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the question not whether the decision represents the law of the State aright, but whether the law of the State ought to be executed, when the judiciary act declares that it shall be the rule of decision.

On the suggestion that I seem to agree with the general result reached by the Supreme Court, that the non-resident bondholder is entitled to recover under “such circumstances," my article must have shot wide of my mark to make such an impression. But this general accord is supposed to be affected by a specific and partial dissent. Here again the article must have been unhappily expressed. The general tenor and spirit of my thought was that it was purely a question in every case, what is the lex loci contractus? The general law and the judiciary act concur to make this the true rule of decision, but the Supreme Court of the United States, make a question controlling which is entirely different from this, that is, What was held to be law by a particular tribunal on or before a particular day? What is law is one thing; what may be held to be so, may be very different. While the holding of a court is high evidence of what the law is, some decisions are self-evidently wrong; many are of questionable authority from the day of their birth, and others are subsequently declared, with more or less candor or evasion and shuffling, by the courts that made them, not to be law. It is true, and that may justify the misconception of the writer of the article on impairment of contracts by decision, that the article wbich he reviews lays much stress on local bias as a reason for change of decision, but a careful reading of that article, it seems to me, will clearly show its drift to be that the true ques. tion is whether there is error in the later State decision, and the cause of the error—the bias; or, the suggestion might have been ignorance—was merely incidental to the error itself. The drift was that if the court could say: "You have so held, and, without imputing any error in the change of holding, we will follow your first holding by an arbitrary rule,” then there was nothing to give the court “ pause,” in considering the result. But if, in every case, the court was bound to say, “ This last decision is wrong, and we can see the motive which misled you,” then such case would be considered under the sanction of judicial courtesy and fairness, and so be made to stand, not upon wbat somebody

has said was law, but upon what the law really was and is. Probably the incident, the bias, the cause of reversing a right decision to make a wrong one, was magnified and the resultthat the later decision was wrong-simply assumed; but it still was the leading idea, that the later decision was wrong. My assumed cause of error, which was merely a step toward the result, has been magnified so as to throw the result itself into a shadow of obscurity. The process is complete omitting the motive to error. It is the error, not the motive, which is the gist of the matter.

The true principle is that the Supreme Court of the United States is bound by law to decide according to the lex loci contractus, and by the statute creating the court, to decide according to the law of the State where the contract was made. Of that law, the decisions of the highest court are the best evidence, but when they are in conflict, when rights are acquired under decisions clearly right, and sought to be defeated by decisions clearly wrong, the court should so declare; and when probable wrong is satisfactorily accounted for by some motive attributable to the court, it will only be rendered more credible and probable.

The evidence what the law is must be weighed by the court which has jurisdiction to review, and be decided just as a like question of law, arising upon a transaction in France or England. But that a court may, under any circumstances, say that they will not decide according to the lex loci, is what that article was not intended to concede. It is true the correctness of the result in the several cases criticised was not called in question or discussed. It was immaterial to the purpose of the article whether a just or proper result was reached in each or either case. The fault found was with the principle announced, not with the judgment arrived at.

Instead, therefore, of the article conceding that the validity of contracts could depend upon “such circumstances,” the contention of that article was that such circumstances" did not properly control the result, had nothing to do with it except in Bu far as the contradictory decisions justified the reviewing court in the belief that the later decision did not truly present the law of the State, but the former ones did. “Such circumstances” might allow the court to say the former decision was law and the later is made under some motive which has misled the court, and that decision is not law; but they could not properly allow it to say that the first decision was wrong and was not law, but it conferred rights that the law did not confer, and created obligations and duties which the void contract did not impose.

To make the point clear, if in the Gelpke case the decisions of the State of Iowa holding that by the Constitution of Iowa, the bonds of a city were valid obligations, truly represented the law of Iowa, then the bonds of the city of Dubuque were valid obligations, and the decision of the State court that the power did not exist was an erroneous decision, and the Supreme Court, or any other court of the United States in which a case involving the question was to be decided, had the right to say so. True, they are bound by precedent and principle to follow the State courts in a matter of settled law, but they would not be bound to follow a decision plainly absurd and untenable, or one evidently corrupt, or one made in gross ignorance, or one made under influence of local prejudice, or for any cause clearly wrong. And where there have been decisions both ways, the court which was set up on account of the possibility of local influence, to decide cases between citizens of a State and non-citizens, must, of necessity, have the power to decide contrary to the court which is subject to the objection. Of necessity, if they have the jurisdiction to counteract local prejudice, they must have the power to disregard and correct the decisions which result from it.

In the Dubuque case, if the first decision of the Iowa court was right, the Supreme Court of the United States ought to have so held. If it was wrong, and if, according to the Constitution of Iowa, the Legislature did not have the power to authorize the issue of those bonds, then the error of the State court, which wrongly held that the power existed, did not operate to confer that power, or to validate bonds which the city had no power to impose upon her people. If the first decision was wrong, the Supreme Court of the United States bad no right to say that a right accrued to the bondholder in virtue of the blunder of the State court, and that she would, in conse

quence, give him a judgment to which the law of Iowa did not entitle him. The Supreme Court of the United States must find and enforce the law of Iowa, not adjudge rights on what, right or wrong, somebody has said to be the law. Private persons, not parties to a litigation, are not estopped by judicial decisions, nor are municipalities; and a party not estopped cannot have that enforced against him as law which is not law.

Whenever the Federal courts have the right to review the State courts, they must have the power to ascertain what the law of the State is. The highest evidence of the law is the authoritative declaration of the highest court; but it is the law at last they are to declare and not the evidence. Therefore, on some questions they may properly refuse to follow State decis. ious. Mr. Justice Miller's dissenting view in the Gelpke case is in substantial accord with this. The State courts have a right generally to decide as a finality upon their own local law, but no one will deny that if in a matter reviewable in the Supreme Court of the United States, they decide for the first time a question of statute or local law, the Supreme Court case may reverse as well as review the decision, and would fail in their duty if they refused to do so when clearly satisfied that there was error. The substance, then, of Mr. Justice Miller's objection must be taken to be that the court, without any sufficient reason to say that the decision of the State court was wrong, was departing from its own rule; but he would never have made the utterance in the sense that every atrocity or absurdity of a State court must be regarded as conclusive evidence what the law was, or that two contradictory decisions were to be weighed solely by considering which was most recent.

Under the head of objections considered, it is said that, “Mr. Heiskell urges that a new decision, overruling former decisions, is not a new law, but merely a later and better advised exposition of the law as it was all the time.” This is a b c law, but it is urged that it is insufficient to meet the exigencies of the argument, “ for the Federal courts are of a different and independent sovereignty from that of the State courts, and, in the absence of this rule (that they will follow the State decisions), would not be obliged to follow the latest State decisions on any question.” This is a proposition involving several questions.

That the Federal courts are of a different and independent sor. ereiguty is not true in substance, though formally the statement is correct. The sovereignties are parts of one scheme, and the two are interdependent rather than independent. But suppose this independence existed. Suppose it was an English court called upon to decide upon a New York contract, would not that court be bound to decide according to New York law ? and how can that peculiar independence, resulting from the judiciary act, which requires the United States courts to make the State law the rule of decision, exonerate those courts from the duty to obey their constituent statute, as well as from the duty to execute the law that the lex loci controls in matters of contract? Would not the courts of England follow the latest decisions of New York as to New York law, unless controlling and cogent reasons led them to a different conclusion as to what the law of that State was? Probably no court would regard the latest decision of a revolutionary court of a foreign country, reversing the traditions of ages, as conclusive of the previously existing lex loci, though every court would lay down the rule that they were bound to regard the decisions of the court of the country as to what that law was.

I admit that a case may arise in which, in deciding upon the law of a State, the Supreme Court of the United States may disregard the decision of the State court, but I regard the occasion as one in which the reason for so doing must be cogent and extreme. It is the fact that they have, in this class of cases, disregarded such decisions without examination or assigning any reason, and, upon a theory which allows such disregard without examination of the question of right or error, that gave occasion to my examination of their theory and practice.

The Supreme Court of the United States might find, as I have suggested, a state of facts which would justify them in holding that the latest decision of the highest court of France did not truly set forth the law of that country. In a case arising out of an English contract, it is not impossible that they might be justified in holding that the latest decision of the highest court of that country on the question involved, was not the law of England and of the contract, but all will admit that it would require an extreme case and the most extraordivary

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