Decordova v. City of Galveston
| Decision Date | 31 December 1849 |
| Parties | DECORDOVA v. THE CITY OF GALVESTON. |
| Court | Texas Supreme Court |
The construction of the terms “ ex post facto laws,” “laws impairing the obligation of contracts,” and “retrospective law” examined and discussed. (Note 102.)
The term “retrospective,” in the bill of rights, was designed to embrace laws which are not included in the description of ex post facto laws or laws impairing the obligation of contracts, but which destroy or impair vested rights or rights to do certain actions or possess certain things, according to the laws of the land. (Note 103.)
Laws which affect the remedy merely are not within the scope of the inhibition against retrospective laws unless the remedy be entirely taken away or be incumbered with conditions that would render it useless or impracticable. There cannot be a vested right to any particular remedy, until suit be commenced, at least.
Whether statutes of limitations affect the remedy merely or pertain to the contract is not now an open question.
The first section of the act of limitations of 1841 applies as well to contracts then existing as to those subsequently made.
Where one period of limitation or prescription takes the place of another, the principle of computation is established in Gautier v. Franklin and Hays v. Cage. But quere when a period of limitation or prescription is established where before there was none.
The facts that the notes were made by a municipal corporation, and that interest was made payable annually, cannot affect the question of limitation; the notes being payable at a certain time after date.
Where interest is payable annually and is not paid, quere whether the creditor is entitled to interest upon interest. (Note 104.)
It seems that where interest falls due before the principal, the statute of limitations does not commence running against the claim for interest until the principal is due also, although the creditor might have maintained his separate action for such interest.
Appeal from Galveston. This suit was instituted on the 28th of April, 1849, on three promissory notes, a copy of one of which is as follows:
The two others were for the same amount and of the same tenor, except the difference in numbers and the date of their maturity; one being payable on the 1st day of January, 1843, and the other on the 1st day of January, 1844. The defendant demurred and pleaded the statute of limitations. To the plea of the statute of limitations the plaintiff demurred. Both demurrers were overruled.
A jury was waived. In support of the issue on the facts, the plaintiff produced the original notes, and the notarial certificate of the demand and refusal of payment on the 17th April, 1849, was admitted as proved. Here the case closed, and judgment was rendered in favor of the defendant.
I. A. & G. W. Paschal, for appellant. It will be seen that these contracts bore date before the statute of limitations of 1841, under the first section of which this plea was pleaded. (Acts 1841, p. 163, sec. 1.) This was a remedial act, intended to operate prospectively, and not to affect contracts then in existence. Such is understood to be the intention of the decisions of this court in giving effect to the ten-year statute which existed prior to the act of 1841. (Gautier v. Franklin, 1 Tex. R., 732; Carson v. Rainey, 2 Tex. R., 296; Ingram v. Ingram, 2 Tex. R., 590; Ennis and Reynolds v. Cocke, 2 Tex. R., 592; Frosh v. Swett, 2 Tex. R., 485; Coles v. Kelsey, Id., 541.) These contracts were executed on the 27th day of August, 1840, at Galveston, when there was no law of limitation in existence; the ten-year statute of Spain having been repealed by the common-law act of 1840, and no new law having been enacted until the 9th February, 1841. (Gautier v. Franklin, 1 Tex. R., 740.) The old maxim that the statute of limitations affects the remedy merely and not the rights, that the law of the forum and not of the contract is to govern, has been a good deal modified of late years. The cause of action on each of these notes really accrued before the passage of the act, because the first payment of interest on each was to be made on the 1st day of January, 1841. The allowance of the plea was therefore to give a retroactive effect to the law. And courts of justice have expressed the strongest disapprobation of retroactive legislation, and will not give to a law a retroactive construction if it be susceptible of any other. (Calder v. Bull, 3 Dall. R., 386; 1 Cond. R., 386; Dash v. Van Kleek, 7 Johns. R., 477.)
II. The fact that no demand was made until March, 1849, seems to us to take the case out of the statute. The debt was a security given by a corporation, and which could only be paid by proper officers. It was like a bank-note drawing interest, but which nevertheless is never barred by the statute of limitations. Interest was stipulated for, but the cause of action did not accrue as to the principal until demand. It would be a dangerous precedent to place the paper of a corporation on the same footing of the paper of individuals.
III. If the money was really in the hands of the treasurer of the city, he held it in trust for the plaintiff, and a refusal to pay him, or an appropriation of the money otherwise than to his use, was such a breach of trust and fraud as to avoid the statute; for a trust or fraud avoids the statute of limitations. .)
Joseph & Howard, for appellee. The court correctly overruled the plaintiff's demurrer to the defendant's plea of the statute of limitation. It is true that at the time of the making of these contracts or promissory notes there was no statute of limitation in force; but prior to their maturity one had been enacted by the Congress of the Republic of Texas which is yet in force. (Acts of 1841, p. 163.) That statute, it is contended, applies to this case. Statutes of limitation affect the remedy only.
The only question deemed material to discuss is whether the action was barred by the statute of limitations approved 5th February, 1841.
The principal ground in support of the position that the action was not barred is that the operation of the statute was prospective, and could not constitutionally affect contracts in existence at the time of its passage. The promissory notes were executed in 1840, during the interval between the abolition of the Spanish laws of prescription and the passage of the statute, and when there were consequently no laws of limitation in force. To the satisfactory solution of the question whether the contract was affected by the subsequent law of limitation we will consider--
1st. Whether, under the Constitution of the Republic of Texas, any law of limitation could, without a violation of the Constitution, operate on contracts previously made.
2d. Whether the first section of the statute extends as well to existing contracts as to those made subsequent to the passage of the statute.
The Constitution of the Republic declares that “no retrospective or ex post facto law, or law impairing the obligation of contracts, shall be made,” (sec. 16, Dec. of Rights;) and if the law, as applied to the cause of action, be within the intent of the inhibition, it is null and inoperative. It is very clear that the law does not come within the technical definition of an ex post facto law, which is limited to offenses, and declares an action indifferent in itself at the time of its commitment to be an offense, and punishes the person who has committed it. (1 Black. Com., 46; 3 Dallas R., 386.) Nor does it violate the prohibition against laws which impair the obligation of contracts. A distinction has always been taken between the obligation of a contract and the remedy for its enforcement; and it has never been doubted but that the Legislature may vary “the nature and extent of the remedy, so that some substantial remedy be in fact left.” A State may at pleasure regulate the modes of proceeding in its courts in relation to past contracts as well as future. It may, for example, shorten the period of time within which claims shall be barred by the statute of limitations, or exempt the necessary implements of agriculture, or the tools of the mechanic, or articles of necessity in household furniture, from execution. “Regulations of this description have always been considered, in every civilized community, as properly belonging to the remedy, to be exercised or not by every sovereignty according to its own views of policy and humanity,” and as not impairing the obligation of the contract. (Bronson v. Kinzie et al., 1 How. U. S. R., 315.)
The question then arises whether the statute, as applied to past contracts or transactions, is retrospective within the meaning and intent of the constitutional prohibition. Ex post facto laws and such as impair the obligation of contracts are retrospective; but there may be retrospective laws which are not necessarily ex post facto, or which do not impair the obligation of...
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