Law School Case Brief
Trs. of Dartmouth Coll. v. Woodward - 17 U.S. (4 Wheat.) 518 (1819)
A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of its creation confers upon it, either expressly, or as incidental to its very existence.
Plaintiffs, the trustees of Dartmouth College, brought an action in trover against William H. Woodward for corporate property to which the trustees alleged they were entitled. Woodward claimed under three acts of the legislature of New Hampshire, one of which amended the charter of the college and increased the number of trustees to 21, that such acts gave over the appointment of the additional members to the executive of the state, and created a board of overseers, with the power to inspect and control the most important acts of the trustees. The trustees refused to accept this amended charter, and brought suit for the corporate property.
Was the charter granted by the British crown to the trustees of Dartmouth College in New-Hampshire in the year 1769, a contract within the meaning of that clause of the constitution of the United States?
The Supreme Court stated that the circumstances of the case constituted a contract, as an application was made to the crown for a charter to incorporate a religious and literary institution. The donors, the trustees, and the crown were the original parties to the contract, which was one made on valuable consideration. The court held that the obligation of the contract could not be impaired without violating the Constitution. As the acts of the legislature were repugnant to the Constitution, the Court reversed the judgment of the state court below.
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