BOOKS AND PERIODICALS.

1. LEADING LEGAL ARTICLES.

FEDERAL SUPERVISION OF INSURANCE. A new subject for the application of the power of Congress to regulate interstate commerce is suggested by the recommendation of a federal statute regulating insurance, which was made by a special committee at the last meeting of the American Bar Association. Report of the Committee on Insurance Law.1 Four of the committee's five members joined in the majority opinion, while the fifth presented a minority report. Neither report was acted upon by the association, but a resolution declaring the opinion that federal control of insurance would be unconstitutional was referred to the Committee on Insurance Law for the present year.

The members of the committee, while unanimous in the opinion that Congressional regulation is desirable and practicable, disagree upon the question of its constitutionality. The majority report maintains that the past decisions of the United States Supreme Court do not exclude the business of insurance from the definition of "commerce," and intimates that Congress itself has the exclusive power to determine what articles are the subjects of interstate commerce within the meaning of the constitutional provision. The minority opinion denies both these propositions, and insists that federal supervision is impossible without a constitutional amendment.

The statement that Congress has authority to define the limits of its power to regulate interstate commerce, which is at least startling, suggests an examination of the authorities upon which it purports to be based. The majority rely upon isolated sentences quoted from decisions which denied to a state the power to exclude from its boundaries intoxicating liquors in the original packages. The language of these cases is clearly shown by the context to mean that Congress, as against the asserted police power of a state, has authority to determine whether commodities which are admittedly in fact subjects of commerce within the meaning of the constitutional clause, shall be lawful articles of commerce. Further support for the committee's position is sought in the famous case of McCulloch v. Maryland (4 Wheat. [U. S.] 316). This decision, however, was simply to the effect that Congress has the implied power to charter a national bank as an appropriate means to the execution of its admitted fiscal powers; and the opinion contains no intimation that Congress has authority to define the limits of the great substantive and independent powers, to which the power of choosing appropriate means of execution was held to be annexed as an incident. The authorities cited do not deny that the meaning of the term "commerce " in the constitutional phrase is a question of the interpretation of a written instrument which is to be made by judicial decision, and not by legislative fiat.

The majority's contention, that past decisions furnish no obstacle to federal regulation of insurance, is true only to the extent that the Supreme Court has never passed upon the validity of an act of Congress regulating insurance. It has, however, frequently held constitutional state statutes which totally exclude foreign insurance companies from doing business within state territory except upon condition that they obtain a license from the state or pay a tax upon the amount of premiums secured in the state. Paul v. Virginia, 8 Wall. (U. S.) 168, 183; Liverpool Ins. Co. v. Massachusetts, 10 Wall. (U. S.) 566, 573. The contention that these decisions have not excluded insurance from the definition of "commerce cannot be supported except upon the assumption that the statutes affected only matters local and limited in their nature, which state legislatures may regulate in the absence of legislation by Congress. But the

1 Published in pamphlet form by the American Bar Association, Baltimore.

opinions, so far from being rested upon this narrow ground, have specifically stated that insurance is not 66 commerce within the meaning of the constitutional provision. Furthermore, if insurance were "commerce," state statutes exacting a tax or license from foreign insurance companies as conditions precedent to their doing business within the state, could not be sustained consistently with the line of decisions which hold invalid identical statutes concerning express companies and railroads. Cf. Crutcher v. Kentucky, 141 U. S. 47; Hooper v. California, 155 U. S. 648, 653; Nutting v. Massachu setts, 183 U. S. 553, 556. In each class of cases the state is not legislating concerning merely local subjects, but is interfering directly with the freedom of interstate business; in each the interference is sought to be justified by the right to exercise police powers. The only valid distinction between the two classes of statutes is that one does, and the other does not, attempt to regulate commerce." The recent decision concerning lottery tickets, which is cited in the majority report holds, not that lottery companies are engaged in "commerce," but that the carrying of lottery tickets by an express company is commerce. Lottery Case, 188 U. S. 321, 354. This opinion, from which four justices dissented, can hardly be said to have weakened the authority of the earlier cases recognizing the power of a state to regulate insurance. A reversal of these decisions could be justified only upon the ground that a radical change in the nature of the business of insurance has occurred since they were rendered; and on principle it seems difficult to distinguish the present business of insurance from that of the negotiation of any contract by mail between parties residing in different states.

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DISHONOR OF A CERTIFIED Check. It is common belief that a bank is under an absolute obligation to pay a check certified at the instance of the payee as long as the check remains in his possession, and that the payee, questions of forgery aside, has an irrevocable right to compel payment, irrespective of the circumstances under which he procured the check. MORSE, BANKS AND BANKING, 4th ed., § 414. While admitting this as a general principle, a late article by an anonymous writer suggests that the bank, under certain circumstances, is justified in refusing to honor the check. Stopping Payment of a Certified Check, 22 Bank. L. J. 411 (June, 1905). It is, of course, assumed that the check has not reached the hands of a bona fide purchaser for value. The author points out that a certified check is analogous to a promissory note of the bank, and that a bank does right in refusing to pay its bank note held by a thief. Olmstead v. Bank, 32 Čonn. 278. Therefore, under like conditions, it should also be protected in its refusal to pay a certified check; and it is contended that the same power should exist when the bank has notice that the check was obtained by the payee through fraud on the maker, or as payment for an illegal transaction, such as gambling, in which both maker and payee were concerned.

Though the writer does not support his view by any theoretical discussion, his result appears to be substantially correct. On certification the practice is for the bank to debit immediately the amount of the check to the maker's account, and credit its "certified check account," which is in turn debited with the check on payment. The drawer being thus effectually deprived of all control over that amount of his earlier credit, a novation arises, by which the bank promises the drawer to pay the payee, in consideration of the drawer's giving up all claim on it. As the act of certification is merely a short cut for actual payment by the bank of the amount of the check, and its redeposit by the payee, the payee, as consideration for the bank's promise, accepts the extinction of the check and allows the money to remain on deposit. Finally, the novation is completed by the payee's promise to accept the bank as debtor in the drawer's place, for which the latter promises to release his claim against the bank. A certified check is, then, like a bank note - the maker is released, and the bank is bound directly to the payee.

When fraud becomes an element of the situation, however, the ordinary rule, founded on equitable principles, permitting the defrauded party to trace and recover his property, must apply. 2 PARSONS, CONTRACTS, 9th ed., 949. Thus in the case of a certified check in the hands of a fraudulent payee, the maker has a right to recover it, and the payee holds it in constructive trust for him. See 19 HARV. L. REV. 55. If the bank has knowledge of the facts, it would seem proper not only that it should have the right not to honor the check, but that it should be liable to the maker, if it does honor it. That the payee has turned penitent when he asks the bank to pay the check, and is about to reimburse the maker, is highly improbable, and payment by the bank, with knowledge of these circumstances, is an equitable tort against the maker, an injury to his beneficial interest in the check, the res, such as to make the bank liable to him, as cestui, for its connivance at the breach of the constructive trust. Cf. 19 HARV. L. REV. 68. Where the payee has been guilty of theft, the same constructive trust relationship would arise; but it is difficult to find the basis on which the drawer could urge any equitable claim where he and the payee are confederates in illegality. In such a case the maker, since he is in pari delicto with the payee, is in no position to claim any equity in his own favor. See McCord v. Bank, 96 Cal. 197.

DEPENDENT SERVICES OF COMMON CARRIER. In the general development of the law of public-service companies, certain phases of the subject have received inadequate treatment by courts and text-writers. One of these relates to the dependent services of common carriers. A recent article by Professor Wyman furnishes an admirable discussion of the question, not only collating the leading cases on the points involved, but working out a consistent theory by which to test the conflicting decisions. The Public Duty of the Common Carrier in Relation to Dependent Services, by Bruce Wyman, 17 Green Bag 570 (Oct., 1905). The subject involves the relations of railroads to express companies, palace and refrigerator car companies, hackmen at railway stations, transfer companies, etc. The authorities seem to be about equally divided, and as the question has been passed upon as yet in less than half of the States of the country, the subject is a fruitful one for discussion.

The case of the express companies may be taken as typical. Is the carrier bound to furnish express facilities to all express companies which apply, or may it make an exclusive agreement with one company for the carriage of all express matter over its line? The carrier's responsibility is founded on its public duty. It seems that it owes no direct duty to the express companies, for it might, ultra vires aside, carry on an express business itself and shut out all express companies from its line. Moreover, it has never held itself out as a carrier for all express companies. Historically the relation has always been based on contracts with individual companies. Its duty is to the shipping public to carry all express matter from one end of its rails to the other. If none of the law of public service applies between the carrier and the express company, however, it follows, argues Professor Wyman, that the latter may be charged extortionate prices by the carrier, which in turn will react upon the public. The express company is itself a common carrier, and therefore bound to carry at a reasonable rate; but this duty is relative, and if it must pay an increased price, it may charge it against the public as a necessary operating expense. To protect the public from such a result the author submits that we must apply the law of public service companies throughout. To insure the public the satisfactory service at a reasonable rate, to which it is undoubtedly entitled, we must hold that the carrier performs its whole duty only by serving all express companies with adequate facilities, without discrimination and for a fair compensation.

It may be argued, however, that since the railroads' only duty is to the public, so long as the public are served to their reasonable satisfaction, it is a

matter of no importance as to the particular agency through which this is accomplished. Sargent v. Boston, etc., R. R., 115 Mass. 416. This doctrine has received the approval of the United States Supreme Court. The Express Cases, 117 U. S. 1. On strict legal theory it seems difficult to escape the result reached. Moreover, it does not seem that it allows the exploitation of the public. For if the railroad is under a duty to carry at a reasonable rate, it cannot escape this obligation by delegating the performance of it. Whether it chooses to act through one express company or several, the public may still enforce its right to a reasonable rate from the road. The case does not seem to present any insuperable practical difficulty, as the public may work out its rights as to the transportation of express matter along lines similar to those followed as to the carriage of freight. Professor Wyman's remedy is open to objection from a practical standpoint, in that it would tend to increase through the wastes of competition the reasonable rate which the public must pay.

ALIEN LABOR LEGISLATION AND THE COURTS. Henry A. Prince. 41 Can. L. J. 628. CHRISTIAN SCIENTISTS AND THE LAW. Walter Mills. Demanding that they be treated as physicians in so far as to place them under the Medical Acts. 4 Can. L. Rev. 435.. COMPARATIVE STUDY OF THE CONSTITUTIONS OF THE UNITED STATES OF MEXICO AND THE UNITED STATES OF AMERICA, A. William H. Burges. Stating and contrasting seriatim the provisions of the Constitutions of the two countries. 39 Am. L. Rev. 711.

DISTINCTION BETWEEN REAL AND PERSONAL PROPERTY, THE. T. M.

Advocat

ing the abolition of the distinction between realty and personalty save in so far as inherent in the nature of things. 9 L. Notes (N. Y.) 125. EXCLUSION AND DEPORTATION OF ALIENS. Parliamentum. Considering whether an act to return an alien " to the country whence he came is extra-territorial in effect. 25 Can. L. T. 487.

EXCLUSIVENESS OF THE POWER OF CONGRESS OVER INTERSTATE AND FOREIGN COMMERCE. I, II. James S. Rogers. 53 Am. L. Reg. 529, 593.

EXIT OF THE DOCTRINE OF SITUS. John R. Rood. A favorable comment upon the recent decision of Harris v. Balk, 25 Sup. Ct. Rep. 625, holding that where a debtor is garnisheed while temporarily within a foreign state and compelled to pay the debt, such payment furnishes a defense to a subsequent action by his creditor in the state where the debt was created. 61 Cent. L. J. 265.

FEDERAL SUPERVISION OF INSURANCE. Anon. 9 L. Notes (N. Y.) 123. JURISDICTION RATIONE ORIGINIS. George Duncan. Arguing that a Scottish domicile and personal citation will give jurisdiction against a defendant living outside of Scotland, in a petitory action. 17 Jurid. Rev. 254.

LEGITIMATE FUNCTIONS OF JUDGE-MADE LAW. Hannis Taylor. An historical sketch of the importance of case law in supplementing constitutions and codes and in adapting them to changed conditions of society. 17 Green Bag 557. PROCESS TO STOP THE RUNNING OF THE STATUTE OF LIMITATIONS, OF. Anon. 49 Sol. J. 721, 733, 741, 748, 757.

PUBLIC DUTY OF THE COMMON CARRIER IN RELATION TO DEPENDENT SERVICES. Bruce Wyman. 17 Green Bag 570. See supra.

STOPPING PAYMENT OF A CERTIFIED CHECK. Anon. 22 Bank. L. J. 411. See supra.

TREATIES AND EXECUTIVE AGREEMENTS. John Bassett Moore. Pointing out distinctions to be observed when the question arises, whether ratification by the Senate is necessary. 20 Pol. Sci. Quar. 385.

WHERE THERE IS A BREACH OF CONTRACT WHICH MAY BE REGARDED AS TOTAL, IS THE INJURED PARTY PREVENTED FROM RECOVERING FUTURE DAMAGES, BY BRINGING AN ACTION ONLY FOR PAST DAMAGES, WHERE THE TIME for FULL PERFORMANCE HAS NOT ARRIVED? Anon. Criticising a New York case which held that injured party could not recover future damages. 61 Cent. L. J. 281.

II. BOOK REVIEWS.

CONSTITUTIONAL LAW OF ENGLAND. By Edward Wavell Ridges. London: Stevens & Sons, Limited. 1905. pp. xxxii, 458. 8vo.

This is a book of the hour, inspired by the two great issues that engross the attention of the thinking classes in England at the present moment, imperial federation, political and commercial. The author evidently has these matters very much at heart and has written with the aim of furnishing all those who have the same interest a practical handbook enabling them to post themselves rapidly on any of the numerous details of the constitutional mechanism that holds together the complex political entity known as the British Empire. In other words, it would be useless to turn to it for a careful exposition of the evolution of the constitution as it exists to-day, or again for a broad and philosophic treatment of constitutional questions such as we might expect from Mr. James Bryce. Mr. Ridges' aim is closely circumscribed by existing conditions; his method is too handbooky, if the term may be used, to permit digressive and comparative disquisitions.

Within the limits he has chosen Mr. Ridges does his work well. He divides and subdivides his subject clearly, and details are easy to find. He has six principal parts: 1, The Nature and Sources of English Constitutional Law; 2, The Legislature and the Public Revenue; 3, The Executive; 4, The Judiciary; 5, The Church; the Navy and the Army; 6, Countries subject to the laws of England. Within these parts are chapters and sections that range in matter from Wei-Hai-Wei to the Isle of Man, from the Indian Civil Service to the Court of Pied Poudre, and from the origin of the title of Duke to the incidence of the death duties.

Mr. Ridges attains a good standard of accuracy; among his infrequent slips the following may be noted. In Miller's case (p. 70) Wilkes was not, as stated, committed to the Tower. He refused to appear before the House of Commons except as member for Middlesex, and the House shirked the fight and let him go. George III. presided over a Cabinet Council on at least one occasion, and it is incorrect to say (p. 143) that "since the reign of George I the Crown has ceased to attend meetings of the Cabinet." At p. 15 there is a bad error in the number of States composing the American Union. Mr. Ridges defines constitutional law as embracing laws proper and conventions. These conventions he groups under eleven heads, the last two of which appear open to some exception. These two constitutional conventions are thus stated:

"(10) The foreign policy of the country ought to be conducted according to the wishes of the two Houses of Parliament, and in case of difference between the Houses, in accordance with the wishes of the House of Commons.

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"(11) Declaration of war or peace against the will of the House of Commons is unconstitutional. In cases of sudden emergency (e. g. insurrection or invasion), if the Ministry require additional authority, they should convene Parliament."

Now if a convention means an actual tacit understanding, then surely Mr. Ridges goes too far in trying to make the ultimate power of the electorate anything more than a potential factor in this case. The attitude of the House of Commons towards the conduct of foreign affairs has long been one into which an element of self-effacement has entered. The Crown has continued to exercise a large amount of discretion, whether acting on its own initiative or on the advice of ministers. Not only is it the case that treaties implying war or concluding peace are constitutionally valid without reference to Parliament, but the House of Commons has rarely, if ever, shown any disposition to assert any greater right in such a case than that which it holds in every case of passing a hostile vote against the responsible Ministry. It might even be said that under the last two British sovereigns, Victoria and Edward, the House of Commons has viewed with complacency the personal intervention of the sovereign on more than one occasion. In another important question, that of imperial federation,