Bronk v. Barckley

Putnam, J.:

The contract which the plaintiff seeks to enforce was executed under and in pursuance of the provisions of chapter 382, Laws of 1889 (amending title 2 of chapter 3 of part 4 of the Revised Statutes), which provided that “ the managers of the New York State Reformatory, at Elmira, and the managing authorities of any of the penitentiaries, or other penal institutions of this State, are hereby authorized to conduct the labor of the prisoners therein, respectively, *73under the puhlic-account system, or piece-price- system, in like manner and subject to like restrictions as labor is authorized by title two of chapter three of- part four of the Revised Statutes, as hereby amended, to be conducted in the State prisons.” “ By the piece-price system is meant the system by which the State receives payment for the products of the labor of the prisoners upon materials and. machinery furnished by the person making such payment, or furnished partly by such person and partly by the State.”

This statute must be deemed to have authorized a “ time contract.” Under its provisions the managers of the Albany penitentiary could lawfully enter into an agreement with the plaintiff to furnish convict labor to be employed upon materials and with machinery to be furnished by him. Under such an agreement the contractor must place his machinery in the prison and-obtain his materials, and thereafter the contract is to be carried out. A piece-price ” contract, authorized by the statute, is, necessarily, one to - be. performed after the making of it — a time contract.” NTor is it claimed by the defendants that the agreement in question was an unfair or unreasonable one. ' In fact, the submission concedes that it was valid and binding at the time of the adoption of the present State Constitution. I have no doubt that the commissioners ’ of the Albany Penitentiary Commission were authorized' to enter into it under the statute above quoted. The contract was fairly within the power conferred.

There was, therefore, at the time of the enactment of section 29, article 3 of the Constitution of the State, a legal contract between the plaintiff and the managers of the Albany penitentiary. It was authorized by a general statute of the State, and was as valid and binding as if the Legislature had, by a special statute, authorized the commissioners to enter into the agreement in question. It is not clear that section 29, article 3 (supra), was intended to have a retrospective effect, or to in validate contracts lawfully made in pursuance of the authority of the State prior to the adoption of the Constitution. It is true that the words of the section are sufficient to cover past as well as future agreements; but it has been held that general words in a statute should not be so construed as to nullify contracts made before the law was passed. (Dash v. Van Kleeck, 7 Johns. 477; Sackett v. Andross, 5 Hill, 327-334; Wood v. Oakley, 11 Paige, *74400; Johnson v. Burrell, 2 Hill, 238; Warren Mfg. Co. v. The Etna Ins. Co., 2 Paine, 501.)

Without passing upon this cpiestion, however, and assuming that the section of the Constitution referred to was intended to have a retrospective operation, and, hence, to nullify the agreement sought to be enforced, and that its effect, if valid, was to terminate and destroy the lights of the plaintiff under his contract, it is difficult to see why the section in question does not violate the provisions of article 1, section 10, of the Constitution of the United States,' prohibiting* a State from passing a- law impairing the obligation of a contract. Tlie plaintiff claims under a written agreement authorized by statute and conceded to be valid when the State Constitution was adopted. If that Constitution •was intended to invalidate his contract, why does it not violate the provisions of the Rational Constitution %

In Hall v. Wisconsin (103 U. S. 5) the facts were as follows: The Governor of Wisconsin, in pursuance of a statute of the State authorizing him to do so, had entered into a contract with one Hall for the performance of services for an agreed time and price. Before performance the statute authorizing the contract was repealed. It was held that “ A contract between a State and a party, whereby he is to perform certain duties for a specific period at a stipulated compensation, is . within the protection of the Constitution, and on his executing it lie is entitled to that compensation, although before the expiration of the period the State repealed the statute pursuant to which the contract was made.” • I think the doctrine enunciated in the authority cited, and many other cases to the same effect, to which I do not deem it necessary to. refer, apply to this case.

It is suggested that the act of 1889 conferred upon the commissioners of the Albany penitentiary a mere license, revocable at the will of the Legislature,, and that the parties should be deemed to have dealt with the subject-matter, knowing that it w*as under the control of the State, and liable to be affected by changes in the rules and regulations. The act of 1889 was a law of the State which empowered the making of the very contract under which the plaintiff claims. It conferred authority upon the commissioners to contract, and they having legally acted under that authority, the State should not be allowed, by a retrospective statute, to destroy the validity of a contract thus lawfully made. As above suggested, the *75statute is the same as if the Legislature had, by a special act, authorized the defendants to make the agreement hi question. It would be more Correct to say that the act of 1889 conferred on the managers of the Albany penitentiary authority to contract, rather than a license to do so.

But it is suggested that section 29 of article 3 of the State Constitution (supra), and the act of the Legislature, passed in pursuance of its provisions (Chap. 429 of the Laws of 1896), do not violate the provisions of the Rational Constitution, because they, were enacted under and in pursuance of the police power reserved to the States. It may be conceded that chapter 382, Laws of 1889, which provides for the government, management and maintenance of prisons, the disposition, instruction and labor of prisoners, was an act passed by the State in pursuance, according to the largest definition, .of its. police powers. The same may be said of the State Constitution, above referred to, and the act of the Legislature in pursuance thereof.

It has been held in certain cases that the Legislature cannot bargain away the police power of the State; that one Legislature cannot pass a statute that will prevent the future action of its successors in police matters. In Stone v. Mississippi (101 U. S. 814) the facts were as follows: The Legislature of Mississippi, in 1867, granted a charter to a lottery company for twenty-five years. In 1868 a new Constitution was adopted by the State, the effect of which was to repeal such charter. It was held that the provisions, of the new Constitution were not in conflict with section 10, article 1 of the Rational Constitution. In the opinion it was said: “ The Legislature cannot bargain away the police power of a State. c Irrevocable grants of property and franchises may be made if they do-not impair the supreme authority to make laws for the right government of the State ; but no Legislature can curtail the power of its successors to make such laws as they may deem proper in matters of police.’ ” The same doctrine was stated in Boyd v. Alabama (94 U. S. 645-650); Metropolitan Board of Excise v. Barrie (34 N. Y. 657, 667, 668); State v. Holmes (38 N. H. 225); Powell v. Pennsylvania (127 U. S. 678-683); Beer Co. v. Massachusetts (97 id. 25); Fertilizing Co. v. Hyde Park (Id. 659-663); People ex rel. N. Y. Electric Lines Co. v. Squire (107 N. Y. 593).

*76In Stone v. Mississippi (supra) the object of the new law was to suppress lotteries, called in the opinion, “a species, of gambling, and wrong in their influences.” In Boyd v. Alabama (supra) the repealing statute referred to was also enacted to suppress a lottery; and it was stated in the opinion that one Legislature could not restrain the power of a subsequent one “ to suppress any and all practices tending to corrupt the public morals.” In Metropolitan Board of Excise v. Barrie and State v. Holmes (supra) the repealing statutes referred to terminated licenses to sell liquors theretofore granted and directly affected the public health and morals. Howell v. Pennsylvania (supra) referred to a statute of Pennsylvania “ For the Protection of the Public Health and to Prevent

.Adulteration of Dairy Products and Fraud in the Sale thereof.” Beer Co. v. Massachusetts (supra), considered an act of the Legislature to regulate the sale of intoxicating liquors. Fertilizing Co. v. Hyde Park, and The People ex rel. N. Y. Elec. Lines Co. v. Squire (supra) were cases upholding the power of a Legislature to prevent a corporation from so conducting its business as to create a public nuisance. In People v. Girard (145 N. Y. 105) the power •of the Legislature to prohibit the adulteration of vinegar' was sustained ; and in People ex rel. Nechamcus v. Warden, etc. (144 N. Y. 529), chapter 602, Laws of 1892, providing for the examination and registration of “ employing or master plúmbers ” was held constitutional as an act affecting the public comfort and health.

It will be seen that the above, and other cases which might be •cited, holding that one Legislature cannot by contract prevent a subsequent one from exercising the police powers reserved to the States, refer to police powers exercised in matters relating to the public health, morals, comfort or safety. They do not .hold that a ■State by a retrospective law can impair the. validity of a contract made or authorized by it, and which it had power to make or authorize, but they determine that a Legislature has no power to prevent its successors from exercising the police power reserved to the States in matters directly affecting the public health, morals, comfort or safety.' If it attempts to do so the act is beyond its power, •and hence a retrospective law affecting the validity of such contract ■does not violate the provisions of the National Constitution. In that ease the contract impaired by the subsequent law is not a legal *77or ■ authorized' one, and has been termed in some of the cases 'a license rather than a contract, valid while it exists, but revocable at the will of the Legislature. In matters, however, not directly affecting the public health, morals, comfort or safety, I think it must be deemed an established doctrine that a State may make or authorize a valid contract, which cannot be impaired by a subsequent constitutional amendment or statute. A retrospective law which impairs a contract must, in order to be valid, be an exercise of the police power within a narrow definition of that phrase.

In some authorities the phrase “ police power ” is defined to be legislation in regard to any matter affected by the public interest, while in the cases above referred to the words are given a more restricted meaning, and apply to laws directly affecting the public health, morals, comfort or safety. While there is some apparent conflict in the authorities on this subject, I think it must be held that, while the Legislature by a statute cannot make or authorize a contract that will prevent the exercise of the police powers by its successors in matters intimately connected with the public morals, comfort, health or safety, in all other regards it can ; that. the cases where a retrospective law can nullify a contract authorized by the statute are rather an exceptional class, and an exercise of the police power within the narrow definition of that phrase.

Ordinarily the police powers of a State are subject to the provisions of the National Constitution. In Matter of Application of Jacobs (98 N. Y. 98-108) Judge Earl, speaking of the police power of a State, remarks: “ But the power, however broad and extensive, is not above the Constitution. When it (the Constitution) speaks, its voice must be heeded. It furnishes the supreme law, the guide for the conduct of legislators, judges and private persons, and so far as it imposes restraints, the police power must be exercised in subordination thereto.” The same doctrine was stated in People v. Gillson (109 N. Y. 401) in the opinion of Beckham, J. (See, also, Lake View v. Rose Hill Cem. Co., 70 Ill. 191, 192; Brennan v. Titusville, 153 U. S. 289-299; Walling v. Michigan, 116 id. 446-460.)

The distinction between the case where a Legislature may or may not, by a retrospective statute, invalidate a contract previously *78authorized by the State, is referred to in Butchers' Union Co. v. Crescent City Co. (111 U. S. 748-750) where it is said : “ While we are not prepared to say that the Legislature can make valid contracts on no subject embraced in the largest definition of the police-power, we think that, in regard to two subjects so embraced, it cannot, by any contract, limit the exercise of those powers to the prejudice of the general welfare. These are the public health and public morals. The preservation of these is so necessary to the best interests of social organization, that a -wise policy forbids the legis- ■ lative body to divest itself of the power to enact laws for the preservation of health and the repression of crime.”

In The New Orleans Gas Co. v. Louisiana Light Co. (115 U. S. 650) a .legislative grant of an exclusive right to supply gas to a municipality and its inhabitants, through pipes and mains laid in the public streets, was upheld as a contract protected by the Constitution of the United States against State legislation to impair it, and it was held that, in granting the exclusive franchise to supply gas to a municipality and its inhabitants, the State Legislature did not part with the police power and duty of protecting the public health, the public morals and the public safety.

In New Orleans Water Works Co. v. Rivers (115 U. S. 674) the same doctrine was held in reference to the grant of an exclusive right to supply water to a municipality.

The granting of the charters by the State to the gas company and to the water company, referred to in the cases last cited, and the. ■enacting of the statutes attempting to repeal the charters so granted, was an exercise, .according to its largest .definition, of the police ■power of the State in a matter affecting the public welfare. The State, in the first instance, in the exercise of its- police power, had. deemed it wise to grant exclusive privilege to the corporations referred to. Afterwards it abandoned that policy. But it was held that such change of policy could not invalidate.contracts which, when entered into, were lawfully made, and within the power of the State to make. In the opinion of Harlan, J., in New Orleans Gas Co. v. Louisiana Light Co. (supra, 669), he referred to some of the cases, holding that one Legislature cannot by contract limit the discretion of its successor in police matters, as follows : “ The principle upon which the decisions in Beer Co. v. Massachusetts, Fertilizing Co. v. Hyde *79Park, Stone v. Mississippi and Butchers' Union Co. v. Crescent City Live-Stock Landing Co. rest is, that one Legislature cannot so limit the discretion of its . successors that they may not enact such laws as are necessary to protect the public health or the public morals. That principle, it may be observed, was announced with reference to particular kinds of private business which, in whatever manner conducted, were detrimental to the public .health or the public morals. It is fairly the result of those cases, that statutory authority given by the State to corporations or individuals to engage in a particular private business attended by such results, while it protects them for the time against public prosecution, does not constitute a contract jireventing the withdrawal of such authority, or the granting of it to others.”

I think that it was within the power of the Legislature to authorize the contract made by the commissioners of the Albany penitentiary with the plaintiff, which the latter now seeks to enforce. The State, by the act of 1889, adopted the policy of furnishing the labor of its convicts under the “ piece-price ” system'. By the present Constitution it has abandoned that system. The new Constitution works a mere change of policy in the manner of employing convicts. To a certain extent the constitutional enactment in question affects the public interests, but the same could be said of almost every law.

The statutes referred to in Matter of Application of Jacobs and People v. Gillson (supra) and in People v. Marx (99 N. Y. 377) clearly concerned the public interest, but it was held in those cases that such statutes did not affect the public health, and hence were not within the police power reserved to the State, and were un constitutional.

It cannot be said that the State Constitution regulating the manner of employing State prisoners confined in its penal institutions affects the public health, morals, comfort or safety. Hence, it should not be given a retrospective operation so as to nullify a contract, authorized by the State and adopted by it prior to the enactment of the new Constitution.

Cases like the one under consideration, where a constitutional amendment is claimed to have a retrospective operation and to invalidate an authorized contract entered into' in pursuance of an authority conferred by the Legislature, are clearly distinguishable *80from that class of cases' like People v. Budd (117 N. Y. 1); Munn v. Illinois (94 U. S. 113), and The Buffalo East Side R. R. Co. v. Buffalo Street R. R. Co. (111 N. Y. 132), where it has been held that a Legislature could lawfully regulate the manner in which a company, previously incorporated must conduct its business and the prices it may charge; and that such legislation . does not violate the provisions of the National Constitution. A law making a reasonable regulation in regard to the manner of conducting a business of a corporation is very different from one absolutely nullifying a contract or charter lawfully made or granted. Yet it has been held in regard to statutes regulating the business of a corporation that legislation affecting the corporate powers “ must not be in conflict with any of the provisions of the charter, and they must not, under pretence of regulation, take from the corporation any of the essential rights and • privileges which the charter- confers. ■ In short, they must be p>olice regulations in fact and not amendments of the charter in curtailment of the corporate franchise.” (Cooley’s Const. Lim. [6th ed.] 710; Sinking Fund Cases, 99 U. S. 700, 720, 721.)

I conclude that the contract in question is valid, unaffected by the provisions of the present State Constitution, and protected by the provisions of the National Constitution ; and the learned counsel for the defendant conceding that on such a determination a judgment for a specific performance should be entered in favor of the plaintiff, judgment should be directed accordingly.

Herrick, L, concurred in result.