In the case of South Dakota v. North Carolina,8 however, the true party of interest was shown to be the plaintiff State. Jurisdiction was assumed by the Supreme Court and a judgment and decree awarded against the defendant State. The facts of this important case were these:

In 1849 the State of North Carolina chartered a railroad and subscribed for twenty thousand shares of stock of one hundred dollars each. At the same time an issue of bonds was provided for and these shares of stock, thus held by the State, pledged for their payment. These bonds ran for thirty years and became due in 1897. In 1879, however, the State had compromised its debt, including all except about $250,000 of these bonds. In 1901 the owner of several of these unpaid bonds gave ten of them outright to the State of South Dakota, which State by legislative act authorized the acceptance of them and the institution of suit upon them and the employment for this purpose, by the attorney-general, of special counsel who should " be entitled to reasonable compensation out of the recoveries and collections in such suits and actions." Whereupon original suit in the Supreme Court of the United States against the State of North Carolina was instituted. The Supreme Court, by a bare majority of five justices to four, assumed jurisdiction, gave judgment for the plaintiff, and ordered, in default of payment of the amount decreed, the sale at public auction of one hundred shares of the railroad stock owned by the State.9

8 192 U. S. 286; 24 Sup. Ct. Rep. 269; 48 L. ed. 448.

Justice Brewer delivered the opinion of the court. After calling attention to the fact that the validity of the bonds and mortgages was not in doubt, Justice Brewer argued that the case did not come within the doctrine of New Hampshire v. Louisiana,10 for the reason that the bonds had been assigned absolutely to the State of South Dakota, and that a recovery upon them would inure to the benefit of that State. The motive which had dictated the assignment of the bonds in question to the State could not, the justice argued, affect the validity of the gift or the jurisdiction of the court. In support of this point was cited McDonald v. Smalley,11 in which it was held that federal jurisdiction was not affected because the title to the property in question had been conveyed to the plaintiff in the belief that it would be sustained in the federal and would not be in the state courts, and Cheever v. Wilson12 and other cases in which it was held that if a person take up a bona fide residence in another State, he may sue in a federal court, notwithstanding that his purpose in so doing is that he may resort to the federal courts in cases in which he would have no standing as a resident of the State in which the federal courts are held.

The question to be decided in South Dakota v. North Carolina was thus reduced to whether, because of the simple fact that the the defendant was a State, the court was without jurisdiction. That this question should be answered in the negative, Justice Brewer showed by a review of cases in which it appeared that from the beginning suits instituted by one State against another involving property rights had been entertained and decided.13

9 The amount was later paid by North Carolina, and thus the forced sale of its stock made not necessary. 10 108 U. S. 76; 2 Sup. Ct. Rep. 176; 27 L. ed. 656. 11 1 Pet. 620; 7 L. ed. 287. 12 9 Wall. 108; 19 L. ed. 604.

That which differentiated this case, however, from the cases previously decided was the fact that it was not one for the recovery of a specific piece of property, but for a money judgment upon a debt. To the objection that the court should not exercise jurisdiction for the reason that it would not be able to enforce such a judgment, when rendered, by the sale of public property,14 or by the levy of a tax,15 Justice Brewer said that in the case at bar, at least as it was then before the court, it would not have to meet this difficulty for the reason that a sale of the stock mortgaged for the payment of the bonds might produce sufficient to satisfy the plaintiff's claim. " If that should be the result," he said, " there would be no necessity for a personal judgment against the State. . . . Equity is satisfied by a decree for a foreclosure and sale of the mortgaged property, leaving the question of a judgment over for any deficiency to be determined when, if ever, it arises. And surely, if, as we have often held, this court has jurisdiction of anaction by one State against another to recover a tract of land, there would seem to be no doubt of the jurisdiction of one to enforce the delivery of personal property."

The dissenting opinion, concurred in by four justices, rested in the main upon the argument that the spirit of the Eleventh Amendment prohibited such a suit, and that it should not be violated by the device of transferring the debt from private hands to a State. In support of the position that the spirit and not the strict letter of the Amendment should be followed, the dissenting opinion cited the cases of New Hampshire v. Louisiana,16 Hans v. Louisiana,17 and Smith v. Reeves.18 justices pointed out, to render justiciable claims that were not even within the reach of the ruling of Chisholm v. Georgia, for it would permit the assignment to and collection by another State of claims held by citizens against their own States. Indeed, the opinion argued, the logical effect of the decree concurred in by the majority of the court, would be, in the light of the jurisdiction of the Supreme Court as upheld in United States v. North Carolina and United States v. Texas, to render the United States suable for any claim against it which private individuals might transfer to a State.

13 Approving reference was also made to the declaration of Marshall in Cohens v. Virginia. (6 Wh. 264; 5 L. ed. 257), that the adoption of the Eleventh Amendment had been due not so much to a wish to maintain the sovereignty of the State from the degradation supposed to attend a compulsory appearance before a federal tribunal as to the desire to avoid anticipated suits for the collection of certain debts then existing.

14 Meriwether v. Garrett, 102 V. S. 472; 26 L. ed. 197.

15 Rees v. Watertown, 19 Wall. 107; 22 L. ed. 72.

In the first of these cases, argued the opinion, it was conceded that, but for the fact that the defendant was a State, the title of the .plaintiff would have supported a cause of action, and that, therefore, it had been the spirit rather than the letter of the Eleventh Amendment which had governed the court in refusing jurisdiction. In Hans v. Louisiana the suit was clearly not for-hidden by the letter of the Eleventh Amendment, for it was one not between a State and a citizen of another State, but between a State and one of its own citizens. Yet the court held that the general policy laid down by the Amendment forbade its prosecution. In Smith v. Reeves, controlled by the spirit of the Eleventh Amendment, the court refused to permit a State to be sued by a federal corporation which claimed that, in virtue of the law of its creation, it had the right to invoke the jurisdiction of the federal courts even in a suit against a State, the Eleventh Amendment to the contrary notwithstanding. In denying this claim the court, applying the spirit rather than the letter of the Amendment, said: " It could never have been intended to exclude from federal judicial power suits arising under the Constitution or laws of the United States when brought against a State by private individuals or state corporations, and at the same time extend such power to suits of like character brought by federal corporations against a State without its consent." So also, it was pointed out, that in United States v. North Carolina19 and in United States v. Texas20 the spirit, rather than the letter of the Constitution, was followed in holding that, though not specifically granted the power, the Supreme Court might entertain a suit brought by the United States against one of the individual States of the Union. To entertain jurisdiction in the present case was, indeed, the dissenting Still further, it was argued in the dissenting opinion, that, independently of the foregoing objections, the claim of South Dakota should have been refused recognition for the reason that it was based upon an assignment of a debt, which did not constitute, and never had constituted a justiciable obligation against the State of North Carolina, and that, therefore, South Dakota as assignee should not be held to have received any legal right which the assignor himself had not had. In support of this contention, reference was made to United States v. Buford,21 in which it was held that a claim, barred by the statute of limitations, would not be made enforceable by assignment to the United States, against which, ordinarily, the statute does not run. Finally, upon mere grounds of equity, it was argued that the suit of South Dakota should have been dismissed, as it was apparent that the whole proceeding was but a part of a scheme to evade a constitutional pro-vision.22

16 108 U. S. 76; 2 Sup. Ct. Rep. 176; 27 L. ed. 656. 17 134 U. S. 1; 10 Sup. Ct Rep. 504; 33 L. ed. 842. 18 178 U. S. 436;. 20 Sup. Ct. Rep. 919; 44 L. ed. 1140. 19 136 U. S. 211; 10 Sup. Ct Rep. 920; 34 L. ed. 336. 20 143 U. S. 621; 12 Sup. Ct. Rep. 488; 36 L. ed. 285.