40. States; operation of Constitution on.
The Constitution and its limitations are the safeguards of all the
States preventing any and all of them under the guise of license or
otherwise from exercising powers not possessed. New York Life
Ins. Co. v. Head, 149, 166.
CONSTRUCTION OF STATUTES.
1. Government; annulment for breach; assumption of benefit and burden of
provision.
The benefit and burden of a provision in a Government contract giv-
ing a right to annul in consequence of a breach by failure to com-
mence work must hang together and the Government cannot avail
of the former without accepting the latter. Stone & Gravel Co. v.
United States, 270.
2. Government; reletting on breach; damages to which Government entitled.
Where the contract contains a provision for a method of annulment and
liquidated damages in case of a breach by failure to commence
work and the Government avails of that provision it is only en-
titled to the liquidated damages and cannot recover damages for
difference in cost on reletting the contract under a provision for
failure to complete or abandonment after commencing the work.
United States v. O'Brien, 220 U. S. 321, distinguished. Ib.
3. Government; reletting; liability of original contractor.
Where, after default of the original contractor, the contract is relet,
the original contractor is not bound for difference unless the con-
tract as relet is the same as the original contract. United States v.
Axman, 36.
4. Government; reletting; variations; liability of original contractor.
Where a contract for dredging requires the dredged material to be de-
posited in a specified location, changes made as to the location for
depositing such materials amount to such an important variation
that the first contractor cannot be held for difference. United
States v. McMullen, 222 U. S. 460, distinguished. Ib.
5. Government; changes in; importance of.
Change in location for depositing material dredged under a govern-
ment contract is not to be regarded as a minor change; it is clearly
an important one. Ib.
6. Government; District of Columbia; obligation of surety on bond; dual
aspect; change in contract; effect on liability of surety.
The obligation given by the surety under the District of Columbia
Materialmen's Act of 1899 which is modeled after the General
Materialmen's Act of 1894, has a dual aspect, being given not only
to secure the Government the faithful performance of all the obliga-
tions assumed towards it by the contractor, but also to protect
third persons from whom the contractor may obtain materials and
labor; these two agreements being as distinct as though contained
in separate instruments, the surety cannot claim exemption from
liability to persons supplying materials merely on account of
changes made by the Government and the contractor without its
knowledge and which do not alter the general character of the
work. United States v. National Surety Co., 92 Fed. Rep. 549,
approved. Equitable Surety Co. v. McMillan, 448.
7. Government; bond, discharge of surety by alteration of contract; when
rule of strictissimi juris not applicable.
Under the rule of strictissimi juris, the agreement altering the contract
must be participated in by the obligee or creditor as well as the
principal in order to discharge the surety; in the case of a bond
under the Materialmen's Acts of 1894 or 1899, there is no single
obligee or creditor to consent thereto and the rule of strictissimi
juris does not apply where the alterations agreed upon do not
change the general nature of the work. Ib.
8. Government; District of Columbia; bond given under act of 1899; effect
of change in contract to release surety.
In this case the alterations of the terms of a contract for building a
school house in the District of Columbia altering its location but
without affecting its general character, without the knowledge or
consent of the surety, did not have the effect of releasing the surety
from the obligation of the bond given under the District of Colum-
bia Materialmen's Act of February 28, 1899. Ib.
9. Government; District of Columbia; bond; change in contract releasing
surety; quære.
Quare, and not involved in this case, what would be the result of a
change not contemplated in the original contract as between the
District of Columbia and so great as to amount to abandonment
10. Liquidated damages for delay; enforcement; waiver.
While reasonable contracts for liquidated damages for delay are not
to be regarded as penalties and may be enforced between the par-
ties, Sun Printing Ass'n v. Moore, 183 U. S. 642, one party must not
prevent the other party from completing the work in time, and if
such is the case, even if the subsequent delay is the fault of the
latter, the original contract cannot be insisted upon and the
liquidated damages are waived. United States v. United Engineer-
ing Co., 236.
11. Liquidated damages for delay; right of Government to recover; effect of
supplemental contracts.
Where the original contract for government work provided for liq-
uidated damages for delay beyond a specified date but supple-
mental contracts contained no fixed rule for the time of completion,
the Government is limited in its recovery to the actual damages
sustained by reason of the delay for which the contractor was re-
sponsible. Ib.
12. Liquidated damages for delay; fault of both parties; effect to annul
obligation to pay.
It is the English rule, as well as the rule in some of the States, that
⚫ where both parties are responsible for delays beyond the fixed date,
the obligation for liquidated damages is annulled; and, unless there.
was a provision substituting a new date, the recovery for subse-
quent delay is limited to the actual loss sustained. Ib.
13. Liquidated damages for delay; waiver by Government; effect of diffi-
culty in proof of actual damages.
Where the Government has by its own fault prevented performance
of the contract and thereby waived the stipulation as to liquidated
damages, it cannot insist upon it as a rule of damages because it
may be impracticable to prove actual damages. Ib.
See CLAIMS AGAINST UNITED STATES, 2;
CONSTITUTIONAL LAW, 10, 23, 36;
ECCLESIASTICAL BODIES, 2, 3;
PUBLIC LANDS, 10, 11, 12;
PUBLIC WORKS, 3;
CONTROVERSIES BETWEEN STATES.
CONVEYANCES.
See INDIANS, 1, 2;
1. Personal judgment against; essentials to validity.
It is essential to the rendition of a personal judgment against a cor-
poration that it be doing business within the State; but each case
must depend upon its own facts to show that this essential require-
ment of jurisdiction exists. International Harvester Co. v. Ken-
tucky, 579.
2. Service of process on; sufficiency of presence within State.
The presence of a corporation within a State necessary to the service of
process is shown when it appears that the corporation is there
carrying on business in such sense as to manifest its presence within
the State, although the business may be entirely interstate in its
character. International Harvester Co. v. Kentucky, 579, 589.
3. Service of process on; effect of business being entirely interstate in char-
The fact that the business carried on by a corporation is entirely inter-
state in its character does not render the corporation immune from
the ordinary process of the courts of the State. Ib.
4. Stockholders' liability; Minnesota law; effect of transfer of stock.
A stockholder cannot, under the statutes of Minnesota, even by a
bona fide transfer of his stock, escape liability for debts of the cor-
poration theretofore incurred. Selig v. Hamilton, 652.
5. Stockholders' liability; Minnesota law; effect of bankruptcy proceedings
against corporation.
Bankruptcy proceedings against a Minnesota corporation do not stand
in the way of a resort to the statutory method of enforcing the
liability of a stockholder which is not a corporate asset. Ib.
6. Stockholders' liability; effect of corporation's 'discharge in bankruptcy.
Congress has not yet undertaken to provide that a discharge in bank-
ruptcy of a corporation shall release the stockholders from liability.
Ib.
7. Stockholders' liability; foreign stockholders; Minnesota law; effect of
order of state court in sequestration proceedings.
A foreign stockholder of a Minnesota corporation is not concluded by
an order of the state court in sequestration proceedings under the
statute, and in which he was served only by publication without
the State, as to any matter relating to his being a stockholder or
as to other personal defense. Ib.
8. Stockholders' liability; Minnesota law; when liability ceases.
When his ownership of the stock ceases, a stockholder in a Minnesota
corporation ceases to be liable for debts of the corporation there-
after incurred, although liable for debts previously incurred. Ib.
9. Stockholders' liability; Minnesota law; who assessable.
Under the state statute, the Minnesota court, in a proceeding to assess
stockholders for liability, may assess persons who previously were
stockholders for liability for debts incurred during the period they
owned the stock. Ib.
10. Stockholders' liability; application of local law limiting time of action
to collect.
Bernheimer v. Converse, 206 U. S. 516, followed to the effect that
§ 394, New York Code of Civil Procedure, does not apply where
the corporation is not a moneyed one or a banking association and
that the six year period does apply under § 382 to the claim of a
receiver of a foreign business corporation for personal liability of a
stockholder assessed under the state statute. Ib.
11. Stockholders' liability; proceeding to determine; representation of
stockholder.
In a proper judicial proceeding to determine the amount of indebted-
ness of an insolvent corporation and the dates of origin of such
indebtedness, the individual stockholders are sufficiently repre-
sented by the presence of the corporation itself; and the decree
establishing such indebtedness is admissible as evidence thereof
in a suit against a stockholder. Ib.
12. Stockholders' liability; Minnesota law; defenses open to stockholder not
personally served.
While a stockholder not personally served may urge his personal de-
fenses in a suit to recover the assessment made in sequestration pro-
ceedings of an insolvent Minnesota corporation, he may not reopen
the amount of the assessment or the question of the necessity
therefor. Ib.
See CONSTITUTIONAL LAW, 22, 24;
See CONSTITUTIONAL LAW, 8.
1. Interference with functions of government.
The courts will not interfere with the ordinary functions of the ex-
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