In The Founder's Constitution, an anthology of writings (letters, records of debates and early cases) relating to the Federal Constitution, Chief Judge Kent's decision in Livingston v. Van Ingen is included as Document 13 of the materials underlying Article 1, Section 8, Clause 3 (Commerce).
The world's first steamboat successfully completed her maiden voyage on the river Clyde in Scotland in 1798. That year, Chancellor Robert R. Livingston proposed to the New York Legislature that he would develop a new form of public transportation, the steamboat ferry, in return for a monopoly on steam navigation in New York waters. Despite the Legislature's scepticism that steamboat technology was viable, legislation granting Livingston the monopoly was enacted.
In 1802, Livingston met the inventor Robert Fulton and agreed to fund the construction of a steamboat that Fulton had recently designed. The vessel –– the North River Steamboat –– completed her maiden voyage from New York1 to Albany on Wednesday, August 19, 1807, and the Legislature enacted a statute (L. 1808, ch 225) extending the Livingston & Fulton monopoly for a further 30 years. Any steamboat operating in New York waters was required to obtain a license from the Livingston & Fulton monopoly, and the penalty for failure to do so was the forfeiture of the unlicensed vessel to the monopoly.
Albany attorney James Van Ingen was part-owner of two steamboats, the Hope and the Perseverance, that provided ferry services on the Hudson river. Van Ingen did not obtain a license from the monopoly and Livingston & Fulton sought an injunction against him in the United States Circuit Court. Justice Brockholst Livingston held that the court lacked jurisdiction because (1) breach of patent rights was an action at law and (2) the Circuit Court of the United States, sitting as a court of equity, lacked jurisdiction where both parties were citizens of the same State (1 Paine 45 ).
Next, Livingston & Fulton demanded forfeiture of the Hope under the 1808 law and, when Van Ingen refused to hand over the boat, applied to the New York Court of Chancery for an injunction prohibiting the use of the Hope in New York waters. Chancellor Lansing delivered a learned opinion in which he referenced the Institutes of Justinian, principles of common law, and the Federal Constitution to support his decision that navigable rivers were open to all, and that an injunction should not be granted. This decision had nationwide importance in an era focused on the development of a transportation infrastructure.
Livingston and Fulton, represented by several prominent members of the bar, including Thomas Addis Emmet, appealed to the New York Court for the Correction of Errors. Justices Yates, Thompson and Kent all wrote opinions rejecting the Chancellor’s decision. Chief Justice Kent wrote that the States could regulate interstate commerce unless their regulations conflict with federal law. Essentially, the court held that Congress has a right to regulate "external" commerce while States had the right to regulate "internal" commerce. Relying on the latter power, the Court of Errors remitted the case to the Court of Chancery with instructions to grant the injunction sought by Livingston & Fulton.
This case did not put to rest the issues of the Livingston & Fulton monopoly or the State’s power to control internal commerce, issues which came before the courts again in the landmark New York case of Gibbons v Ogden, decided by the United States Supreme Court in 1824 (22 U.S. 1).
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