Marshall v. Baltimore & Ohio Railroad
Opinion of the Court
delivered the opinion- of the court.
A question, necessarily preliminary to our consideration of the merits of this case,-has been brought to the notice of the court, though not argued or urged by the counsel.
The plaintiff in error,, who was also plaintiff below, avers in his declaration that he is a citizen of Virginia, and that “ The Baltimore and Ohio Railroad Company, the defendant, is a body corporate by an act'of the General Assembly of Maryland.” It has been objected, that this averment is insufficient to show jurisdiction in the courts of the United States over the “ suit ” or “ controversy.” The decision of this court in the case of the Louisville Railroad v. Letson, 2 Howard, 497, it is said, does not sanction it, or if some of the doctrines advanced should seem so to do, they are extrajudicial, and therefore not authoritative.
The published report of that case (whatever the fact may have been) exhibits no dissent to the opinion of the c'ourt by any member of it. It has, for the space of ten years, been received by the bar as a final settlement of the questions which have so frequently arisen under this clause of the Constitution; and the practice and forms of pleading in the courts of the United States have been conformed to it. Confiding in its stability, numerous controversies involving property and interests to a large amount, have been heard and decided by the circuit courts, and by this court; and many are still pending here, where the jurisdiction has been assumed on the faith of the sufficiency of such an averment. If we should now declare these judgments to have been entered without jurisdiction or authority, we should inflict a great and irreparable evil on the community. There are no cases, where an adherence to the maxim of “ stare decisis ” is so absolutely necessary to the peace of society, as those which affect retroactively the jurisdiction of courts. For this reason alone, even if the court were now of opinion, that the principles affirmed in the case just mentioned, and that of
Besides the numerous cases, with similar averments, over which the court have exercised jurisdiction without objection, we may mention that of Rundle v. The Delaware and Raritan Canal, 14 Howard, 80, as one precisely in point with the present. The report of that case shows that the question of jurisdiction, though not noticed in the opinion of the court, was not overlooked, three of the judges having severally expressed their opinion upon it. Its value as a precedent is therefore not merely negative. But as we do not rely only on precedent to' justify our conclusion in this case, it may not be improper, once again, to notice the argument used to impugn the correctness of our former decisions, and also to make a brief statement of the reasons which, in our opinion, fully vindicate their propriety.
By the Constitution, the jurisdiction of the courts of the United States is declared to extend, inter alia, to “ controversies between citizens of different States.” The Judiciary Act confers on the circuit courts jurisdiction “ in suits between a citizen of the State where the suit is brought and a citizen of another State.”
The reasons for conferring this jurisdiction on the courts of ■ the United States, are- thus correctly stated by a- contemporary, writer (Federalist, No. 80.) “ It may be esteemed as the basis of the Union, ‘ that the citizens of each State shall be entitled to all the privileges and immunities of the citizens of the several States.’ And’ if it be a just principle, that every government ought to possess the means of executing its own provisions by its own-authority, it will follow, that in order to the inviolable maintenance of that equality of privileges and immunities, the national judiciary ought to preside in all cases, in which one State or its citizens are opposed to another State or its citizens.”
Now, if this be a right, or privilege guaranteed by the Constitution to citizens of one State in their controversies with citizens of another, it is plain that it cannot 'be taken away from the plaintiff by any legislation of the State in which the defendant resides. If A, B, and C, with other dormant or secret partners, be empowered to act by their representatives, to sue or to be sued in a collective or corporate name, their enjoyment of these privileges, granted by State authority, cannot nullify this important right conferred on those who contract with them. It was
Let us now examine the reasons which are considered so conclusive and imperative, that they should compel the.court to give a construction to this clause of the Constitution, practically- destructive of the privilege so clearly intended to be conferred by it.
“A corporation, it is said, is an artificial person, a mere legal entity, invisible and intangible.”
This is no doubt metaphysically true in a certain sense. The inference, also, that such an artificial entity “ cannot be a citizen ” is a logical conclusion from the premises which cannot be denied.
But a citizen who has made a contract, and- has a “ controversy ” with a corporation, may also say, with equal truth, that he did not deal with.a mere metaphysical abstraction, but with natural persons ; that his writ has not been served on an imaginary entity, but on men and citizens; and that his contract was made with them as the legal representatives of numerous unknown associates, or secret and dormant partners.
The necessities and conveniences of trade and business require that such numerous associates and stockholders should act by representation, and have the faculty of contracting, suing, and being sued in a factitious or collective name. But these important faculties, conferred on them by State legislation, for their, own convenience, cannot be wielded to deprive others of acknowledged rights. It is not reasonable that those who. deal wiih such persons should be deprived of a valuable privilege by a. syllogism, or rather sophism, which deals subtly with
Nor is it reasonable that representatives of numerous unknown 'and ever-changing associates should be permitted to allege the different citizenship of one or more of these stockholders, in order to defeat the plaintiff’s privilege. It is true that these stockholders.are corporators, and represented by this “juridical person,” and come -under the shadow of its name. But for all the purposes of acting, contracting, and judicial remedy, they can speak, act, and plead, only through their representatives or curators. For the purposes of a suit or controversy, the persons represented by a corporate name can appear only by attorney, appointed by •its constitutional organs. The individual or personal appearance of each and every corporator would not be a comjDliance with the exigency of the writ. of summons or distringas. Though, nominally, they are not really parties to the suit or controversy. In courts of equity, where there are very numerous associates having all the same interest, they may plead and be impleaded through persons representing their joint interests; and, as in the ease between the northern and southern branches of the Methodist Church, lately decided by this court, the fact that individuals adhering to each division were known to reside within both States of which the parties to the suit were citizens, was not considered as a valid objection to the jurisdiction.
In courts of law, an act of incorporation and a corporate name are necessary to enable the representatives of a numerous association to sue and be sued. “ And this corporation can have no legal existence out of the bounds of the sovereignty by which it is created. It exists only in contemplation of law and by force of the law; and where that law ceases to operate the corporation can. have no existence. It must dwell in the place of its creation.” Bank of Augusta v. Earle, 13 Pet. 512. The persons who act under these faculties, and use this corporate name, '"may be justly presumed to be resident in the State which is the necessary habitat of the corporation, and where alone .they can be made stíbject to suit; and should be estopped in equity from averring a different domicil as against those who are compelled- . to seek them there, and can find them there and nowhere else. If it were otherwise it would be in the power of every corporation, by electing a single director residing in a different State, to deprive citizens of other States with whom they have controversies, of this constitutional privilege, and compel them to resort to State tribunals in cases in which, of all others, such privilege may be considered most valuable.
But it-is contended that, notwithstanding the court in decidid g the question of jurisdiction, will look behind the corporate
The right of choosing an impartial tribunal is a privilege of no small practical importance, and more especially in cases where a distant plaintiff has to contend with the power and influence of great numbers and the combined wealth wielded by corporations in almost every State. It is of importance also to corporations themselves that they should enjoy the same privileges, in other States, where local prejudices or jealousy might injuriously affect them,
'With these remarks on the subject of jurisdiction we will now proceed to notice the various exceptions to the rulings of the court on the trial.
The declaration, besides a count for work and labor done and
“ On motion, it was resolved, that the President be, and is hereby authorized, in addition to the agent heretofore employed by the committee for the same purpose, to employ and make arrangements, with other responsible persons, to attend at Richmond during the present session of the legislature, in order to superintend and further any application or other proceeding to obtain the right of way through the State of Virginia, on behalf of this company, and to take all proper measures for that purpose-; that he also be authorized to agree with such agent or agents, in case a law shall be obtained from the said legislature, during its present session, authorizing the company to extend their road through that State to a point on the Ohio River as low down the river as Fishing Creek; and the stockholders of this company shall afterwards accept such law as may be obtained, and determine to act under it; or, in case á law should be passed authorizing the construction of a railroad from any point on the Ohio River above the mouth of the Little Kenawha and below the city of Wheeling, with authority to intersect with the present Baltimore and Ohio Railroad ; and the stockholders of the Baltimore and Ohio Railroad Company shall determine to accept and adopt said law, or shall become the proprietors thereof, and prosecute their road according to its provisions, then, in either of the said cases, the president shall be and is authorized to pay to the agent or agents whom he may employ in pursuance of this resolution, the sum of fifty thousand dollars, in the six per cent, bonds of this company, at their par value, and to be made payable at any time within the period of five years. Resolved, That it shall be expressly stipulated in the agreement with the said agent or agents employed pursuant to this resolution, anu. as a condition thereof, that if no such law as aforesaid shall pass, or if any law that may be passed shall not be accepted, or adopted, or used by the stockholders, the said agents shall not be entitled to receive any compensation whatever for the service they may render in the premises, or for any expense they may incur in obtaining such law or otherwise.”
And also the following resolution of January 18th, 1847:
“ On motion it was unanimously resolved, that the right of Mr. Marshall to the compensation under the existing contract shall attach upon the passage of a law at the present session of-the legislature, giving the right of way to Parkersburg or to Fishing Creek, either to the Baltimore and Ohio Railroad Company, orto an independent company: Provided this company
And also a letter from the president of the company, of February. 11th, 1847, containing a further modification of the terms as exhibited in the following extract:
“ In this crisis, if after the utmost exertion nothing better ban be done, if it were practicable to pass Mr. Hunter’s substitute with Fish Cheek instead of Fishing Creek, we would not undertake to prevent the passage of such a law. We would then refer the whole question to the stockholders; and I am authorized to say that, every thing else failing, if such a law as is indicated pass, and the stockholders adopt, it and act under it in the manner contemplated by the contract, your compensation shall- apply to that as to any other aspect of the case.”
The defendants gave notice of the following grounds of defence, as those upon which they intended to rely:
“ 1. That the agreement sought to be enforced by the plaintiff, admitting his ability to make it out by legal proof -to the extent of his pretensions, was an agreement contrary to the policy of the law, and which cannot be sustained.
“ 2. That, admitting the said agreement to be a valid one, which the courts would enforce, yet the plaintiff is not entitled to recover, because he failed to accomplish the object for which it was entered into.
“ 3. That the law of Virginia, which was accepted by the defendants after it had been modified by. the waiver of the city of Wheeling, as mentioned in the plaintiff’s notice, was not obtained through the efforts of the plaintiff, but against his strenuous opposition, and furnishes him no ground for his present claim.
“ 4. That there was a final settlement between the plaintiff and defendants, after the passage of the Virginia law aforesaid, which concludes him on this behalf.”
On the trial the plaintiff, after giving in evidence the contract as above stated, produced various letters and documents tending to show the measures, pursued, and their result — a particular recapitulation of these facts is not necessary, and would encumber the case. A very brief outline will suffice to an understanding Of the points to be considered.
ft appears that the defendants were desirous to obtain, from the Legislature of Virginia, the grant of a right of way so as to strike the Ohio Fiver as low down as possible in view of a connection from thence towards Cincinnati. It was the interest of the people of Wheeling to prevent, if possible, the terminus o the road on the Ohio from, being anywhere else but at their city. In the winter of 1846-7 the antagonist parties came.into
The plaintiff afterwards admitted his defeat, ■ and want of success in fulfilling the conditions of his contract. He at the same time demanded and received the sum of six hundred dollars for expenses of agents, See. But as Wheeling and defendants both desired the extension of the road to the Ohio, they finally agreed to a compromise, modifying the operation of the act under which the road has since been completed.
The defendants then offered in evidence, in support of their defence, on the ground of illegality of the contract, a letter from the plaintiff to the president of the board, dated 17th Novem- • ber, 1846, with an accompanying document, in which plaintiff proposes himself as agent, and states his terms; and the course he advises to be pursued, and the means to be used to ensure success; and also a letter from the president in answer thereto, . stating his inability to act on his individual responsibility, and inviting an interview; together, also, with a letter from' the same, dated 12th of December, in which he says:. “ I am now prepared to close an arrangement with you on the basis of your communication of the 17th of November.”
The plaintiff’s objection to the admission of these documents in evidence, and the reception of.them, form the subject of the first bill of exceptions.
In order to judge of the competency and relevancy of these documents to the issue in the case, it will be necessary to give a brief statement of some portion of their, contents.
The letter of November 17th commences by referring to a, former interview and a promise to submit a plan, in writing, by which it was supposed the much desired right of way. through Virginia might be procured from the legislature. It proposes •that the writer should be appointed, as agent of the company, to manage “ the delicate and important trust.” It states that, as the business required “absolute secrecy,” he could not safely get testimonials as to his qualifications; but that he had “ con- ' siderable experience as a lobby member ” before the legislature of Virginia, and could allege “ an ostensible reason ” for his presence in Richmond, and his active interference, without disclosing his real character and object.
The accompanying document explains the cause of previous failures, and shows what remedy or counteracting influence
That, in order to the “ requisite secrecy,” the company should know but one agent, and he select the others ; that the cost of all this will “ necessarily be great,” as the result can be obtained “only by offers of high contingent compensation;” that “high services cannot be had at a low bid,” and that he would not be willing to undertake the business unless “ provided with a fund of at least $50,000.”
As- the contract was made “ on the basis of this communication,” there can .be no doubt as to its legal competence as evidence to show the nature and object oí the agreement. As parts of one and the same transaction, they may be considered as incorporated in the contract declared on. The testimony is therefore competent- Is it relevant?
As the first three propositions, contained in the charge .of the court, have reference to the question of the relevancy of this matter to the issues, they may well be considered together.
They are as follows:
“ 1; If at'the time, the special contract was made, upon which this suit is brought, it was understood between the parties that-the services of the plaintiff were to be of the character and description set forth in his letter to the president of the railroad company, dated November 17th, 1846, and the paper therein inclosed, and that, in consideration of the contingent compensation mentioned in the contract, he was to use the means and influences proposed in his letter and the accompanying paper,
“ 2. If there was no agreement between the parties that the services of the plaintiff should be of the character and description mentioned in his letter and communication referred to in the preceding instruction, yet the contract is against the policy of the law, and void, if at the time it was made the parties agreed to conceal from the members of the Legislature of Virginia the fact that the plaintiff was employed by the defendant, as its agent, to advocate the passage of the law it desired to obtain, and was to receive a compensation, in money, for his services, in case the law was passed by the legislature at the session referred to in the agreement.
“ 3. And if there was no actual agreement to practise such concealment, yet he is not entitled to recover if he did conceal from the members of the legislature, when advocating the passage of the law, that he was acting as agent for the defendant, and was to receive ■ a compensation, in money, in case the law passed.”
It is an undoubted principle of the common law, that it will ■ not lend its aid to enforce a contract to do an act that is illegal; or which is inconsistent with sound morals or public policy; or which tends to corrupt or contaminate, by improper influences, the integrity of our social or political institutions. Hence all contracts to evade the revenue laws are void. Persons entering into the marriage relation should be free from extraneous or deceptive influences; hence the law avoids all contracts to pay money for procuring a marriage. It is the interest of the State that ail places of public trust should be filled by men of capacity and integrity, and that the appointing power should be shielded from influences which may prevent the best selection; hence the law annuls every contract for procuring the appointment or election of any person to an office. The pardoning power, committed to the executive, should be exercised as free from any improper bias or influence as the trial of the convict before the court; consequently, the law will not enforce a contract to pay money for soliciting petitions or using influence to obtain a pardon. Legislators should act from high considerations of public duty. Public policy and sound morality do therefore imperatively require that courts should put the stamp of their disapprobation on every act, and pronounce void every contract the ultimate or probable tendency of which would be to sully the purity or mislead the judgments of those to whom the high trust of legislation is confided.
All- persons whose interests may in any way be affected by
Legislators should act with a single eye to the true interest of the whole people, and courts of justice,.can give no countenance -to the use of means which may subject them to be misled by the pertinacious importunity and indirect influences of interested and unscrupulous agents or solicitors.
Influences secretly urged under false and covert pretences must necessarily operate deleteriously on legislative action, whether it be employed to obtain the passage of private or public acts. Bribes, in the shape of high contingent compensation, must necessarily lead to the use of improper means and the exercise of undue influence. Their necessary consequence is the demoralization of the agent who covenants for them; he is soon brought to believe that any means which will produce so beneficial a result to himself are “ proper means; ” and that a share of these profits may have the same effect of quickening the perceptions and warming the zeal of influential or “ careless ” members in favor of his bill. The use of such means and such agents will have the effect to subject the State governments to the combined capital of wealthy corporations, and produce universal corruption, commencing with the representative and ending with the elector. Speculators in legislation, public and private, a compact corps of venal solicitors, vending their secret influences, will infest the capital of the Union ' and of every State, till corruption shall become the normal condition of the body politic, and it will be said of us as of Borne — “ omne Romm venale.”
2d. It' forbids all officers of the United States to be engaged as agents or attorneys for prosecuting claims or from receiving any gratuity or interest in them in consideration of having aided or assisted in the prosecution- of them, under penalty of fine and imprisonment in the penitentiary.
3d. It forbids members of Congress, under a like penalty, from acting as agents for any claim in consideration of pay ■ or compensation, or from accepting any gratuity for the same.
4th. It subjects any person who shall attempt to bribe a member of Congress to punishment in the penitentiary, a,nd the party accepting the bribe to the forfeiture of his office. .
If severity of legislation be any evidence of the practice of the offences prohibited, it must be the duty of courts to take a firm stand, .and discountenance, as against the policy of the law, any and every contract which may tend to introduce the offences prohibited.
Nor are these principles now advanced for the first time. Whenever similar cases have been brought to the notice of courts they have received the same decision.
Without examining them particularly, we would refer to the cases of Fuller v. Dame, 18 Pick. 470; Hatzfield v. Gulden, 7 Watts, 152; Clippinger v. Hepbaugh, 5 Watts & Sergt. 315; Wood v. McCan, 6 Dana, 366; and Hunt v. Test, 8 Alabama, 719. The Commonwealth v. Callaghan, 2 Virginia Cases 460.
The Sum of these cases is.— 1st. That all contracts for a contingent compensation for obtaining legislation, or to use personal or any secret or sinister influence on legislators, is void by the policy of the law. '
2d. Secrecy, as to the character under -which the agent or solicitor acts, tends to deception, and is immoral and fraudulent ; and where the agent contracts to use secret influences, or voluntarily, without contract with his principal, uses such means, he cannot have the assistance of a court to recover compensation.
3d. That what, in the technical vocabulary of politicians is termed “ log-rolling,” is a misdemeanor at common law, punishable by indictment.
It follows, as a consequence, that the documents given in evidence under the first bill of exceptions were relevant to the issue ; and that the court below very properly gave'the instructions under consideration.
“ 4. But if the contract was made upon a valid and legal consideration, the contingency has not happened upon which the sum of fifty thousand dollars was to be paid to the plaintiff— the law passed by the legislature of Virginia being different, in. material respects, from the one proposed to be obtained by the defendant by the agreement of February 11th, 1847; and the. passage of which, by the terms of that contract, was made a condition precedent to the payment of the money.”.
“ 5. The subsequent acceptance of the law as passed, under the agreement with the city of Wheeling, stated in the evidence, was not a waiver of the condition, and does not entitle the plaintiff to recover in an action on the special contract.”
“6. There is no evidence that the plaintiff rendered any services, or was employed to render any, under any contract, express or implied, except the special contract stated in his declaration ; and as no money is' due to him, under that contract, he cannot recover upon the count of quantum meruit.”
We do not think it necessary, in order to justify these instructions of the court below, or to vindicate our affirmance of them, to enter into a long and perplexed history of the various schemes of legislative action, and their results, as exhibited by the testimony in the case. It would require a map of the country, and tedious and prolix explanations. Suffice it to say, that after a carecí examination of the admitted facts of the case, we are fully satisfied of the correctness of the instructions,
1. Because the plaintiff, by his own showing, had not performed the conditions which entitled him to demand this stipulated compensation.
2. The act of assembly which was passed, and afterwards used by defendant for want of better, was obtained by the op-’ ponents of defendants, and in spite of the opposition of plaintiff ; and the fact that the company were compelled to accept the act under modifications, by compromise with their opponents, would not entitle plaintiff to his stipulated reward.
3. By the stipulations of his contract-he is estopped from claiming under a quantum meruit, as his whole compensation depended on success in obtaining certain specified legislation, which he acknowledged he had failed to achieve.
The judgment of the Circuit Court is therefore affirmed, with costs.
said that he concurred with his bro
He remarked, further, that according to the assumption that a corporation was a citizen of the State where it was incorporated, a company having a charter for a railroad in two States (and there were many such) might sue citizens of the State and place where the president and directors resided, averring that the company was a citizen of the other State, and vice versa. In such case the corporation could sue in every federal court in the Union.
Dissenting Opinion
From the opinion just delivered I must declare my dissent. In the settlement of the discreditable controversy between the parties to this cause, I take no part. If I did, I should probably say that it is a case without merits, either in the plaintiff or in the defendants, and that in such a case they should be dismissed by courts of justice to settle their dispute by some standard which is cognate to the transaction in which they have been engaged.
My participation in this case has reference to a far different and more important ingredient involved in the opinion just announced, namely, the power of this court to adjudicate this cause consistently, with a just obedience to that authority from which, and from which alone, their being and their every power are derived.
Having in former instances, and particularly in the case of the Rundle v. Delaware and Raritan Canal Company, endeavored to expose the utter want of jurisdiction in the courts of the United States over c.auses in which corporations shall be parties
Thus it has been insisted that a corporation, created by a State, can have no being or faculties beyond the limits of that State; and if its president and officers reside within that State such a conjuncture will meet and satisfy the predicament laid down by the Constitution.
The want of integrity, in this argument, is exposed by the following questions:
1. Does the restriction- of the corporate body within particular geographical limits, or the residence of its officers within those limits, render it less a corporation, or alter its nature and legal character in any degree ?
2. Does the restriction of the corporate faculties within given bounds, necessarily or by any reasonable presumption, imply that the interest of its stockholders, either in its property or its acts, is confined to the same limits ? If it does, then a change of residence by officers, agents, or stockholders, or a transfer of a portion of the interests of the latter, would, destroy the qualification of citizenship depending upon locality. If it. would not have this effect, then this anomalous citizen may possess the rights of both plaintiff’and defendant, nay, by a sort of plural being or ubiquity, may be a citizen of every State in the Union,
Again it has been said, that the Constitution has reference merely to the interests of those who may. have access to the federal courts; and that provided those interests can be traced, or .presumed to have existence in persons lesiding in different States, it cannot be required that those by whom such interests are legally held and controlled, or represented, should be alleged or proved to be citizens, or should appear in that character as parties upon the record. In reply t.o this proposition it may be asked, upon what principle any one cari be admitted into a court of justice apart from the interest he may possess in the matter in controversy; and whether it is not that interest alone and the position he holds in relation thereto, which can give him access to any court ? But, again, the language of the Constitution refers expressly and conclusively to the civil or political character of the party litigant, and constitutes that character the test of his capacity to sue or be sued in • the courts of the United States.
In «strict accordance with this doctrine has been'the interpretation of the Constitution from the early, and what may in some sense be called the cotemporaneous interpretation of that instrument, an interpretation handed down in an unbroken series of decisions, until crossed and disturbed by the anomalous ruling in the case of Letson v. The Louisville Railroad Company.
Beginning with the case of Bingham v. Cabot, in the 3d of Dallas, 382, and running through the cases of Turner v. The Bank of North America, 4 Dallas, 8; Turner’s Admr. v. Enrille, Ib. 7; Mossman v. Higginson, Ib. 12; Abercrombie v. Dupuis, 1 Cranch, 343; Wood v. Wagnon, 2 Ib. 1; Capron v. Van Noorden, 2 Ib. 126; Strawbridge v. Curtis, 3 Ib. 267; The Bank of the United States v. Deveaux, 5 Ib. 61; Hodgson v. Bowerbank, 5 Ib. 303; The Corporation of New Orleans v. Winter, 1 Wheat. 91; Sullivan v. The Fulton Steamboat Company, 6 Wheat. 450 — the doctrine is ruled and reiterated, that in order to maintain an action in the courts of the United States, under the clause in question,’ not only must the parties be citizens of different States, but that this character must be averred explicitly, and must appear upon the record, and .cannot be inferred from residence or locality, however expressly stated, and that the failure to make the required averment will be fatal to the jurisdiction of a federal court, either original or appellate; and. is- not cured by the want of a plea or of a formal exception in any other form. But the decisions have not stopped at this point; they have ruled that to come' within the meaning of the Constitution, the eause of action
This renders it necessary, inasmuch as the proceedings of no court can be valid farther than its jurisdiction appears or can be presumed, to set.forth upon the record óf a circuit court, the facts or circumstances which give it jurisdiction, either expressly or in such manner as to render them certain by legal intendment. Amongst those circumstances it is necessary, where the defendant appears to be a citizen of one State, to show that the plaintiff is a citizen of some other State, or an alien; or if, as in the present case, the suit be upon a promissory note by an assignee, to show that the original promisee is so, for by a special provision of the statute it is his description as well as that of the assignee, which effectuates the jurisdiction; but here the description given of the promisee only is, that he used trade at Philadelphia or North Carolina; which, taldng either place for that where he used trade, contains no averment that
Nor has the doctrine ruled by the cases just cited been applied to proceedings at law alone, in which a peculiar strictness or an adherence to what may seem to partake of form is adhered to. The overruling authority of the Constitution has been regarded by this court as equally extending itself to equitable as to legal rights and proceedings in the courts of the United States. Thus in the case of Course v. Stead in 4 Dallas, 22. That was a suit in equity in the Circuit Court of the United States for the District of Georgia, in which it was deemed necessary to make a new party by a supplemental bill. This last bill recited the original bill, and all the orders which had been made in the cause, but omitted to allege the citizenship .ui the newly made defendant. In this case, when brought here by appeal from the court below, this court say, in reference to the omission to aver the citizenship of the new party, “it is unnecessary to form or to déliver any opinion upon the merits of this cause; let the decree of the Circuit Court be, reversed.” The case of Jackson v. Ashton, in 8 Peters, 148, is still more in point. This also was a suit in equity. The caption of the bill was in these words: “ Thomas Jackson and .others, citizens of the State of Virginia v. The Rev. William E. Ashton, a citizen of Pennsylvania.” What said this court by its organ, Marshall, Chief Justice, upon this state of the case ? “ The title or cap
The principle stare decisis, 'adopted by the courts in order to give stability to private rights, and to prevent the mischiefs incident to mutations for light and insufficient causes, is doubtless a wholesome rule of decision when derived from legitimate and competent authority, and when limited to the necessity which shall have demanded its application ;■ but, like every other rule, must be fruitful of ill when it shall be wrested to the suppression of reason or duty, or to the arbitrary maintenance of injustice, of palpable error, or of absurdity. Such an application of this rule must be necessarily to rivet upon justice, upon social improvement and happiness, the fetters of ignorance, of wrong, and usurpation. It is a rule which, whenever applied, should be derived from a sound discretion, a discretion having its origin in the regular- and legitimate powers of those who assert it. It can never be appealed to in derogation or’ for the destruction of the supreme authority, of that authority which created and-which holds in subordination the agents whose functions it has defined, and bounded, by .clear and plainly-marked limits.
There cannot be a more striking example than is instanced by the case before us, of the mischiefs that must follow from disregarding the language, the plain words, or what may be termed the body, the corpus, of the Constitution, to ramble in pursuit of some ignis fatuus of construction or implication, called its spirit or its intention, — a spirit not unfrequently about as veracious, and as closely conndbted with the Constitution, as are the spirits of the dead with the revolving tables and chairs which, by a fashionable metempsychosis of the day, they are said to animate.
The second section of the third article of the Constitution prescribes citizenship as an indispensable’requisite for obtaining admission- to the courts of the United States — prescribes it in ' language too plain for misapprehension. This court, in the case of Deveaux and the Bank of the United States, yielded obedience; professedly at any rate, to the constitutional mandate : for they asserted -the indispensable requisite of citizenship; but in an unhappy attempt to reconcile that obedience with an unwarranted claim to power, they utterly demolished the legal rights, . nay, the very existence of one of the parties to the controversy; .thereby taking from that party all standing or capacity to appear in any court. This was ignis' fatuus, No. 1. This was succeeded by the case of Letson v. The Cincinnati and Louisville Railroad Company, in which, by a species of judicial resurrection, this party (the corporation) was deterré, raised up again, but was not restored to the full possession of life and vigor, or to the use of all his members and. faculties, nor even allowed the privilege of his original name; but semianimate, and in virtue of some rite of judicial baptism, though “ curtailed of his natural dimensions,” he is rendered equal to a release from the thraldom of constitutional restriction, and made competent at any rate to the power of commanding the action of the . federal courts. This is ignis fatuus', No. 2. Next in order is the case of Marshall v. The Baltimore and Ohio Railroad Company. This is-indeed the chef d’oeuvre amongst the experiments to command the action of the spirit in defiance of the body of the Constitution.
It is compelled, from the negation of that-instrument, by some necromantic influence', potent as that by which, as we read, the resisting Pythia was constrained to yield her vaticinations of an occult -futurity. For in this case is manifésted the most en
Thus does it appear to me that this court has been led on from dark to' darker, until at present it is environed and is beaconed onward by varying and deceptive gleams, calculated to end in a deeper and more dense obscurity. In dread of the precipices to which they would conduct me, I -am unwilling to trust myself to these rambling lights; and if I cannot háve reflected upon my steps the bright and cheering day-spring of . the Constitution, I feel bound nevertheless to remit no effort to halt in what, to my apprehension, is the path that terminates in ruin. And in considering the tendencies and the results of this progress, there is nothing which seems to me more calculated to hasten themfthan is the too evidently prevailing disposition to trench upon the barrier which, in the creation by the several-States of the federal government, they designed to draw around and protect their sovereign authority and their social and private rights; and to regard and treat with affected derision every effort to arrest any hostile approach, either indirectly or openly,' to the consecrated precincts of that barrier. It is indeed a sad symptom of the downward progress of political morals, when any appeal to the Constitution shall fail to “ give us pause,” and to suggest the necessity for solemn reflection. Still more fearful is the prevalence of the disposition, either in or out of office, to meet the'honest or scrupulous devotion to its commands with'a sneer, as folly unsuited to the times, and condemned by that
We cannot, however, resist the disposition to ask of those whose expanded and more pervading view can peneirate beyond th'e palpable form of the charter, what it is they mean to convey by the term abstraction, which is found so well adapted to their purposes ? We would, with becoming modesty, inquire whether every axiom or precept, either in politics or ethics, or in any other science, is not an abstraction ? Whether truth itself, whether justice or common honesty is not an abstraction ? And we \yould farther ask .those who so deal with what they call abstractions, whether they design to assail all general precepts and definitions as incapable of becoming the fixed and fundamental basis of rights or of duties. The philosophy of these expositions may easily embrace the rejection of the decalogue itself, and might be particularly effectual in reference to that injunction which forbids the coveting of all that appertains • to our neighbor. The Constitution itself is nothing more than an enumeration of general abstract rules, promuiged by the several States, for the guidance and control of their creature or agent, the federal government, which for their exclusive benefit they were about to call into being. Apart from these abstract rules the federal government can have no functions and no existence. All its attributes are strictly derivative, and anv and. every attempt to transcend.the foundations (those proscribed abstractions) on which its existence depends, is an attempt at anarchy, violence, and usurpation., Amongst the most dangerous means, perhaps, of accomplishing this usurpation, because its application is nojseless whilst it is persevering, is the habitual interference, for reasons entirely insufficient, by the federal authorities with the. governments of the several States; and this too most commonly under the strange (Í had almost called it the preposterous) pretext of guarding the people of the States against their' own governments, constituted of, and administered by, their own fellow-citizens, bound to them by the sympathies arising from a community or identity of interests,
My opinion is, that this cause should have been dismissed by the Circuit Court for want of jurisdiction, and should now be remanded to that court with instruction for its dismission.
Dissenting Opinion
I dissent from that portion of the opinion of the court which affirms the jurisdiction of the Circuit Court in this case. The question involves a construction of a clause in the Constitution, and arises under circumstances which make it proper that I should record the reasons for the dissent.
The cases were argued together by counsel of eminent ability, with preparation and care, and were decided by the court' fith much deliberation and solemnity. Chief Justice Marshall declared the opinion of the court to be “ that the invisible, intangible, and artificial being, the mere legal entity, á corporation aggregate, is certainly not a citizen, and consequently cannot sue or be sued in the courts of the United States unless the rights of the members in this respect can be exercised in the corporate name.” As it appeared in the two cases first mentioned that the corporators might sue and be sued in the courts of the United States under the circumstances of the cases, the court on those cases treated them “ as a company of individuals who, in transacting their joint concerns, had used a legal name,” and for the reason “ that the right of a corporation to litigate depended upon the character (as to citizenship) of the members which ■ compose it, and that a body corporate cannot be a citizen within the meaning of the Constitution. ‘ The judgment in the last case was reversed for want of jurisdiction.” .
In Sullivan v. Fulton Steamboat Company, 6 Wheat. 450, the defendant was described as a body corporate, incorporated by the. Legislature of the State of New York, for the purpose of navigating, by steamboats, the waters of East Fiver or Long Island Sound, in that- State.’.’ This corporation was sued in New York. Upon appeal, this court determined that the Circuit Court had no jurisdiction of the defendant. ’ In Breithaupt v. The Bank of Georgia, that corporation was .sued in that State, but this court certified “ that as the bill did not aver that the corporators of the -Bank of Georgia ate citizens of the State of Georgia, the Circuit Court had. no jurisdiction of the case.” In the Vicksburg Bank v. Slocomb, 14 Pet. 60, a corporation was sued by a citizen of a different State, in the State of its char
In similar pleas, before this, it had appeared that the corpora-tors belonged to the State of the adverse party, and consequently were within the exclusion' of the eleventh section of the Judiciary Act of 1789. In the present case the plaintiff was a citizen from a different State from these corporators. The court notices this fact as a peculiarity. “ The point,” they say, “ has never before been under the consideration of this court. We are not aware that it ever occurred in either of the circuits until it was made in this case. It has not then been directly ruled in any case.” The court proceeded then to decide that there was jurisdiction under the Constitution, for the parties were citizens of different States, and that the Judiciary Act did not exclude it.. Thus was this point in the plea disposed of, upon grounds which unsettled none of the cases before cited. The court avows this, ■ and saya, “ that the case might be safely put upon these reason- ■ ihgs,” conducted “ in deference to the doctrines of former cases.” It tiren prbceeds, “ but there is a broader ground, upon which we desire to be understood upon which we altogether rest our present judgment, although it might be maintained upon the narrower ground already suggested. It is, that a corporation created by and doing' business in a particular State, is to be deemed, to all intents and purposes, as a person, although an artificial person, an inhabitant of the same State, for the purposes of its incorporation,, capable of being treated as a citizen of that State, as much as a natural person.”
Since the decision of Letson’s case, there have been cases of corporations, suing in the federal courts beyond the State of their location, and suing and being sued in the State of their location, in which this question might have been considered in this court. But there was no argument at the bar, and no notice of it in the opinion of the court. In one of these, one of the six . judges who assisted in the decision of Letson’s casé expressed strongly .a disapprobation of its doctrine, while another limited
The case of the Indiana Railroad Company v. Michigan Railroad Company, 15 How. 233 presented the question now before us, and at that time I was favorable to its retxamination ; but this was expressly waived by the court, and the case decided upon another question of jurisdiction.
In the- case of the Methodist Church, there was but one corporation before the court as a party. The two corporators who composed that were defendants in their corporate, as well as individual capacity. The citizenship of all the parties to the record was legally declared; and the parties to the record legally represented, all the interests of the voluntary association at issue. In reference to jurisdiction, Justice Washington says, “ the cases of a voluntary association, trustees, executors, partners, legatees, distributees, parishioners, and the. like, are totally dissimilar to a corporation, and this, dissimilarity arises from the peculiar character of a corporation, (4 Wash. C. C. R. 595,) and this is clear by .the decisions of this court. 4 Cranch, -306; 8 Wheat. 642.
I have been thus specific in the statement of the precedents in. the court, that it may appear that this dissent involves no attempt to innovate upon the doctrines of the court, but the contrary, to maintain those sustained by time and authority in all then integrity.
The declaration before us describes the defendant “ as a body corporate by act of the General Assembly of Maryland,” and cor- '• responds therefore with the cases cited from 5 Cranch, 57; 6 Wheat. 450 ; 1 Pet. 238; and in those cases jurisdiction was first questioned and disclaimed in this court. These cases were not cited in Letson’s case, and are decisive of this.
If we search the record for facts to sustain the jurisdiction, we can collect that the defendant has been recognized as a body corporate by the Legislature of Virginia, is commorant, and transacts business there by its authority, has for its corporators citizens and a city of that State, and that the plaintiff is, also a citizen of Virginia. If these facts are considered with reference to the question of jurisdiction, all the cases decided by this court on this subject have principles which would exclude it. Even Letson’s case prescribes, that the corporation should carry on its business in the State of its charter, and that case hardly contemplated an estoppel, such as is described in the opinion of the court..
I am compelled to consider this case as uncontrolled by the declaration of doctrine in Letson’s case; nor do I consider the cases in which the decision of the question has been waived as obligatory. I cannot look for the conclusions of this court or
The inquiry now presented is, shall I concur in a judgment which removes the ancient landmarks of the court, in reference to its jurisdiction, and which it established with care and solemnity, and maintained for so long a period with consistency and circumspection ? I am compelled to reply in the negative.
A corporation is not a citizen. It-may be an artificial person, a moral person, a juridical person, a legal entity, a faculty, an intangible, invisible .being; but Chief Justice Marshall employed no metaphysical refinement, nor subtlety, nor sophism, but spoke the common sense, “the universal understanding,” as he calls it, of the people, when he declared the unanimous judgment of this court, “ that it certainly is not a citizeh.”
Nor were corporations within the contemplation of the framers of the Constitution when they delegated a jurisdiction over controversies between the citizens of different States. The citation by the court frbm the Federalist, proves this. It is said by the writers of that work, “ that it may be esteemed as the basis of union that the citizens of each State shall be entitled' t'o all the immunities and privileges of citizens of the several States.” And if it be a just principle that every government ought to possess the means of executing its own provisions, by its own authority, it will follow, that, in order to the inviolable maintenance of that equality of immunities and privileges to which citizens of the Union will be entitled, the national judiciary ought to preside in all eases in which one State or its citizens are opposed to another State or its citizens.” Thus to administer the rights and privileges of citizens of the different States, held under a constitutional guaranty, when brought into collision or controversy — rights and immunities derived from the constitutional .compact, and forming one of its fundamental conditions, was the object of this jurisdiction. The commonplace, that it resulted as a concession to the possible fears' and apprehensions of suitors, that justice might not be imr partially administered in State jurisdiction, soothing as it is to the official sensibilities of the federal courts, furnishes no satisfactory explanation of it.
The doctrine' of the court in Earle’s case, 13 Peters, 519, and Runyan’s case, 14 Peters, 1-22, to the result that corporations have no extraterritorial rights, but that the legal exercise of their faculties, extraterritorially, was the effect of a rule of comity among the States, dependent upon their policy and convenience, and revocable at their pleasure, was in harmony with these judgments of the court, and the constitutional principles I have stated. The administration of the rules of domestic policy adopted by the several States, in reference to these artificial creatures of a domestic legislation, belonged to State jurisdictions, and'were ascertainable from its laws and judicial interpretations. ' But when, from the later case of Letson, it was supposed that these legal entities had a status which admitted them to the federal tribunals by a constitutional recognition, ■ the inquiry at once arose, for what purpose was this privilege held ? The interdependence between the sections of the Constitution which defined the privileges and immunities of citizens of the Union, and the jurisdiction of the federal courts in controversies between citizens of the States, was known and felt. It was argued that thé capacity to sue was only a consequent of the right to contract, to hold property, and to perform civil acts. They commenced, therefore, an agitation of the State courts for their rights as “citizens of the Union.” The Supreme Court of- Kentucky, (12 B, Mon. 212,) repelling these pretensions find' exposing their perilous character, thus refers tó Letson’s case, which had been relied on for their support: “ There are some' expressions in that opinion which indicate that corporations may be regarded as citizens to all intents and purposes. But in saying this, the court went far beyond the question before them, and to which it may be assumed that their attention was particularly directed.” So, too, in New Jersey, 3 Zabris. 42.9, it was argued that the existence of the extraterritorial rights of corporations “ is not now a question of comity in the United States, but a constitutional principle incapable of being altered by State legislation.”
Thus the introduction of new subjects of doubt, contest, and contradiction, is the fruit of abandoning the constitutional land- . marks.
Nor can we tell when the -mischief will end. It may be safely assumed that no offering could be made to the wealthy, powerful, and ambitious corporations of the populous and commercial States of the Union so valuable, and none which would so serve to enlarge the influence of those States, as the adoption, to its full import, of the conclusion, “ that to all intents and purposes, for the objects of their incorporation, these artificial persons are capable of being treated as a citizen as much as a natural person.”
The Supreme Court of Kentucky s^ys, truly, “ The apparent reciprocity of the power would prove to be a delusion. The competition for extraterritorial advantages would but aggrandize the stronger to the disparagement of the weaker States. Resistance and retaliation would lead to conflict and confusion, and the weaker States must either submit to have their policy controlled, their business monopolized, their domestic institutions reduced to insignificance, or the peace and' harmony of the States broken up and destroyed.” To this consummation this judgment of the court is deemed to be a progress. The word “ citizen,” in American constitutions, state and federal, had a clear, distinct,.and recognized meaning,understood by the com» mon sense, and i...uerpreted accordingly by this court through a series of adjudications.
The court has contradicted that interpretation, and applied to it rules of construction which will undermine every limitation in the Constitution, if universally adopted. A single instance’ of the kind awakens apprehension, for it is regarded as a link in a chain of repetitions. '
The litigation before this court, during this term, suffices to disclose the complication, difficulty, and danger of the controversies that must' arise before these anomalous institutions shall have attained their legitimate place in the body politic. Their revenues and establishments mock at the frugal and stinted conditions of State administration; their pretensions and demands are sovereign, admitting impatiently interference by State-legislative authority. And from the present case we learn that disdainful of “the careless arbiters” of State interests, they are ready “to hover about them” in “efficient and vigilant activity,” to make of them a prey; and, to accomplish this, to employ corrupting and polluting appliances.
Our opinion is, that the judgment of the Circuit Court should be affirmed for the want of jurisdiction.
Order.
This cause came on to be heard on the transcript of the record from the Circuit Court of the United States for the District of Maryland, and was argued by counsel. On consideration whereof it is now here ordered and adjudged by this court, that the judgment of the said Circuit Court in this cause be, and the same is hereby affirmed, with costs.
Reference
- Full Case Name
- Alexander J. Marshall, Plaintiff in Error, v. the Baltimore and Ohio Railroad Company
- Cited By
- 241 cases
- Status
- Published