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that could exercise visitatorial authority over them. For breaches of trust, however, being a public charity, they were liable to be supervised in respect of their trust by courts of equity, upon information filed by the Attorney-General in behalf of the sovereign; and they would have been equally liable had they been trustees administering a public charity without incorporation.
In 1816, the legislature of New Hampshire passed an act, entitled " An Act to amend the Charter, and enlarge and improve the Corporation of Dartmouth College ;" the preamble of which recited that the " college of the State may, in the opinion of the legislature, be rendered more extensively useful." Therefore it changed the name from Dartmouth College to Dartmouth University, increased the number of trustees from twelve to twenty-one, enlarged its powers, authorizing it to establish different colleges, created a board of overseers, gave to the amended corporation all the powers, privileges, and property enjoyed by the old one, and made other changes of a like nature. The majority of the old corporation refused to accept the new charter, brought an action of trover against the treasurer of the new university for the record books of the college, and, after the Supreme Court of New Hampshire decided that the amended charter was constitutional,1 removed the case by writ of error to the Supreme Court of the United States, under the 25th section of the Judiciary Act. The case was argued at February Term, 1818, by Mr. Hopkinson and Mr. Webster for the plaintiffs, —by the latter in a masterly manner, and with an array of authorities skilfully selected to prove what was necessary to carry the plaintiffs' case, and to prove nothing beyond. Indeed, this celebrated argument deserves the encomiums which have been heaped upon it, with the immaterial exception of being sound- The case admitted of rhetoric, and there was plenty of it. For the defendant —that is, for the State of New Hampshire — the case was argued very imperfectly by Mr. Wirt, Attorney-General, and Mr. Holmes, — another of the thousand instances which show how much better private interests are defended and protected than public ones.2 Had the case for the defence been presented with the
i Dartmouth College v. Woodward, 1 N. H. 111.
* We have been of this opinion since we first carefully examined the case, and we are glad to find that Mr. Webster fully sustains us. He says of Mr. Holmes's argument, " Upon the whole, he gave us three hours of the merest stuff that was ever research and ability with which Mr. Sergeant and Mr. Binney argued the Girard Will case, or with which Mr. Dana and Mr. Evarts argued the Prize Causes, we are convinced that the decision would have been very different.
At February Term, 1819, the court reversed the judgment of the Supreme Court of New Hampshire, deciding that the legislature had no power to amend the charter without the consent of the trustees, and that the statute by which they attempted to do so was a law impairing the obligation of contracts within the meaning of the Constitution of the United States. Mr. Justice Duval dissented, but read no opinion.1
The opinion of the Chief Justice, who delivered the judgment of the court, is characterized by his usual massive strength and cogent powers of reasoning, but, nevertheless, in our judgment, is, in some respects, not quite worthy of him, and treats the case too much as a matter of abstract reasoning. We think there is apparent, in many parts of it, proof that he found it extremely difficult to state with precision the principle upon which the decision could rest, without at the same time deciding that the prohibition against impairing the obligation of contracts applied to the political government of a State. Chief Justice Marshall was not given to elaborate examination of authorities. Nevertheless, when investigating a question wholly or in part depending on them, he generally gave them some attention, as is observable in the judgment he delivered at the same term, in Baptist Association v. Mart? It is significant, therefore, that in this case, with the exception of two incidental references to Blackstone, there is not a single authority of any kind cited; and it is but fair to conclude that the learned judge felt that it was safest thus to do. He was probably led to the conclusions to which he
ottered in a county court . . . . Wirt followed. He is a good deal of a lawyer, and has very quick perceptions and handsome power of argument. But he seemed to treat this case as if his side could furnish nothing but declamation. . . . He made an apology for himself that he had not had time to study the case, and had hardly thought of it until he was called on." Mr. Webster to Mr. Mason, March 13, 1318; 1 Webster's Private Corr. 275,276. But see, contra, Mr. Webster to Mr. Wirt, 2 Kennedy's Life of Wirt, 82, 83. Mr. Pinkney said, that " Wirt's back was not strong enough for such a case." The best statement of the defendant's side Is the able opinion of Chief Justice Richardson in the New Hampshire court
• The court consisted of Marshall, C. J., and of Washington, Johnson, Livingston, Todd, Duval, and Story, JJ.
* 4 Wheat. 1.
came by the seeming hardship of the case, and by a feeling that public policy demanded it, that many private rights were tied up with corporate privileges, and that it would be exceedingly dangerous to leave these at the mercy of State legislatures; and that, therefore, upon the whole, it was best to take advantage of the clause in the Constitution, as already broadly construed, to protect from legislative action corporate charters as well as ordinary contracts.
Mr. Justice Washington endeavors to maintain his conclusions by authorities. His opinion is short, and occupies a position about half way between the Chief Justice's and Judge Story's. Perhaps the reason why this excellent judge (never given to display) wrote an opinion at all was, that he was not satisfied with the reasoning of the Chief Justice, and thought he could place the decision on a firmer foundation.
Mr. Justice Story's opinion is much more elaborate and ambitious. Of this distinguished jurist — the most learned lawyer, whether we consider the extent or the variety of his attainments, that our country has produced — we wish to speak with all the respect that his eminence deserves. Upon questions of private rights, his judgments are of high authority, and are often admirable; and the value of his text-books is shown by the fact that now, after a lapse of between thirty and forty years, they keep their place as standard authorities in the courts of America and England. But in respect to government and governmental authority, his views were, to say the least, often eccentric. His dicta in this case go far beyond the record, and have been most essentially qualified by later decisions.
Before discussing the doctrines of this case, it may be well to say a word or two about the nature of corporations. Kyd, whose book, after the lapse of nearly a century, is still the best authority on the subject, so far as it goes, says: —
"A corporation, then, or a body politic, or body incorporate, is a collection of many individuals, united into one body, under a special denomination, having perpetual succession under an artificial form, and vested, by the policy of the law, with the capacity of acting, in several respects, as an individual, particularly of taking and granting property, of contracting obligations, and of suing and being sued, of enjoying privileges and immunities in common, and of exercising a variety of political rights, more or less extensive, according to the design of its institution, or the powers conferred upon it, either at the time of its creation, or at any subsequent period of its existence."
'•A corporation," he further says, "has been called 'a mere capacity to sue and be sued, and to take and to grant,' which is as ridiculous as it would be to say 'that a man is a mere capacity to walk with two feet.' It is not a capacity, but a political person, in which many capacities reside."
He also ridicules the old definition that a corporation is immortal, saying, —
"Th.it a body framed by the policy of man, a body whose parts and members are all mortal, should, in its own nature, be immortal, ... in the common acceptation of the word, seems beyond the reach of common understanding."1
Lord Chief Justice Hale defines "persons politic or corporations" as bodies created by operation of law, and adds, that "the highest and noblest body politic is the King, who, though he be a body natural, yet to many purposes is a body politic or corporate." 2 The political privileges possessed by a corporation are commonly known as its franchises. The elementary definition of a franchise is a " royal privilege or branch of the royal prerogative subsisting in the hands of a subject, by grant from the King." 3 A corporation, therefore, is a political body, created only by the sovereign authority; and its privileges or franchises are political privileges conferred by the sovereign. In this country, where we have innumerable corporations, from the governments of cities and towns down to associations for the manufacture of paper collars, such a definition may seem a little high-flown. But we must remember, that in England technical corporations are far less numerous than in this country, and were less numerous still a century ago. The ordinary trading association, such as in the United States has full corporate privileges, in England is not treated as a corporation at all, but is known as a joint-stock company; and so particular is the government there in conferring corporate privileges and in limiting them to purposes of high public importance, that, in the charters of associations for the purposes of insurance and banking organized by special act of Parliament, and possessing privileges which the Supreme Court
» 1 Kyd on Corp. 13-16. » Analysis of the Law, 37.
8 Chitty on Prerog. 119; 2 Bl. Com. 87.
has declared made them corporations, to all intents and purposes, in the United States, it is expressly declared that the provisions of the act shall not make the companies corporations.1
Corporations are created by grant of the Crown (and less frequently by act of Parliament), and an act of incorporation granted by the Crown is undoubtedly an irrevocable grant as against it, and in the nature of a compact between it and the persons incorporated. We fully admit that the King cannot revoke, amend, or annul it, except by proper proceedings in his name in courts of justice, for abusing its chartered privileges. This, however, is just as true of the charter of a municipal corporation like a city or borough, as it is. of the merest trading association. When Chief Justice Marshall, therefore, declares a charter by the King to be a contract, if it depends upon the nature of the grant itself and the power of the King over it, he must include municipal and purely political corporations, as well as corporations of the very lowest kind. If he means that they are contracts that cannot be impaired only so far as the objects of the corporation are of a purely private nature, and with which the public has no concern so long as the corporate privileges are not abused, then he must exclude from the category all colleges, hospitals, and other public charities.
We do not care to know the particulars of the controversy which led to the legislature's interference with Dartmouth College, or the real motives that were supposed to actuate them in endeavoring to amend the charter. It arose, we believe, out of a quarrel among the officers, and the interference was considered at the time harsh and unjustifiable. It is now well settled that any matter of this kind is utterly beside the merits of the case in a constitutional point of view. If necessity, or any conjuncture of circumstances, could justify the legislature in interfering with the charter, then we must assume that such necessity or circumstances existed; and when the legislature state that their purpose was to increase the usefulness of the college, it is but right to suppose that such was their motive, and that the amendatory act tended to do this. This is now so familiar a principle of constitutional law, that it is needless to cite authorities to support it. How entirely it was lost sight of in the Dartmouth College
1 Liverpool Insurance Company v. Massachusetts, 10 Wallace, 866.