Hans v. Louisiana, 134 U.S. 1 (1890)

Hans v. Louisiana

No. 4

Argued and submitted January 22, 1890
Decided March 3, 1890
134 U.S. 1

ERROR TO THE CIRCUIT COURT OF THE UNITED STATES

FOR THE EASTERN DISTRICT OF LOUISIANA

Syllabus

A State cannot, without its consent, be sued in a Circuit Court for the United States by one of its own citizens upon a suggestion that the case is one that arises under the Constitution and laws of the United States.

Chisholm v. Georgia, 2 Dall. 419, questioned.

While a State cannot be compelled by suit to perform its contracts, any attempt on its part to violate property or rights acquired under its contracts may be judicially resisted, and any law impairing the obligation of contracts under which such property or rights are held is void, and powerless to affect their enjoyment.

This is an action brought in the Circuit Court of the United States, in December, 1884, against the State of Louisiana, by Hans, a citizen of that State, to recover the amount of certain coupons annexed to bonds of the State, issued under the provisions of an act of the legislature approved January 24, 1874. The bonds are known and designated as the "consolidated bonds of the State of Louisiana," and the coupons sued on are for interest which accrued January 1, 1880. The grounds of the action are stated in the petition as follows:

Your petitioner avers that, by the issue of said bonds and coupons, said State contracted with and agreed to pay the bearer thereof the principal sum of said bonds forty years from the date thereof, to-wit, the 1st day of January, 1874, and to pay the interest thereon represented by coupons as aforesaid, including the coupons held by your petitioner, semiannually upon the maturity of said coupons; and said legislature, by an act approved January 24, 1874, proposed an amendment to the constitution of said State, which was afterwards duly adopted, and is as follows, to-wit:

No. 1. The issue of consolidated bonds, authorized by the general assembly of the State at its regular session in the year 1874 is hereby declared to create a valid contract between the State and each and every holder of said bonds, which the State shall by no means and in no wise impair. The said bonds shall be a valid obligation of the State in favor of any holder thereof, and no court shall enjoin the payment of the principal or interest thereof or the levy and collection of the tax therefor. To secure such levy, collection, and payment, the judicial power shall be exercised when necessary. The tax required for the payment of the principal and interest of said bonds shall be assessed and collected each and every year until the bonds shall be paid, principal and interest, and the proceeds shall be paid by the treasurer of the State to the holders of said bonds as the principal and interest of the same shall fall due, and no further legislation or appropriation shall be requisite for the said assessment, and collection and for such payment from the treasury.

And petitioner further avers that, notwithstanding said solemn compact with the holders of said bonds, said State hath refused and still refuses to pay said coupons held by petitioner, and by its constitution, adopted in 1879, ordained as follows:

That the coupons of said consolidated bonds falling due the 1st of January, 1880, be, and the same is hereby, remitted, and any interest taxes collected to meet said coupons are hereby transferred to defray the expenses of the State government;

and by article 257 of said constitution also prescribed that "the constitution of this State, adopted in 1868, and all amendments thereto, is declared to be superseded by this constitution;" and said State thereby undertook to repudiate her contract obligations aforesaid, and to prohibit her officers and agents executing the same, and said State claims that, by said provisions of said constitution, she is relieved from the obligations of her aforesaid contract, and from the payment of said coupons held by petitioner, and so refuses payment thereof, and has prohibited her officers and agents making such payment. Petitioner also avers that taxes for the payment of the interest upon said bonds due January 1, 1880, were levied, assessed, and collected, but said State unlawfully and wrongfully diverted the money so collected, and appropriated the same to payment of the general expenses of the State, and has made no other provision for the payment of said interest. Petitioner also avers that said provisions of said constitution are in contravention of said contract, and their adoption was an active violation thereof, and that said State thereby sought to impair the validity thereof with your petitioner, in violation of Article 1, Section 10, of the Constitution of the United States, and the effect so given to said State constitution does impair said contract. Wherefore petitioner prays that the State of Louisiana be cited to answer this demand, and that after due proceedings she be condemned to pay your petitioner said sum of ($87,500) eighty-seven thousand five hundred dollars, with legal interest from January 1, 1880, until paid, and all costs of suit; and petitioner prays for general relief.

A citation being issued directed to the State, and served upon the governor thereof, the attorney general of the State filed an exception, of which the following is a copy, to-wit:

Now comes defendant, by the attorney general, and excepts to plaintiff’s suit, on the ground that this Court is without jurisdiction ratione personae. Plaintiff cannot sue the State without its permission; the constitution and laws do not give this honorable Court jurisdiction of a suit against the State; and its jurisdiction is respectfully declined.

Wherefore respondent prays to be hence dismissed, with costs, and for general relief.

By the judgment of the court, this exception was sustained, and the suit was dismissed. See Hans v. Louisiana, 24 Fed.Rep. 55.