Sandusky City Bank v. Wilbor.

to themselves no right to change these terms. The only consideration required, the only consideration to be paid, is this four per cent. In other words, the general assembly say to such persons as may take the stock, you may enjoy the privileges of banking, if you will consent to pay to the State of Ohio, for this privilege, four per cent. on your dividends, as they shall from time to time be made. The charter is accepted, the stock is subscribed, and the corporation pays, or is willing to pay, the consideration stipulated; to wit, the four per cent. Here is a contract, specific in its terms, easy to be understood. Privileges are proffered for certain and definite considerations to be paid; and those privileges being accepted, the payment of the consideration can be enforced. After a contract similar to this, between individuals, where one undertook to convey any interest to another for a definite consideration, and the conveyance is made and accepted, it will not be pretended that anything more than the definite consideration can be recovered. But a contract between the state and individuals is as obligatory as any other contract. Until a state is lost to all sense of justice and propriety, she will scrupulously abide by her contracts; more scrupulously than she will exact their fulfillment by the opposite contracting party. As here was a contract between the state and the corporators of the Commercial Bank, in their corporate capacity, that the latter should enjoy certain privileges, in consideration of certain payments to be made, any *law requiring the [511 payment of a greater amount, varies this contract and impairs its validity. The tenth section of the first article of the constitution of the United States provides, that no state shall pass any law impairing the obligation of contracts; and the sixteenth section of the eighth article of the constitution of Ohio, that no ex post facto law, or law impairing the validity of contracts, shall ever be made.' A law, then, made in express terms, and for the avowed purpose of collecting a greater tax than four per cent. upon its dividends, from the Commercial Bank, would be in contravention of both these constitutions, and could not be enforced, unless we adopt the principle that an unconstitutional legislative enactment is a binding law of the land; unless we adopt the principle that the law-making power is above the constitution under which it acts; unless, in fact, we adopt the principle, that in this country, where we boast of constitutional and limited government, legislative supremacy is co-extensive with with parliamentary omnipotence."

Sandusky City Bank v. Wilbor.

Collett, judge, dissented, but the grounds of his dissent are not stated.

This decision of the Supreme Court determined and settled, as fully as the highest judicial tribunal of the state can settle any question within its constitutional jurisdiction, that when the general assembly provide in a bank charter that "the State of Ohio shall be entitled to receive four per cent. on all dividends made by said bank," the legitimate interpretation and construction of such language is, that the general assembly intend and do stipulate that the tax so provided for is fixed beyond alteration.

Whether these terms in the charter were so express and explicit as to justify the construction given them by the court, I do not stop to inquire, for we are now dealing with the simple fact, that the Supreme Court gave to them, by interpretation and construction, the force and effect of such a stipulation.

This judicial construction was promulgated in 1835; remained, without being questioned or doubted by the Supreme Court, as the law of Ohio, when the general assembly, in 1845, introduced into the charter of the State Bank of Ohio the following section: 512] Each banking company organized under this act, or accepting thereof and complying with its provisions, shall, semiannually, on the days designated in the fifty-ninth section for declaring dividends, set off to the state six per centum on the profits, deducting therefrom the expenses and ascertained losses of the company, for the six months next preceding; which sum or amount, so set off, shall be in lieu of all taxes to which such company or the stockholders thereof, on account of stock owned therein, would otherwise be subject; and the cashier shall, within ten days thereafter, inform the auditor of state of the amount so set off, and shall pay the same to the treasurer of state," etc.

And now the question is, in view of the previous adjudication of the Supreme Court, whether the general assembly intended that these terms should have the force and effect which judicial interpretation had given like terms, less express and explicit, and less clearly indicating a stipulation fixing the amount of taxes. The general assembly must be presumed to know-indeed, no one can deny that they in fact knew-what construction had been given to like but more uncertain terms, by a co-ordinate branch of the government, authorized to construe statutes and charters. How, then, can any one entertain the remotest doubt that this section was in

Sandusky City Bank v. Wilbor.

serted in the charter of the State Bank with an intention that it should have the force and effect which had been given to like language by the Supreme Court?

Whatever opinion this court may entertain of the intention of the general assembly who granted the charter to the Commercial Bank, it seems to me that there can be no doubt of the intention of the general assembly who passed the charter of the State Bank. The first was an open question for judicial determination on the terms of a charter; the second is the grant of a charter based upon that judicial determination. Besides, what is the position of this court now upon this question?

The highest judicial tribunal of the state, and upon which devolves the power of interpreting statutes and charters, determine and fix, in 1835, the force and effect of certain words in a charter. These words were held to create a specific contract *between the [513 state and citizens who might become stockholders under the charter. After this determination had been promulgated for ten years, the general assembly adopt like words in a charter, and citizens become stockholders. The two co-ordinate branches of the government thus proceed harmoniously, the one first fixing the interpretation, force, and effect of words in a charter, and the other afterward incorporating the like words in charters. And now the same judicial department of the government is called upon to say that these same words, which it had before pronounced "a contract, specific in its terms, easy to be understood," so uncertain in their terms and so difficult to be understood, that, on the whole, the general assembly who used the words in view of previous judicial interpretation, could not have intended them as any stipulation whatever.

A question is made in this case as to the continued operation of the act of March 7, 1842, after its repeal.

The act of March 7, 1842 (Curwen, 907), reserved to the general assembly the right to alter or repeal all charters thereafter granted. The charter of the State Bank of Ohio was passed February 24, 1845, and afterward, and at the same session, by act of March 12, 1845, the act of March 7, 1842, was repealed. The act of February 24, 1845, however, for the organization of the State Bank, did not become operative as a charter, or any citizens accept its provisions, or corporation exist under it, until after the repeal of the act of March 7, 1842. It is insisted that the general assembly, by force of the act thus repealed, can now change and modify the rights of the

Whetstone and Price v. Riley.

corporators under the charter of the State Bank. On the contrary, it seems to me that the very object, intent, and effect of the repeal of that law by the general assembly, was to divest them of the powers reserved by it.

I do not deem it necessary to discuss the last two propositions of the syllabus, at the head of this case. They are not so definite and limited as to meet my concurrence; and the principles involved in 514] them have not in my opinion any application to the *present case. I am constrained, therefore, to dissent from all the rulings in this case.

SCOTT, J., also dissented on the same grounds.

JOHN WHETSTONE AND WILLIAM PRICE v. JAMES RILEY.

In an action against special bail, judgment was entered against the principal, at the April term, and execution issued thereon, and returned "not found," and suit commenced against the bail, in which summons was issued returnable on the 10th, and served upon the 3d of September, and duly returned; and September 29th default of bail for answer to petition was entered upon the docket by order of the court, and cause continued to the October term, during which, on the 8th of October, the bail, without showing cause arising previous to their becoming finally charged, obtained leave of court, and surrendered their principal. Held

1. That the bail having become finally charged, and their undertaking being no longer conditional, such order of court did not give them legal authority to surrender their principal in discharge of their liability.

2. That an answer filed by the bail setting forth such surrender of the principal in accordance with the order so made by the court, does not show a legal defense to the action.

3. That the court refusing to hear proof of such surrender, upon a motion filed with their answer by the bail for exoneration, and overruling the motion, and holding the facts so stated in their answer to be an insufficient defense, and refusing to set aside the default, did not show an improper exercise by the court of its legal discretion.

IN error to the Superior Court of Cincinnati.

This was an action brought by Riley against Whetstone and Price on their undertaking as special bail for Newman.

Whetstone and Price v. Riley.

The petition was filed in the Superior Court of Cincinnati, August 31, 1855, and alleged the commencement of the original suit against Newman, the principal, for $750; his arrest on the ground that he fraudulently incurred the obligation; the undertaking of the defendants as special bail, dated March 26, 1855; the release of Newman from custody; the judgment against Newman at the April term, 1855, of the Superior Court of Cincinnati, *for $750 and [515 costs; an order of arrest to the sheriff of Hamilton county, and a return that the body of Newman was not found, and demanded a judgment against defendants, as bail.

The summons was returnable in ten days. Service was made on the 3d of September.

On the 4th of September, defendants procured a bail-piece, and sent an agent with it, for Newman, to the interior of Maryland, where he then resided; and, by the quickest mode of conveyance,. brought him to Cincinnati on the 12th of September.

On the 29th of September, the clerk, by order of court, entered upon the docket the default of defendants for answer to the petition, and the cause was continued to the next (October) term. During the October term (October 8th), on motion of the defendants, the court granted the following order:

"On motion by the defendant, for an allowance of further time within which to surrender Edward Newman to the sheriff of the county of Hamilton, in discharge of their undertaking as special bail for said Newman, dated March 26, A. D. 1855, on which undertaking the present suit is founded, and upon affidavits and other evidence exhibited, and arguments of counsel, the court order that the said defendants, Wm. Price and John Whetstone, be allowed till twelve o'clock at noon, on Wednesday, the 10th day of October, instant, as further time within which said defendants, as bail, may surrender their principal, the said Edward Newman, to the sheriff of Hamilton county, in discharge of their said undertaking; provided, and it is ordered, that the said defendants shall pay all the costs which have accrued in the present case, and the jailor's fees, in committing said Newman to jail."

On the 8th of October, the same day the order was granted, allowing the further time, the defendants surrendered Newman to the sheriff, with a copy of the undertaking and bail-piece, and paid costs and jail fees, and Newman was committed to jail.

The defendants then filed a motion for an exoneration on their VOL. VII-30 465