City of Louisville v. President of University of Louisville
Opinion of the Court
delivered the opinion of the Court—
By an act of February, 1833, (Sess. Acts, 300,) the Medical Institute, of Louisville, was incorporated for the advancement of medical science, with the right to acquire and hold property and to make by-laws for the advancement of its objects. In April, 1837, it was resolved by a meeting of the citizens of Louisville, held at the Radical M. E. Church, that there ought to be a college with medical and law departments, in the city of Louisville; that the square bounded by Eighth, Ninth, Chestnut, and Magazine streets, is approved for the location of a college; that it is sufficiently large for the buildings of a college proper, and also of the medical and law departments; that the mayor and council would act in accordance with public sentiment in Louisville, by donating said square for said college buildings; that the establishment of a college, with medical and law departments, would be alike beneficial and advantageous to all the citizens of Louisville, in proportion to their property and business, and ought to be a general charge upon all; that it is highly expedient and proper that the medical department of said college be established and put into immediate operation, with a sufficient endowment on the part of the city of Louisville to afford all the facilities for instruction in medical sci
In pursuance of these resolutions, and under an express reference to them, the mayor and council resolved to donate or appropriate the designated square, for the purpose of a college, and to erect buildings thereon, and provide a library and apparatus for the medical department. And, on the 21st day of November, 1837, a deed was executed under their authority, by which the said square was conveyed to the Medical Institute of Louisville, to hold for the uses and purposes, and upon the terms and conditions stated in the resolutions of the citizens and of the mayor and council. And the city covenanted to erect on said square, within the years 1838 and 1839, buildings for a medical college at a cost not exceeding $30,000. And the president and managers of the institute covenanted that in case a charter should be obtained for a college or university, they would, on request of the city, or of the mayor and council, convey to the trustees of said college or university, the said square and all the improvements thereon, and the library, apparatus, &c., belonging at the time to said establishment.
In pursuance of the covenant in this deed and of the resolutions referred to, suitable buildings were erected on the said square, and a library and apparatus were provided at an aggregate cost to the city of about $50,000. By an act of February, 1840, (Sess. Áctt, 173,) the Medical Institute was authorized, among other things, to confer degrees in medicine, to establish professorships, and to hold the real estate, library and apparatus which it then possessed, under
Under these various proceedings, the medical department was organized and successfully conducted by the Medical Institute, which, after the date of the conveyance from the city, received some small donations of books, commencing in 1838, and not amounting to more than $-, up to 1846. In February, 1846, an act was passed (Sess. Acts, 135) to establish the University of Louisville, to take effect on the 15th day of March, 1846. On the — day of April, 1846, the' mayor and council of the city of Louisville passed resolutions providing for having the square which had been conveyed to the Medical Institute, with the ‘library, apparatus, &c., conveyed to the trustees of the University of Louisville. And on the 24th day fif April, 1846, said conveyance was accordingly made. The Medical Institute, and the Louisville College, of which there are some traces in the Statutes, were thenceforth merged in the university.
The first section of the act to establish this university, appoints eleven persons, by name, as trustees of said university, to have perpetual succession by the name of “the President and Trustees of the University of Louisville,” with power to acquire and hold estate, real and personal, sufficient to yield an annual income of $40,000 ; and the first and second sections confer all other usual powers of such corporations or universities. The thirdsection enacts that thetrustees shall from time to time choose from their own body a president,“who shall hold his office during the pleasure of the board, or such time as fixed by the by-laws, or until-vacated by death, resignation, or removal from the county, or removal by a majority of the trustees and that after the election of a president, the remaining ten trustees shall class themselves into five equal
The fourth section provides for an annual report of the condition of each department, &c., from the president and trustees to the mayor and council, who shall have the right, at all times, of inquring into the same.
The fifth section provides for the disposition of donations, &c., among the departments, &c., according to the designation made by the donor. And special reference being made to the conveyance of the square above described to the Medical Institute, in accordance with the resolutions passed at the Radical Church, and to the stipulation for a conveyance of said square, with the improvements, library, apparatus, &c., by the said institute, on request of the mayor and council, to any college or university which might be chartered, &c.
The sixth section provides that when such conveyance shall be made to the president and trustees of the university established by that act, the Medical Institute shall cease to exist; provided, that neither the said president and trustees, nor the mayor and council of Louisville, shall ever appropriate the estate, real and personal, thus conveyed, to any other purpose than to the use of the medical department of said university, nor shall the profits, fees, or revenue of any department be diverted from the use of such department.
The seventh section repeals an act of January, 1840, for the benefit of the Louisville College, (Sess. Acts, 57,) and directs the proceeds arising from the sale, whether then or afterwards made, of the seminary lot in Louisville, to be applied by the mayor and council to the erection of buildings for the academic department of the university on the square above described.
The eighth section relates to the continuance or removal of the professors in the institute as professors in the medical department of the university.
The ninth section gives to one class in the academic department a right to attend, free of charge, one course of lectures annually on anatomy, physiology, and chemistry, and to one class in the law department, the right to attend, in like manner, a course of lectures on medical jurisprudence, and enacts that each department shall, if required, receive from the public schools of Louisvile a number of pupils not exceeding six, provided certain conditions are complied with.
Under this charter, and with the property received from the Medical Institute, the university, and especially the medical and law departments, were successfully conducted, and without, so far as appears, any cause of complaint, actual or alleged, in the performance of any of the duties, either expressly or impliedly, devolved upon them or on the corporation. Some additional donations of books, to the value of about $-, were made prior to 1851.
By the first section of the 10th article of an act to charter the city of Louisville, approved March 24,1851 which is not the original, but a new charter of said city, it is enacted that at the first election of city officers under that charter, (which was directed to take place on the first Saturday in April, 1851, and annually thereafter,) there shall be elected by the qualified voters in each ward of the city, two persons qualified as before provided, as trustees of the university and public schools of Louisville, to constitute and be en
The second section of said tenth article vests in said board of trustees, subject to the provisions of this charter, and to the ordinances of the general council of the city, the control and management of the University of Louisville, and of the high school for females, and of the public schools of Louisville, and of the property and funds belonging thereto, &c. And the trustees are required by the third section to make oath or affirmation faithfully to discharge the duties enjoined by this charter and the ordinances of the general council of said city. By the fourth section they may make by-laws, not inconsistent with this charter or the city ordinances. By subsequent sections, various powers are conferred and duties prescribed, which it is not necessary to enumerate; among which is a provision for annual reports, to the general council, of the condition of the university, the high school for females, and the public schools of Louisville, all of which it was the design of this act to unite into one general system of education, under the management of the board of trustees constituted as above stated, and in subordination to the general council. It is made the duty of the first general council elected under the charter to create and appropriate a fund for the erection, establishment, and maintenance of said university and public schools, including buildings for the academical department of the university, and for the high school for females, for which purpose money is to be borrowed, if necessary; and for the maintenance of all these an annual tax
It is, however, provided by the tenth section of the thirteenth article of the charter of Louisville, that before the trustees elected under this charter shall acquire any right to hold and take possession of the University of Louisville, or its medical department, the rights shall be adjudicated and settled by the judge of the Jefferson Circuit Court, on a petition to be filed by the city of Louisville, on which the judge is to decide, according to his opinion with respect to the constitutionality or unconstitutionality of the provisions of this charter in relation to the University of Louisville, or its medical department, subject to the right of appeal to this court.
The board of new trustees was elected in April, 1851; and under the provision just stated, the city of Louisville, in June, 1851, caused a petition to be filed in the Jefferson Circuit Court, in her name, setting forth or referring to the preliminary facts, alleging the constitutional validity of their title under the charter of 1851, and asking that the president and trustees of the University of Louisville be decreed to surrender the said university and medical department to the trustees elected under the new charter. The president and trustees of the university insist upon
Under the general inquiry whether the provisions made in the new charter of Louisville respecting the University of Louisville, are constitutional, two principal questions are presented, viz: 1. Is the original charter of the university entitled to the protection of the constitution either of the State or of the United States, on the ground of being a contract, and as such, withdrawn from the legislative power of the State ? And, 2. If it be such a contract, does the tenth article of the charter of Louisville violate the original charter of the university, in any of those particulars in which as a contract it is placed beyond the reach of legislation by the constitution ?
If the first of these questions be answered in the affirmative, a similar answer to the second is so palpably a matter of course, that it docs not require, and scarcely admits of discussion. The tenth article of the charter of Louisville is in fact a new charter, and if it may not properly be called the charter of a new university, it is certainly the charter of a new corporation. It does not, in terms, abolish or annihilate the pre-existing corporation. But it deprives it of everything that is essential to its continued existence. It takes from it its property conveyed to it by solemn deed in perpetuity. It takes from it the university which, by the first charter, had been committed to its charge and management. It strips it of the faculties, franchises, patronage and privileges, and of all the powers and rights pertaining to it as the visitor, governor and legislator of the university. It deprives it of that source of continued and vigorous succession which the biennial election of one-tenth of
The new charter contained in the tenth article of the charter of Louisville is not merely an amendment of the original charter: It does not merely change the number of trustees, or the mode of their election, or the term of office, or the manner in which they are to exercise their powers, or to administer their property: It creates a new body of trustees, by a new mode of election and for a new term of office, and it takes from the old trustees and confers upon the new ones all the property, and, practically speaking, all of the rights and powers which, under the original charter, had belonged to the original trustees and their successors; and it places the whole under the direct control of the general council of the city of Louisville.. Under these circumstances, it is unnecessary to institute any detailed comparison between the old and the new charters. The question is not whether the univeraity is more likely to flourish and to dispense the expected benefits to the community under the new than under the old organization; nor whether the plan by which all the schools of the city are to be placed under the same management as the university, with the promises of additional and permanent support from the city, and all to be under the supervision and control of the city councils, constitute such inducements as render the change desirable, and should lead to general acquiescence in it; nor whether such advantages as are secured or promised by the new charter, might not have been as well secured by means of the original corporation, with such enlargement of powers and means as might have been deemed necessary, and would probably have been acceptable.
The foregoing is a statement- of the effect rather than the terms of the proposition maintained on the part of-the city, and it is maintained upon the ground that the university from the beginning was and is a public and not a private corporation, and that being a public corporation, it derives no protection from the clause of the constitution which has been referred to, but is subject to repeal or modification, at the legislative discretion. This argument, it will be perceived, does not require the consent or co-operation of Louisville to authorize the destruction of this corporation or the divestiture of its property by legislative act. And if the grounds of this argument be true, not only.the existence and rights of the corporation, but the property which had been given to it by the city of Louisville, and the purposes to which it should be appropriated, are subject to the Legislative will and discretion, without the necessity of any consent or co-operation ón the part of Louisville, or of the corporation to which the gift was made. The fundamental proposition on which this argument is based, is found in the opinion delivered by Chief Justice Marshall, in the case of the Dartmuoth College vs. Woodward, 4 Wheaton, 629-30, containing the following comprehensive proposition, now quoted and relied on as the true American rule for distinguishing a public from a private corporation : “If (says the Chief Justice) the act of incorporation be a grant of political power, if it create a civil institution to be
In applying this proposition to the present case, it is contended that the University of Louisville, as first chartered, was a civil institution, created to be employed in the administration of the government, and that its funds were public property; and it is argued that coming thus within two of the conditions laid down in the proposition relied on, it is also embraced within the conclusion which declares all such corporations to be subject to the legislative power of the State, unrestrained by the constitution of the United States. If, according to the real meaning of the proposition relied on, the premises on which this conclusion rests were established, it cannot be denied that on the authority of the same proposition, the conclusion itself would also be established. But in proportion to the weight of authority conceded to the proposition itself, so is the necessity, that in giving effect to it, its terms should be fairly interpreted and its principles properly applied.
The fact that the conclusion announced in the proposition quoted, subjects to the unrestrained legislation of the States, the corporations therein described, and thus withholds from them the protection which, as the case referred to decides, the constitution affords to other corporations, renders the true ground of discrimination of the utmost importance ; and even if it were shown that according to an interpretation which might be given to the proposition relied on, the University of Louisville might be brought within the class of corporations excluded from constitutional protection, the importance of the subject, no less than justice to the judge and the
In view of these sources of exposition, from the language itself in which the proposition in question is expressed, from the nature and terms of the several conditions therein stated, and of the conclusion applied to them, and from a more extended view of the general principles and scope of the opinion, as an entire and consistent exhibition of thought and reasoning, we are satisfied .that in speaking of the government and the public, in the sentence quoted, it was not intended to refer to whatever might, in any sense be termed a government or a public, but that the reference was to that government which could or did create the corporation, and to that public which it represents; in a word, to the government and public of the State whose power was the subject of consideration; and not to any subordinate community or local public within the State. Indeed, the several descriptions or conditions of the corporations which, according to the proposition, are subject to the legislative discretion, though somewhat variant in the circumstances mentioned in each, seem each to present and to be founded on the one general idea, that the corporation referred to is the mere instrument or agent of the government, through which it exer
The two other opinions delivered in the case, and which concur in the general conclusions stated by the Chief Justice, certainly do not enlarge the class of corporations declared by him to be subject to the legislative discretion, nor place their subjection upon any new or different principle. Nor do we perceive that there is any essential difference between the three opinions with respect either to the nature of the corporations declared not to be protected by the constitution, or to the extent of the legislative power over them.
The opinion of the Chief Justice does not, like the others, take up the division of corporations into such as are public and such as are private, and of course does not discuss, with reference to this classification, the question of constitutional protection or legislative power. Without giving any general name to the corporations declared to be unprotected, that
Of this latter description are municipal corporations referred to in the opinions of Judges Washington and Story, as examples of public corporations: the latter judge saying that they are generally regarded as public, and in many respects are so, although they involve some private interests; which interests he considers as being excepted from the legislative power. In making this exception, Judge Washington substantially concurs, and both of these judges refer to the case of Terret &c. vs. Taylor, 9
If, as reason and observation prove, and as the authorities referred to assume, a municipal corporation may acquire property which does not thereby belong to the State, and may appropriate it to uses which
Then the city of Louisville, though itself a civil . ..... Ti, i , mstitution created to be employed to some extent as an instrument of the government, was not and is not the government itself, but a distinct though subordinate being; and although, as a public corporation, it holds its existence and its peculiar forms and facul- * ties at the will of the government of which it is an instrument, or in some sense a part, it is not so identitled with it that all its acts and acquisitions must -i-i.i necessarily be ascribed to the government, or enure to its benefit, either in point of interest or of power. Louisville might hold property for herself and her corporators, she might contract with individuals or other corporations with respect to her peculiar interests, and might certainly contract with the State; and even if abolished as a corporation, the State would not thereby become the beneficial proprietor of her rights of property or contract, but these would remain subject to the uses for which she had lawfully acquired or appropriated them. That the property given by the city, through the Medical Institute or otherwise, to the university, was the property of Louisville and not of the State, is, we think, unquestionable. If, while it belonged to Louisville, it might with reference to the local community be deemed public property, it was not public with reference to
It is said that the promotion of education is a proper object and duty of government, as well as of individuals ; and it is argued that the university, having been incorporated and endowed for the promotion of education and in performance or pursuance of this duty, was an institution created for the purposes of government and to be employed in its administration; and it is contended that on this ground
The charter does give to the city, through an elec-' tion by her municipal council, the power of filling vacancies as they may occur in the body of incorporated trustees. But this power, which may secure to her some gradual influence in determining the action of the corporation, was intended as a means of perpetuating and not of destroying it, as a privilege to be exercised under the charter, and not to place her above it; and the succession may be kept up by the corporation itself, even if the city should fail or unreasonably delay to act. Other means of influence may have been expected, and have probably been found by Louisville in her wealth and numerous population, and in the locality of the university and its trustees within her limits, which could not fail to insure a due consideration of her interests so far as they might be involved in the acts of the corporation! But be this as it may, she gave her property to the corporation precisely as it was, and chose it in the shape in which it was created by the Legislature as the permanent, the perpetual instrument for appropriating that property, not for her own exclusive benefit, but to the purposes and in the manner indicated by the terms of her gift and of the charter, in which both her will and her power, with respect to its disposition, were merged and exhausted. The charter confers upon the city of Louisville no legislative power whatever. It gives no right to revoke her gift, no power to effect in any manner either the charter or the corporation, unless it be by the occa
It is clearly settled in the case of the Dartmouth College vs. Woodward, supra, that when individuals make a donation for charitable purposes to a corporation created at their instance to receive and administer it, there is a contract for the substantial maintenance of the charter, to which the constitutional protection applies with full force. Some of the judges seem to have considered that such a contract arises between the government and the corporation by the mere acceptance of the charter, irrespective of any endowment. But if there be an endowment, the opinion is clearly expressed by the Chief Justice, and concurred in by a majority of the court, that there is a contract to which the donors, the government and the corporation, (that is, the trustees,) are the original parties. It is also expressly laid down in the same case, that where trustees are incorporated to administer a charity, and the endowment is made by individuals, the donors have no longer any interest in the property while the corporation exists, but only a reversionary right in case of its extinction; and that the present rights of property are vested in the trustees, who, under the charter, represent the donors as well as the objects of the charity, and may vindicate against wrongful assault both the property and the franchises of the corporation ; while the donors as such have no present right
According to these principles the concurrence of the donors in any legislative act injurious to the corporation and inconsistent with the charter, would be of no avail, not only because they have transferred their rights and vested their powers as donors in the trustees or corporation, but because the incorporated trustees from a third party to the contract which, there being no reservation to that effect, can no more be dissolved or mutually changed than it could have been originally made without their consent. And in the case of the Dartmouth College the consent or dissent of the' donors is not referred to as affecting the question of legislative power. Has this third party then, created by the supreme power in the State for the very purpose of receiving donations from Louisville and others, and of administering them, for accomplishing the important obj ects of the charter, no rights, or are its rights to be disregarded, because Louisville, a municipal corporation subject to the same supreme power, is the principal or only donor ? Can it be true, that the State is under an inviolable obligation to respect the rights and maintain the existence and form of this third party, if it receive donations from individuals only, and that in that case the obligation cannot be released by the donors, not even although every citizen of Louisville should contribute ratably to a donation equal in amount to that which Louisville has given, and yet if Louisville, in her corporate character, be the only donor, there is no such obligation on the part of the State, or none which may not be released by the donor ? If this be so, what becomes of the objects to be effected by the charter, and which constituted the presumed consideration for granting it ? What becomes of the inter
If the city of Louisville, or the government of the State, or both, in co-operation, could destroy this corporatio'n to which the property of Louisville was given, or could take the property from the original donee and vest it in a new corporation, and thus in effect abrogate the original charter which constituted the law of the gift as well as of the corporation, we see nothing which can prevent the same power from changing altogether the uses of the property, and diverting it to purposes entirely new. But the State did not possess this unrestrained power over the corporation, because the corporation was not invested with political power, nor created to be employed and partake in the administration of government, nor to control funds belonging to the State, nor to conduct transactions in which the State alone was interested; because in a word it was not the mere instrument or agent of the State, created for its purposes or for purposes of the government, and therefore the State was bound, if not by the mere acceptance of the charter, by the making and acceptance of donations under it. Louisville, on the other hand, did not possess the power, because the charter of the corporation in question considered as a legislative act of the State was beyond her control, because, whatever may have been her power or dignity in" other respects, her dealings with others in the way of contract and in the acquisition or alienation of property, were subj ect to the general law which regulated the similar transactions of individuals, and by that law
And although it be said, that in making the donation the trustees of the university, Louisville made that corporation the instrument of dispensing her bounty or her charity, yet as the charter was the only authoritative law of its being and action, in adopting the corporation as her instrument she adopted the charter as expressing her permanent will with respect to it. It was then her instrument in no other sense than it would have been the instrument of an individual donor; since each would be equally bound by the charter, and equally powerless to make or unmake the corporation; and each would be under the same obligation to permit the donee to perform its prescribed duties, and each equally precluded from imposing a new condition or requiring a new consideration for the gift. Nor do we perceive that this equality of condition, of rights and obligations, is at all effected by assuming that the donation of Louisville Avas an assumption thus far of the duty of promoting education, and that the university was incorporated in order that she might, by her proposed donation or endowment, make it an instrument for that purpose. If this be so, the case was precisely the same with respect to the charter and endowment of Dartmouth College, with the single difference that in that case the instrument was furnished to individuals and endowed by them, and in this case it is furnished to a municipal corporation, by which it is endowed. The fact still remains that the instrument was created not by the municipal corporation whose purpose, as well
It seems to us, therefore, under every aspect in which we have been able to consider this case, that the trustees of the University of Louisville, as originally incorporated, are entitled to occupy the same impregnable position as parties to a contract, which was conceded to the trustees of Dartmouth College, •and that their rights under the original charter are equally protected by the constitution. There is, in our opinion, nothing in the character or the rights of Louisville, as a municipal corporation, and as the founder or endower of the university, nothing in the manner in which its charter was obtained, or in its objects or the purposes for which it was enacted, nothing in the relation of the trustees of the university as a corporation, either to the city of Louisville or to the State of Kentucky, which should prevent them from having the full benefit of the obligations which the circumstances plainly indicate. These circumstances, and the reciprocal obligations flowing from them, need not be recapitulated. They present
After the decision of the case of the Dartmouth College vs. Woodward, and of other cases with respect to charitable corporations in which that decision ha$ been followed by the courts of different-States,, this would not have been a serious question but for the circumstance that the university was chartered-at the request of the city of Louisville, and to'receive as its principal endowment the donation which was afterwards made by that city. To this circumstance, and to the arguments founded upon it, and the inferenees which it authorizes, wfe have given that earnest consideration which the importance of the-queation demands. The result of our reflections and investigations have been stated, and although they may. disappoint the present: wishes of the city of Louisville or of those who are acting for her, they confirm the objects and wishes of those who procured the charter of the university and made the donation to it. And if they have the effect of marring, the symmetry of the' intended system of education of which the university- under its new organization-was to -constitute the centre, they do it by placing thq rights of Louisville upon the only basis -which cari’secure
If it be material to designate more particularly than has been already done, the character of this corporation, we say it is private because it is not the instrument or agent of the government, created to exercise any of its powers, nor entrusted with its property or with the conduct of its affairs, and because it was endowed with the private property of Louisville and others; and we suppose it is eleemosynary, because it was created and endowed for the promotion of education, and because its endowment, with lots, buildings, library, apparatus, and other necessary accommodations, reduces the cost of instruction to the students generally or enables the institution to educate gratuitously a certain number; and to this extent it is eleemosynary. And although it be true that the donation by Louisville was prompted mainly by a view to her own aggrandizement and that of her citizens, it was still a charity, because it was given upon no other consideration required from the donee, but the promotion of education, which the law characterizes as a charitable object. (See Statute of Charitable Uses, 43 Eliz.; Statute Laws of Ky. page 308.) A gift to a corporation created for charitable purposes the law regards as a charity, and its legal character is not affected by the particular motives which may have induced it or the- incidental advantages which may be derived or expected from it. Whatever may have been the actual motives of the donation, literary and professional education were the objects of the charter. And though the immedi-' ate gain to be expected from the aggregation of professors and students may have stimulated the charity of Louisville, it did not limit the education to be imparted, and could not confine its ultimate benefits to her own citizens or to her own territory.
The material question, however, is, whether this corporation stands upon the stable basis of a contract
The case of the Alabama University vs. Winston, of which we have only seen a short statement in 1 U. S. Digest, title corporation, seems to have been one in which the State had not only-endowed the corporation which was decided to be public, but actually paid the trustees for attending to its affairs. So far, therefore, is that case from contravening either our own conclusions with respect to the University of Louisville,.or the principles of the case of the Dartmouth College, as we have expounded them, that as the funds of the corporation belonged wholly to the State, ;as it was clearly but an instrument or agent for administering the property of the State in the fulfillment of a duty actually assumed by the State, it was, according to the opinion of Chief Justice Marshall, as understood by us, a public corporation, and subject to the unrestricted power of the State. The Legisla
We are of opinion, therefore, upon the .ground of authority as well as of reason, that the original charter of the University of Louisville creates a private corporation, which is protected by that clause, of the constitution of the United States which prohibits the enactment of laws impairing the obligation of contracts; and that so much of the amended charter of the city of Louisville, of 1851, as relates to the preexisting corporation and charter of the university, and vests or professes to vest in a new corporation or in new trustees the property and privileges of the original corporation, is in violation of that constitutional prohibition, and consequently void.
Wherefore, the judgment is affirmed by the concurrence of a majority of the court. Judge Hise will present his views in a dissenting opinion.
Dissenting Opinion
dissent to the foregoing opinion—
On the 27th of June, 1851, the city of Louisville instituted suit in the Jefferson Circuit Court, by petition, against the president and trustees of the University of Louisville, for the purpose of recovering the possession of the university square in the city, the buildings erected thereupon, the property, funds and archives of the university, in order that the government, control, and management thereof should be placed in the hands of the “ Board of Trustees of the University and Public Schools of Louisville,” as elected and appointed in pursuance of the provisions of the tenth article of the present city charter, approved March 24, 1851. This proceeding was instituted in conformity with, and by authority of the .tenth section of the thirteenth article of the said act chartering the city of Louisville,^which provides, in substance, that by such proceeding the question of the constitutional validity of those provisions of the city charter, under and by virtue
Upon the pleadings, exhibits, proofs, and facts agreed, the circuit judge determined that so much of the act providing a new charter for the city of Louisville, approved March 24, 1851, as provides for the appointment of the “Board of Trustees of the UnG versity and Public Schools of Louisville,” and directs that the' possession and control of the university shall be delivered to them, and which virtually supersedes and removes from office the trustees, (defendants,) who were appointed according to the provisions of the charter of the University, was unconstitutional and void, and thereupon the petition of the city was dismissed, and the title to the property in controversy was “vested and quieted in the defendants.”
The city, not content with the decision of the circuit judge, has, by writ of error, brought the case before this court; upon which the responsible duty is imposed, therefore, of determining finally the grave and important constitutional question presented by this record.
The important and interesting questions involved arise upon the following state of case :
By an act of the Legislature, approved February 2, 1833, Wm. C. Galt and eight others, by name, citizens of Louisville, were incorporated for the purpose of promoting medical science in the city of Louisville, with the corporate name and style of “The Medical Institute of the city of Louisville.” The charter confers upon the persons incorporated, and their successors in office, the ordinary privileges and duties usually appertaining to corporate institutions of like character. The nine persons named in the
By an act of the Legislature, approved January 17,1840, an institution of learning called the Louisville College, which had been previously established by the city of Louisville within its limits, and en
2. That the trustees shall conduct the affairs of the college, and manage and control the corporation under the corporate name and style of the Louisville College; and the usual rights, qualities, and powers of a corporation are conferred.
3. That the city of Louisville may take and hold, and the college may take and hold for the benefit of the institution, real and personal estate, the income from which not to exceed $10,000, to be applied for the establishment of libraries, cabinets of curiosities, and scholarships and professorships in the college.
4. The city of Louisville, as the founder of this institution, is vested by the charter, with full visitorial power over its affairs, and with the right to prescribe all the rules and regulations for its government and for the government of its fiscal and prudential concerns.
5. The power is reserved to the Legislature to amend, modify, or to repeal the charter; in the event of repeal, the property to revert to the donors or their heirs.
Such are the provisions of the charter of the Louisville College, found in Session Acts, 1839-40, on page 51-2.
This college, it appears, was manifestly a public institution, created and established by the city of Louisville as a public municipal corporation, for a public politicalpui’pose — the diffusion of education; it was endowed by, and was completely under the government of the city, and when incorporated, it was with the same endowment, with the same public object, and remained still under the same control and
On the 80th of March, 1837, more than four years after the Medical Institute of the city of Louisville was chartered, and after general and full notice thereof in the city newspapers, a large meeting of the citizens of Louisville was held at the Radical M. E. Church in the city, which organized in the usual form, by the appointment of Levi Tyler as chairman, and W. Tannehill as secretary, by which meeting the following resolutions were adopted unanimously :
“1. That there ought to be a college in the citw of ■Louisville, with both medical and law departments attached.
“2. That the public square in the city, bounded by Eighth, Ninth, Chestnut and Magazine streets, should be set apart for the location of such college thereon.
“3. That said square was large enough for the erection of buildings thereon for a college proper, and for both the law and medical departments thereof.
“4. That the mayor and council of the city would act in conformity with the public sentiment of the citizens, by donating said square for the erection of said buildings.
“5. That the establishment of a college with medical and law departments attached would be alike beneficial and advantageous to all the citizens of Louisville, in proportion to their property and business, and ought to be a general charge on all.
“6. That-it was highly expedient and proper that the medical department of such college should be immediately established, with a sufficient endowment, on the part of the city of Louisville, to afford means of
“7. That these resolutions be published in the city papers, and that they be laid before the mayor and council of the city, for their action thereon.”
These public resolutions, signed by the chairman and secretary of the meeting, were accordingly presented to and laid before the next ensuing regular meeting of the mayor and board of councilmen of the city of Louisville, held on the third of April, 1837, by Levi Tyler, the chairman of said public meeting, and thereupon, upon the motion of James Guthrie, a member of the council, the following resolutions were adopted by the board of councilmen:
“1. That, in accordance with the resolutions of the citizens, of the 30th March, 1837, adopted at the Radical Church, (then before the council,) the square bounded by Chestnut, Magazine, Eighth and Ninth streets shall be given as a college square, and that the city of Louisville will undertake to build on said square the necessary buildings for a medical college, at a cost not exceeding $30,000, and that the city will advance in cash, for the purpose of purchasing a library, anatomical museum, and the requisite apparatus, &c., for the use of a medical school, the sum of $20,000, and that the control and management of the school be placed under the direction of the president and managers of the Medical Institute of Louisville.
“2. That the finance committee of the board cause a conveyance of said square to be prepared,
“3. That the Finance committee consider the ways and means of raising $20,000 for the purchase of the library, apparatus, &c.”
In pursuance of the resolutions thus adopted by the citizens, and approved by the city authorities of Louisville, on the 21st of November, 1837, a deed was prepared and executed by the city as grantors, to the president and trustees of the Medical Institute of Louisville as grantees. In this deed the said resolutions adopted by the city council are recited at length as showing the design and purpose of the grant, and the institute agrees to accept the property upon the terms stated in the resolutions of the citizens as approved and adopted by the resolutions of the city council; and by this deed the square of ground between Eighth, and Ninth, Chestnut, and Magazine streets is conveyed, in consideration of the premises, to said grantees and to their successors, upon the following trusts and conditions :
1. The institute to have and to hold the property for the uses and purposes and upon the terms and conditions stated in said resolutions.
2. The city to have erected within the years 1838 and 1839 the necessary buildings for a medical college, at a cost not exceeding $30,000.
3. The city to have the right at any time thereafter to have erected other college edifices on the said square, and to alter, change, modify, enlarge or di
4. At the request of the city, the grantees and their successors are bound to convey the said square and all the improvements thereon, and the library, apparatus, and other property conferred upon them by the city, to a college or university, if a charter should be thereafter obtained incorporating such college or university in the city.
5. That all the property, real and personal, thus conveyed by the city, and to be procured and donated by the city, for the establishment of the medical school, shall revert to and be vested in the city for her own use, whenever the same shall cease to be used for the purposes of a medical school.
Such are in substance the purposes set forth, and the trusts contained in this deed to the president and trustees of the Medical Institute of Louisville.
The city afterwards erected buildings upon the square conveyed, as stipulated in the deed, at a cost of about $30,000, for a medical college, and appropriated and applied about $20,000 to the purchase of a library, anatomical museum, &c., for its use.
Afterwards, by an act approved February 12,1840, (Session Acts, 1839-40, page 173,) the charter of the Medical Institute of Louisville, by its consent, was so amended as in substance—
1. To abolish the office of moderators.
2. To give to the managers the right to appoint their own successors, and to fill all vacancies in the board, and to appoint their president and all the officers and agents of the institution, including professors, &c., and to remove them at pleasure.
3. To legalize the conveyance made by the city to the institute, and to confirm it according to its terms and conditions, and to authorize it to acquire other property and estate, so that its income shall not exceed $10,000 per annum, exclusive of the fees of the professors.
This institution under its charter, as thus amended by consent, continued in successful operation until 1846.
By an act of the Legislature, approved 7th of February, 1846, a charter was framed and adopted for the establishment of the University of Louisville by which—
1. Eleven persons named in the act are appointed trustees, and they and their successors are authorized to become a body politic and corporate in law, with the name and style of the “President and Trustees of the University of Louisville,” and when organized are vested with those powers and charged with those duties which usually appertain to the managers of institutions of learning of like character. The university may acquire and hold real andpersonal estate sufficient to produce an annual income not exceeding $40,000, and the trustees may establish all such departments, faculties, professorships, lectureships, and tutorships as may be considered necessary for the promotion of every branch of science, literature, and the liberal arts, and alter or abolish the same at pleasure, and appoint a faculty, professors, lecturers, and tutors, and remove them at pleasure.
2. The president and trustees are to appoint all officers and agents of the institution, and have the management and control of its concers, and may confer all such degrees and exercise all such powers as appertain to a university of the highest order.
3. The trustees have authority to select and appoint one of themselves as president, and remove him at pleasure. ■ The ten named trustees remaining, after the appointment of one of their number as president, are to divide themselves into five classes, two in each class: the first class to go out of office
The power and authority to appoint the successors tp the first set of trustees, as their terms of office shall respectively expire, is vested in the public authorities, to-wit: the mayor and council of the city of Louisville, and the trustees so appointed by the city to hold their office for ten years. The city also has authority to fill all vacancies in the board, occurring from any cause whatever.
4. The president and trustees are required to make annual reports to the public authorities of the city of Louisville, showing the condition of each of the departments of the university, and the condition of the buildings, library, apparatus, &c., thereto belonging, and the mayor and council have authority, at all times, of inquiring into the concerns and condition of the institution.
5. All endowments or donations thereafter made to any department or branch of said university, to be held by the trustees, in trust especially for the.exclusive use of such department, &c., as may be designated in the grant, and all endowments or donations to the university, made generally and without specification, shall be applied to the use of the academical department thereof.
■ The act then, by way of preamble to the sixth section thereof, refers to the conveyance from the city to the Medical Institute of Louisville, of the university square, &c., as having been executed to carry out the wishes and purposes of the citizens as expressed in said deed, and in the resolutions adopted at the Radical Church, and reported to and approved by the public authorities of the city, and it tefers also to the stipulations in the conveyance in respect to the contemplated establishment, of a university, and the undertaking of the institute upon the request of the city, to surrender and convey all the.property' derived.from the city to such contem
6. That when the Medical Institute, by request of the city, shall have conveyed the square, buildings, library, apparatus, &c., as derived from the city by the deed dated November 21, 1837, to the president and trustees of the university, and to their successors, that then the charter of the institute shall stand repealed, and the said institute shall then be merged into and become the medical department of the University of Louisville, and be under the control of the president and trustees of said university; provided that neither the city authorities or trustees of the university shall ever appropriate the Medical College edifice or said square, or the library, museum, apparatus, &c., belonging thereto, to any other use or purpose than for the advancement of the medical department of the said university.
The 7th section repeals the .charter of the Louisville College, as above referred to — the repeal thereof to take effect when this act should go into operation — and directs the proceeds of the past and future sales of the college or seminary lot, west of Eighth street, to be applied, under the supervision of the public authorities of the city, to the erection of buildings on the university square for the academical department of the university.
The 8th section provides that a majority of the trustees may appoint and remove the professors in either department of the university, at pleasure.
The 9th section provides that one class from the academical department, each year, may attend gratuitously a course of lectures on anatomy, physiology, and chemistry, and that one class of the law department may annually attend gratuitously a course of lectures on medical jurisprudence, and that each department, if required, and upon the recommendation of the mayor and council of the city, shall receive not exceeding six pupils without charge, who have been two years in the public schools of
The 10th section provides that the act shall take effect on March 15, 1846. The power is not expressly reserved by the Legislature, to alter or repeal this charter. • (Sess. Acts, 1845-46,page 135.)
Such are, in substance, the provisions of the act incorporating the University of Louisville.
On the 20th of April, 1846, at a meeting held on that day, the mayor and council of the city of Louisville took under consideration the question of directing the Medical Institute to convey to the university, the said square and buildings, library, museum, and the other property and funds which the city had previously granted to said institute; and after amending, and then approving a deed, from the president and managers of the institute, to the trustees of the university, which had been prepared by the city attorney, it was
“Resolved, That the deed be spread upon the records of this council, and a copy thereof be presented by the mayor to the said president and managers of the institute, who are hereby requested to sign, seal, acknowledge, and deliver the same for record in the County Court clerk’s office.”
On the 24th of April, 1846, the president and managers of the Medical Institute, as required in the deed to them from the city, and in pursuance of the request of the city council, as expressed in their resolution of the 20th of April, executed a conveyance to the president and trustees of the University of Louisville of all the property, funds, &c., derived from the city; which was acknowledged and recorded. In this deed the conveyance from the city to the institute, dated November 27, 1837, is referred to, and its terms, trusts, and conditions briefly stated. It is further stated therein that it was made in pursuance of the resolutions of the citizens, followed by those of the municipal council of the city of Louisville as heretofore referred to. That the trusts stipulated in
Two days after the date of this deed, to-wit, on the 26th of April, 1846, the president and trustees of the University of Louisville, through their secretary, present their first report to the mayor and council of the city, then being in session, in which they inform the council that they had organized themselves as a corporation, by electing a president and classifying themselves, as required by the 3d section of the charter ; that they had received from the president and managers of the institute the conveyance of the college buildings, &c., and that they were in possession of all the property named in the conveyance, including the sum of $1,379 32, balance in cash on
It appears that after the institute had been endowed by the city, and before and after the organization of the university, under its charter, some inconsiderable presents in books, &c., had been made by private persons, some to the institute and some to the university, amounting altogether in value to about $950. These small presents are considered as gratuitous additions to the endowments previously made by the city, both to the institute and the university.
The medical department of this university continued in successful operation from the time of its endowment and cotemporaneous organization in April, 1846, until the present controversy arose.
By an act approved March 24, 1851, the present charter of the city of Louisville was framed. The 1st section of article 10 of this city charter provides for the election, by the qualified voters in each of the wards of the city, of two qualified persons for each ward, and that the persons so elected shall constitute and be styled the “Board of Trustees of the University and Public Schools of Louisville.” The first board elected are to be divided by lots into two classes: Those of the first classes to vacate their office in one year; the second in two years from the day of their election, and annually, thereafter, the voters of each ward in the city shall elect one person, as trustee of the university and public schools of' Louisville, to serve for two years and no longer.
The 2d section provides that the control and management of the university, of the high school for females, and of the public schools of Louisville, and of all the property and funds belonging to them, and which may accrue to them, in any way, for their establishment, management, and maintenance, under’ the provisions of the city charter, or otherwise, shall be’ vested in the said board of trustees, subject to the pro
The 3d, 4th, 5th, and 6th sections of the 10th article prescribe the general powers and duties of the said board of trustees, in respect to the government and management of the entire university, and the general educational system in the city of Louisville, as provided for by the city charter. These powers and duties are similar to and not inconsistent with those conferred and imposed upon the trustees by the charter of the university.
In the 6th section it is further provided that when two years shall have elapsed after the academical department of the universüy and the female high school has been opened for the reception of pupils, none shall be received or admitted therein as pupils, except such as have attended for at least one scholastic year in some of the public schools of Louisville, and such others, of prescribed age and proficiency in learning, as have been raised and educated at the orphan .asylums, or at other charitable institutions in the city.
It further provides that no fees shall ever be charged for tuition in the said academical department of the university, or in the high school for- females.
The seventh section requires that' the board of trustees shall annually, and oftener if required by the general council of the city, report in writing to the council the action, progress, and affairs of the university and public schools, and the condition of their property, funds, &c.; and report such other matters as may be required from time to time by the council.
The eighth, ninth, and tenth sections charge the general council of the city with the duty and power to procure, by taxes and loans, &c., and to apply ample and sufficient funds for the support and maintenance of the whole system of public education in the city as provided for in the charter, including the support of the University of Louisville, and all the pub-
The fourteenth section of the tenth article provides that, “the said board of trustees, and their successors in office, as provided for herein, shall take and hold the possession of all property and funds, set apart for the use of said university, for said high school for females, for the public schools of Louisville, and for educational purposes in the city. But the university square, and all the property of the University of Louisville, shall be held to the uses and purposes set forth in the deed of donation, made by the mayor and council of said city to the president and trustees of the Medical Institute of Louisville, and in accordance with the resolutions adopted by the people of said city, in mass meeting at the Radical Methodist Church, on the 20th day of October, 1837.”
The tenth section of the thirteenth article provides that as preliminary to the right of the trustees, elected under the foregoing provisions to take possession of the university, its property, funds, &c, with a view to its management by them, their constitutional validity shall be tested and settled by the proceedings instituted in this case.
By the foregoing provisions of the city charter, the corporate existence of the University of Louisville has not been destroyed, its powers and duties have not been abridged, but rather enlarged, its property, resources, and funds have not been diminished, but provision ample is made for their increase; and the trusts, uses, and purposes for which the public endowment by the city government was made as limited in the deeds exhibited, have not been changed, diverted, or defeated, but on the contrary they have been expressly recognized, ratified, and confirmed by the 14th section of the 10th article of the city charter.
This question is answered by the counsel for the defendants by assuming, 1st. That the University of Louisville is a, private institution or a, private corporation ; and 2nd. That consequently the original trustees appointed and incorporated by the university charter, and their successors appointed, as in the charter directed, by the mayor and council of the city, have taken and derived under the charter vested rights and franchises of which they cannot be deprived by either the local government of the city or that of the State, or by both combined, and that the said university charter is a contract between the original trustees and their successors, on the one part, and the commonwealth of Kentucky on the other, which cannot be altered by the Legislature as has been attempted without their consent; and that the immutability or inviolability of the charter is secured by the first clause of the tenth section of the constitution of the United States, and by the 18th section of the 10th article of the former, as well as by the 20th section of the 13th article of the present constitution of this State, each prohibiting the enactment of laws impairing the obligation of contracts.
On the other hand, it is assumed by the city, 1st. That the University of Louisville is a public corporation, created and designed exclusively as a political or civil institution, to be employed and used in the administration of the government for the promotion particularly and specially of the political and pecuniary interests of the local political community of Louisville, and generally of the interests of the State. 2nd. That the property and funds of the institution are public and not private, and were provided and set apart by the local community of Louisville, through her local government, and as a municipal corporation for the advancement of her public inter
If the University of Louisville, as incorporated by the act of February 7, 1846, is a private corporation, and if the charter is a contract with the original trustees and their successors, accepted and agreed to by them, and by which they have acquired vested rights for themselves or those whom they represent, of a private, not public nature, then it must be conceded that the Legislature had no power, without the consent of its founders, or of the parties to the contract, to change the number of the trustees, to abridge their term of office, to alterthe mode of their appointment, or to authorise and direct the delivery of all the property and funds of the university, and to give up the entire management and control thereof, and of all the affairs and concerns of the institution, to the “Board of Trustees of the University and Public Schools of Louisville,” elected by the qualified voters in the several wards of the city — all of which has been attempted to be done by the various provisions of the city charter above referred to — and in such case, if such be the character of the institution, those provisions of the city charter are unconstitutional and void, unless they be adopted, accepted, and agreed to by the real parties in the interest to this
In detemiing the true character of the corporation of the University of Louisville, it is not necessary to take into consideration the classes into which corporations are divided, as sole and aggregate ; as ecclesiastical and lay. There is no question but that the University of Louisville is a lay corporation. Lay corporations are, however, subdivided into civil and eleemosynary. It is not deemed important, with a view to the decision of the constitutional question under consideration, whetherthe university of Louisville be regarded as belonging to the one or the other of those subdivisions, because there are both public and private civil corporations ; and so of those that are eleemosynary, which maybe either public or private, as their foundation, purposes, and management may be of a public or private nature. Cities and towns chartered and provided with subordinate local gov
If the University of Louisville had received its endowment from the State of Kentucky, then inasmuch as the State would, as a political sovereign, have both created the institution, and endowed it with the property and funds, in the first instance provided for its support, and as the purpose of its creation was, undoubtedly, to promote a system of public education, which is a matter of public and' governmental concern, duty, and power, in such case, as the State would have been both the incipient and perficient founder of the institution, there would have been no difficulty, upon the application of the rule as above defined, in determining that this university was a public corporation.
So on the other hand if the State had upon the application of private citizens, .as private contributors or subscribers of their own property or money, granted this charter to them to enable them to organize and support this institution for their private profit, or for charitable purposes, to enable them as philanthropists or patrons of the cause of learning, science, and education, to diffuse and furnish to the youth of the country gratuitous instruction: upon the application of the rule stated, it would be easy to ascertain the character of such corporation, and in such case it would necessarily be adjudged to be private, and as private not subject by alteration or amendment, to be impaired by Legislative interference, although the State itself might subsequently to its creation have furnished the largest contributions for its successful operation; for though it be the design or motive of the State in granting charters for the incorporation of companies, to promote the public interest and general welfare of the citizens, such design or motive- would not of itself necessarily make the corporation public, inasmuch as a similar design
It is not controverted by the counsel who represent the university that the institution possesses two of the attributes of a public corporation, to-wit: 1. That it received its charter from the government of the State; and 2. That it was chartered for the public purposes indicated in the resolutions, (and especially the fifth of the series,) adopted by the citizens of Louisville at their public meeting, held at the Radical M. E: Church, on the 30th of March, 1837, as ratified and approved by the resolutions of the mayor and council of the city, adopted on the 3d of April, 1837, and as further indicated in the deed from the city to the Medical Institute of Louisville, made in pursuance of the said resolutions of the citizens and of the city council, dated 21st of November, 1837, and in the deed from the institute to the university, dated 24th of April, 1846. The purpose thus shown being manifestly to create a great university as the head and pinnacle of a splendid and munificent system of
It is thus assumed that, although the city of Louisville be a public municipal corporation, itself the exclusive creature of the sovereign powers of the State, subject to have its political and governmental capacities increased or diminished, regulated or totally annihilated at the pleasure of the Legislature of the State; that although the property and funds constituting the exclusive original foundation of the university, belonged to the city as a municipal government, and as a public and political corporation; and although the charter of the university was expressly granted for the city, and at her instance, to receive the endowment previously provided, and the university as constituted was procured to be created to serve as a public instrument and political machine by which, to promote a system of public education as a public enterprise for the promotion of the prosperity, grandeur, and wealth of the city, yet that because the incipient founder, the State, and th sperjicient founder, the city, were not the same identical political communities, and because the former was the government of the State, and the latter was the local and subordinate government of the municipality of the city of Louisville, therefore this university is a private corporation, and therefore the original board of trustees and their successors are parties to a pri
It is conceded that had this corporation been chartered by the legislature, upon the application of private individuals, and to receive from them a private foundation, and that the corporation was thus organized and thus founded, in such case it would have been private in its character, and so have continued, although the city of Louisville as a local and subor
The State creates a public agent a municipal corporation for public purposes with certain powers as an instrument of government within the limits of the city of Louisville. This public corporate agent of the State has authority from the State to endow with public property and revenues a public sub-agent, a chartered university, by means of which to carry out a system of public policy, in respect to education and the diffusion of learning under the public patronage.
It seems, therefore, that the sub-agent, the university, is as much an instrument of the supreme government as the principal agent, the municipality of Louisville, and that both are alike subject to legislative control as public corporations, always provided that by the exercise of such control there be no unauthorized interference with or violation of the vested rights of individuals’ or of private corporations.
The university of Louisville is assumed to be a public corporation, therefore, for the reasons stated, and which may be briefly recapitulatee, as follows:
1. Because its endowment was wholly provided and furnished by a public instrument and agent of the supreme government, to-wit: the public municipal corporation of the city of Louisville, which makes the said endowment public, as much so as if it had
2. It Was created by the supreme government of the State as a subordinate public sub-agent; and
3. It was designed to assist in the administration of the government, in respect to the support and management of a plan of public instruction.
■ 4. Not only was it founded by the local public óf Louisville as a municipal corporation, but, more effectually to mark its public character, the city authorities appointed the trustees, filled all vacancies occurring in the board. The tx’ustees were bound to make reports in writing, to the city council, annually or oftener, if required, of the action, progress, and condition of the institution, and of all such matters, in respect to its management, as might be required by the public authorities, who at all times had the power of examining its affaix’s and condition, as appears from the third and fourth sections of the charter.
The trustees of the university are therefore mere public employees, appointed without emolument or rewai’d of any kind, to manage it as a public institution, until superceded either by a repeal of its charter or a change in its constitution, by which its management may be committed to other persons appointed by the State.
But suppose the position taken by the circuit judge to be correct — that because the university was endowed or founded by the local community of Louisville, and not directly by the Legislature of the State, that therefore, (although the city goveimment is itself a mei’e political creature and agency of the State,) the university is a private corporation, and that its charter is in the nature of a contract between the government of the State and the government of the city as contracting parties, and hence irrepealable and unalterable except with the consent of the city; or, to use the language of the opinion of the circuit judge, that
The authorities of the city government, it is conceded, applied for and procured the passage of the charter, and doubtless tl:e names of the eleven gentlemen mentioned in the charter as the original trustees were presented to the Legislature by the city with a request that they should be appointed by the charter, as the original trustees through whom to conveniently effect the organization of the institution, and under the charter they took no vested rights, in the corporation after its organization; they held no interest of value ; they were mere naked trustees charged by the State and the city with the temporary management of the institution, after its organization was effected through their instrumentality, and until their successors should be appointed by the city council. No personal interest of value or vested personal right, was connected with the trusts confided to them for the time being; they received no compensation for their services, which were to'be gratuitously rendered; they were under no obligations, legal or moral, to accept the trust; accepting it, they could resign it at pleasure, and it is not perceived how they can be regarded as having such vested right or interest in this corporation as that they may forbid the sovereign power of the State, with the consent of the founder of the university, the city of Louisville, to new model and change its government so as to throw its management in the hands of other trustees, at the same time leaving untouched the uses, and trusts, and purposes for the furtherance of which the funds and property were provided by said city. They were the mere agents of the State or city, or of both, with instructions and authority for certain specified purposes as prescribed in said charter, and surely the State and the city concurring, they may revoke such agency and appoint other agents at their discretion ; therefore the eleven trus
The students who receive their education in the institution cannot be regarded as having any legal or equitable interest under this corporate contract, if such it is, and cannot be parties to it, for the reasons given above, and because, further, they merely deal with and employ the corporation to furnish them instruction for compensation agreed tobe given. They come and go continually, and have no further interest in the institution, after they have received the amount of instruction desired, and for which they have made remuneration. And the question again
In the Dartmouth College case, the trustees, the regular successors of those named in the charter, were plaintiffs in the action against W. II. Woodward, to recover the records, books, property, and funds of the institution; Woodward had been removed from his offices of secretary and treasurer of the college, and was appointed to the same offices by the new board of trustees, who had received their appointments, under the recent re-construction of the charter by the Legislature of New Hampshire. The defendant resisted the claim of the plaintiffs upon the ground that under the amended charter he was, as secretary and treasurer of the Dartmouth University,
The right of the trustees in that case to contest the validity of the amendments to the charter, and to maintain the action, was not based upon the ground that they had vested rights and interests of value in the institution which had been impaired, but, upon the ground that they were the proper plaintiffs in the case, and had authority to sue under the charter, a.nd to recover, as the representatives and trustees of the private founders of the institution, their donations, so as to dispense their bounty and their charitable contributions through the instrumentality of a charity school, or an eleemosynary corporation, as Dartmouth College was, from the peculiar features of its charter, pronounced to be. What the opinion of the Supreme Court would have been in that case, had it appeared that all the private founders of the college had assented to and accepted the modifications of the charter made by the acts of the New Hampshire Legislature, cannot be known with certainty. It is certain, however, that as such was not the fact in that case, it bears no analogy to this, but differs materially in this ; that in that case the founders of the institution, through the corporation as their representative and assignee, were complaining that their contract had been impaired and violated without their consent; and in the case under consideration, the original perficient founder consents to the alterations made in the contract, and demands that the institution, with its government as changed, shall be sur
A college or university, employing its funds and property in the business of carrying on a system of education for compensation and profit, or in procuring.teachers, and selling instruction for gain, cannot be regarded as an eleemosynary institution, any more than banking, manufacturing, commercial, or mining corporations, who employ their capital to make gain and profit by trading in money, goods, minerals, &c. And it does not follow that a chartered institution of learning is necessarily eleemosynary in its nature, but its character, whether civil or eleemosynary, depends upon the object and purpose of its creation, and the uses and purposes to which its
The city of Louisville, as a municipal corporation, by authority from the State, may devote the public property and revenues of the city to promote a system of education, for her own benefit. Suppose, by her charter, she had general legislative power also to incorporate colleges and universities,-as instruments of the city to effect such views, within her local and subordinate jurisdiction; and in the exercise of such power, suppose the city council had both chartered and endowed the Louisville University to carry out a system of public policy for the city, in respect to education, could the trustees, in such case, claim that the charter was a contract between them and the city government, and that they, as the beneficiaries, could gainsay the authority of that government so to amend the charter, as to authorize the transfer of the university to other trustees of her own appointment ? They could not; and if not, their right to set themselves up as parties to and beneficiaries under this charter contract cannot arise, or acquire validity, because it was granted by the State to the city, at her request, with the express design of receiving its foundation from her.
On behalf of the defendants it is first assumed that the university is a charitable institutiion; and then it is contended, that although, (as conceded in the opinion delivered by Chief Justice Marshall in the Dartmouth College case,) the trustees have no beneficial interest or vested personal rights under the charter, yet as the representatives or assignees of the donors or founders of the charity, (who do not appear to protect and defend their own right, to have their bounty dispensed according to their own de
On behalf of defendants it is assumed that the city of Louisville has no beneficial interest whatever in the university, either legal or equitable, and that the cause of education generally, and of medical education in particular, are the only beneficiaries, and that they are not complaining, and are not parties to this proceeding, except as represented by the defendants; that the city has, by the deeds to the institute and to the university, made valid grants of her property for the benefit of education, and she occupies no longer the attitude of holder of the legal title, nor that of cestui que trust under the grants; and this is contended for, in the face of the resolutions of the citizens, and of the city council, and of the very purposes and objects of the appropriation of the property and revenues of the city, as distinctly defined and set forth in the deeds referred to. The correctness of this view is not perceived. On the contrary, the city should be regarded as having, by those deeds, and in that form, made an investment of her property and capital in this institution for her own exclusive benefit; not for the cause of education merely, except so far as its advancement would tend to promote her political and pecuniary interests. She invests her property and funds that they may be em
Incorporated institutions may be, and are often established and founded upon private capital, and owned by private persons, to make profit by furnishing education to the youth of the country for full compensation, by furnishing medicine, medical attendance, and advice, together with board and maintenance to the sick, for adequate compensation; or by receiving, supporting, and treating medicinally, maniacs, lunatics, and insane persons for pay. These institutions are called colleges, hospitals, asylums, infirmaries, and the like; yet neither their names nor the business in which they may be engaged, would necessarily make them charitable institutions or eleemosynary corporations, though they be private. They may be and frequently are mere money making contrivances of those furnishing the capital upon which they are founded, to derive gain, by the sale of education, board, and maintenance, and medical assistance, &c. So with respect to the University of Louisville; if it is a private corporation, then it is obvious that Louisville is the private owner of it, as she furnished the whole capital on which it was founded, to promote her own interest by the sale of education; and the trustees or managers of all such institutions are the mere agents of the founders; and if they have themselves furnished no part of the'capital, and have no personal interest whatever, they have no legal ground of objection to the action of the real beneficiaries, in procuring amendments to their
Corporate colleges, hospitals, asylums, &c., therefore may or may not be charitable institutions ; and whether they be so or not is to be collected from the provision of their several charters, and the terms upon which their funds and property may have been furnished for their foundation. If they are private and eleemosynary in their character, then it is granted that the trustees represent the founders of the charity, and that as their assignees they may rightfully claim the protection of the institution as against legislative infractions of the charter. If they be not charitable institutions, but mere instruments by which to make gain and profit for the contributors of the capital, in such case they may have their charters altered and amended at their discretion, with or without the consent of their trustees, if they are not also contributors ; and as before remarked, and assumed, such corporate institutions may also be either public or private.
It is said in the opinion of the court in the Dartmouth college case, as follows: “That education is an object of national concern, and a proper subject of legislation, all admit. That there may be an institution founded by government, and placed entirely under its immediate control, the officers of which would be public officers, amenable exclusively to government, none will deny.”
Now it would seem that to class the Louisville University as a public corporation is a matter of necessity and that it cannot be otherwise classed, reasonably, because its business to educate youth is one of “joublic concern;'1'1 the local public of Louisville got it up, and furnished its whole endowment or capital; it was chartered and endowed to promote the exclusive interest of the public community of Louisville, and it was chartered by the general public of the State, to assist the suborate public authorities of Louisville in the administration of the public local government of
The case of the Trustees of New Gloucester vs. Bradbury, 2 Fairfield, (M. R.) 118, and of Allen vs. McKean, 1 Sumner's R. 296, are mainly relied upon by defendants as authority in support of the assumption that the University of Louisville is a private corporation, and that its charter is not amendable or repealable by the State Legislature. In the former case, though very similar to this in many respects, yet it seems it was expressly provided in the charter of that institution “that it should never be in the power of the town to alter or alienate the appropriation of the fund.” This was of course a condition upon which the incorporating act was passed. It seems, also, that in the act of separation of Maine from the State of Massachusetts it was provided that “all grants of lands, franchises, immunities, corporate or other rights, &c., which have been, or maybe made by the said commonwealth before the separation, * * shall continue in force,” &c.; and that this provision composed a part and was embodied in the constitution of the State of Maine. Therefore as the charter of the new Gloucester educational institution, granted by Massachusetts, was made inviolable by an express provision of the constitution of the State of Maine, the question as to its character, whether public or private, did not necessarily arise, and its decision was not required, to arrive to the determination that the laws amending that charter were unconstitutional. - And it seems moreover that the court in that case took a very superficial and somewhat inaccurate view of the opinion of the Supreme Court in the Dartmouth College case, and of the principles therein decided.
In the case of Allen vs. McKean, 1 Sumner, 276, the Bowdoin College was pronounced to be a private corporation, although its.fundshad been derived gen
It may, perhaps, with propriety be admitted that a chartered institution of learning may have been created for the furtherance of objects of public concern, power and duty, and provided with public funds exclusively for its suppoi't, and yet at the saín estime it may be made pi’ivate by the express px-ovisions of its charter, axxd thus be exempt from the i-ule applicable to public coi’porations, and be placed beyond legislative control, because so expressly pi’ovided, and because the foundation, though given by the State, has been granted absolutely and without reserve or condition to the corporation to be managed and employed, not as a public but as a private fund. But if the charter be issued by the State, to create an institution for public purposes, and upon a foundation in the first instance exclusively provided by the State at large, or by any of its subordinate local public agents and instruments of government, such as municipal coi’porations, such institution surely would be subject
To give authority to alter or repeal the charter of a private company, it is necessary that the charter itself should so provide. On the other hand, If from its creation, purposes, and endowment, the corporation be public, it cannot have the inviolable sanctity belonging to those which are private, or be exempt from Legislative control, unless also by express provision of its charter such private sanctity is given to it, and such control is expressly renounced. The charter of the Louisville University contains no such provisions; the foundation Is public and conditional; the property composing it to be employed according to the terms and trusts of the investment as contained in the articles of subscription, to-wit: the deeds to the institute and to the university, and the whole property to revert to the city in the event the university shall be discontinued.
The charter of the Bowdoin College was also placed on the footing of a private corporation, by the articles of separation between the States of Massachusetts and Maine, which as before observed, were incorporated into the constitution of the latter State, and which provided that “the president and trustees and the overseers of said college shall have, hold, and enjoy their powers and privileges in all respects, so that the same shall not be subject to be altered, limited, annulled, or restrained, except by judicial process, according to the principles of law.” So that the Maine Legislature had manifestly no authority to intermeddle with the charter of the college granted by Massachusetts, unless with the consent of the State of Massachusetts first had and obtained. She had not consented as was decided in that case, and if not, it was not at all necessary in this, any more than in the New Gloucester school-fund case, to fix the
The opinion of the Supreme Court of Alabama, pronounced in the case of the University of Alabama vs. Winston, 5 Stewart and Porter, 7, are in support of the views entertained by me, as expressed in this dissenting opinion, both as to the true character of the corporation, and the public control over it. (See also Angell & Aimes on Corporations, page 9, sec. 14, page 27, sec. 31, page 31, sec. 32, page 32, sec. 34.)
There are in the legislation of this State, and doubtless of the other States of the Union, numerous instances of legislative enactments amendatory to the charters of public educational corporations, the validity of which has not been questioned, and of which no complaintshavebeen made, for the obvious reason, doubtless, that the legislative authority over such institutions has not hitherto been doubted in this State. (See 2 Litt. Laws, 107, 108, 208, 234, 240, 378, 389; 3 Litt. Laws, 206, 255, 277, 279, 409.) By an act of 17S8 the Legislature united and merged two institutions, the Transylvania Seminary and the Kentucky Academy, into one, and named it the Transylvania University, and appointed an entire new board of trustees, to whom the other two institutions were surrendered, with their rights and obligations, assuming that this was done upon the application of a majority of the trustees of the seminary and academy.
By an act of assembly passed 4th of December, 1800, eight new trustees were appointed for the Jefferson Seminary of learning clothed with full powers as such, without the consent of the existing trustees for aught that appears in the act.
By an act approved 19th of December, 1805, it is declared that the former trustees, appointed under the “act establishing the Franklin Academy,” had forfeited their powers by non-uses, and nine new trustees are appointed in their place, and clothed with their powers, for all that appears, without their consent. . -
By an act passed 21st of December, 1805, various radical alterations and amendments were made to acts incorporating the Shelbyville, Newton, and Logan Academies, and other institutions of learning in the State, including the Kentucky Seminary, involving the increase and diminution of the number of the trustees, the removal of some and substitution of others in their places, and the abridgement or enlargement of their powers, &c., all apparently at the discretion of the Legislature.
By an act approved 27th of December, 1808, the Legislature, assuming that a majority of the trustees had so agreed, unite the Newton Academy and Logan Seminary into one institution, appoint a new set of trustees with full powers, and create án entire new corporate institution, and vest in it all the rights, immunities, funds, and property which had previously belonged to both of the others thus merged into it. These and other acts which might be referred to, prove that in Kentucky at least the legislative power to alter, amend, or repeal the charters of public institutions of learning has been freely exercised, and hitherto never questioned, and in my judgment it should not now be questioned for the first time; and perhaps had it not been that the interesting'questions presented in this case were expressly submitted for adjudication by the tenth section of the thirteenth article of- the city charter, that power would not have
Case-law data current through December 31, 2025. Source: CourtListener bulk data.