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cussion, it was observed by the court that the objec. tion to a law, on the ground of its impairing the violation of contracts, did not depend on the extent of the change effected by the law; any deviation from the terms of the contract, by accelerating or postponing the period of performance, which the latter prescribes, imposing conditions not expressed in it, or dispensing with the performance of those which are, however minute or apparently immaterial or partial in their effect onghe contract, impairs its obligation. The material point decided on this occasion was, that a compact between two states was a contract within the constitutional prohibition.*
Another case, which led to a very extensive inquiry into the operation of this constitutional restriction, arose under an insolvent act of New York, passed in 1811. This law was retrospective, and discharged the debtor, upon his single petition and the surrender of his property, without the concurrence of any creditor, from all pre-existing debts, and from all liability and responsibility by reason of them. The court on this occasion recognised the doctrine adverted to in a former lecture, that until Congress exercise its power on the subject of bankruptcy, the individual states may pass bankrupt laws, provided they contain no provision violating the obligation of contracts. It was admitted that the states might discharge debtors from imprisonment, because imprisonment is no part of the contract, but only a means for coercing its performance. It was also admitted that a state may pass statutes of limitations, as they are termed, for these also relate only to the remedy, and not to the obligation of the contract; and it was stated that the insolvent laws of far the greater
* 8 Wheat., 1.
number of states only discharged the person of the debtor, and left the obligation to pay in full force. But a law which discharged the debtor from his contract, and released him without payment, impaired, because it entirely discharged the obligation of the contract; for it is to be observed that there is an obvious distinction, in the nature of things, between the obligation of a contract, and the remedy to enforce it. The latter may be modified as the wisdom of the Legislature may direct. But the Constitution, intending to restore and preserve completely the public credit and confidence, established as a fundamental principle that the former shall be inviolable. *
The case in which the above decision was made had arisen in the Federal Courts, and the contract existed when the state law was passed. But it was afterward held that there was no difference when the-suit in such a case is brought in a court of the state of which both the parties were citizens, and in which the contract was made and the discharge obtained, and where the parties continue to reside until the suit be brought.f A distinction, however, was taken in the courts of New York and Massachusetts between a contract made before and one made after the passing of the state law. The doctrine they established was this, that an insolvent act in force when the contract was made did not, in the sense of the Constitution, impair its obligation, because the parties to every contract have reference to the existing laws of the country where it is made, and are presumed to make their contract in reference to them. · This distinction was supposed to be consistent with the decision of the Supreme Court of the * 4 Wheat., 122.
+ 6 ibid., 131. # 16 J. R., 233. 7 J. C. R., 297. 13 Mass. Rep., 1.
United States; but in a subsequent case, where the discharge was under an insolvent law of a different state from that in which the contract was made, the Supreme Court went a step farther, and held that a discharge under such a law existing when the debt was contracted, was equally within the principle before established. *
It remained, however, to be settled whether a state could constitutionally pass an insolvent law which should effectually discharge the debtor from a debt contracted after the passing of the act, and within the state in which the law was passed. The general language of the court on the last occasion seemed to reach even this case ; but the facts on which the question then arose did not cover the whole ground. The decision, therefore, was not authority to the extent mentioned; and it was subsequently ruled, by a bare majority of the court, and after much apparent hesitation, that a bankrupt or insolvent law of a state, discharging both the person of the debtor and his future acquisitions of property, is not a law “impairing the obligation of contracts," in respect to debts contracted within the state subsequently to its enactment."
The venerable Chief-justice Marshall was among the minority of the court, and delivered the reasons for their dissent. He admitted that none of the former decisions comprehended the question then presented, and that it was, consequently, an open one. He also admitted that there was an essential difference in principle between laws that act on past or future contracts; and that, while those of the former description could seldom be justified, those of the latter were proper subjects of ordinary legislative dis
* 4 Wheat., 209.
† 12 ibid., 213.
cretion. A constitutional restriction, therefore, on the power to pass laws of the one class might very well consist, with entire legislative freedom, in regard to the other. Yet, when we consider the nature of the Union; that it was intended to make us in a great measure one people, as to commercial objects ; that, so far as respects the intercommunication of individuals, the lines of separation between states are in many respects obliterated, it would be matter of surprise if, on the delicate subject of contracts actually formed, the interference of state legislation should be greatly abridged or entirely forbidden. In the nature of the existing provision, then, there seems to be nothing which should induce us to adopt the limited construction which had been given in that case to the prohibitory clause.
The former part of the section, comprehending the prohibition, enumerates the cases in which the action of the state legislatures is absolutely and entirely forbidden ; while the latter part specifies those in which the prohibitions are qualified. The former comprehends two classes of powers : those of the first class are political and general in their nature, consisting in the exercise of sovereignty without affecting the rights of individuals ; while the second class comprehends those laws which operate upon individuals, and includes, among others, “ laws impairing the obligation of contracts.” In all the cases embraced in both classes, whether the thing prohibited be the exercise of mere political power or legislative action on individuals, the prohibition is complete and total. Legislation of every discription on those subjects is, without any exception, comprehended and forbidden. A state is as entirely prohibited from passing laws impairing the obligation of contracts as from making treaties or coining money.
So much of the prohibition as restrains the power of the state to punish offenders in criminal cases, and inhibits bills of attainder and ex post facto laws, is, in its very terms, confined to pre-existing cases. But that part of the clause which relates to the civil transactions of individuals is expressed in more general terms—in terms which comprehend, in their ordinary acceptation, cases which occur after as well as before the passing of the act. It forbids a state to make anything but gold or silver coin a tender in payment of debts, or to pass any law impairing the obligation of contracts. These prohibitions relate to kindred subjects; they contemplate legislative interference with private rights, and restrain such interference. In construing that part of the clause which respects tender laws, a distinction has never been attempted between debts existing at the time the law may be passed and those afterward contracted. The prohibition in that case is total ; and yet the difference in principle between making property a tender in payment of debts contracted after the passage of the act, and discharging those debts without payment or by a surrender of property, in other words, between an absolute and a contingent right to tender in payment, is not clearly discernible. Nor is the difference in language so obvious as to denote plainly a difference of intention in the framers of the Constitution. The same train of reasoning which would confine the words relative to contracts to those contracts only which existed at the passage of the law, would go far in limiting those relative to a tender in payment of debts to such as previously existed; yet the distinction between these and such as were contracted subsequently to the law seems never before to have occurred to any expounder of the