One of the world’s first steamboats successfully completed a maiden voyage on the river Clyde in Scotland in 1798. That same 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 skepticism 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. Known simply as “the North River steamboat,” the vessel completed its maiden voyage from the city of New York 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 an 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 (the brother of Irish Republican martyr Robert Emmet), appealed to the New York Court for the Correction of Errors.
The case centered on how to interpret Article 1, Section 8, Clause 3 of the U.S. Constitution, otherwise known as the Commerce Clause. It states that Congress is specifically empowered “to regulate Commerce with foreign Nations, and among several States, and with the Indian Tribes.”
More simply put, the Commerce Clause gives Congress exclusive authority over commercial activities among the states and with foreign countries and Indian tribes. Under this framework, the individual states can only regulate intrastate commerce that takes place exclusively within their borders.
In Livingston v. Van Ingen (9 Johns. R. 507 N.Y. 1812), the New York Court for the Correction of Errors upheld a New York statute authorizing a monopoly on steam boat transportation in New York waters.
The decision did not resolve the Commerce Clause controversy or the battle over the steamboat monopoly. More than a decade later, the U.S. Supreme Court decided Gibbons v. Ogden 1824 (22 U.S. 1).
In that landmark case argued before Chief Justice John Marshall, the U.S. Supreme Court invalidated the New York statute authorizing the monopoly. More importantly, the Court held that the Constitution authorizes Congress to regulate any form of commerce that crosses state lines. During the oral arguments it was Daniel Webster who was credited with the winning argument, which broke the monopoly and opened the tide waters of all the states to free navigation.
The Historical Society of the New York Courts will host “200 Years of the Commerce Clause: Gibbons v. Ogden,” a program looking at the critical and often deadly role steamboats played on the Hudson River for almost two centuries, set for Tuesday, May 9th.
This program examine how Gibbons led to the birth of the federal commerce clause doctrine, which, two hundred years later, continues to be at the center of cases testing the limits of federal and state regulation of interstate commerce, including current challenges to state laws governing recreational cannabis and animal welfare.
This program will begin at 6:30 pm and will take place in person only at the New York City Bar Association, 42 West 44th Street in Manhattan. For more information and to register visit the event page: https://history.nycourts.gov/
You can support the work of the Historical Society of the New York Courts by becoming a member. Society membership supports public lectures, publications, education initiatives, and projects to preserve and promote the courthouses and legal history of the judges and lawyers of New York State. You can become a member here.
PETER HESS says
New York State, and most other early states, lacked a decent transportation system to move people and products to desired locations. They also lacked public funds to undertake these developments.
This caused the State to wisely trade Monopoly Rights, for a limited period of time, to private individuals willing to undertake substantial effort and investment to develop these improvements with their own funds. They Monopoly allowed them to recover their investment and compensated them for the risk they took.
Improved toll roads, ferries and bridges were the result. Public Steamboat travel between NYC and the other municipalities all the way to Albany were Livingston’s contribution.
Subsequent to these legal decisions, taxes were raised and public funds used to construct ports, roads, bridges, etc.
James S. Kaplan says
The decision in Gibbons v. Ogden opened stream navigation on the Hudson
To entrepreneurs such as Cornelius Vanderbilt Gibbons key captain. They were a New Jersey based ferry operation
Challenging the Fulton Livingston
Monopoly in New York waters. Ironically Aaron Ogden the defendant representing the New York interests was
A former governor of New Jersey.
Within five years if the Kurt’s decision there were five times as many ferry operations on the Hudson greatly expanding New York’s economy.
Ultimately Vanderbilt proved ti be
a more efficient operator and the predominant factor in the market.
Later he went into rrailroads and died the richest man in America at the time.
James S. Kaplan
Lower Manhattan Historical Assiciation