Nor are laws modi of evidence prior cases. conflicting with this provision; though such an objection might properly be raised in criminal prosecutions. If, however, such statutes would be unconstitutional fying rules in criminal suits as ex post facto, they might be reunconstitu- garded as unconstitutional in civil suits as impairtional as to ing the obligation of contracts, or as taking property out of the due course of law. This, however, will be hereafter discussed. It is sufficient here to state that in criminal cases a statute modifying evidence is not unconstitutional as to prior cases, provided it does not materially impair the defendant's rights. But it is otherwise as to statutes making certain evidence absolute proof. It has been held, also, that a statute to the effect that drinking spirituous liquors in a particular place shall be prima facie proof of sale is unconstitutional; and so of a statute making notoriety prima facie proof of liquor-selling. On the other hand, a statute throwing the burden of exculpation on persons in whose houses spirituous liquor is delivered has been held constitutional in Massachusetts; and so of a statute making it the defendant's duty, in such case, to prove a license." be applied. Angell on Lim., § 22, note. The act of 1879 is doubtless retrospective; but every word of it, save two, may have effect, and yet reach only past offences still subject to punishment when it was enacted. These two words make the prosecution legal, where the indictment has been found within five years from the time of committing the offence.' This provision is nugatory, unless it was meant to legalize indictments, theretofore found, more than two years after the crime. But this language does not reach the plaintiff's case; his indictment was found after the statute; and, under the rule, vigorously enforced, the law must be considered as not legalizing his prosecution. If necessary to avoid injustice I would so interpret it." 1 Infra, §§ 494, 566. 2 See Calder v. Bull, 2 Dall. 386; Seip v. Storch, 52 Penn. St. 210; Richter v. Cummings, 60 Penn. St. 441; State v. Beswick, 13 R. I. 211. That a statute removing incapacity from infamy is not ex post facto as to prior cases, see Sutton v. Fox, 55 Wis. 531. Aliter as to statute doing away with necessity of corroborating accomplice. State v. Bond, 4 Jones, L. 9. For further cases, see infra, § 494. 3 Infra, §§ 494-566. People v. Lyon, 27 Hun, 180. 5 State v. Beswick, 13 R. I. 211; but see State v. Thomas, 47 Conn. 546. 6 Com. v. Wallace, 7 Gray, 222. 1 Com. v. Kelly, 10 Cush. 69; see Com. v. Williams, 6 Gray, 1. Under state tions retrospective constitu 475. In the constitutions of many states retrospective laws are specifically prohibited. And in all cases, when the effect of retrospective action is to unseat vested rights, statutes will be construed unconsti as having only prospective operation.1 laws are tutional. XVIII. LAWS IMPAIRING THE OBLIGATION OF CONTRACTS. Constitu tional limi tation prompted by political and busi ness dan gers. § 477. The tenth section of the first article of the constitution provides that "no state shall pass any law impairing the obligation of contracts." The motives which led to the introduction of this restriction were several: (1) The recklessness exhibited by some of the colonial legislatures in sanctioning by law the repudiation of contracts had greatly injured both the political and the business interests of the country at large. (2) Unrestrained interstate trade was one of the chief objects in the creation of the new government,2 yet, unless contracts were protected from dissolution by state legislation, unrestrained interstate trade could not be assured. (3) Several of the leading members of the convention, among whom Dr. Franklin was conspicuous, were students of political economy, and had accepted the position that justice and expediency require that freedom of contract should be absolute. It is neither right nor politic, so it was argued, that by legislation men should be prevented, unless in those extreme cases in which the object is immoral or illegal, from making such bargains with each other as their interests or sense of duty suggest. It is not for the public good, neither is it just, that this function should be taken from the field of individual enterprise and competition, and placed in the hands of the state. The wealth of the country is more fully brought out, its energies more effectively employed, if meu are permitted, without government interference, to make what bargains seem most conducive to business success, provided there be no wrongful advantage taken, and no illegal or immoral object secured. The state, therefore, should be prohibited 1 People v. Brooklyn R. R., 89 N. Y. 75; infra, § 610. 2 Supra, §§ 418 et seq. 3 Infra, § 365. from interfering by legislation with this freedom of contract. It will be seen, therefore, that the restriction before us has two aspects: (1) That which protects contracts already made; (2) that which protects the general right to contract.-The distinction in this respect between our constitution and the British is marked by the fact, that while by the latter landbills divesting landlords' rights are sustained by the judiciary, in our system legislation providing for the extinction of antecedent irredeemable ground-rents is unconstitutional.' The same reasoning invalidates state legislation reducing interest on existing debts, and state legislation relieving a bank from the duty of paying its debts in specie, and extending the time for the payment of such debts.3 impairing legal contracts invalid. § 478. Whatever we may say on the question hereafter discussed, as to the constitutionality of state legisLegislation lation impairing the capacity to contract, there can antecedent be no question that the clause now before us makes invalid state statutes impairing, under the conditions hereafter expressed, the obligation of contracts which were in force at the time of the passage of such statutes. Nor can the obligation of contracts be impaired by declaratory legislation. How far it can be impaired by the changes of judicial opinion in state courts will hereafter be discussed. Contracts, however, to be within the protection of this clause must be in themselves valid and binding. Hence the clause does not apply to contracts illegal or void from public policy; nor to contracts which a state is precluded from making by its constitution. $479. What has been said applies to contracts entered into by the state as well as by individuals. Hence it Limitation has frequently been held that a grant by a legisla contracts ture, for a consideration, of special privileges to an individual or a corporation, cannot be rescinded applies to by state. 1 Palairet's Appeal, 67 Penn. St. 479; and cases there cited, and cases cited see infra, §§ 566-7. 2 Roberts v. Cocke, 28 Grat. 207. 3 Godfrey v. Terry, 97 U. S. 171. 4 Whart. on Cont., §§ 1071 et seq., infra, §§ 479 et seq. 5 Koshkoning v. Burton, 104 U.S. 668. 6 Infra, §§ 480, 526. 7 Whart. on Cont., §§ 335 et seq. 8 Infra, § 480, 603. when the grant was one consistent with the policy of the law.1 "When a state descends from the plane of its sovereignty and contracts with private persons, it is regarded, pro hac vice, as a private person itself, and is bound accordingly." A contract, therefore, between a state and a private person, by which he is to render certain services for a limited period for a fixed compensation, he not being a public officer, is a contract under the constitution. The limitation applies as well to cases where the state contracts through an agent as where it contracts by its immediate representatives. "Where a state has authorized a municipal corporation to contract, and to exercise the power of local taxation to the extent necessary to meet its engagements, the power thus given cannot be withdrawn until the contract is satisfied.". Indebted ness incurred in accordance with state law will be by the § 480. A difficult question arises when a state court has decided that a bond issued by a municipal or other local corporation is not in conformity with law, and an appeal is taken to the supreme court of the United States. Can the latter tribunal reverse on the ground of the inviolability of the contract incorporated in the bond? This has been held in cases where the bonds had been sustained by prior decisions of the state court, on the faith of which they were taken, and even where there was no such prior decision, but where the supreme court of the United States held that the construction given by the state court to a statute, made that statute unconstitutional. 1 Fletcher v. Peck, 6 Cranch, 87; Terrett v. Taylor, 9 Cr. 43; McGee v. Mathis, 4 Wall. 143. 2 Hall v. Wisconsin, 103 U. S. 5. 3 Swayne, J., Von Hoffman v. Quincy, 4 Wall. 535, adopted in Wolff v. New Orleans, 103 U. S. 358. Gelpcke v. Dubuque, 1 Wall. 175; Havemeyer v. Iowa Co., 3 Wall. 297; Chicago v. Sheldon, 9 Wall. 50. For a fuller discussion of these cases, see infra, § 526. Butz v. Muscatine, 8 Wall. 575. Burgess v. Seligman, 107 U. S. 20, United sustained supreme court of the States, there be decision of state court. It has though contrary was a case in which, subsequent to the construction of a statute by the Federal circuit court, another construction of the same statute was given by the state court. The supreme court of the United States held that they were not bound by the state decision, and affirmed the decision of the circuit court. Gelpcke v. Dubuque, and the line of cases to which it belongs, are cited to show that "when contracts and transactions have been entered into, and rights accrued thereon under a particular state of the decisions, or also been said in New York (though the position was not necessary to the issue), that where obligations have been entered into on faith of decisions of the courts of another state, such obligations cannot be affected by subsequent conflicting decisions of such courts. In Pennsylvania it has been held that this doctrine applies to title acquired in conformity with decisions of the Pennsylvania Supreme Court, even though that court subsequently changed its ground with regard to the point decided in such rulings. But it cannot be denied that thus to place rights acquired on the faith of a decision of a court under the protection of the clause before us, may operate unduly to shackle the development of law, as well as to establish in the same jurisdiction two distinct laws as to the same subject matter, i. e., the old law as to contracts supposed to absorb it, and the new law as to other cases. The rule, if finally adopted, should be restricted to contracts incorporating a specific law in their terms. Legislation § 481. It has been held that state legislation rescinding a prior grant of a private franchise or estate is unrescinding constitutional, unless the right of such repeal is private reserved in the grant. This restriction has been grants of where there has been no decision of the state tribunals, the Federal courts properly claim the right to adopt their own interpretation of the law applicable to the case, although a different interpretation may be adopted by the state courts after such rights have accrued." Burgess v. Seligman is affirmed in Pana v. Bowler, 107 U. S, 529, cited infra, § 526. Jessup v. Carnegie, 80 N. Y. 441. 2 Menges v. Dentler, 33 Penn. St. 495; Geddes v. Brown, 5 Phila. Rep. 180. This point, however, seems to be modified in Wright v. Brown, 44 Penn. St. 224; nor is it sustained in subsequent cases, though there must have been many instances in which, on the court changing the prior law, titles acquired under such prior law must have been open to question; see article by Mr. Henry Reed in Amer. Law Rev., Apr. 1875, and infra, § 526. See, also, Daly v. Maitland, 88 Penn. St. 384, as apparently conflicting with Menges v. Dentler, and other cases cited 9 Amer. Law Rev. 405; though see Wickersham v. Savage, 58 Penn. St. 365, apparently relying on Menges v. Dentler. As criticizing Gelpcke v. Dubuque, see Holman, ex parte, 28 Iowa, 88, 165; Chamberlain v. Burling. ton, 19 Iowa, 395, and an able article by Mr. Wm. M. Meigs, in the Southern Law Review for December, 1882. That a contract made subject to a particular law may be assumed to incorporate in its terms that law, see Whart. Conf. of Laws, §§ 427, 431. 3 See supra, §§ 22 et seq.; and see, also, infra, § 596. 4 See Durkee v. Board of Liquidation, |