Dartmouth College v. Woodward
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Trustees of Dartmouth College vs. Woodward, 17 U.S. 518 (1819) was an important United States Supreme Court case dealing with the impairment of contracts.
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Background
The landmark case Dartmouth College v. Woodward is not without precedent. Earlier, the Marshall Court, in the first instance of the Court invalidating a state legislative act, had ruled in Fletcher v. Peck, 10 U.S. 87 (1810) that contracts, no matter how they were procured (in the case of Fletcher, a land contract had been illegally obtained), cannot be invalidated by state legislation. Thus, the court, though working in an early era, was treading on familiar ground when it handed down Dartmouth.
The Case
Dartmouth College’s charter was granted by King George III of the United Kingdom on December 13, 1769. In 1815, over thirty years after the conclusion of the American Revolution, the legislature of New Hampshire attempted to invalidate Dartmouth's charter in order to convert the school from a private to a public institution. The trustees of the College objected, and thus sought to have the attempted actions of the legislature declared unconstitutional.
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The trustees retained Dartmouth alumnus Daniel Webster, a New Hampshire native who would later become a U.S. Senator from Massachusetts and Secretary of State under President Millard Fillmore. Webster was hired to defend the college in court against William H. Woodward, the state-appointed secretary of the new board of trustees. Webster's speech in defense of Dartmouth (which he described as "a small college" but added, "there are those who love it") was so moving that it reportedly brought tears to Chief Justice Marshall.
The Decision
The decision, handed down on February 2, 1819, ruled in favor of the college, and thus invalidated the act of the New Hampshire legislature; which, in turn, allowed Dartmouth to remain a private institution. The majority opinion was, predictably, written by Marshall.
Dartmouth at the time was not a popular decision. When the United States Supreme Court ruled for Dartmouth, a public outcry ensued. State courts and legislatures, supported by the people, declared that state governments had an absolute right to amend or repeal a corporate charter.
However, today Dartmouth is considered to be one of the most important Supreme Court rulings, strengthening the Contract clause and limiting the power of the States to interfere with private institutions' charters. The decision protected contracts against specifically state encroachments. More recently it has had the effect of safeguarding business enterprises from state governments’ dominion.
References
- Richard L. Grossman and Frank T. Adams, Taking Care of Business, Citizenship and the Charter of Incorporation (Cambridge: Charter, 1993), 11-12.
See also
- Fletcher v. Peck, 10 U.S. 87 (1810)
- Corporate personhood
- List of United States Supreme Court Cases
External links
- LII: full text of Trustees of Dartmouth College v. Woodward (http://supct.law.cornell.edu/supct/html/historics/USSC_CR_0017_0518_ZS.html)
- Full text of the decision courtesy of Findlaw.com (http://laws.findlaw.com/us/17/518.html)