Arkansas State Highway Commission v. Dodge

Hart, C. J., (concurring). Judge Humphreys and myself concur in the judgment only.

The most difficult and perplexing question in the case is whether or not the present action is a suit against the State. On the one hand, it is claimed that the State Highway Commission is a legal entity with corporate powers and as such is subject to suit, as decided by the Supreme Court of Missouri in State ex rel State Highway Commission v. Bates, 317 S. W. 696 , 296 S. W. 418 . On the other hand, it is claimed that the Highway Commission is an agency of the State, and not a separate body politic or corporate, and that a suit against the Commission is a suit against the State itself. Looney v. Stryker, 31 N. M. 557, 249 Pac. 112 , 50 A. L. R. 1404; and State Highway Commission v. Utah Construction Co., 278 U. S. 194 , 49 S. Ct. 104 .

■ • This is a question which each State must decide for itself, and the opinion of the Supreme Court of the United States is only persuasive. In Palmer v. State of Ohio, 248 U. S. 32 , 39 S. Ct. 16 , the court said that the right of individuals to sue a State in either Federal or State courts cannot be derived from the Constitution or laws of the United States. It can only come from the consent of the State. In Duhne v. State of New Jersey, 251 U. S. 311 , 40 S. Ct. 154 , it was held that Federal courts have ho jurisdiction of a suit brought by a citizen against his own State without its consent. In Ex parte State of New York, 256 U. S. 490 , 41 S. Ct. 588 , the court said:

“That a State may not be sued without its consent is a 'fundamental rule of jurisprudence having so important a bearing upon the construction of the Constitution of the United States that it has become established by repeated decisions of this court that the entire judicial power granted by the Constitution does not embrace authority to entertain a suit brought by private parties against a State without consent given; nor'one brought by citizens of another State, or by citizens or subjects of a foreign State, because of the Eleventh Amendment; and not even one brought by its own citizens, because of the fundamental rule of which the Amendment is but an exemplification. ’ ’

In that case the court also said that it is now thoroughly settled that what is to be deemed a suit against a State is a question to be determined, not by the mere name of the titular parties, but by the essential nature and effect of the proceeding as it appears from the entire record. The court quoted from Pennoyer v. McConnaughy, 140 U. S. 1 , 11 S. Ct. 699 , to the effect that where the suit is brought against the officers of the State as representing the State’s action and liability, thus making it, though not a party to the record, the real party against which the judgment will operate, the suit is, within the meaning of the Eleventh Amendment, an action against the State. So, too, where the suit operates so as to require the State to make pecuniary satisfaction for any liability, it would be a suit against the State. Smith v. Reeves, 178 U. S. 436 , 20 S. Ct. 619 .

It will be noted that in the case of State Highway Commission of Wyoming v. Utah, 278 U. S. 194 , 49 S. Ct. 104 , the court expressly held that a State is not a citizen, and that a suit between the State and citizens or corporations of another State is not within the jurisdiction of Federal courts as involving diversity of citizenship.

While, as above stated, we must be controlled by our own decisions on this question, still the opinion of the Supreme Court of the United States on the identical question is very persuasive, and is, we think, in line with our own decisions on the question, and should be followed. The obligation to build and maintain adequate public highways, including bridges across rivers, devolves primarily on the State; and we have recognized that the State itself may discharge the obligation or delegate the duty to an subordinate agency. Bush v. Martineau, 174 Ark. 214 , 296 S. W. 9 .

In Jobe v. Urquhart, 98 Ark. 525 , 136 S. W. 663 , the court said that the penitentiary board was bufan agency of the State, composed of certain officers thereof, for the conduct and maintenance of the State penitentiary, and that a suit against said board to reform a contract for the purchase of a State convict farm was in effect a suit against the State within the inhibition of the Constitution.

In the present suit a judgment against the Highway Commission would require the State to make pecuniary satisfaction for the liability, and we are of the opinion, that it is in effect a suit against the State. That this view is in accord with the principles declared by the Supreme Court of the United States will be further seen by a quotation from Hopkins v. Clemson Agricultural College, 221 U. S. 636 , 55 L. Ed. 890 , 31 Sup. Ct. Rep. 654, 35 L. R. A. (N. S.) 243, which reads as follows: "'With the exception named in the Constitution, every State has absolute immunity from suit. Without its consent it cannot be sued in any court, by any person, for any cause of action whatever. And, looking through form to substance, the Eleventh Amendment has been held to apply, not only -where the State is actually named as a party defendant on the record, but where the proceeding, though nominally ag’ainst an officer, is really against the State, or is one to which it- is an indispensable party. No suit, therefore, can be maintained against a public officer, which seeks to compel him to exercise the State’s power of taxation, or to pay out its money in lais possession on the 'State’s obligations, or to execute a contract, or to do any affirmative act which affects the State’s political or property rights.”

This brings us to a consideration of whether article 5, § 19 of the Constitution providing that the State of Arkansas shall never be made a party defendant in any of her courts contains a prohibition, or is merely declaratory of the general rule that a 'State may not be sued without its consent. See ease notes to 42 A. L. R. p. 1405 and, 50 A. L. R. at p. 1408. The State of Alabama contains a similar clause in her Constitution, and it was held that the section was prohibitory, and that the Legislature could not enact a statute allowing the State to consent to a suit against itself. Alabama Girls’ Industrial School v. Adler, 42 So. 116 .

We do not consider that case as controlling. The State of Alabama had a clause in its Constitution which provided that no local law shall be passed unless notice of the intention to apply therefor should be published in the county where the matter to be effected was situated, which notice should state the substance of the proposed law, and be published at least once a week for four consecutive weeks in some publication in such county or counties, and the court held that the prohibition was mandatory, and that noncompliance with it rendered the act void. Kumpe v. Irwin, 140 Ala. 460 , 36 So. 1024 . The court said: ‘ ‘ The journals do not affirmatively show that the act was passed in accordance with the provision of said section (Constitution) in which case the courts are required, without any discretion, to pronounce the act to be void. ’ ’

This court, in construing a similar provision which is contained in article 5, § 27, of our Constitution, held directly to the contrary. In a long line of cases, 'beginning with Davies v. Gaines, 48 Ark. 370 , 3 S. W. 184 , this court has held that whether the notice was given was merely a legislative question. Again, in 'construing article 5, § 25, of the Constitution, which provides that in all cases -where a general law can be made applicable, no special law shall be enacted, the court has uniformly held that the section was merely cautionary to the Legislature, and that the Legislature was the judge of the necessity of a special statute.

It has been held that article 19, § 9, which provides that the General Assembly shall have no power to create any permanent State office not expressly provided for by the Constitution, falls within the class of provisions like that which forbids the Legislature to enact a special law where a general law can be made applicable (Const. article 5, § 24) and the court has held that class, of provisions to be directory and merely cautionary to the Legislature. Greer v. Merchants’ & Planters’ Bank, 114 Ark. 212 , 169 S. W. 802 , and Ft. Smith Dist. of Sebastian County v. Eberle, 125 Ark. 350 , 188 S. W. 821 . We do not regard Pitcock v. State, 91 Ark. 527 , 121 S. W. 742 , as authoritative, because what was there said expressed the views of two of the judges only.

We are of the opinion that the better reasoning is to the effect that this section of the 'Constitution was not intended to be prohibitory, but that it was merely intended as a declaration that, the State may not be sued without its consent. The reasoning for such a provision in a Constitution is well stated by Mr. Justice Holmes for the Supreme Court of the United States in Kawananakoa v. Polyblank, 205 U. S. 349 , 27 S. Ct. 526 , as follows:

“Some doubts have been expressed as to the source of the immunity of a sovereign power from suit without its own permission, but the answer has been public property since the days before the days of Hobbes (Leviathan c. 26, 2). A sovereign is exempt from suit, not because of any formal conception or obsolete theory, but on the .logical and practical ground that there can be no legal right as against the authority that makes the law on which the right depends.”

A sovereign State which enacts its own laws and creates its own courts and defines their jurisdiction is of necessity exempt from the jurisdiction of these courts except by its own consent. We can perceive no good reason why a State should not consent to being sued in her own courts upon such terms and conditions as her Legislature might prescribe. We do not think that the consent can be given except by the Legislature, which alone can declare the public policy of the State. If the State is to exercise its sovereign power in building roads, and in constructing bridges across navigable streams, it would seem that there should be a tribunal somewhere, which might pass upon the claims of those with whom the agency of the State had contracted with reference to the matter, and what tribunal could be a more appropriate and safe guaranty of the equal protection of the laws than the courts established by the State for the . protection of its citizens, and for such citizens who might come within its borders for pleasure or gain.

The general rule is' that a State which consents to be sued may prescribe such methods, terms, and conditions as it sees fit. Case Note to 42 A. L. R. p. 1477. Among the numerous cases cited in support of the doctrine is that of Auditor v. Davies, 2 Ark. 494 .

It is settled beyond controversy that the State cannot be sued in its own courts without its consent. In this case, the State, through the Legislature, has granted the right or privilege to claimants to institute actions against the State Highway Commission upon certain terms and conditions; and all persons or corporations seeking to avail themselves of the right or privilege so granted must do so subject to the terms and conditions Which form a part of the right as granted by the Legislature. In other words, the suits instituted must be limited to such claims as are contemplated by the act authorizing the State to be sued. State of Indiana v. Mutual Life Ins. Co., 175 Ind. 59 , 93 N. E. 213 , 42 L. R. A. (N. S.) 256, and cases cited.

In short, a sovereign State can only be sued by its own consent; and, when a claimant avails himself of the consent, he must pursue the remedy in the court prescribed by the statute granting- the privilege, and upon the terms and conditions as it is provided 'by the statute.

It must be remembered that it is conceded by all that, without regard to the constitutional provision under consideration, the Legislature may recognize the validity of any claim against the State and appropriate money to pay it; and that it would have the right to designate a subordinate agency such as a court of claims or other board to pass upon the validity of the claims.

Then, too, it will be seen from the case notes above cited that it is a rule of universal application that, in the absence of a provision on the subject, it is an inherent attribute of sovereignty that a State may not be sued without its consent; and many of the States have express provisions in their Constitutions, authorizing the Legislature to pass laws waiving the State’s immunity from suit; and such provisions have been held to be declaratory of the principle that a sovereign State is incapable of being sued without some legislative provision authorizing such a proceeding; and that the statute must be strictly followed, as stated in Auditor v. Davies, 2 Ark. 494 ; and this, it may also be stated, is the general rale on the subject. All these matters may draw the sting out of the minds of those who fear that the sovereignty of the State may be diminished, or that the efficiency of the State government may be lessened by permitting the Legislature to pass acts permitting the State to be sued in its own courts upon such terms and conditions as it might prescribe. It would put form above substance to say that the Legislature might not permit such suits to be brought in the courts created by the State, but could create other tribunals before whom such claims could be established. At least judicial adjudication is a safe and reasonable way to guarantee that a person shall not be deprived of his property without due process of law.

To sum up, it may be said that when the State Highway Commission was created to construct State roads and. was selected to make contracts to expend the State’s money therefor, it became the State’s agent to do so. Whether it be called a corporate entity, commission or board, it is none the less an agency of the State; for the State may only construct and improve public highways in the discharge of a sovereign function, and it can only exercise that power by committing the discharge of it to agencies selected by its Legislature for that purpose. Therefore, the contracts which the State Highway 'Commission enter into obligates the State and not the Highway 'Commission or its members. Actions against it -are to all intents and purposes suits against the State. It is the State’s property rights that will be affected by the judgment, and the State will be required to make pecuniary satisfaction for any liability. It seems to us that the State’s sovereignty will be better preserved and protected by holding that a 'State may through its Legislature waive its immunity from suit and select the forum and prescribe the terms and conditions upon which it may be sued than to allow the Legislature to parcel out the State’s sovereign functions to various bodies, by whatever name called, and allow them to be sued, thereby accomplishing by indirection what thejr say the State may not do directly.