This defense was based on the 7th section | This request was granted. A bill of excep[57] of an act of the *commonwealth of Pennsylvania of April 27, 1855, in terms as follows: "That in all cases where no payment, claim, or demand shall have been made on account of or for any ground rent, annuity, or other charge upon real estate for twentyone years, or no declaration or acknowledgment of the existence thereof shall have been made within that period by the owner of the premises subject to such ground rent, annuity, or charge, a release or extinguishment thereof shall be presumed, and such ground rent, annuity, or charge shall thereafter be irrecoverable: Provided, That the evidence of such payment may be perpetuated by recording in the recorder of deeds' office of the proper county the duplicate of any receipt therefor, proved by oath or af firmation, to be a true copy of that signed and delivered in the presence of the payer and witnessed at the time by the deponent, which recorded duplicate or the exemplification of the record thereof, shall be evidence until disproved, and the evidence of any such claim or demand may be perpetuated by the record of any judgment recovered for such rent, annuity, or charge in any court of record, or the transcript therein filed of any recovery thereof by judgment before any alderman or justice of the peace, which records and judgments shall be duly indexed: Provided, That this section shall not go into effect until three years from the passage of this act." Thereupon the plaintiff took out a rule on the defendant to show cause why judgment should not be entered against him for want of a sufficient affidavit of defense, assigning as a reason why such rule should be made absolute that the said 7th section of the act of April 27. 1855, was unconstitutional within the 10th section of article 1 of the Constitution of the United States, forbidding any state from passing any law impairing the obligation of contracts. After a hearing the court discharged the said rule for judgment; a bill of exceptions was signed and sealed, and the cause was then taken to the supreme court of Pennsylvania, where the judgment of the court of common pleas was affirmed. 187 Pa. 108, 41 Atl. 38. Thereafter the case came on for trial be[58]fore the court and a *jury. The plaintiff of fered evidence tending to show that the ground rent in question had never been paid off and extinguished. This offer was objected to as immaterial and irrelevant. The objection was sustained, and an exception was taken by the plaintiff. The court was asked to instruct the jury that the 7th section of the act of April 27, 1855, was unconstitutional. because it impairs the contract reserving the rent, and was inhibited by the 10th section of article 1 of the Constitution of the United States, which forbids the states from passing any law impairing the obligation of contracts. The request so to charge was refused by the trial judge. The defendants asked the court to charge that the verdict should be for the defendants. tions to the action of the court in rejecting the plaintiff's offer of evidence, in declining to charge as requested by the plaintiff, and in charging as requested by the defendant, was signed and sealed by the trial court. A verdict and judgment in favor of the de fendants was then entered. The cause was then taken a second time to the supreme court of Pennsylvania, where on April 3, 1899, the judgment of the court of common pleas was affirmed. Mr. George Henderson argued the cause and filed a brief for plaintiff in er ror: This act exceeds the legitimate scope of a limitative act, in denying a remedy as to instalments before they have matured, and in divesting title to the estate without some fault or neglect of the owner. 280, 7 L. ed. 679; Yick Wo v. Hopkins, 118 Jackson ex dem. Hart v. Lamphire, 3 Pet. U. S. 356, 30 L. ed. 220, 6 Sup. Ct. Rep. 1064; Heckerman v. Hummel, 19 Pa. 64; Kirk v. Smith, 9 Wheat. 241, 6 L. ed. 81; Moore v. State, 43 N. J. L. 210, 39 Am. Rep. 558; St. Mary's Church v. Miles, 1 Whart. 233; McQuesney v. Hiester, 33 Pa. 439. 75 Am. Dec. 612; Lindeman v. Lindsey, 69 Pa. 100, 8 Am. Rep. 219. The obligation of the rent is impaired by depriving the owner of all remedy as to arrears before a right of action has accrued. Sturges v. Crowninshield, 4 Wheat. 122, 4 L. ed. 529; Von Hoffman v. Quincy, 4 Wall. 535, sub nom. United States ex rel. Von Hoffman v. Quincy, 18 L. ed. 403; Cooley, Const. Lim. pp. 348, 354, 358; Hare, Const. Law, p. 687; Green v. Biddle, 8 Wheat. 1, 5 L. ed. 547; Bronson v. Kinzie, 1 How. 311, 11 L. ed. 143. See also McGahey v. Virginia, 135 U. S. 662, 34 L. ed. 304, 10 Sup. Ct. Rep. 972; Ohio Life Ins. & T. Co. v. Debolt, 16 How. 416, 14 L. ed. 997. New rules of property can have no retroactive application. Cooley, Const. Lim. p. 112; Norman v. Heist, 5 Watts & S. 173, 40 Am. Dec. 493; Cornell v. Hickens, 11 Wis. 355; Olcott v. Fond du Lac County, 16 Wall. 690, 21 L. ed. 387. Because some of the instalments of a contract are barred, can it be conclusively presumed that there has been a release before a day of maturity? Can a bar of the plaintiff's right be predicated upon the default of the defendant? The covenant in the deed excuses demand. Ingersoll v. Sergeant, 1 Whart. 337; St. Mary's Church v. Miles, 1 Whart. 229. Mr. Ira Jewell Williams argued the cause, and, with Mr. Alexander Simpson, Jr., filed a brief for defendants in error: The validity of the retrospective application of this statute of limitations is not involved, because the full bar of twenty-one years' nondemand took place after the act. Koshkonong v. Burton, 104 U. S. 668, 26 L. ed. 886. A statute of limitations may be constitutionally applied to prior contracts where, as here, a reasonable time is given after the passage of the statute before the bar takes effect. Terry v. Anderson, 95 U. S. 628, 24 L. ed. 365; Koshkonong v. Burton, 104 U. S. 675, 26 L. ed. 889; Turner v. New York, 168 U. S. 90, 42 L. ed. 392, 18 Sup. Ct. Rep. 38; Saranac Land & Timber Co. v. Roberts, 177 U. S. 324, 44 L. ed. 789, 20 Sup. Ct. Rep. 642. Three years is a reasonable time. Ibid. A statute of limitations barring the right of action after twenty-one years, nondemand of interest is constitutional, although the principal itself was not demandable. St. Mary's Church v. Miles, 1 Whart. 229; Lindeman v. Lindsey, 69 Pa. 100, 8 Am. Rep. 219. The legislature, in order to protect titles to property and prevent the assertion of stale claims, can, in the exercise of its discretion, say to the owner of the ground-rent, that he must, within twenty-one years, make demand of interest, or it will be conclusively presumed that he had no right to interest, because of the payment of the principal. Campbell v. Holt, 115 U. S. 620, 29 L. ed. 483, 6 Sup. Ct. Rep. 209; Korn V. Browne, 64 Pa. 57; Biddle v. Hooven, 120 Pa. 221, 13 Atl. 927; Wallace v. Fourth U. P. Church, 152 Pa. 258, 25 Atl. 520; Clay v. Iseminger, 187 Pa. 108, 41 Atl. 38, 190 Pa. 580, 42 Atl. 1039. [58] *Mr. Justice Shiras delivered the opinion of the court. The question for determination in this case is whether the 7th section of the act of assembly of the commonwealth of Pennsylvania of April 27, 1855, the terms of which appear in the foregoing statement, is an act or law impairing the obligation of contracts within the meaning of the Constitution of the United States. The peculiar character, under the laws of [59]the state of Pennsylvania, *of irredeemable ground rents, must first receive our notice. It is defined to be a rent reserved to himself and his heirs by the grantor of land, out of the land itself. It is not granted like an annuity or rent charge, but is reserved out of a conveyance of the land in fee. It is a separate estate from the ownership of the ground, and is held to be real estate, with the usual characteristics of an estate in fee simple, descendible, devisable, alienable. Bosler v. Kuhn, 8 Watts & S. 185; Wallace v. Harmstad, 44 Pa. 495; McQuigg v. Morton, 39 Pa. 31. It may be well to quote the language of the deed reserving the ground rent in question, which is that usually employed in the creation of such estates. The tenendum clause is in the usual form: "To have and to hold the said described lot or piece of ground, hereditaments, and premises hereby granted with the appurtenances unto the said Adam Iseminger, his heirs and assigns, to the only proper use and behoof of the said Adam Iseminger, his heirs and assigns for ever." Then comes the reservation, as follows: "Yielding and paying therefor and thereout to unto the said Alexander Osbourne, his heirs and assigns, the yearly rent or sum of seventy-two dollars, lawful money of the United States, in half-yearly payments on the 1st day of April and October every year hereafter forever, without any deduction, defalcation, or abatement for any taxes, charges, or assessments whatsoever to be assessed as well on the said herebygranted premises as on the said yearly rent hereby and thereout reserved. The first half-yearly payment thereof to be made on the 1st day of October, 1854, and, on default of paying the said yearly rent on the days and time and in manner aforesaid, it shall and may be lawful for the said Alexander Osbourne, his heirs and assigns, to enter into and upon the said hereby-granted premises or any part thereof, and into the buildings thereon to be erected, and to distrain for the said yearly rent so in arrears and unpaid, without any exemption whatsoever, any law to the contrary thereof in anywise sell such distrained goods and effects, ac-[60] notwithstanding, and to proceed with and cording to the usual course of distresses, for rent charges. But if sufficient distress cannot be found upon the said herebygranted premises to satisfy the said yearly rent in arrear and the charges of levying the same, then and in such case it shall and may be lawful for the said Alexander Osbourne, his heirs and assigns, into and upon the said hereby-granted lot and improvements wholly to re-enter, and the same to have again, repossess, and enjoy as in his and their first and former estate and title in the same and as though this indenture had never been made," etc. It appears in the Pennsylvania cases hereinbefore and hereafter cited, that this form of estate was, in the early history of the coinmonwealth, a favorite form of investment; but that eventually great inconveniences arose from the existence of ancient ground rents, which the owners and occupants of the land never heard of, but of whose extinguishment the records of title made no mention. Indeed, the records disclosed the reservation of such ground rents unpaid and unextinguished, going back more than a century. In Korn v. Browne, 64 Pa. 55, there is a quotation in the opinion from a tract by Mr. Eli K. Price, a distinguished real-estate lawyer of Philadelphia, as follows: "Those only who are accustomed to make or read briefs of title in Philadelphia, going back to the times of the first settlement, know how frequently occur ancient rent charges and ground rents, which the owners of the present day never heard of, and which generally have no doubt been honestly extinguished; while making this note the writer has such a single brief before him for an opinion, in which no less than three such charges occur as blemishes, grants, or reservations more than a century ago, which no person living has any knowledge of." These evils led to the passage of the act The theory of this remedial act is that upon which all statutes of limitation are based, a presumption that, after a long [61]*lapse of time, without assertion, a claim, whether for money or for an interest in land, is presumed to have been paid or released. This is a rule of convenience and policy, the result of a necessary regard to the peace and security of society. Bonds, even when secured by mortgages upon land, mortgages themselves, merchants' accounts, legacies, judgments, promissory notes, and all evidences of debt, have universally been treated as lawfully within the reach of legislative power exercised by the passage of statutes of limitation. Such statutes, like those forbidding perpetuities and the statute of frauds, do not, in one sense, destroy the obligation of contracts as between the parties thereto, but they remove the remedies which otherwise would be furnished by the courts. Are not the powers of government adequate for this? are passed which fix upon a reasonable time within which a party is permitted to bring suit for the recovery of his rights, and which, on failure to do so, establish a legal presumption against him that he has no rights in the premises. Such a statute is a statute of repose. Every government is under obligation to its citizens to afford them all needful legal remedies; but it is not bound to keep its courts open indefinitely for one who neglects or refuses to apply for redress until it may fairly be presumed that the means by which the other party might disprove his claim are lost in the lapse of time." Cooley, Const. Lim. 5th ed. 448; Bell v. Morrison, 1 Pet. 351, 7 L. ed. 174; Leffingwell v. Warren, 2 Black, 606, 17 L. ed. 263. We are unable to perceive any sound distinction between claims arising out of ground-rent deeds and other kinds of debts and claims, which would exempt the former from the same legislative control that is conceded to lawfully extend to the latter. But, assuming that there is nothing peculiar in ground rents that withdraw them from the reach of statutes of limitation, it is further contended, in the present case, that the act of April 27, 1855, can have no valid application to a ground rent reserved before the passage of that statute. It may be properly conceded that all statutes of limitation must proceed on the idea that the party has full opportunity afforded him to try his right in the courts. A statute could "Laws for the preservation and promotion of peace, good order, health, wealth, education, and even general convenience, are supported under the police power of the state. Under these laws, personal rights, rights of property, and freedom of action, may be directly affected, and men may be fined, imprisoned, and restrained, and prop-not bar the existing rights of claimants erty taken, converted, and sold away from its owner. The principle of such laws is most easily perceived and recognized when men are held liable for nuisances, acts, and negligences affecting the health and safety of society, when the marriage contract is dissolved, and when property is subjected to charges and sales for matters affecting the public interest and welfare. Beyond this is a wide domain of general convenience where the power is likewise exercised. Thus, estates held in joint tenancy and common may be divided among the tenants, even by conversion and sale; life estates and remainders may be separated from each other; qualified inheritances expanded into absolute fees, and contingent and executory interests extinguished. What greater reason has the owner of an irredeemable ground rent, coming down from a former generation, to complain [than] .. the owner of a remainder or reversion, or of some contingent or executory interest?" Ch. J., Agnew in Palairet's Appeal, 67 Pa. 497. without affording this opportunity; if it Thus, in Terry v. Anderson, 95 U. S. 628, 24 L. ed. 365, it was said per Chief Justice Waite: "This court has often decided that statutes of limitation affecting existing rights are not unconstitutional, if a reasonable time is given for the commencement of an action before the bar takes effect. Hawkins v. Barney, 5 Pet. 457, 8 L. ed. 190; Sohn v. Waterson, 17 Wall. 596, 27 L. ed. 737. "Notwithstanding the protection which the law gives to vested rights, it is possible 62]for a party to debar himself of the *right to "It is difficult to see why, if the legislaassert the same in the courts by his own neg- ture may prescribe a limitation where none ligence or laches. If one who is dispos- existed before, it may not change one which sessed be negligent for a long and unreason has already been established. The parties able time, the law refuses afterwards to lend to a contract have no more a vested interest him any assistance to recover the possession in a particular limitation which has been merely, both to punish his neglect, and fixed than they have in an unrestricted right also because it is presumed that the supposed to sue. They have no more a vested interwrongdoer has in such a length of time pro- est in the time for the commencement of an cured a legal title, otherwise he would soon- action than they have in the form of the ac er have been sued. Statutes of limitation 'tion to be commenced; and as to the forms of action or modes of remedy, it is well settled that the legislature may change them at its discretion, provided adequate means of enforcing the right remain. The same conclusion was reached by the supreme court of Pennsylvania in Wallace v. Fourth U. P. Church, 152 Pa. 258, 25 Atl. 520, where it was said that "the purpose of the act of 1855 was to relieve titles and facilitate the sale of real estate. It *fixes[65] upon an arbitrary period of twenty-one years as that over which the search of a purchaser or other person must extend, and beyond which it shall not be necessary for him to look. If for twenty-one years no payment upon or acknowledgment of the ground rent can be shown, and no demand for payment has been made, the act conclusively presumes a release and extinguish "In all such cases the question is one of reasonableness, and we have, therefore, only to consider whether the time allowed in this statute is, under all the circumstances, reasonable. Of that the legislature is primarily the judge, and we cannot overrule the decision of that department of the govern ment, unless a palpable error has been committed. In judging of that, we must place ourselves in the position of the legislators, and must measure the time of limitation in the midst of the circumstances which sur-ment of the encumbrance by the act of the rounded them, as nearly as possible; for what is reasonable in a particular case depends upon its particular facts." Turner v. New York, 168 U. S. 90, 42 L. ed. 392, 18 Sup. Ct. Rep. 38: Saranac Land & Timber Co. v. Roberts, 177 U. S. 318, 44 L. ed. 786, 20 Sup. Ct. Rep. 642. In Korn v. Browne, 64 Pa. 57, this question was considered, and it was said, per Read, J.: [64] *"The 7th section did not go into effect for three years, and gave ample time to all own ers of ground rents to make claims and demands for the same, so as to prevent the bar of the statute. This prospective commencement makes the retrospective bar not only reasonable but strictly constitutional." Citing Smith v. Morrison, 22 Pick. 430, and Ross v. Duval, 13 Pet. 64, 10 L. ed. 60. parties, and declares that the rent shall thereafter be irrecoverable." In that case the ground rent had been reserved long be fore the passage of the act of April 27, 1855, and it was held that as twenty-one years and ten months had elapsed without the payment of rent, or demand for the same, the right to demand it was extinguished. So, in the present case, where no payment or demand was shown to have been made for more than twenty-one years, it was held that, in view of the numerous and repeated decisions, the question must be considered at rest. Clay v. Iseminger, 187 Pa. 108, 41 Ati. 38. We are therefore of opinion that the Supreme Court of Pennsylvania did not err in holding that the 7th section of the act of April 27, 1855, was constitutionally applicable, and its judgment is affirmed. In Biddle v. Hooven, 120 Pa. 225, 13 Atl. 927, it was said, referring to Korn v. Browne, 64 Pa. 57: "An examination of it shows that the only question there argued was whether the section of the act referred VICKSBURG WATERWORKS COMPANY, to has a retrospective, as well as a prospective, operation with regard to ground rents. Appt., บ. OF VICKSBURG. (See S. C. Reporter's ed. 65-83.) Courts--jurisdiction of circuit court case arising under Constitution and laws of the United States-equitable relief against threatened injury. 1. This appears in the first sentence of the MAYOR AND ALDERMEN OF THE CITY opinion of Justice Read. He very properly held that, as the 7th section did not go into effect for three years, and gave ample time to all owners of ground rents to make claims and demands for the same, so as to prevent the bar of the statute, that this prospective commencement made the retrospective bar, ot only reasonable, but constitutional. In other words, the act gave ample time to preserve all existing rights. The only ground upon which this kind of legislation can be justified is that after the lapse of the statutory period the mortgage or other security is presumed to have been paid, or the ground rent extinguished. The payment of a mortgage and the extinguishment of a ground rent mean substantially the same thing. The act was not intended to destroy the ground landlord's ownership in the rent; it does not impair his title thereto; nor can it be said to impair the contract by which the rent was reserved, but from wellgrounded reasons of public policy it declares that when the owner of such rent makes no claim or demand therefor for twenty-one years it presumes it has been extinguished. which means nothing more than that it has been paid. The language cited, as before observed, affects only the remedy; if it meant more it would be void for the excess." A case presented by a bill in equity which alleges that a contract right of a waterworks company with whose predecessors a municipality, with legislative sanction, contracted for a municipal water supply, is impaired by an ordinance directing that the waterworks company be notified that the city denies any liability on any contract for the use of hydrants, and by the subsequent action of the city in holding an election to authorize an issue of bonds to buy or construct waterworks of its own, and in refusing to pay the amount due and payable under the terms of the contract,-is one so arising under the laws and Constitution of the NOTE. As to Federal question as conferring jurisdiction on United States courts--see notes to Montana Ore-Purchasing Co. v. Boston & M. Consol. Copper & S. Min. Co. 35 C. C. A. 7, and Bailey v. Mosher. 11 C. C. A. 308. As to injunction to restrain a threatened wrong-see note to Gardner v. Stroever (Cal.) 6 L. R. A. 90. United States as to give a circuit court of the United States jurisdiction. 2 Apprehension that such illegal action may be taken by a municipality as will impair the franchise and contract rights of a waterworks company with whose predecessor the city has contracted for a municipal water supply entitles the company to maintain a suit for equitable relief in advance of any actual proceedings on the part of the city to impair the company's rights under the contract. [No. 392.] Submitted December 4, 1901. 7, 1902. Thereupon the complainant moved the court to "continue the restraining order in force as granted until the appeal in this cause is heard by the Supreme Court of the United States, or until the further order is granted by said court." The following order was then entered by the court: "Upon the appeal being allowed herein it is ordered that the temporary restraining order herein be continued until the 1st day of January, 1902, or if before then, until the decision of the appeal herein by the supreme court, upon condition, however, that Decided April the complainant diligently prosecute its appeal and file a motion at or before the next term of the supreme court to advance the appeal in this cause upon the docket of the Supreme Court of the United States, and upon the further condition that the injunc tion bond heretofore given in this case shall stand and continue in force for any additional liability which may be incurred by reason said bond, now in open court consenting of this order, the principal and sureties upon thereto. Ordered, adjudged, and decreed this 3d July, 1901." APPEAL from the Circuit Court Doft fit United States for the Southern District of Mississippi to review a judgment dismiss ing a suit for want of jurisdiction. Re versed. Statement by Mr. Justice Shiras: [66] *The Vicksburg Waterworks Company, a corporation of the state of Mississippi, filed, in February, 1901, in the circuit court of the United States for the southern district of Mississippi, a bill of complaint against the mayor and aldermen of the city of Vicksburg, a municipal corporation of Mississippi. To this bill the city filed a demurrer and certain special pleas, and subsequently moved the court for leave to withdraw the demurrer and pleas, and for leave to file an answer alleging that said answer embodied all the matters of defense which were set forth in said pleas and demurrer, and also a motion to dissolve a temporary injunction which had been theretofore granted. On July 1, 1901, the court entered the following order: "Coming on to be heard the motion to dissolve the injunction herein, and the defendant now having moved the court for leave to file the answer herewith presented and marked by the clerk as filed June 21, 1901, and to withdraw the pleas and demurrers filed April 30, 1901, it is ordered that leave be granted to file said answer and withdraw said pleas and demurrers, but that the question of the jurisdiction of this court to hear the matter in controversy, raised by said answer, shall be first presented and argued.” On July 3, 1901, the complainant moved the court to "require defendant to elect on which plea it will stand, whether on demurrer to the whole bill or on the answer." This motion was overruled, and on July 3, 1901, the court entered the following order and decree: On the same day an appeal was allowed to this court, and on July 4, 1901, the following certificate was signed by the trial judge and filed: "The final decree having been entered herein on the 3d day of July, 1901, dismissing this suit and the bill, and amended and supplemental bill therein, now, therefore, of the 5th section of the act of Congress, apthis court, in pursuance of the 2d paragraph proved March 3, 1891, and entitled 'An Act to Establish Circuit Courts of Appeal, and to Define and Regulate in Certain Cases the Jurisdiction of the Courts of the United States, and for Other Purposes,' hereby Mr. James A. Carr submitted the cause for appellant. Messrs. S. S. Hudson and A. N. Edwards were with him on the brief: Whether the obligation of a contract has or has not been impaired is a Federal question, if the pleading presents a substantial controversy. ty years, or to own or acquire waterworks of its own, except as therein provided. "This cause coming or to be heard upon Southern P. R. Co. v. California, 118 U. the motion to dissolve the injunction here- S. 109, 30 L. ed. 103, 6 Sup. Ct. Rep. 993. tofore issued in this cause, and the court By entering into the thirty years' connow being advised in the premises, and it tract the city was precluded from constructappearing that there is no Federal questioning waterworks of its own during the thir[67]involved in the controversy presented by the pleading, it is therefore ordered, adjudged, and decreed that said injunction be, and the same is hereby, dissolved, and that the bill of the complainant be, and the same is hereby, dismissed, and that execution issue therefor for the cost in the case." 185 U. S. U. S., Book 46. Grant v. Denver, Fed. Feb. 1901; Walla Walla v. Walla Walla Water Co. 172 U. S. 10, 43 L. ed. 345, 19 Sup. Ct. Rep. 77. Without a reservation of the right to regulate the time and rates, it cannot be done 51 809 |