for the furnishing of water to the city for the term of thirty years from the date of the contract, be enjoined because of the invalidity of said contract, on grounds set forth. A preliminary injunction was granted. The defiance Water Company thereupon presented its petition and bond for the removal of the case to the circuit court of the United States for the northern district of Ohio, the petition alleging: "That this is a suit of a civil nature in which there is a controversy arising under the Constitution of the United States, in this especially, that by means of it the said plaintiff seeks to abrogate the contract alleged in its suit, and to deprive this defendant of its property, the amount alleged in said plaintiff's petition to be due this defendant, under said contract, without due process of law and without trial by jury; to which end and for which purpose the said council of the said city of Defiance have colluded and conspired with the said plaintiff, and it is by their said council's procurement that the said plaintiff has brought the said suit."

The case was removed, but on January 24, 1898, was remanded by the circuit court of the United States to the court of common pleas. On the same day the water company filed its bill in the circuit court of the United States against the city of Defiance and the council of the city of Defiance, and complained that complainant was a corporation organized under the laws of the state of Ohio for the purpose of operating waterworks in the city of Defiance, and thereby furnishing water to the city and to its citizens; that on January 4 the city brought the suit hereinbefore mentioned, and had obtained a preliminary injunction therein; that on August 17, 1887, the city of Defiance duly passed an ordinance entitled "An Ordinance to Authorize and Provide for the Construction and Maintenance [186]of a System of Waterworks in the City of Defiance, Defiance County, Ohio," a copy of which ordinance was annexed. The provisions of the ordinance were then set forth, to the effect that by its terms the right and privilege for the period of thirty years thereafter was granted to Bullock & Company, their associates, successors, and assigns, to locate and operate a system of waterworks in that city, and to use the streets of the city for the purposes thereof; that the city contracted to rent of Bullock & Company a certain number of hydrants, and to pay a certain rental therefor; that the city, at the expiration of ten years, was given the right to purchase the system, or, if that was not then done, then at the expiration of five years thereafter.

It was averred that the ordinance was accepted by Bullock & Company, and the

works were constructed, in the course of which Bullock & Company became indebted, and certain mortgage bonds were issued, which were outstanding and held by certain persons named; that Bullock & Company assigned all their rights and interests to the Defiance Water Company, and the water company completed the construction of the works to the entire satisfaction of the city, and the same were accepted March 5, 1889, by resolution.

The bill further averred that the city had used the hydrants and was still using them, and that it had paid all of the rentals claimed under the contract down to January 1, 1898, except the sum of $500 due in 1895, to recover which suit had been commenced. It was then alleged that the city council "at its regular meeting, January 7th, 1896, passed an ordinance or resolution in substance rescinding and annulling said contract of the city with the Defiance Water Company, your orator, so far as it had power so to do; and providing by the terms of said ordinance or resolution, by which it should allow the bill of said water company for the rents that had accrued to them from the said city for the last half of the year 1895, that the payment of the said bill should not be 'construed or taken to be any acknowledgment of any contract between them and the said city for said water rentals, or in any manner implying *any ac-[187] tual performance of any alleged contract, and that no further payment at the present rate be made to the said company.'"

The bill then stated that there was due to the water company for the last half of the year 1897 the sum of $3,142.50, less $756, which, it was subsequently said, had been paid. And it was charged, on information and belief, that the council and the several members of it had, ever since the passage of the resolution or ordinance of January 7, A. D. 1896, claimed, and repeatedly stated and given out to the public generally, that the city had no such contract as aforesaid for furnishing water to it by the water company; and that they had also passed resolutions and ordinances looking toward the construction of waterworks by the city, but nevertheless the city had given no notice of its intention to purchase, and had not offered to purchase, complainant's waterworks. And, furthermore, that many, if not all, of the members of the council combined, colluded, and confederated together and with the city solicitor, to procure him to institute the suit before mentioned, and to procure an order of injunction against themselves, the city council, prohibiting them from paying complainant the amounts due and owing. The bill then averred "that if said order of injunc

Messrs. Henry Newbegin and Robert Newbegin argued the cause, and, with Mr. Robert W. Bingham, filed a brief for appellant.

Messrs. Henry B. Harris and Fred L. Hay argued the cause, and, with Mr. John P. Cameron, filed a brief for appellee.

Mr. Chief Justice Fuller delivered the opinion of the court:

The decree of the circuit court was based on the decree of the state circuit court, which has been reversed by the state supreme court, and various suggestions have been made by counsel in respect of the judgment which they think should be rendered here in view of the termination of the litigation in the state courts.

But the question of the jurisdiction of the circuit court meets us on the threshold, and the disposal of that question disposes of this appeal.

Diverse citizenship did not exist, and, unless the case was one arising under the Constitution or laws of the United States, the jurisdiction of the circuit court was not properly invoked, and should not have been maintained.

We have repeatedly held that "when a suit does not really and substantially in[191]volve a dispute or controversy as to the *ef

fect or construction of the Constitution or laws of the United States, upon the determination of which the result depends, it is not a suit arising under the Constitution or laws. And it must appear on the record, by a statement in legal and logical form, such as is required in good pleading, that the suit is one which does really and substantially involve a dispute or controversy as to a right which depends on the construction of the Constitution or some law or treaty of the United States, before jurisdiction can be maintained on this ground." Western U. Teleg. Co. v. Ann Arbor R. Co. 178 U. S. 239, 44 L. ed. 1052, 20 Sup. Ct. Rep. 867; Little York Gold-Washing & Wa ter Co. v. Keyes, 96 U. S. 199, 24 L. ed. 656; Blackburn v. Portland Gold Min. Co. 175 U. S. 571, 44 L. ed. 276, 20 Sup. Ct. Rep. 222; Shreveport v. Cole, 129 U. S. 36, 32 L. ed. 589, 9 Sup. Ct. Rep. 210; New Orleans v.

In the case last cited we said: "The judicial power extends to all cases in law and equity arising under the Constitution, but these are cases actually, and not potentially, arising, and jurisdiction cannot be assumed on mere hypothesis. In this class of cases it is necessary to the exercise of original jurisdiction by the circuit court that the cause of action should depend upon the construction and application of the Constitution, and it is readily seen that cases in that predicament must be rare. Ordinarily the question of the repugnancy of a state stitution is to be passed upon by the state statute to the impairment clause of the Concourts in the first instance, the presumption being in all cases that they will do what the Constitution and laws of the United States require (Chicago & A. R. Co. v. Wiggins Ferry Co. 108 U. S. 18, 27 L. ed. 636, 1 Sup. Ct. Rep. 614, 617); and if there be ground for complaint of their decision, the remedy is by writ of error under § 709 of the Revised Statutes (U. S. Comp. Stat. 1901, p. 575). Congress gave its construction to that part of the Constitution by the 25th section of the judiciary act of 1789 [1 Stat. at L. 85, chap. 20], and has adhered to it in subsequent legislation."

Complainant rested its assertion of jurisdiction on two grounds:

1. That the resolution or ordinance of

January 7, 1896, impaired the obligation of the contract created by the ordinance of August 17, 1887.

*2. That if complainant were perpetually [192] enjoined, as prayed in the suit in the state courts, the state would thereby have deprived it of its property without due process of law.

1. The bill did not set forth the resolution or ordinance of January 7, 1896, in extenso, but stated that by its passage the city council "in substance" rescinded and annulled the contract "so far as it had power so to do," in that in allowing a bill of the water company for accrued rentals it provided that the payment should not be "construed or taken to be any acknowledgment of any contract between them and the said city for said water rentals,"

The record shows the resolution, which was as follows:

"January 7th, 1896. "A resolution to draw warrant in favor of water company for $3,160.

"Whereas, the Defiance Water Company have submitted a bill to the city council for $3.160, alleged to be due them from said city for water rental for the past six months; and

"Whereas, said council are of the opinion

"Whereas, the best interests of the city, in their opinion, demand that the present service be discontinued and immediate steps be taken for the purpose of supplying water to said city upon fair and equitable terms:

therefore;

"Be it resolved, That the city clerk is hereby directed to forthwith draw his warrant on the city treasurer against the water fund of said city for the said sum of $3,160, in favor of said Defiance Water Company, in full payment of said bill; provided, however, that if said warrant be accepted by said company it be taken and accepted by them without thereby in any manner being construed or taken to be any acknowledgment of any contract between them and said city for said water *rental, or in any nanner implying any actual performance of any alleged contract, and that no further payments at the present rate be made to said company.

"Passed Jan. 7th, 1896."

Clearly, this resolution was not a law impairing the obligation of the contract. It was merely the allowance of a claim for rentals, with a saving clause to prevent estoppel; and the semiannual payments for 196, and the first for 1897, were directed by subsequent ordinances to be made withou any reservation.

And the city not only denies that the resolution (or any other) had or was intendea to have the effect now attributed to it, but ways that if this had been otherwise the resonation would have been invalid because not passed in accordance with the statutes ofhio in that behalf.

The position of the city as disclosed by the record was, indeed, that no valid contract existed, ana it was to test that question that the suit was instituted by the city solicitor in the cout of common pleas; but there was no defin.tive legislative action taken by the city for the erection of its own waterworks, or otherwise, which was obnoxious to the prohibition of the Federal Constitution.

2. Nor does the contention that if the temporary injunction granted by the court of common pleas should ultimately be made perpetual justify the assumption of jurisdiction because of violation of the 14th Amendment.

Litigation in the state courts cannot be dragged into the Federal courts at such a stage and in such a way. The proposition

final action unconstitutional.

Moreover, the state courts are perfectly competent to decide Federal questions arising before them, and it is their duty to *do[194] So. Robb v. Connolly, 111 U. S. 624, 637, 28 L. ed. 542, 546, 4 Sup. Ct. Rep. 544; Missouri P. R. Co. v. Fitzgerald, 160 U. S. 556, 583, 40 L. ed. 536, 543, 16 Sup. Ct. Rep. 389.

And, we repeat, the presumption is in all cases that the state courts will do what the Constitution and laws of the United States require. Chicago & A. R. Co. v. Wiggins Ferry Co. 108 U. S. 18, 27 L. ed. 636, 1 Sup. Ct. Rep. 614, 617; Shreveport v. Cole, 129 U. S. 36, 32 L. ed. 589, 9 Sup. Ct. Rep. 210; Neal v. Delaware, 103 U. S. 370, 389, 26 L. ed. 567, 571; New Orleans v. Benjamin, 153 U. S. 411, 424, 38 L. ed. 764, 769, 14 Sup. Ct. Rep. 905.

If error supervenes, the remedy is found in § 709 of the Revised Statutes (U. S. Comp. Stat. 1901, p. 575).

The present case strikingly illustrates the applicability of these well-settled principles. The preliminary injunction was dissolved by the court by which it was granted, and the city's suit was dismissed by the highest judicial tribunal of the state.

We regard this bill as an attempt to evade the discrimination between suits between citizens of the same state, and suits between citizens of different states, established by the Constitution and laws of the United States, by bringing into the circuit court controversies between citizens of the same state,-an evasion which it has been the constant effort of Congress and of this court to prevent (Bernards Twp. v. Stebbins, 109 U. S. 341, 353, 27 L. ed. 956, 960, 3 Sup. Ct. Rep. 252; Shreveport v. Cole, 129 U. S. 36, 44, 32 L. ed. 589, 592, 9 Sup. Ct. Rep. 210); and are of opinion that it should have been dismissed for want of jurisdiction.

The fundamental question of jurisdiction, first, of this court, and then of the court from which the record comes, presents itself on every writ of error or appeal, and must be answered by the court, whether propounded by counsel or not. Mansfield, C. & L. M. R. Co. v. Swan, 111 U. S. 379, 382, 28 L. ed. 462, 464, 4 Sup. Ct. Rep. 510; Metcalf v. Watertown, 128 U. S. 586, 32 L. ed. 543, 9 Sup. Ct. Rep. 173; Morris v. Gilmer, 129 U. S. 315, 32 L. ed. 690, Rep. 289; Continental Nat. Bank v. Buford, 191 U. S. 119, ante, 119, 24 Sup. Ct. Rep. 54.

Sup. Ct.