question of construction; and the court conceded that Congress had the power to make the jurisdiction of its own courts exclusive.

In Cohens v. Virginia, 6 Wheat. 415, Chief Justice Marshall demonstrates the necessity of an appellate power in the Federal judiciary to revise the decisions of State courts in cases arising under the Constitution and laws of the United States, in order that the constitutional grant of judicial power, extending it to all such cases, may have full effect. He says, 'The propriety of intrusting the construction of the Constitution and laws, made in pursuance thereof, to the judiciary of the Union, has not, we believe, as yet, been drawn in question. It seems to be a corollary from this political axiom, that the Federal courts should either possess exclusive jurisdiction in such cases, or a power to revise the judgment rendered in them by the State tribunals. If the Federal and State courts have concurrent jurisdiction in all cases arising under the Constitution, laws, and treaties of the United States, and if a case of this description brought in a State court cannot be removed before judgment, nor revised after judgment, then the construction of the Constitution, laws, and treaties of the United States is not confided particularly to their judicial department, but is confided equally to that department and to the State courts, however they may be constituted.'

See the subject further discussed in 1 Kent's Com. 395, &c., Sergeant on the Const. 268; 2 Story on the Const., sect. 1748, &c.; 1 Curtis's Com., sects. 119, 134, &c.

The case of Teal v. Felton was a suit brought in the State court of New York against a postmaster for neglect of duty to deliver a newspaper under the postal laws of the United States. The action was sustained by both the Supreme Court and Court of Appeals of New York, and their decision was affirmed by this court. 1 Comst. 537; 12 How. 292. We do not see why this case is not decisive of the very question under consideration.

Without discussing the subject further, it is sufficient to say, that we hold that the assignee in bankruptcy, under the Bankrupt Act of 1867, as it stood before the revision, had authority to bring a suit in the State courts, wherever those courts were invested with appropriate jurisdiction, suited to the nature of the case.

Judgment affirmed.


text: Talk:Claflin v. Houseman Assignee/Opinion of the Court