XIV. STOPPAGE IN TRANSITU.

Inter-State Consignments. In cases involving the right of stoppage in transitu of inter-State consignments of property to be carried by common carriers out of one State into or through another, or into or through still another State or States, the personal right of the consignor to thus stop and reclaim the property is not prejudiced by its passing out of one State, into or through another State or States, but follows the property wherever it goes until delivery to the consignee, and may be enforced in every such other State into which the goods are carried.1 This right will override the claim of intervening purchases made of the consignee, as also levies against him during the transit, to the same extent as it would in the State wherein the consignment is made. But the prevailing idea that the carrier is bound to deliver up the goods on mere claim of the consignor to have the same, and at any and every place at which the goods may arrive, or which they may in their transit pass, or else subject himself, on refusal, to an action for conversion of the same, is altogether erroneous. While there is no want of authority to show that the consignor is entitled, under proper circumstances, to reclaim the goods, and to have possession thereof, yet we have been unable to find any decision imposing upon the carrier the duty of personally knowing the consignor, so as to be truly advised of his identity, or charging the carrier with knowledge of the facts on which the right of stoppage in transitu rests in each particular case, or compelling the carrier to become judge, jury and administrator of the law in each particular case, and as a sequence thereto to deliver up the property to whoever shall assume to have such rights and shall give notice thereof and demand the property, on peril of the carrier being deemed to have converted the goods to his own use in case of refusal, or, of what is still worse, of being chargeable in damages worth the value thereof to the consignee, in case of such delivery to a wrong claimant, or even to the right person, but when no real cause for stoppage in transitu exists.

On the contrary, this right is to be enforced as other rights are enforced; that is, through the courts and officers of the law. The carrier is but a stakeholder between the consignor and consignee, and is not bound to know the consignor personally; is not bound to know whether the goods were consigned or not on a purchase and sale thereof, or if so, whether or not the purchase money was paid or an indebtedness was incurred therefor; or, if the latter was the case, is not bound to know whether the debtor was then or since has proved insolvent, or whether the goods were obtained by fraud, or the facts as to any cause which in law is ground for stoppage in transitu.

Remedy by Replevin. The remedy of the consignor, if he has rights in such respect, is by process of replevin against the carrier to obtain possession of the goods, and the only effect of notice to the carrier is to prevent the latter from delivery of the same to the consignee until reasonable time is elapsed for the consignor to assert his rights. And we hold further, that in such case, although the carrier be made defendant, yet if he act in good faith, and do no more than to avoid committing himself, he will not even be liable for costs. In such actions, however, the carrier should notify the consignee thereof, if not already made a party, and disclaiming other interest than as carrier, move to substitute the consignee as defendant in his stead, that, as the real parties in interest they may interplead.

Bill of Interpleader. But the safer way for the carrier, in cases of doubtful right of the respective claimants to have delivery of the goods, and which must often if not always be the result of inter-State shipment over long lines of carriage, whenever conflicting claims arise as growing out of the right of stoppage in transitu, is to place the goods in the hands of a reliable bailee, and file against the claimants and parties in interest a bill of interpleader, to settle the rights of the parties in that respect, and thereby protect the carrier from the hardship of deciding to whom the right of delivery belongs.3 Chancellor KENT, in recognition of the injustice of a rule that would impose upon

1 Houston on Stoppage in Transitu, 51; Abbott on Shipping, 511 et seq. The notice places the goods quasi in custodia legis. Abbott on Shipping,

Abbott on Shipping, 511 et seq.

3 Kent, 215, 216; Jordan v. James, 5 Ham. 88, 107.

the carrier, in disputed cases of stoppage in transitu, the necessity of deciding, at his own risk, to whom the right of delivery belongs, says that the carrier ought not to be put to such peril, or to the uncertainty of indemnity,1 but "should know to whom of right he can deliver the goods," and that it "is safer for the master to deposit the goods with some bailee until the rights of the claimants are settled, as they can always be, upon a bill of interpleader in chancery, to be filed by the master."2

XV. INVIOLABILITY OF CONTRACTS.

No State can pass a law impairing the obligation of contracts. All such State laws are simply void. But what amounts to impairing the obligation of a contract, within the meaning and intent of the constitutional provision above referred to, has been the subject of much discussion, and the earnest consideration of our national courts, in whom alone, under the Constitution, the decision rests. The decisions are uniform, however, that the invalidity of a State law does not depend upon the degree or extent to which it modifies or changes the rights and obligations of the parties to a contract, or impairs, in any manner, a contract; but a State law is void that does it at all.

..

Such, too, is the case, whether it be by mere statutory enactment, or by a provision or clause of a State constitution; for it is not merely the legislatures of the States, but the States themselves, that are thus inhibited by the national Constitution.4

3 Article 1, § 10, Const. of U. S.; Fletcher v. Peck, 6 Cr. 87; Pawlet v. Clark, 9 Cr. 272; Terrett v. Taylor, 9 Cr. 43; McGee v. Mathis, 4 Wall. 143; Thompson v. Holton, 6 McL. 386; New Jersey v. Wilson, 7 Cr. 164; Dartmouth College v. Woodward, 4 Wheat. 518; Dodge v. Woolsey, 18 How. 331; State Bank of Ohio v. Knoop, 16 How. 369; Providence Bank v. Billings, 4 Pet. 514; Jefferson Branch Bank v. Skelly, 1 Black, 436; Hawthorne v. Calef, 2 Wall. 10; Corning v. McCullough, 1 N. Y. (47, 49; Conant e. Van Schaick, 24 Barb. 87; The

There May be Change of Remedy. The legislature may in good faith, regulate the remedy by general laws, but not to such an extent as to affect or impair the obligation of the contract.1

Rebellious States are within the prohibition. This inhibition extends not only to States confessedly acting within the national union as professed members thereof, but also to the enactments of States that have nominally seceded therefrom, and are professedly acting as integral parts and members of an unlawful and rebel-political organization; so that, although the merely domestic action of such erratic States may be enforcible for the protection and good order of society, when free from constitutional objections, yet statutes thereof which are incompatible with the national constitution will be held void by reason thereof, when brought in question after the suppression of such hostile organizations, upon the same principle and to the same extent as if enacted by loyal States; and this, too, as well in relation to laws impairing the obligations of contracts as to other unconstitutional enactments. In like manner all enactments of such principal rebel government itself will be recorded as illegal and void, and so of judicial order and decisions made in virtue thereof.3

Cases in illustration. Personal liability for corporate debts. Release of by law. A provision in the charter of a private corporation rendering stockholders liable to the amount of their stock for all debts of the corporation contracted prior to the transfer of their stock, is a contract between such stockholders and the creditors of the corporation, which is impaired by a law subsequently passed repealing such individual liability clause of the charter.4

Bank bills receivable, by law, for taxes. So, where a bank charter made the bills of the bank receivable by the State in pay

122; Mason v. Haile, 12 Wheat. 370; Charles River Bridge v. Warren Bridge, 11 Pet. 420; Hawkins v. Barney's Lessee, 5 Pet. 456; Farmers' and Mechanics' Bank v. Smith, 6 Wheat. 131; Satterlee v. Matthewson, 2 Pet. 380; Wilkinson v. Leland, 2 Pet. 627; Hawthorne v. Calef, 2 Wall. 10; McGee v. Mathis, 4 Wall. 143; Fletcher v. Peck, 6 Cr. 88; Dodge v. Woolsey, 18 How. 331; Cooley on Const. Limitations, 4th ed. 333 et seq.; Pomeroy

on the Constitution, 3d ed. 349-413; Story on the Constitution, $$ 13741400.

Bronson v. Kinzie, 1 How. 311; Hawthorne v. Calef, 2 Wall. 23; Ogden v. Saunders, 12 Wheat. 270; Beers v. Haughton, 9 Pet. 329; Cooley's Const. Limitations, 4th ed. 351.

2 Williams v. Bruffy, 6 Otto, 176. Dewing v. Perdicaries, 6 Otto, 193. 4 Hawthorne v. Calef, 2 Wall. 10, 23.

ment of taxes, this was held to amount to a contract with the holders of the bills; and it was further held that an act of assembly repealing such provision was void, as impairing the obliga tion of the contract.1

An exclusive privilege is a contract. So, a provision in a State statute chartering a company to build a toll bridge, that no bridge over the same stream should be built within a given distance from the one thus authorized to be built, is a contract between the corporators and the State, which is impaired by the building of another bridge over the same stream within the inhibited distance, and by act of the legislature permitting the erection of such latter bridge, and such subsequent statute is void as repugnant to the Constitution of the United States, which declares that no State shall make any law impairing the obligation of contracts.2

Purchases under State exemption from taxation. Likewise the sale of lands by a State, or scrip receivable for lands under a statute providing as an inducement to the purchase that the lands should not be taxed for a given number of years, or until reclaimed from their condition as swamp lands, amounts to a valid contract between the State and the purchaser or holder of the scrip or lands, which is irrepealable by the State; and the enactment subsequently of a law repealing such exemption clause and providing for taxing such lands, before the expiration of the time specified, or reclaimation of the land from their swamp land condition, impairs the contract within the meaning of the Constitution, and is therefore unconstitutional and void. 3

Curative laws. But curative laws, making contracts valid, do not impair the obligation of contracts.4

Bank charter exemption from taxation for bonus paid. But a State law which, in consideration of a bonus, embodies in a bank charter a provision exempting the bank from taxation, is a contract inhibition against taxation of the stockholders of such bank, upon their stock therein; and a law creating such tax is void for impairing the contract. Yet such inhibition does not extend or exist longer than the term of the charter, and if thereafter the

51.

1 Woodruff. Trapnall, 10 How. 190. The Binghamton Bridge, 3 Wall.

3 McGee v. Mathis, 4 Wall. 143.

4 Satterlee v. Matthewson, 2 Pet. 380.