Source: https://caselaw.findlaw.com/us-supreme-court/227/150.html
Timestamp: 2019-04-20 21:17:29+00:00

Document:
[227 U.S. 150, 151] Messrs. William d. guthrie and Wallace McCamant for plaintiff in error.
[227 U.S. 150, 154] Mr. A. M. Crawford, Attorney General of Oregon, and Messrs. Martin L. Pipes and George J. Cameron for defendant in error.
This was a criminal prosecution in the state of Oregon, instituted by an information charging the defendants, of whom the plaintiff in error was one, with having converted to their own use a large sum of money belonging to the state's irreducible school fund, agricultural college fund, and university fund, collectively spoken of as educational funds, then held for safe-keeping in a bank of which the defendants were in control as its officers and directors. Upon a separate trial of the plaintiff in error he was convicted and sentenced to a term of imprisonment and to pay a fine. An appeal to the supreme court of the state resulted in the elimination of the fine and in the [227 U.S. 150, 156] affirmance of the judgment in other respects. 55 Or. 450, -- L.R.A.(N.S .) --, 104 Pac. 596, 106 Pac. 1022. The plaintiff in error then brought the case here, claiming that rights secured to him by the Constitution of the United States, and specially set up in the supreme court of the state, were denied by the judgment of affirmance.
Briefly outlined, the case, as we must take it to be, is as follows: In June, 1907, the bank became an 'active depository' under a statute of the state presently to be mentioned, and thereupon an account was opened with the bank as such depository in the name of the state treasurer, with the added designation, 'educational.' The deposits going into the account consisted of checks and drafts belonging to the state's educational funds, and the money collected by the bank on these checks and drafts, less what was drawn out by the state, amounted on November 6, 1907, to $288,426.87. On that day the bank failed, and it was then disclosed that on August 21 the total cash in the bank was $296.19 short of the amount called for by the account, and that this shortage had continued and increased until the day of the failure, when it reached $274,882.73. The defendants had not literally appropriated any of the money to their personal use, but, knowing that it belonged to the state's educational funds, and was received and held by the bank as an active depository, had permitted it to be commingled with other deposits and funds, and had sanctioned its use in paying liabilities of the bank.
The common school fund and the irreducible school fund appear to have been identical. Or. Laws 1907, chap. 117, 36. [227 U.S. 150, 158] duty of such active depository to collect the same without delay, without charge for its services for such collection, or for exchange, and to notify the state treasurer when collected. The compensation to be paid by such active, depository shall be fixed by the state treasurer upon the best terms obtainable for the state.' The words 'funds' particularly defined in 16, as before quoted, was not used in any of the sections having special relation to the active depository.
After that decision, and before the transactions here in question, the depository act was passed and put in force, but its construction and operation were not determined by the supreme court of the state until it passed upon the case at bar. It was then held (a) that the act made provision for general depositories, wherein moneys of the state, not belonging to the educational funds, were to be placed as general deposits, with the right in the depository to comingle them with other deposits and to loan them in the usual course of business, and with an absolute obligation on the depository to pay interest on them at not less than 2 per cent per annum; (b) that the act also made provision for an active depository for the collection of checks, drafts, and the like, belonging to any state fund, whether educational or otherwise, and the safe-keeping of the proceeds, subject to the treasurer's order, but with no right in the depository to commingle them with other deposits or to loan them, and with no specific or absolute obligation on the depository to pay interest thereon; (c) that by contrasting the provisions relating to general depositories with those relating to the active depository it was evident that deposits in the latter, unlike deposits in the former, were to be special, the title not passing to the depository, but remaining in the state; and (d) that the act operated, and the legislature intended, to take the educational funds out of the custom or right of the treasurer to make general deposits which was recognized in Baker v. Williams Bkg. Co. supra. Then, coming to apply the act, as so construed, together with 1807, to the facts of the case as reflected by the verdict of the jury, it was further held (1) that the bank held the money as a special deposit, the title being in the state; (2) that the* [227 U.S. 150, 160] defendants, being in control of the bank as its officers and directors, and knowing of the deposit, were to be regarded as having the money in their possession within the meaning of 1807; (3) that the commingling of the money with other deposits and the using of it in paying liabilities of the bank constituted an unlawful appropriation of it; (4) that as the defendants, as controlling officers and directors of the bank, sanctioned that appropriation, knowing that the money belonged to the educational funds of the state and was held by the bank as an active depository, they thereby converted the money to their own use within the meaning of 1807, even although the appropriation was for the benefit of the bank, and not of themselves personally.
The record shows that the plaintiff in error contended in the supreme court of the state that the depository act was not reasonably susceptible of the construction ultimately adopted, and that to put such a construction upon it would be violative of the prohibition in the Constitution of the United States against ex post facto state laws. Both phases of the contention were denied, the second necessarily failing with the first, and the plaintiff in error now assigns error upon that holding, and complains that it deprived him of a right secured by the Constitution.
But that provision of the Constitution, according to the natural import of its terms, is a retraint upon legislative power, and concerns the making of laws, not their construction by the courts. It has been so regarded from the beginning. In Calder v. Bull, 3 Dall. 386, 1 L. ed. 648, one of the first cases in which the provision was considered, it was spoken of as reaching legislative, but not judicial, acts; and in Fletcher v. Peck, 6 Cranch, 87, 138, 3 L. ed. 162, 178, Chief Justice Marshall said of it: 'In this form the power of the legislature over the lives and fortunes of individuals is expressly restrained.' True, neither of those cases turned upon the question whether the words 'no state shall pass a law' embrace a decision of a court construing a statute, but that question was both presented and decided in Commercial Bank v. Buckingham, 5 How. 317, 12 L. ed. 169. There the supreme court of Ohio, in an action upon a contract, had put upon two pre-existing statutes of the state a construction which was claimed to be unreasonable and to impair the obligation of the contract, and it was sought to have that decision reviewed by this court on the ground that it denied a right secured by the Constitution of the United States. But the writ of error was dismissed for want of jurisdiction, because, as was said in the opinion (p. 342): 'If this court were to assume jurisdiction of this case, it is evident that the question submitted for our decision would be not whether the statutes of Ohio are repugnant to the Constitution of the United States, but whether the supreme court of [227 U.S. 150, 162] Ohio has erred in its construction of them. It is the peculiar province and privilege of the state courts to construe their own statutes; and it is no part of the functions of this court to review their decisions or assume jurisdiction over them on the pretense that their judgments have impaired the obligation of contracts. The power delegated to us is for the restraint of unconstitutional legislation by the states, and not for the correction of alleged errors committed by their judiciary.' A like question was presented, and similarly disposed of, in New Orleans Waterworks Co. v. Louisiana Sugar Ref. Co. 125 U.S. 18, 30 , 31 S. L. ed. 607, 612, 8 Sup. Ct. Rep. 741, where it was said: 'In order to come within the provision of the Constitution of the United States which declares that no state shall pass any law impairing the obligation of contracts, not only must the obligation of a contract have been impaired, but it must have been impaired by a law of the state. The prohibition is aimed at the legislative power of the state, and not at the decisions of its courts, or the acts of administrative or executive boards or officers, or the doings of corporations or individuals.' And in Brown v. Smart, 145 U.S. 454, 458 , 36 S. L. ed. 773, 775, 12 Sup. Ct. Rep. 958, where a decision of the court of appeals of Maryland, expounding a statute of that state, was challenged as impairing the obligation of a contract made after the statute came into existence, it was held that the decision 'was not a law' within the meaning of the provision against the impairment of contractual obligations by state laws. Many other cases give effect to this ruling, but it will suffice to cite, from among them, Central Land Co. v. Laidley, 159 U.S. 103, 109 , 40 S. L. ed. 91, 93, 16 Sup. Ct. Rep. 80; Bacon v. Texas, 163 U.S. 207, 220 , 41 S. L. ed. 132, 137, 16 Sup. Ct. Rep. 1023; Hanford v. Davies, 163 U.S. 273, 278 , 41 S. L. ed. 157, 159, 16 Sup. Ct. Rep. 1051; Turner v. Wilkes County, 173 U.S. 461 , 43 L. ed. 768, 19 Sup. Ct. Rep. 464; Cross Lake Shooting & Fishing Club v. Louisiana, 224 U.S. 632, 638 , 56 S. L. ed. 924, 927, 32 Sup. Ct. Rep. 577.
The plaintiff in error cites the cases of Kring v. Missouri, 107 U.S. 221 , 27 L. ed. 506, 2 Sup. Ct. Rep. 443; Muhlker v. New York, & H. R. Co. 197 U.S. 544 , 49 L. ed. 872, 25 Sup. Ct. Rep. 522; Louisiana v. Pilsbury, 105 U.S. 278 , 26 L. ed. 1090; Gelpcke v. Dubuque, 1 Wall. 175, 17 L. ed. 520, and Butz v. Muscatine, 8 Wall. 575, 19 L. ed. 490, as holding that a judicial decision may be a law in the sense of the constitutional provision which he invokes. But none of those cases, when rightly considered, sustains that position. The first was a criminal case in which a provision in a new constitution was held to be an ex post facto law as to an offense theretofore committed; the second presented the question whether a state statute of 1892 impaired contractual obligations [227 U.S. 150, 164] created by deeds of a much earlier date; the third and fourth were explained in Central Land Co. v. Laidley, 159 U.S. 103, 111 , 112 S., 40 L. ed. 91, 94, 95, 16 Sup. Ct. Rep. 80; Bacon v. Texas, 163 U.S. 207 , 221- 223, 41 L. ed. 132, 137, 138, 16 Sup. Ct. Rep. 1023, and Turner v. Wilkes County, 173 U.S. 461 , 43 L. ed. 768, 19 Sup. Ct. Rep. 464, and were there shown not to be in conflict with other cases on the subject, and the fifth is in no wise distinguishable from the fourth.
We conclude that no Federal right was involved in the ruling respecting the construction struction of the depository act.
The prosecution was instituted by an information conformably to a law of the state in force at the time. Bellinger & C. Anno. Codes & Statutes, 1258. Following the judgment of conviction, and while the case was pending on appeal, a constitutional amendment was adopted, declaring: 'No person shall be charged in any circuit court with the commission of any crime or misdemeanor defined or made punishable by any of the laws of this state, except upon indictment found by a grand jury.' [Or. Const. art. 7, 18.] The plaintiff in error thereupon advanced the contention that the constitutional amendment worked a repeal of the statute under which the information was filed, and made it impossible to enforce the judgment against him without depriving him of his liberty without due process of law, contrary to the 14th Amendment to the Constitution of the United States. The state court ruled that the amendment to the state Constitution was prospective and did not affect pending cases. Error is now assigned upon that ruling. But it involved nothing more than the construction of the constitutional amendment, which was a question of local law, and its decision by the state court is not reviewable here.
As the record presents no Federal question, we are without jurisdiction to review the judgment, and therefore cannot enter into the merits of the questions that were presented and determined in the state court.

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