N. Y. Supreme Court.-Sackett v. Andross. the English bankrupt system was ever extended, at any period, to all classes of persons. It is proper to mention here, that our first bankrupt law, which was passed in the year 1800, was, in all its leading features, based upon the English bankrupt system. This law was passed while most of the men who had taken part in framing and ratifying the constitution were still living. As a practical construction of the bankrupt power, no one can deny that it is a precedent of great importance. At that period no one seems to have supposed that the power of congress extended over the whole subject of insolvency; and probably few persons would ever have thought of such a thing, if we had not witnessed the sad consequences of idleness, extravagant living and gambling speculations. But none of these things can alter the constitution. congress may take upon itself the whole business of regulating the collection of debts; may abolish the state laws, and the whole civil jurisdiction of the state courts; and may give to the federal courts the exclusive jurisdiction over all matters touching the relation of debtor and creditor. It is impossible to deny that these consequences are the legitimate offspring of the doctrine advanced by the learned commentator. And can any one believe for a moment that either the convention, the states, or the people intended to confer such powers upon the federal government? Does the author of the note believe it? I presume not. And I ought in justice to say, that the doctrine was only put forward with a "perhaps," and without the benefit of having heard the question discussed by counsel; and from the known candor of the author it is not to be doubted, that when the subject comes to be examined by him as a judge, it will receive the same careful and able investigation which it would be sure to command under other circumstances. stitution of the word insolvency, with all the consequences which have just been suggested. The wit of man cannot point to a well defined resting place between the two extremes. When the supreme court of the United States shall decide that the power spreads over the whole field of insolvency, I shall submit; because, as the question arises under the constitution and laws of the union, it will be my duty to do so. But until then, I must be permitted to entertain the opinion that a law "on the subject of bankruptcies" must be confined, as it always was prior to the year 1841, to debtors who are engaged in some branch of trade. I have met with no authority for saying that a bankrupt law may be extended to all classes of debtors, save what may be found in one of the numerous elementary books of Mr. Justice Story. Before leaving this branch of the case In his commentaries on the constitution, it is proper to say, that there is no middle he has the following note: "Perhaps as ground between taking the legal signifisatisfactory a description of a bankruptcation of the word bankrupt, and the sublaw as can be framed, is, that it is a law for the benefit and relief of creditors and their debtors, in cases in which the latter are unable or unwilling to pay their debts. And a law on the subject of bankruptcies, in the sense of the constitution, is a law making provisions for cases of persons failing to pay their debts." (3 Story on Const. 13, 14) No authority is cited in support of this definition, except a debate in congress, which, to say the most of it, proves as much against, as it does in favor of the doctrine; and I must be permitted to add, that a legislative debate in modern times proves very little on any subject. Let us glance for a moment at the consequences which may follow, should this! doctrine be established. "A law on the subject of bankruptcies in the sense of the constitution, is a law making provisions for cases of persons failing to pay their debts." If this be so, congress may, under the bankrupt power, restore the law of imprisonment for debt, which has been abolished in this and several of the other states. And much more than that, It has been said, that upon this construction there will be great difficulty in specifying the classes of persons who may properly be subjected to the operation of a bankrupt law; and this has been deemed an argument of some importance in support of the law under consideration. But there is very little of truth in what is alleged as the groundwork of this reasoning; and if the supposed difficulty really N. Y. Supreme Court.-Sackett v. Andross. existed, the argument based upon it would be good for nothing. The improvements which have from time to time been made in the English bankrupt laws, based upon long experience of their practical operation, must furnish the means of specifying with sufficient accuracy who may, and who may not come within the operation of the system. And I may add, that this specification was actually made in our own bankrupt law of 1800; and so also it was by the law of 1841, when we come to that branch of it which may properly be termed a bankrupt law. But however great the supposed difficulty may be, it clearly cannot have the effect of enlarging the power. stance of the creditors.' (1 Dane Ab. 317.) No such thing was ever known. prior to 1841, as that a man should declare himself a bankrupt, and demand a discharge in defiance of his creditors. It may be remarked here, that for a long time these laws afforded no relief of any kind to the bankrupt. Neither the 34th and 35th H. 8. ch. 4, nor the 13 Eliz. ch. 7, provided for the bankrupt's discharge. The creditors seized on all his estate for the payment of their debts, and if they were not fully satisfied the bankrupt remained liable for the balance. until the reign of Anne, that the bankrupt, on conforming to all that was required of him, obtained a discharge from so much of his debts as had not been satisfied under the commission. It still remained for the creditors to adopt this remedy or not, at their pleasure. It was not If they elected to sue out a commission, they got the effects of the bankrupt, and he was discharged. But it was never in his power to move in the matter, and say to his creditors, "I will have a discharge whether you agree to it or not." Under the English system, the bankrupt could not be discharged until fivesixths of the creditors had assented to it by signing his certificate. By our own bankrupt law of the year 1800, the con The next feature which I shall notice in a proper bankrupt system is, that there must be something more than the mere non-payment of debts-some act must be done by the trader, which the law has declared to be an act of bankruptcy-before he can be brought under the operation of the system. So are the English bankrupt laws; so was the law of 1800; and so too is the bankrupt branch of the law of 1841. And here I will refer once more to the definition of Blackstone. "A bankrupt is a trader who secretes himself, or does certain other acts tending to defraud his creditors." The law dictionaries hold the same language. Chancel-sent of two thirds in number and value of lor Kent says, "bankruptcy in the English law has, by long and settled usage, received an appropriate meaning;" it is applicable to traders "who do certain acts which afford evidence of an intention to avoid payment of their debts." (2 Kent, 389.) Now let us consult some of the most approved lexicographers. Bailey defines bankruptcy, as the "act of turning bankrupt." Webster and Richardson agree entirely in the definition of Blackstone. In a proper bankrupt system, the law, like all other laws for the collection of debts, is made for the special benefit of the creditor, and can only be set in motion at his instance. So are the English bankrupt laws; so was our own law of 1800; and so is the bankrupt branch of the law of 1841. "One distinction has ever existed, that is, an insolvent act has ever operated at the instance of the debtor imprisoned; but bankrupt laws at the in the creditors who had proved their debts under the commission was required before the bankrupt could be discharged. Thus we see, that the proceedings were not only commenced by some one or more of the creditors, but the consent of the creditors as a class was a necessary pre-requisite to the granting of a discharge. There was at the same time another, and an entirely distinct system of laws in operation in England for the relief of in solvent debtors. The first of these laws was passed as early as the 22 and 23 Charles II. ch. 20, and at the time of our revolution there were not less than thirty British statutes on the subject. These laws relieved the debtor from imprisonment on surrendering his property; but left his future acquisitions still liable for the payment of debts. They answered very nearly to the cessio bonorum of the Roman law, which did not discharge the debt, but only released the debtor from confinement. We see, then, that there N. Y. Supreme Cour-Sackett v. Andross. were two distinct and independent systems in operation touching the relation of debtor and creditor; and it will be found on examination that these two systems related to different classes of debtors, were based on different principles, and administered by different tribunals. Several of the colonies had also enacted insolvent laws, with some modifications of the British statutes, while the other colonies had taken the British insolvent system as they found it. A brief notice of the law under consideration will render the application of what has been said plain and obvious. What has congress done? It has given us a law in two distinct branches, one of which contains several of the leading features of a bankrupt law proper. It is confined to debtors who are engaged in some branch of trade, and who have done certain specified acts which are made acts of bankruptcy. Against such a debtor the creditor may institute proceedings, and may thereby overreach unjust preferences, set aside fraudulent conveyances, and seize on the bankrupt's estate before it is wasted, and cause it to be applied to the satisfaction of his debts. In these particulars it is just such a system as the convention, and every intelligent man in the United States at the time the constitution was adopted, must have intended by the power conferred upon congress to legislate "on the subject of bankruptcies." And in my humble judgment it filled the measure of the power. There was no room for another drop of constitutional legislation on the subject. But congress has attempted to do a great deal more. It has added another, and an independent branch of legislation. Losing sight of those features in a bankrupt system which confine it to merchants and traders, and make it a remedy in the hands of the creditor, congress has extended this branch of the law to "all persons whatsoever-owing debts," and this new, and by far the most numerous class of debtors, are to come under the operation of the law or not, according to their own pleasure, without any power of coercion in the creditor. It would sound strangely in the ears of an English lawyer, or of any of those distinguished jurists of our own country who were on the stage at the time the constitution was adopted, to tell them of a bankrupt law | extending to all classes of persons, and which was made for the exclusive benefit of the debtor. And it will sound strangely enough to us, so soon as we have fully recovered from the spasm which produced this enactment. This statute not only brings in the English insolvent laws under a new name, but it gives them a scope and influence which they never had before. Instead of stopping where the insolvent laws did, with the release of the debtor from imprisonment, this law goes further, and annuls the obligation of the contract. And what is still worse, upon the construction for which the defendant contends, it has a retrospective operation, and nullifies contracts which had been made before the law was passed. This, too, is done without the consent of creditors, either as individuals, or as a class governed by majorities. The respect which I feel for those who enacted the law has not overcome the convictions of my own judgment, that this was not a constitutional exercise of power. Indeed, I think the opinion of congress itself may be cited against the validity of the law; for it has been repealed by the very same body of men which enacted it. But whether the members became themselves satisfied that the law was unconstitutional, or whether they yielded to the force of public opinion, is not a very important inquiry. That the law has been very generally condemned no one can deny. Let us see where a bankrupt system might end if the principles asserted in this law were fully carried out. If the power of coercion may be denied to the creditor as to any particular class of debtors, then it may be denied in all cases. This would give us a system made for the exclusive benefit of the debtor, which would contradict all that has ever been enacted or written on the subject of a bankrupt law. Again: If persons not connected with trade may become voluntary bankrupts, then it is entirely clear that congress can extend the system in its compulsory form, so as to authorize the creditor to sue out a commission against any debtor, whatever may be his pursuit or occupation. Such a law would be without any warrant in the history of the past, and could not fail to shock the whole community. Our farmers, planters, and mechanics, to N. Y. Supreme Court.-Sackett v. Andross. If the I do not say nothing of many other classes which But the principle asserted by this act of congress.reaches a still wider field than we have yet surveyed. If the law comes within the power, it must be because congress is not tied down to any particular system of laws touching the relation of debtor and creditor; but has power over the whole subject of insolvency, taking the word in its largest sense. This covers the entire relation of debtor and creditor, so far as relates to their rights and remedies in case the debt is not paid. Congress has but to exert its authority, and the whole civil jurisdiction of the state courts, from the highest to the lowest, will be blotted out. And still more. power does not refer to any system of laws, but is to be understood as speaking of insolvency in the abstract, then congress need not require the debtor to go through the forms of asking a discharge; but may at once absolve him from his obligation, and tell the creditor he is a creditor no longer. There need be no surrender of the debtor's estate. He may keep it, if such be the will of congress. see how it is possible to deny that these consequences may follow, if the principle asserted by this law can be defended. It is no answer to say that such powers will not be exercised. The question is whether I think not. they have been granted. Every one knows that the states were jealous of their rights, and that nothing pertaining to their sovereignty was yielded to the federal government, unless the grant was either essential to the existence and efficiency of that government, or the well being of the whole people; and in all cases the utmost caution was observed in making the grant. Powers were not bestowed on the assumption that they would not be used. There were good reasons for giving congress the power over bankruptcy, as that term had always before been understood; but not for going further and including the whole relation of debtor and creditor. Merchants and commercial men are under the necessity of using credit as well as capital, and their affairs are not confined to any particular district, but spread over the whole country. No single state could either secure to them the just fruits of their enterprise and skill, or grant them adequate relief in case their hazardous employments should prove unsuccessful. Hence the necessity for a are not engaged in trade, are not always N. Y. Supreme Court.-Sackett v. Andross. national bankrupt law. But in the ordi- | not. But suppose we leave England, an 1 nary dealings between neighbor and neigh-cast our eyes over the rest of Europe. I bor, who are not engaged in the business have yet to learn that any government on of buying and selling as a livelihood, there could be no occasion for calling in the aid of the federal government. And besides, the condition and wants of the great mass of the people could not be so well understood by congress as by the local legislatures. These considerations render it highly improbable that the states have surrendered the powers which congress has attempted to exercise, and they are entitled to great weight in fixing the true interpretation of the grant. the continent had a bankrupt law, eo nomine, or any thing which answered either in form or substance to the English bankrupt system, or to the one which we have so recently had and repudiated. Most of the European states had the cessio bonorum of the civil law, which only relieved the debtor from imprisonment on surrendering his effects, and left his future acquisitions subject to be seized by the creditor. We must then return to England before we can find a bankrupt system which will blot out the debt; and when we go there we can find no pattern for the insolvent or voluntary branch of our bankrupt law. Scotland has a bankrupt law which differs in several particulars from the English system. But it will not anIt was If we intend to meet this question fairly, without warping the fundamental law to the exigency of the times, I cannot entertain a doubt that the framers of the constitution, when they used the word "bankruptcies," plainly referred to one, and only one of the two great legal systems touch-swer the defendant's purpose. ing the relation of debtor and creditor which had long been in operation. The convention did not stop to define, because the matter was already well understood. The constitution speaks in the same way of taxes, duties, imposts, trial by jury, and many other subjects; and if we once depart from the sense in which the words were used and received at the time, a written constitution will not be worth preserving; for it will either mean nothing, or else it will mean every thing, and include whatever interest, ambition or profligacy may desire. Chief Justice Marshall has told us, what few will be disposed to question, that the enlightened patriots who framed the constitution were men whose intentions required no concealment (9 Wheat. 188.) If they had intended to confer a power covering the whole relation of debtor and creditor, I cannot suppose that they would have confined themselves to a single word, or if they did, that they would have chosen one which most men would be likely to understand in a more restricted sense. not until within a recent period that it provided for the discharge of the debt. And, besides, I suppose no one will affirm that the convention referred to the Scotch, instead of the English bankrupt system. Bankruptcy is a legal term; we are discussing its meaning as used in a legal instrument; and we must go to the laws to ascertain its legal import. And to what laws shall we go but to those of England under which we had lived down to the revolution? Will it be said that either the convention, the states, or the people had in mind any other laws? I presume Some considerations have been pressed into the argument which can have little or no just bearing upon the question. We are told that some of the states, prior to the revolution, had made enactments containing many of the features of a bankrupt system. That may be true. But they had never called them bankrupt laws. They had always been termed insolvent laws, or laws for the relief of insolvent debtors; and if the convention intended to refer to those laws, they would have spoken of insolvency, instead bankruptcy. The argument that the state laws contained some of the features of a bankrupt system, so far as it proves anything, weighs against those who use it. As the states had never called them bankrupt laws, no one can say that such is their proper name, without comparing them with some bankrupt system; and this carries us back again to the laws of England. Before dismissing this head of the argument I must not omit to notice that, prior to the adoption of the federal constitution, there were very few if any state laws which discharged the debt; and whether we look at those laws before or after that period, I have never met with more than one which discharged the debt without the consent of the cred |