LECTURE XXXI. --- The Legislature may change or regulate the Procedure as they think proper, unless the Change injuriously hinders the Creditor. - A Particular Means of Redress may be taken away if an Adequate Remedy remains or is substituted. — Laws giving an Unreasonable Stay of Execution or Exemption are Unconstitutional. What is reasonable in View of the Circumstances is primarily for the Legislature, but their Decision may be overruled if manifestly Erroneous. - The Right of Distress may be abolished, though stipulated for in the Lease. Is an Agreement not to take Advantage of an Actual or Prospective Stay or Exemption obligatory? — Retroactive Stay and Exemption Laws depend on the Police Power, which is ordinarily paramount. Substitution of an Inferior though reasonably Efficient Remedy. - Legislation should not be held unconstitutional if the Case admits of a Reasonable Doubt. — Rule where the Question arises under a Prohibitory Clause. -Denying or injuriously restricting the Means of Proof impairs the Obligation. The Legislature may retroactively abridge the Period for bringing Suit if a Reasonable Time is left. In the cases hitherto considered, the obligation was impaired by varying the mode or time of performance, or withholding something which the contractor had agreed to give. But the Constitution may equally be violated by a statute which, without affecting the right, suspends or abrogates the remedy for the breach. If, for instance, the law were, instead of postponing the time of payment for a week, to declare that no action should be brought until a week after the debt had become due, the injury to the creditor would be the same, although inflicted in a somewhat different way. Payment would still be legally demandable at the time originally fixed, and might, if the question arose in another jurisdiction, be compelled; but as there would be no means of enforcing it in the place where the contract was made, the object which the Constitution had in view would be frustrated. And this would seem to be true irrespectively of the time during 690 IMPAIRING THE REMEDY which the delay endures. To impair is to diminish, to make less, to deteriorate; and a contract is necessarily impaired when anything is subtracted from the sum of the duties which it imposes or the rights which it confers. If it be conceded that the suspension of the right to proceed by suit to judgment is unconstitutional, it would seem to follow that a postponement of the period at which the judgment may be enforced by execution will also be contrary to the Constitution. In neither case does the law act directly on the contract to vary the time or manner of performance and there is a delay in both which may be equivalent to a denial of justice by affording the debtor an opportunity to place his property beyond the reach of his creditors.1 It is accordingly established that an act suspending the creditor's right to proceed to execution, or clogging it with restrictions which render it less efficient, may be equally invalid with an act postponing the period for the payment of the debt. The question arose in Bronson v. Kinzie 2 on a bill filed for the foreclosure of a mortgage which contained a stipulation that the mortgagee might enter for default of payment and dispose of the premises at public sale. The defendant relied on a statute of Illinois providing that no sale should be made compulsorily on process unless the property brought two thirds of its value as estimated by appraisers to be appointed by the court, and that the mortgagor should have a year in which to redeem, on repaying the purchase-money with interest at ten per cent. Chief-Justice Taney said, in delivering judgment, that agreeably to the law existing when the mortgage was executed, the equity of the mortgagor might be absolutely precluded by a decree of foreclosure. If the law, though 1 Edwards v. Kearzey, 96 U. S. 661, 664; Danks v. Quackenbush, 1 N. Y. 129; Johnson v. Higgins, 3 Metcalf (Ky.), 567; Wood v. Wood, 13 Richardson, 408; Johnson v. Duncan, 3 Martin (La.), 530; Webster v. Rose, 6 Heiskell, 93, 102; Jacobs v. Smallwood, 63 N. C. 112; Hudspath v. Davis, 41 Ala. 389; Lester v. Hunter, 30 Texas, 688; Taylor v. Stearns, 18 Grattan, 242, 288. 2 1 Howard, 317. IMPAIRS THE CONTRACT. 691 subsequent, had simply changed the remedy, it would be liable to no constitutional objection. A State might clearly regulate at pleasure the mode of procedure in reference to past contracts as well as future. It might, for example, shorten the period within which claims would be barred by the statute of limitations; it might even direct that necessary implements of agriculture, the tools of the mechanic, or articles which, like wearing apparel and household furniture, are needful for the daily wants of life, should be exempt from levy and sale for debt. New remedies might be substituted, and if these were less convenient, or rendered the recovery more tardy or difficult, it did not follow that the law was unconstitutional. Whatever belonged merely to the remedy might be altered at the will of the State, provided the obligation of the contract was not impaired. If that effect was produced, it was immaterial whether it resulted from a law acting on the remedy, or directly on the contract. In either case it was prohibited by the Constitution. As the law stood when the contract before the court was made, the mortgagee was entitled on default to obtain an order for the sale of the mortgaged property free and discharged from the equitable interest of the mortgagor. This was the obligation of the contract, and any subsequent law impairing the right which it conferred was necessarily invalid. The question presented by the second point was equally clear. Though the statute apparently acted upon the remedy, and not directly upon the contract, its effect was to deprive the complainant of his pre-existing right to foreclose the mortgage by a sale of the premises, and to impose conditions that would render any sale impracticable. The unconstitutionality was the more glaring because the mortgage contained a covenant authorizing the mortgagee, in default of payment, to sell the premises at public auction for the payment of the debt, which was rendered nugatory by the law. Mortgages made after the passage of the law might be regulated by it, because a State had the power to prescribe the equitable and legal effect of contracts thereafter made within its jurisdiction. It might exempt any property it saw proper from sale for the payment of debts; it might impose such conditions and restrictions on the creditor as the judgment and policy of the legislature dictated. All future contracts would be subject to the conditions so imposed, and they would be obligatory on the parties in the courts of the United States as well as in those of the State. But antecedent contracts could not be impaired by retroactive legislation consistently with the Constitution of the United States. Laws authorizing the debtor to redeem after a judicial sale were in like manner held invalid in Scobey v. Gibson 1 and Iglehart v. Wolfin.2 In the subsequent case of McCracken v. Hayward,3 the controversy arose under a retroactive enactment that property should not be sold on execution for less than two thirds of its appraised value. The court held that the obligation of a contract consisted in its binding force on the party who made it. This depended on the laws existing when it was made. They were the measure of the obligation incurred by one party and of the right acquired by the other. A subsequent law affecting to diminish the duty or impair the right bore on the obligation, and any law which in its operation amounted to a denial or obstruction of the right, though professing to act only on the remedy, was obnoxious to the prohibition of the Constitution. The obligation of the defendant in the case before the court was to perform the agreement; and if he made default, the plaintiff was entitled to bring suit and obtain damages for the breach and proceed by execution until the judgment was satisfied in accordance with the then existing law. This right was in every respect binding on the defendant, and as much a part of the contract as if it had been set forth in terms. Any law which denied or obstructed the right by superadding a condition that the mortgaged premises should not be sold for less than their value as ascertained by appraisement or by any other method than a public sale, impaired the obligation of the contract because it could 32 Howard, 60S. 1 17 Ind. 572. 2 20 Ind. 32. OF EXECUTION UNCONSTITUTIONAL. 693 only be enforced by a sale, and the prevention of such a sale was a denial of justice. In Bunn v. Gorgas,1 a like view was taken by the Supreme Court of Pennsylvania. "It was idle to say that the law under consideration was merely a modification of the remedy. A law modifying the remedy might impair the obligation of the contract. The obligation of a contract, in the sense in which the word was used in the Constitution, is that duty of performing it which is recognized and enforced by the law; and if the law is so changed that the means of legally enforcing the duty are materially impaired, the obligation of the contract is no longer the same." It results from these decisions that where the creditor is by the existing law entitled to proceed forthwith to an absolute sale, the legislature cannot impair this right retroactively by providing that the debtor shall be entitled to redeem from the purchaser, or that no bid shall be accepted which does not bear a certain proportion to the value as fixed by an appraisement. It is not less clear in principle, and from the language held in McCracken v. Heyward, that whether the legislature postpones the period for performance, or the period at which performance can be enforced, the obligation is equally impaired, because a judgment without the right to proceed to execution is futile, and the material question as regards the creditor is not when the debt matures, but when can the debtor be obliged to pay. In Hasbrouck v. Shipman,2 a statute exempting all persons who should enter the service of the United States from process until they were discharged was accordingly held to transgress the constitutional prohibition. The right of the legislature to make such reasonable regulations as do not injuriously hinder or delay the creditor was conceded in Bronson v. McKenzie, and has been repeatedly upheld by the State tribunals; but while there is no doubt as to the existence of the right, it is not easy to define its extent, or the circumstances which admits of its exercise. In Chadwick v. Moore the distinction was declared to be be8 8 W. & S. 49. 15 Wright, 441. 2 16 Wis. 296. |