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The Constitution of the United States of America: Analysis and Interpretation Part 126

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the New York insurance commissioner, as a statutory liquidator of an insolvent auto mutual company organized in New York sued resident Georgia policyholders in a Georgia court to recover a.s.sessments alleged to be due by virtue of their membership in it. The Supreme Court held that, although by the law of the State of incorporation, policyholders of a mutual insurance company become members thereof and as such liable to pay a.s.sessments adjudged to be required in liquidation proceedings in that State, the courts of another State are not required to enforce such liability against local resident policyholders who did not appear and were not personally served in the foreign liquidation proceedings; but are free to decide according to local law the question whether, by entering into the policies, residents became members of the company.

Again, in State Farm Ins. _v._ Duel,[118] the Court ruled that an insurance company chartered in State A, which does not treat membership fees as part of premiums, cannot plead denial of full faith and credit when State B, as a condition of entry, requires the company to maintain a reserve computed by including membership fees as well as premiums received in all States. Were the company's contention accepted, "no State," the Court observed, "could impose stricter financial standards for foreign corporations doing business within its borders than were imposed by the State of incorporation." It is not apparent, the Court added, that State A has an interest superior to that of State B in the financial soundness and stability of insurance companies doing business in State B,--which is obviously more the language of arbitration than of adjudication, as conventionally regarded.

WORKMEN'S COMPENSATION STATUTES

Finally, the relationship of employer and employee, so far as the obligations of the one and the rights of the other under workmen's compensation acts are concerned, has been the subject of similar treatment. In an earlier case,[119] the cause of action was an injury in New Hampshire, resulting in death to a workman who had entered the defendant company's employment in Vermont, the home State of both parties. The Court held that the case was governed under the full faith and credit clause by the Vermont workmen's compensation act, not that of New Hampshire. The relationship, it said, "was created by the law of Vermont, and so long as that relationship persisted its incidents were properly subject to regulation there."[120]

However, in an unacknowledged departure from this ruling the Court has subsequently held that the full faith and credit clause did not preclude California from disregarding a Ma.s.sachusetts workmen's compensation statute and applying its own conflicting act in the case of an injury suffered by a Ma.s.sachusetts employee of a Ma.s.sachusetts employer while in California in the course of his employment.[121] The earlier case was distinguished as not having decided more than that a State statute, applicable to employer and employee within the State, which provides compensation if the employee is injured while temporarily in another State, will be given full faith and credit in the latter when not obnoxious to its policy. Inasmuch as the Court in the older decision is reputed to have observed that reliance on the Vermont statute, as a defense to the New Hampshire suit, was not obnoxious to the policy of New Hampshire, it may be possible to reconcile these two cases by stating that a foreign workmen's compensation statute will be recognized when it is invoked as a defense but need not be applied when the plaintiff endeavors to found his suit thereon.

Later decisions involving the recognition of a foreign workmen's compensation act include the following. In Magnolia Petroleum Co. _v._ Hunt[122] the Court ruled that a Louisiana employee of a Louisiana employer, who is injured on the job in Texas and who receives an award under the Texas Act, which does not grant further recovery to an employee who receives compensation under the laws of another State, cannot obtain additional compensation under the Louisiana Act. However, a compensation award by State A to a resident employee of a resident employer injured on the job in State B will not preclude State B from awarding added compensation under its own laws, when the compensation statute of State A does not expressly exclude recovery under a law of the State in which the injury occurred and when the State A award incorporated a private settlement contract wherein the employee reserved his rights in State B.[123] Also, the District of Columbia workmen's compensation act, which expressly covers an employee of the District employer, "irrespective of the place where the injury occurs,"

const.i.tutionally may be applied, in the case of injury resulting in death, to a District resident, employed by a District employer, who was a.s.signed to a job at Quantico, Virginia, and who, for three years prior to his death in Virginia, has commuted to the job site from his house in the District.[124]

Development of Section to Date and Possibilities

EVALUATION OF RESULTS

Thus the Court, from according an extrastate operation to statutes and judicial decisions in favor of defendants in transitory actions, proceeded next to confer the same protection upon certain cla.s.ses of defendants in local actions in which the plaintiff's claim was the outgrowth of a relationship formed extraterritorially. But can the Court stop at this point? If it is true, as Chief Justice Marshall once remarked, that "the Const.i.tution was not made for the benefit of plaintiffs alone," so also it is true that it was not made for the benefit of defendants alone. The day may come when the Court will approach the question of the relation of the full faith and credit clause to the extrastate operation of laws from the same angle as it today views the broader question of the scope of State legislative power. When and if this day arrives, State statutes and judicial decisions will be given such extraterritorial operation as seems reasonable to the Court to give them. In short, the rule of the dominance of local policy of the forum State will be superseded by that of judicial review.[125]

The question arises whether the application to date, not by the Court alone but by Congress and the Court, of article IV, section 1, can be said to have met the expectations of its framers. In the light of some things said at the time of the framing of the clause this may be doubted. The protest was raised against the clause that in vesting Congress with power to declare the effect State laws should have outside the enacting State, it enabled the new government to usurp the powers of the States; but the objection went unheeded. The main concern of the Convention, undoubtedly, was to render the judgments of the State courts in civil cases effective throughout the Union. Yet even this object has been by no means completely realized, owing to the doctrine of the Court that before a judgment of a State court can be enforced in a sister State, a new suit must be brought on it in the courts of the latter; and the further doctrine that with respect to such a suit, the judgment sued on is only evidence; the logical deduction from which proposition is that the sister State is under no const.i.tutional compulsion to give it a forum. These doctrines were first clearly stated in the McElmoyle Case and flowed directly from the new States' rights premises of the Court; but they are no longer in harmony with the prevailing spirit of const.i.tutional construction nor with the needs of the times. Also, the clause seems always to have been interpreted on the basis of the a.s.sumption that the term "judicial proceedings" refers only to final judgments and does not include intermediate processes and writs; but the a.s.sumption would seem to be groundless, and if it is, then Congress has the power under the clause to provide for the service and execution throughout the United States of the judicial processes of the several States.

SCOPE OF POWERS OF CONGRESS UNDER SECTION

Under the present system, suit has ordinarily to be brought where the defendant, the alleged wrongdoer, resides, which means generally where no part of the transaction giving rise to the action took place. What could be more irrational? "Granted that no state can of its own volition make its process run beyond its borders * * * is it unreasonable that the United States should by federal action be made a unit in the manner suggested?"[126]

Indeed, there are few clauses of the Const.i.tution, the merely literal possibilities of which have been so little developed as the full faith and credit clause. Congress has the power under the clause to decree the effect that the statutes of one State shall have in other States. This being so, it does not seem extravagant to argue that Congress may under the clause describe a certain type of divorce and say that it shall be granted recognition throughout the Union, and that no other kind shall.

Or to speak in more general terms, Congress has under the clause power to enact standards whereby uniformity of State legislation may be secured as to almost any matter in connection with which interstate recognition of private rights would be useful and valuable.

FULL FAITH AND CREDIT IN THE FEDERAL COURTS

As we saw earlier, the legislation of Congress comprised in section 905 of the Revised Statutes lays down a rule not merely for the recognition of the records and judicial proceedings of State courts in the courts of sister States, but for their recognition in "every court of the United States," and it further lays down a like rule for the records and proceedings of the courts "of any territory or any country subject to the jurisdiction of the United States." Thus the courts of the United States are bound to give to the judgments of the State courts the same faith and credit that the courts of one State are bound to give to the judgments of the courts of her sister States.[127] So, where suits to enforce the laws of one State are entertained in courts of another on principles of comity, federal district courts sitting in that State may entertain them, and should, if they do not infringe federal law or policy.[128] However, the refusal of a territorial court in Hawaii, having jurisdiction of the action, which was on a policy issued by a New York insurance company, to admit evidence that an administrator had been appointed and a suit brought by him on a bond in the federal court in New York wherein no judgment had been entered, did not violate this clause.[129]

The power to prescribe what effect shall be given to the judicial proceedings of the courts of the United States is conferred by other provisions of the Const.i.tution, such as those which declare the extent of the judicial power of the United States, which authorize all legislation necessary and proper for executing the powers vested by the Const.i.tution in the Government of the United States, and which declare the supremacy of the authority of the National Government within the limits of the Const.i.tution. As part of its general authority, the power to give effect to the judgment of its courts is coextensive with its territorial jurisdiction.[130]

JUDGMENTS OF FOREIGN STATES

Doubtless Congress might also by virtue of its powers in the field of foreign relations lay down a mandatory rule regarding recognition of foreign judgments in every court of the United States. At present the duty to recognize judgments even in national courts rests only on comity and is qualified, in the judgment of the Supreme Court, by a strict rule of parity.[131]

Section 2. The Citizens of each State shall be ent.i.tled to all Privileges and Immunities of Citizens in the several States.

The Comity Clause

SOURCES

The community of rights among the citizens of the several States guaranteed by this article is traceable to colonial days. It had its origin in the fact that the colonists were all subjects of the same monarch.[132] After the Declaration of Independence was signed, the question arose as to how to reconcile the advantages of a common citizenship with a dispersed sovereignty. One element of the solution is to be seen in the Fourth of the Articles of Confederation, which read as follows: "The better to secure and perpetuate mutual friendship and intercourse among the people of the different States in this Union, the free inhabitants of each of these States, paupers, vagabonds and fugitives from justice excepted, shall be ent.i.tled to all privileges and immunities of free citizens in the several States; and the people of each State shall have free ingress and regress to and from any other State, and shall enjoy therein all the privileges of trade and commerce, subject to the same duties, impositions and restrictions as the inhabitants thereof respectively * * *" Madison, writing in _The Federalist_,[133] adverted to the confusion engendered by use of the different terms "free inhabitants, free citizens," and "people" and by "superadding to 'all privileges and immunities of free citizens--all the privileges of trade and commerce,' * * *" The more concise phraseology of article IV, however, did little to dispel the uncertainty. In the Slaughter-House Cases,[134] Justice Miller suggested that it was to be regarded as the compendious equivalent of the earlier version: "There can be but little question that the purpose of both these provisions is the same, and that the privileges and immunities intended are the same in each. In the Articles of the Confederation we have some of these specifically mentioned, and enough perhaps to give some general ideal of the cla.s.s of civil rights meant by the phrase."[135]

THEORIES AS TO ITS PURPOSE

First and last, at least four theories have been proffered regarding the purpose of this clause. The first is that the clause is a guaranty to the citizens of the different States of equal treatment by Congress--is, in other words, a species of equal protection clause binding on the National Government. The second is that the clause is a guaranty to the citizens of each State of all the privileges and immunities of citizenship that are enjoyed in any State by the citizens thereof,--a view which, if it had been accepted at the outset, might well have endowed the Supreme Court with a reviewing power over restrictive State legislation as broad as that which it later came to exercise under the Fourteenth Amendment. The third theory of the clause is that it guarantees to the citizen of any State the rights which he enjoys as such even when sojourning in another State, that is to say, enables him to carry with him his rights of State citizenship throughout the Union, without embarra.s.sment by State lines. Finally, the clause is interpreted as merely forbidding any State to discriminate against citizens of other States in favor of its own. Though the first theory received some recognition in the Dred Scott Case,[136] particularly in the opinion of Justice Catron,[137] it is today obsolete. The second was specifically rejected in McKane _v._ Durston;[138] the third, in Detroit _v._ Osborne.[139] The fourth has become a settled doctrine of Const.i.tutional Law.[140] In the words of Justice Miller in the Slaughter-House Cases,[141] the sole purpose of the comity clause was "to declare to the several States, that whatever these rights, as you grant or establish them to your own citizens, or as you limit or qualify, or impose restrictions on their exercise, the same, neither more nor less, shall be the measure of the rights of citizens of other States within your jurisdiction."[142] It follows that this section has no application in controversies between a State and its own citizens.[143] It is deemed to be infringed by a hostile discrimination against all nonresidents[144]

but not by such differences of treatment between residents and nonresidents as the nature of the subject matter makes reasonable.[145]

HOW IMPLEMENTED

This clause is self-executory, that is to say, its enforcement is dependent upon the judicial process. It does not authorize penal legislation by Congress. Federal statutes prohibiting conspiracies to deprive any person of rights or privileges secured by State laws,[146]

or punishing infractions by individuals of the right of citizens to reside peacefully in the several States, and to have free ingress into and egress from such States,[147] have been held void.

CITIZENS OF EACH STATE

A question much mooted before the Civil War was whether the term could be held to include free Negroes. In the Dred Scott Case,[148] the Court answered it in the negative. "Citizens of each State," Chief Justice Taney argued, meant citizens of the United States as understood at the time the Const.i.tution was adopted, and Negroes were not then regarded as capable of citizenship. The only category of national citizenship added under the Const.i.tution comprised aliens, naturalized in accordance with acts of Congress.[149] In dissent, Justice Curtis not only denied the Chief Justice's a.s.sertion that there were no Negro citizens of States in 1789, but further argued that while Congress alone could determine what cla.s.ses of aliens should be naturalized, the several States retained the right to extend citizenship to cla.s.ses of persons born within their borders who had not previously enjoyed citizenship, and that one upon whom State citizenship was thus conferred became a citizen of the State in the full sense of the Const.i.tution.[150] So far as persons born in the United States, and subject to the jurisdiction thereof are concerned, the question was put at rest by the Fourteenth Amendment.

CORPORATIONS

At a comparatively early date the claim was made that a corporation chartered by a State and consisting of its citizens was ent.i.tled to the benefits of the comity clause in the transaction of business in other States. It was argued that the Court was bound to look beyond the act of incorporation and see who were the incorporators. If it found these to consist solely of citizens of the incorporating State, it was bound to permit them through the agency of the corporation, to exercise in other States such privileges and immunities as the citizens thereof enjoyed.

In Bank of Augusta _v._ Earle[151] this view was rejected. The Supreme Court held that the comity clause was never intended "to give to the citizens of each State the privileges of citizens in the several States, and at the same time to exempt them from the liabilities which the exercise of such privileges would bring upon individuals who were citizens of the State. This would be to give the citizens of other States far higher and greater privileges than are enjoyed by the citizens of the State itself."[152] A similar result was reached in Paul _v._ Virginia,[153] but by a different course of reasoning. The Court there held that a corporation--in this instance, an insurance company--was "the mere creation of local law" and could "have no legal existence beyond the limits of the sovereignty"[154] which created it; even recognition of its existence by other States rested exclusively in their discretion. More recent cases have held that this discretion is qualified by other provisions of the Const.i.tution, notably the commerce clause and the Fourteenth Amendment.[155] By reason of its similarity to the corporate form of organization, a Ma.s.sachusetts trust has been denied the protection of this clause.[156]

ALL PRIVILEGES AND IMMUNITIES OF CITIZENS IN THE SEVERAL STATES

The cla.s.sical judicial exposition of the meaning of this phrase is that of Justice Washington in Corfield _v._ Coryell,[157] which was decided by him on circuit in 1823. The question at issue was the validity of a New Jersey statute which prohibited "any person who is not, at the time, an actual inhabitant and resident in this State" from raking or gathering "clams, oysters or sh.e.l.ls" in any of the waters of the State, on board any vessel "not wholly owned by some person, inhabitant of and actually residing in this State. * * * The inquiry is," wrote Justice Washington, "what are the privileges and immunities of citizens in the several States? We feel no hesitation in confining these expressions to those privileges and immunities which are, in their nature, fundamental; which belong, of right, to the citizens of all free governments; and which have, at all times, been enjoyed by the citizens of the several States which compose this Union, * * *"[158] He specified the following rights as answering this description: "Protection by the Government; the enjoyment of life and liberty, with the right to acquire and possess property of every kind, and to pursue and obtain happiness and safety; subject nevertheless to such restraints as the Government may justly prescribe for the general good of the whole. The right of a citizen of one State to pa.s.s through, or to reside in any other State, for purposes of trade, agriculture, professional pursuits, or otherwise; to claim the benefit of the writ of _habeas corpus_; to inst.i.tute and maintain actions of any kind in the courts of the State; to take, hold and dispose of property, either real or personal; and an exemption from higher taxes or impositions than are paid by the other citizens of the State; * * *"[159]

After thus defining broadly the private and personal rights which were protected, Justice Washington went on to distinguish them from the right to a share in the public patrimony of the State. "* * * we cannot accede" the opinion proceeds, "to the proposition * * * that, under this provision of the Const.i.tution, the citizens of the several States are permitted to partic.i.p.ate in all the rights which belong exclusively to the citizens of any particular State, merely upon the ground that they are enjoyed by those citizens; much less, that in regulating the use of the common property of the citizens of such State, the legislature is bound to extend to the citizens of all other States the same advantages as are secured to their own citizens."[160] The right of a State to the fisheries within its borders he then held to be in the nature of a property right, held by the State "for the use of the citizens thereof;"

the State was under no obligation to grant "co-tenancy in the common property of the State, to the citizens of all the other States."[161]

The precise holding of this case was confirmed in McCready _v._ Virginia;[162] the logic of Geer _v._ Connecticut[163] extended the same rule to wild game, and Hudson County Water Co. _v._ McCarter[164]

applied it to the running water of a State. In Toomer _v._ Witsell,[165]

however, the Court refused to apply this rule to free-swimming fish caught in the three-mile belt off the coast of South Carolina. It held instead that "commercial shrimping in the marginal sea, like other common callings, is within the purview of the privileges and immunities clause" and that a heavily discriminatory license fee exacted from nonresidents was unconst.i.tutional.[166] Universal practice has also established another exception to which the Court gave approval by a dictum in Blake _v._ McClung:[167] "A State may, by rule uniform in its operation as to citizens of the several States, require residence within its limits for a given time before a citizen of another State who becomes a resident thereof shall exercise the right of suffrage or become eligible to office."[168]

DISCRIMINATION IN PRIVATE RIGHTS

Not only has judicial construction of the comity clause excluded some privileges of a public nature from its protection; the courts have also established the proposition that the purely private and personal rights to which the clause admittedly extends are not in all cases beyond the reach of State legislation which differentiates citizens and noncitizens. Broadly speaking, these rights are held subject to the reasonable exercise by a State of its police power, and the Court has recognized that there are cases in which discrimination against nonresidents may be reasonably resorted to by a State in aid of its own public health, safety and welfare. To that end a State may restrict the right to sell insurance to persons who have resided within the State for a prescribed period of time.[169] It may require a nonresident who does business within the State[170] or who uses the highways of the State[171] to consent, expressly or by implication, to service of process on an agent within the State. Without violating this section, a State may limit the dower rights of a nonresident to lands of which the husband died seized while giving a resident dower in all lands held during the marriage,[172] or may leave the rights of nonresident married persons in respect of property within the State to be governed by the laws of their domicile, rather than by the laws it promulgates for its own residents.[173] But a State may not give a preference to resident creditors in the administration of the property of an insolvent foreign corporation.[174] An act of the Confederate Government, enforced by a State, to sequester a debt owed by one of its residents to a citizen of another State was held to be a flagrant violation of this clause.[175]

ACCESS TO COURTS

The right to sue and defend in the courts is one of the highest and most essential privileges of citizenship, and must be allowed by each State to the citizens of all other States to the same extent that it is allowed to its own citizens.[176] The const.i.tutional requirement is satisfied if the nonresident is given access to the courts of the State upon terms which, in themselves, are reasonable and adequate for the enforcing of any rights he may have, even though they may not be technically the same as those accorded to resident citizens.[177] The Supreme Court upheld a State statute of limitations which prevented a nonresident from suing in the State's courts after expiration of the time for suit in the place where the cause of action arose,[178] and another such statute which suspended its operation as to resident plaintiff, but not as to nonresidents, during the period of the defendant's absence from the State.[179] A State law making it discretionary with the courts to entertain an action by a nonresident of the State against a foreign corporation doing business in the State, was sustained since it was applicable alike to citizens and noncitizens residing out of the State.[180] A statute permitting a suit in the courts of the State for wrongful death occurring outside the State, only if the decedent was a resident of the State, was sustained, because it operated equally upon representatives of the deceased whether citizens or noncitizens.[181]

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The Constitution of the United States of America: Analysis and Interpretation Part 126 summary

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