The Federal Courts, Localism, and the National Economy, 1865–1900

Business History Review

Volumn 53, Issue 3, 1979, Pages 343-363

  Freyer, Tony A ^a  

^a UNIVERSITY OF ARKANSAS AT LITTLE ROCK   (United States)

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EID: 84975988184     PISSN: 00076805     EISSN: 2044768X     Source Type: Journal    
DOI: 10.2307/3114090     Document Type: Article

References (43)

1. Samuel P. Hays, The Response to Industrialism, 1885–1914 (Chicago, 1957); Robert H. Wiebe, The Search for Order, 1877–1920 (New York, 1967); Ray Ginger, Age of Excess: The United States from 1877 to 1914 (New York, 1975); Ida M. Tarbell, The Nationalization of Business, 1878–1898 (Chicago, 1971); Glenn Porter, The Rise of Big Business, I860 1910 (New York, 1973); Edward C. Kirkland, Industry Comes of Age: Business, Labor, and Public Policy 1860–1897 (Chicago, 1961); and especially, Alired D. Chandler, Jr., “The Beginnings of ’Big Business’ in American Industry,” Business History Review, XLIII (Spring, 1959), 3–31.
2. Hays, Response to Industrialism, 158–162; Weibe, Search for Order, 80–83, 291–295; Ginger, Age of Excess, 110, 116, 264–266, 303–307; Tarbell, Nationalization of Business, 97, 100, 105, 139, 217–218; Arnold Paul’s The Conservative Crisis and the Rule of Law (Los Angeles, 1960) is the best statement by a constitutional historian of this view. And two valuable studies treating the commerce power and the Fourteenth Amendment are John P. Roche’s “Entrepreneurial Liberty and the Fourteenth Amendment,” Labor History, VII (Winter 1963), 3–31, and “Entrepreneurial Liberty and the Commerce Power; Expansion, Contraction, and Casuistry in the Age of Enterprise,” University of Chicago Law Review, XXX (Spring 1963), 680–703. See also, Wallace Mendelson, Capitalism, Democracy, and the Supreme Court (New York, 1960), Arthur S. Miller, The Supreme Court and American Capitalism (New York, 1968).
3. Although their focus is neither localism nor congressional politics, studies by several legal-economic historians suggest useful alternative approaches to Paul and others. See Charles W. McCurdy, “Justice Field and the Jurisprudence of Government-Business Relations: Some Parameters of Laissez-Faire Constitutionalism, 1863–1897,” Journal of American History, LXI (March 1975), 970–1005; James W. Hurst, Law and the Conditions of Freedom in the Nineteenth-Century United States (Madison, 1956); and, especially, Harry N. Scheiber, “Federalism and the American Economic Order, 1789–1910,” Law & Society Review, X (Fall 1975), 57–118. For an interesting case study see Albro Martin, “Railroads and the Equity Receivership: An Essay on Institutional Change,” The Journal of Economic History, XXXIV (September 1974), 685–709.
4. Felix Frankfurter and James M. Landis, The Business of the Supreme Court: A Study in the Federal Judicial System (New York, 1928), 86–93, 134–145, was a pioneering study of reform of federal judicial administration. The thrust of the present study is to reconsider the work of Frankfurter and Landis in a broader context and thus to suggest conclusions relevant to the general history of the period.
5. Frederick Emory Haynes, “The New Sectionalism,” Quarterhj Journal of Economics, X (April 1896), 265–295; J. P. Dunn, Jr., “The Mortgage Evil,” Political Science Quarterly, V (March 1890), 64–83. Note that the following come from weekly news journals in which topics were untitled and often grouped under some general title such as “Corporate News.” Also, I have used the short form of Central Law Journal (CLJ) and Railroad and Corporation Law Journal (RCLJ) throughout this study: RCLJ, I (January 1889), 21, 26–27; RCLJ, I (May 1887), 456; RCLJ, II (December 1887), 527; RCLJ, III (June 1888), 576; RCLJ, II (November 1887), 456; RCLJ, V (February 1889), 188; RCLJ, V (June 1889), 596; RCLJ, IX (March 1891), 220; RCLJ, IX (April 1891), 279; CLJ, IX (August 1879), 160; see also note 13.
6. William H. Taft, “Criticisms of the Federal Judiciary,” American Law Review, XXIX (September-October 1895), 651.
7. RCLJ, II, (November 1887), 456.
8. Thomas C. Cochran, Railroad Leaders, 1845–1890: The Business Mind in Action (Cambridge, 1953), 184–185; Cochran, Business in American Life: A History (New York, 1972), 196; Robert D. Marcus, Grand Old Party: Political Structure in the Gilded Age, 1880–1896 (New York, 1971), 50–53, 153, 195, 256, 263; Edward C. Kirkland, Dream and Thought in the Business Community 1860–1900 (Ithaca, 1956), 135; Kirkland, Men, Cities, and Transportation: A Study in New England History, 1820–1900 (Cambridge, Mass.,1918), 19; Frankfurter and Landis, Supreme Court, 65, 89, 90, 292.
9. Kirkland, Dream and Thought, 135; Marcus, Old Party, 50–53, 153, 195, 256, 263.
10. As quoted in Marcus, Old Party, 51.
11. As quoted in Kirkland, Dream and Thought, 135.
12. RCLJ, I (January 1887), 26–27; and for other examples of local sentiment see, “Memorial from Iowa Legislature,” 15 Congressional Record, Part 3, 1st, sess., 2917, 2939, 2955; Taft, “Criticism of Federal Judiciary,” American Law Review, XXIX (September-October 1895), 643–644; Edward McGrady, “Reorganization of the Federal Courts,” CLJ, III (May 1876), 311.
13. CLI, XVIII (April 1884), 281–282; RCLJ, VII (April 1890), 282.
14. See Tony Freyer, “Unity From Diversity: Commercial Stability and Swift v. Tyson (1842)” (Doctoral Dissertation, Indiana University, 1975), 197–198 for citations and discussion.
15. RCLJ, I (January 1887), 21.
16. “Township Bonds,” Monthly Western Jurist, I (April 1875), 558–560; CLJ, I (July 1874), 359; CLJ, II (January 1875), 34; CLJ, V (October 1877), 499; CLJ, VIII (January 1879), 3–5; CLJ, IX (August 1879), 160; CLJ, I (March 1874), 123; CLJ, III (May 1876), 338; CLJ, VII (October 1878), 262–264, 321–322; CLJ, VIII (April 1879), 323; CLJ, X (March 1880), 194; CLJ, XII (January 1881), 36; CLJ, I (May 1874), 225.
17. Simon Fleishmann, “The Influence of the Bar in the Selection of Judges Throughout the United States,” American Law Review, XXXIX (May-June 1905), 354, 356; Cochran, Business in American Life, 196, and note 9. See also CLJ, I (October 1874), 486; CLJ, I (November 1874), 550; CLJ, III (July 1876), 443; CLJ, IV (January 1877), 73; CLJ, XV (August 1882), 81; CLJ, XV (September 1882), 221–222; CLJ, XXIII (September 1886), 242.
18. CLJ, X (January 1880), 17. For further discussion concerning the uncertainties of jury verdicts see: RCLJ, IX (June 1891), 461; “Jury Trials,” CLJ, II (April 1875), 261; CLJ, VI (March 1878), 240; “Unanimity of Juries,” CLJ, X (June 1880), 483–485; “Jury Trials in Civil Cases,” CJC, XXIII (October 1886). 361; “The Jury System,” CLJ, II (November 1875), 730. For the condition of tort law in America and its relation to the jury see Lawrence Friedman, A History of American Law (New York, 1973), 409–427. For the changing nature of the fellow-servant rule, and of negligence generally, see the three editions of the treatise, Thomas G. Shearman and Amasa A. Redfield, A Treatise on the Law of Negligence (New York, 1869, 1st ed.), 1–15, 65–128, 121; Shearman and Redfield, Law of Negligence (4th ed., 2 vols., New York, 1888) I, 1–24, 61–70, 230–249; Shearman and Redfield, Law of Negligence (6th ed., 3 vols., New York, 1913), I, 2–46, 104, 347–716, 685–688. In the 1888 edition the authors say, “It would be difficult to name any branch of the law which has had greater or more interesting growth during that last forty years, and especially during the last twenty” (iii).
19. B. Micharel Pritchett, “Northern Institutions in Southern Financial History: A Note on Insurance Investments,” Journal of Southern History, XLI (August 1975), 391. Fitz Hugh McMaster, Life Insurance Companies Should be Compelled to Invest in the Securities of those States in which the Funds Originate (1914), copy Library of Congress d am indebted to Professor Harry N. Scheiber for this source). Dunn, “Mortgage Evil,” Political Science Quarterly, V (March 1890), 64–83; Ginger, Age of Excess, 64–68. RCLJ, V (June 1889), 552, 596.
20. William Meade Fletcher, Cyclopedia of the Law of Private Corporations (8 vols., Chicago, 1917), VIII, 9442–9446; Gerard C. Henderson, The Position of Foreign Corporations in American Constitutional Law (Cambridge, Mass., 1918), 132–147.
21. Stanley C. Hollander, “Nineteenth Century Antidrummer Legislation in the U.S.,” Business History Review, XXXVIII (Winter 1964), 479. For the function of these agents see, Kirkland, industry Comes of Age, 264–266; Glenn Porter and Harold C. Livesay, Merchants and Manufacturers: Study in the Changing Structure of Nineteenth-Century Marketing (Baltimore, 1971).
22. Charles Warren, The Supreme Court in United States History (3 vols., Cambridge, Mass., 1923), II, 532. See also Freyer, “Unity From Diversity.”
23. George C. Holt, The Concurrent Jurisdiction of the Federal and State Courts (New York, 1888), 180–181; Shearman and Redfield, Law of Negligence (4th ed.), I, 230–429.
24. The principle of diversity jurisdiction was included in Article III of the Constitution and the Judiciary Act of 1789. Diversity applied to those cases in which the state or national citizenship of one party to a suit was different from the state or national citizenship of the other party. Under the Judiciary Act of 1789 cases in which diversity existed were removable from state courts under certain limited criteria. By 1875 the right of removal and the range of diversity jurisdiction was broadened. (See notes 33 and 34.) Swift v. Tyson, 18 Peters 1 (1842) established the doctrine. For discussion and sources concerning the legal and political implications of the doctrine and section 34 see Freyer, “Unity from Diversity,” 65–255, and esp., 189–91, 197–201. See also notes 24 and 25.
25. See citations and discussion in Freyer, “Unity from Diversity,” 1–27, 65–126, and also 65–255. William M. Meigs “Speech of Townshend of Illinois,” 15 Congressional Record, Part 6, 1st Session, Appendix, 360–366. See also notes below on judicial reform, CLJ, XVI (May 1883), 381. The cost is in 1875 dollars.
26. Frankfurter and Landis, Supreme Court, 61–64. See also Stanley I. Kutler, Judicial Power and Reconstruction Politics (New York, 1968). John F. Dillion, Renewal of Causes from, State Courts (St. Louis, 1889), 27–31, 32–39. Benjamin R. Curtis, Jurisdiction, Practice, and Peculiar Jurisprudence of the Courts of the United States (Boston, 1880), 109, 173; Anonymous, “Removal of Causes from State to Federal Courts,” Monthly Western Jurist, II (May 1875), 56–64; Freidman, American Law, 337; PYankfurter and Landis, Supreme Court, 65.
27. H.W.N., “Effect of Recent Act Increasing the Jurisdiction of the Federal Circuit Court,” CLJ, II (April 1875), 274–275; “An Act to Determine the Jurisdiction of the Circuit Courts of the United States, and to Regulate the Removal of Causes from State Courts, and for other Purposes,” Monthly Western Jurist, II (May 1875), 41–42; JNOF Kelly, “The Test of the Citizenship of a Corporation with the Judiciary Article of the Constitution of the United States and the Judiciary Acts,” CLJ, XIII (December 1881), 482 485; Dillion, Removal of Causes, 103–104; Henderson, Foreign Corporations, 77–99; Curtis, Peculiar Jurisdiction, 127, 132–135; see also note 32. The cases on the fiction, in addition to those given in note 33 are: Bank of the United States v. Devcau, 5 Cranch 61 (1809); Bank of Augusta v. Earle, 13 Peters 519 (1839); Louisville, Cincinnati, and Charleston Ry. Co. v. Letson, 2 Howard 497 (1844); (for how Lctson was modified see especially, Northern Indiana R.R. v. Michigan Cent. R.R., 15 Howard 233 [1854]; Marshall v. Baltimore and Ohio R.R., 16 Howard 314 (1854). For a thorough, though not unbiased, analysis of the fiction, see Dudley O. McGouney, “A Supreme Court Fiction: Corporations in Diverse Citizenship Jurisdiction of the Federal Courts,” Harvard Law Review, LVI (1943), 853–898, 1090–1124, 1225–1260.
28. Curtis, Peculiar Jurisdiction, 108; Frankfurter and Landis, Supreme Court, 1–45, 69; see also note 38. CLJ, VI (January 1878), 34–35.
29. Walter B. Hill, “Relief of Suitors in Federal Court,” Atlantic Monthly, LXVI (November 1890), 671–680; William Strong, “Relief for the Supreme Court,” North American Review, 151 (November 1890), 567–575; Alfred G. Coxe, “Relief of the Supreme Court,” VI, The Forum (February 1889), 567–578; “Report of the Committee on Federal Legislation,” VI, Report of the American Bar Association (May 1889), 69–98; W. H. Rossington, “Federal and State Jurisdiction,” V, Kansas Bar Association Report (January 1883), 34–53; R.C.M. “The Supreme Court of the United States and the Schemes for Relieving It,” II, Current Comment and Legal Miscellany (January 1890), 11–17; M. W. Fuller, “Annual Address,” X, Kansas Bar Association Proceedings (January 1887), 65–66; John M. Harlan, “The U.S. Supreme Court,” Chicago Legal News, XX (February 1888), 208; “Remarks of Chief Justice Waite,” XXXVI, Albany Law Journal (October 1887), 318; Robert M. Hughes, “Reorganization of the Federal Courts,” X, Vin’ginia Law Journal (April 1886), 193–200; Walter B. Hill, “The Federal Judicial System,” XII, American Bar Association Report (August 1889), 289–324; “Goodbar, White & Co., Tennent, Walker & Co., and other businessmen and merchants of Saint Louis, Mo.,” 15 Congressional Record, Part 5, 1st Session, 1884, 5171; “Board of Trade & Transportation of the City of Cincinnati,” 15 Cong. Rec, Part 5, 1st Sess., 1884, 5324; “Alms & Doepke of Cincinnati, Ohio,” 15 Cong. Rec, Part 5, 1st Sess., 1884, 5378; “Large number of businessmen, lawyers, and others in Toledo Ohio,” 15 Cong. Rec., Part 6, 1st Sess., 1884, 5469; “Diamond Match Co. of Akron, Ohio,” 15 Congress. Rec, Part 6, 1st Sess., 1884, 5513; John Shillito Co. of Cinn., Ohio,” 15 Cong. Rec, Part 6, 1st Sess., 1884, 5611; II, CLJ (January 1875), 2–3; II, CLJ (February 1875), 101–102, 180; II, CLJ (August 1875), 551–555; III, CLJ (February 1876), 68–70; III, CLJ (April 1876), 311; V, CLJ (October 1877), 337; VI, CLJ (January 1878), 34–35; XII, CLJ (January 1881), 25; XIII, CLJ (September 1881), 167–169; XIV, CLJ (May 1882), 381; XVI, CLJ (January 1883), 1–2; XVI, CLJ (May 1883), 381; XVIII, CLJ (October 1883), 281; XVII, CLJ (November 1883), 480; XVIII, CLJ (April 1884), 282; XX CLJ (March 1885), 241–242; XXIII, CLJ (September 1886), 242; XXV, CLJ (July 1887), 73–74; XXVIII, CLJ (February 1889), 129; Edward Cahill, “How can the Sunreme Court Docket be Relieved?” XXIX, CLJ (October 1889), 329–233; XXX, CLJ (April 1890), 297; “The New Federal Judiciary Act,” XXXII, CLJ (May 1891), 392–294; XXXIII, CLJ (July 1891), 1; II, RCL] (January 1887), 73?74; VI, RCLJ (December 1889), 462; IX, RCLJ (March 1891), 238.
30. “First Annual Message of Dec. 3, 1889,” as quoted; Felix Frankfurter and James M. Landis, The Business of the Supreme Court: A Study in the Federal Judicial System (New York, 1928), 97; XXI, CLJ (December 1885), 518.
31. The Davis Bill was first introduced in 1877 by David Davis (former justice of the U.S. Supreme Court turned Senator). The bill was discussed in CLJ, V (October 1877), 337. After nearly fifteen years of Congressional wrangling the bill, with few major changes, became law. The bill was reported in full in “The New Federal Judiciary Act,” CLJ, XXXII (May 1891), 392–394.
32. Dillion, Removal of Causes, 37, 58. See also note 32, 33, 34, 56.
33. Frankfurter and Landis, Supreme Court, 89–91.
34. 10 Congressional Record, Pt. 1, 2nd Sess., 850.
35. 10 Cong. Rec, Part 1, 2nd Sess. (1880), 724.
36. 10 Cong. Ree., Part 2, 2nd Sess. (1880), 1278.
37. 13 Cong. Ree., Part 4, 1st Sess. (1882), 336–337.
38. 14 Cong. Ree, Part 2, 2nd Sess. (1883), 1248, 1246.
39. See U.S. Statutes at Large, XXIV, 552, for Act of 1887 and the revised Act of 1888, U.S. Statutes at Large, XXV. 433. The provisions of the act were to increase jurisdictional amount from $500 to $2000 and to eliminate the right of the plaintiff to remove his case from state to federal court except where it could be proven conclusively that local prejudice was present. For the original bill proposed by Culberson, and the rejoinder from the Senate, see: 18 Cong. Rec, Part 1, 2nd Sess., (1887), 2542–46. See also, CLJ, XXIV (April 1887), 313; “Removal of Causes - Powers of State Courts,” CLJ, XXIV (May 1887), 435–436; Dillion, Removal of Causes, 40–49.
40. County of Yuba v. Pioneer Gold Mining Co., 32 1 Fed. Cases 183 (FCCND Calif., 1887), construed the act of 1887 very narrowly, so as to prevent virtually any removal. For comment on this decision see RCLJ, II (November 1887), 481. Almost immediately, however, the Yuba decision was disapproved of, and a broader interpretation established in the midwest circuits. See Bank of Winona v. Avery, 34 Fed. Cases 81 (1888); Tiffany v. Wilce, 34 Fed. Cases 230 (USCC Mich., 1888); Short v. Chicago; M & St. P.R.R., 34 Fed. Cases 225 (USCC Minn., 1888); Fales v. Chicago M. & St. P.R.R.; 32 Fed. Cases 673 (1887). For others see, Dillion, Removal of Causes, 47. For comment, see RCLJ, III (January 1888), 1–2.
41. Samuel Maxwell “Removal of Causes for Prejudice or Local Influence,” CLJ, XXVIII (January 1889), 113. See also E. F. Ware “Removal of Causes on Account of Prejudice or Local Influence,” CLJ, XXX (January 1890), 29–31.
42. Frankfurter and Landis, Supreme Court, 101–102. See also note 45 and notes 3 and 4. For growth of the Swift doctrines and the corporate fiction see Freyer, “Unity from Diversity,” 214–234, and note 34. There were numerous comments on Swift. See for example: George Wharton Pepper, The Border Land of Federal and State Decisions (Philadelphia 1889); William M. Meigs, “National Common Law,” Southern Law Review, VIII (December 1882), 414–493; Henry M. Mills, “Should Federal Courts Ignore State Laws,” American Law Review, XXXIV (January-February 1900), 51–69; William B. Horn-blower, “Conflict Between Federal and State Decisions,” American Law Review, XIV (March 1880), 211–223; J. B. Heikskell, “Conflict Between Federal State Decisions,” American Law Review, XVI (June 1882), 743–760.
43. Wiebe in Search for Order says: “To the degree a general government policy existed in the years following reconstruction, Federal courts had usually supplied it. Disorganizing change during the late nineteenth century had encouraged exactly the kind of broad, outlined guidance the judiciary could provide” (81). In a perceptive and detailed analysis, Harry Scheiber, while noting exceptions to the Court’s centralizing tendencies during the period, draws a similar conclusion in his “Federalism and American Economic Order,” L&SR, X (Fall 1975), 57–118. That contemporaries noted the same thing is evidenced by Frederick Perry Powers, “Recent Centralizing Tendenices in the Supreme Court,” Political Science Quarterly, V (September 1890), 389–410. See Thomas C. Cochran, “The Paradox of American Economic Growth,” JAH, LXI (March 1975), 935, for the impact of local legal resistance to interstate business on economic growth during the period.