But when the Supreme Court of the United States was called upon, in the determination of the power of the New Hampshire legislature, by an amendment to its charter, to change the composition of the Board of Trustees of Dartmouth College, to construe the meaning and effect of this clause, it was held, under the lead of Chief-Justice Marshall, who delivered the opinion of the court, that the charter of incorporation of a private corporation was a contract which could not be impaired or altered by subsequent legislation, unless the power of amendment was reserved; and that the act of the legislature of New Hampshire, creating a new college corporation, and directing a transfer to them of the control of Dartmouth College and of its property, was such an impairment of the obligation of a contract as to be void under this clause of the Federal Constitution.'

Under the influence of the decision of the court in the Dartmouth College case, it has been held that subsequent legislatures are bound by legislative còn

"It can require no argument to prove that the circumstances of this case constitute a contract. An application is made to the crown for a charter to incorporate a religious and literary institution. In the application it is stated that large contributions have been made for the object, which will be conferred on the corporation as soon as it shall be created. The charter is granted, and on its faith the property is conveyed. Surely, in this transaction, every ingredient of a complete and legitimate contract is to be found."-Marshall, Ch. J., in Dartmouth College Case v. Woodward, 4 Wheat., 518, 627.

tracts to exempt persons and corporations from liability for taxes. The decisions in support of this proposition are to be found in great numbers, both in the State and Federal reports. It suffices to refer here to only a few decisions of the Supreme Court of the United States, in which we first find intimation in the dissenting opinions of the future modifi cation of the ruling in the Dartmouth College and other early cases.' In these decisions, the opinion . of the majority of the court seems to go the length of holding to the inviolability of any contract made by a legislature which was not prohibited by the Constitution, even though its performance would be injurious to the commonwealth; while the dissent. ing opinions rest their objections to the decision of the court on the ground that the power of taxation was political, and that the legislature cannot barter away it or any other political power.

But it was not long before the injurious effect of the decision of the Dartmouth College case was ap preciated, and it became an almost universal legislative custom to grant charters subject to repeal and amendment. But that custom did not prevent the decision from working a dangerous effect in recog

1 State Bank of Ohio v. Knoop, 16 How., 376; Ohio Life Ins. and Trust Co. v. Debolt, 16 How., 376.

See, to the same effect, Billings v. Providence Bank, 4 Pet., 514; Gordon v. Appeal Tax Court, 3 How., 133; Home of the Friendless v. Rowse; Washington University v. Rowse, 8 Wall., 430, 439.

nizing the inviolability of charter privileges. The dangerous consequences of this doctrine were exemplified by the facts of the case of Charles River Bridge Company v. Warren River Bridge Company, II Pet., 536. The Charles River Bridge Company had been authorized to establish and maintain a bridge across the Charles River, and to charge toll for its use for a stated period, at the lapse of which the bridge was to become public. This bridge was constructed in pursuance of this grant, and after it had been in use for some time, but before the expiration of the period for which the Charles River Bridge Company had been granted the right to charge toll, the legislature authorized the construction of a second bridge, connecting the same places, and situated within a short distance of the first bridge. It is plain that the construction of the second bridge could under those circumstances have had but one effect upon the franchise of the Charles River Bridge Company-viz., an immediate serious diminution in the profits of that company, and an ultimate destruction of the franchise in consequence of the second bridge being opened to the public without charge at an earlier day. It had already become public when the decision in the case was pronounced by the Supreme Court of the United States. The public pressure in favor of the second bridge was so great that, notwithstanding it was a

plain case of impairment of the charter rights of the Charles River Bridge Company, the court, under the lead of Chief-Justice Taney, gave judgment for the Warren River Bridge Company, resting its decision on the technical ground that all grants of the State must be construed favorably to the State, and strictly against the grantee; that the grant of a 2. franchise will not be considered as an exclusive monopoly, unless expressly declared to be so, and that the incidental injury proceeding from the grant of a second franchise would not be, in the constitutional sense, an impairment of the obligation of a contract. Public opinion was not yet ripe for an open repudiation of the doctrine of the Dartmouth College case; and hence the end was attained by the employment of a technicality.'

But from this time to the present the power of private corporations has increased rapidly, every advance in science and industry tending to develop the proportions and the strength of corporations, until there is a general popular fear of an usurpation by them of control of the government. The popular demand for a control of railroad and other corporations became so great and so urgent, that it was impossible for Congress or the courts to ignore it. Laws

1 Charles River Bridge Co. v, Warren River Bridge Co., II Pet., 536. See, to same effect, Richmond R. R. Co. v. Louisa. R.R. Co., 13 How., 71.

were passed subjecting railroads to all sorts of regulations, and finally they were placed in many States, under the control of a railroad commission. On the general principles, that corporations, like natural persons, were subject to the police power of the State, and that there was no impairment of the obligation of a contract, if a railroad corporation were subjected to reasonable special police regulations, although these regulations increased the liabilities of the corporations and diminished their income, it was held that this police power could not be bartered away by the legislature.' And so, also, has it been held that there is no violation of the constitutional prohibition of impairment of the obligation of a contract where corporations are subjected to a regulation of their charges by State officers or commissions. This was held to be only one phase of the police power of the State, and that the charters were issued subject to the exercise of the power.❜

So far in the course of this constitutional development, it has been possible for the courts, by the aid of technicalities and refinements of verbal meanings,

1 Thorpe v. Rutland, 27 Vt., 140; Railroad Co. v. Fuller, 17 Wall., 560; Chicago, etc., R.R. Co. v. Haggerty, 67 Ill., 113; Haas v. Railroad Co., 141 Wis., 44; Pennsylvania R. R. Co. v. Lewis, 79 Pa. St., 33.

2 Chicago, etc., R.R. Co. v. Iowa, 94 U. S., 115; Peck v. Chicago, etc., R.R. Co., 94 U. S., 164, 176; Union Pac. Ry. v. United States, 99 U. S., 700.

3.