Roger B. Taney; painting by Anderson. Library of Congress, Washington, D.C.
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by Roger B. Taney and Joseph Story, 1837
In 1785 the Massachusetts legislature granted to the Charles River Bridge Company the right to build a toll bridge over the Charles River at Boston. This charter was extended for seventy years in 1792. But in 1828 a similar right was granted to another group, the Warren Bridge Company, which proposed to build a second and competing bridge beside the first. The older company then brought suit against the newer one, alleging an impairment of contract under the Constitution. The majority opinion of the U.S. Supreme Court, part of which is reprinted here, was written by Roger B. Taney, a Jackson presidential appointee who had succeeded John Marshall as chief justice in 1836. The decision, handed down on February 14, 1837, favored Warren Bridge. Taney argued that in the absence of explicit provision-which in this case did not include a grant of monopoly-the interests of the community had precedence over the interests of a single corporation. Joseph Story, who had been Marshall's learned and devoted associate on the Supreme Court, was incensed at Taney's opinion. According to Senator Daniel Webster, his dissent (also reprinted here in part) left the majority view "not a foot, nor an inch, of ground to stand on." Like other conservatives, Story thought property in danger with the appointment of Taney to the Court. "Now we feel with a pang the loss of Marshall," he lamented. "Now we sadly realize that we are to be under the reign of little men-a pigmy race, and that the sages of the last age are extinguished."
Chief Justice Taney: The case most analogous to this, and in which the question came more directly before the Court, is the case of the Providence Bank v. Billings ... which was decided in 1830. In that case, it appeared that the legislature of Rhode Island had chartered the bank in the usual form of such acts of incorporation. The charter contained no stipulation on the part of the state that it would not impose a tax on the bank, nor any reservation of the right to do so. It was silent on this point. Afterward, a law was passed imposing a tax on all banks in the state; and the right to impose this tax was resisted by the Providence Bank upon the ground that if the state could impose a tax, it might tax so heavily as to render the franchise of no value and destroy the institution; that the charter was a contract, and that a power which may in effect destroy the charter is inconsistent with it, and is impliedly renounced by granting it.
But the Court said that the taxing power was of vital importance and essential to the existence of government; and that the relinquishment of such a power is never to be assumed. And in delivering the opinion of the Court, the late chief justice states the principle, in the following clear and emphatic language. Speaking of the taxing power, he says, "as the whole community is interested in retaining it undiminished, that community has a right to insist that its abandonment ought not to be presumed, in a case in which the deliberate purpose of the state to abandon it does not appear."
The case now before the Court is, in principle, precisely the same. It is a charter from a state; the act of incorporation is silent in relation to the contested power. The argument in favor of the proprietors of the Charles River Bridge is the same, almost in words, with that used by the Providence Bank; that is, that the power claimed by the state, if it exists, may be so used as to destroy the value of the franchise they have granted to the corporation. The argument must receive the same answer; and the fact that the power has been already exercised, so as to destroy the value of the franchise, cannot in any degree affect the principle. The existence of the power does not, and cannot, depend upon the circumstance of its having been exercised or not.
It may, perhaps, be said, that in the case of the Providence Bank, this Court were speaking of the taxing power; which is of vital importance to the very existence of every government. But the object and end of all government is to promote the happiness and prosperity of the community by which it is established; and it can never be assumed that the government intended to diminish its power of accomplishing the end for which it was created. And in a country like ours, free, active, and enterprising, continually advancing in numbers and wealth, new channels of communication are daily found necessary, both for travel and trade, and are essential to the comfort, convenience, and prosperity of the people.
A state ought never to be presumed to surrender this power, because, like the taxing power, the whole community have an interest in preserving it undiminished. And when a corporation alleges that a state has surrendered, for seventy years, its power of improvement and public accommodation in a great and important line of travel, along which a vast number of its citizens must daily pass, the community have a right to insist, in the language of this Court, above quoted, "that its abandonment ought not to be presumed, in a case, in which the deliberate purpose of the state to abandon it does not appear." The continued existence of a government would be of no great value, if, by implications and presumptions, it was disarmed of the powers necessary to accomplish the ends of its creation and the functions it was designed to perform transferred to the hands of privileged corporations.
The rule of construction announced by the Court was not confined to the taxing power, nor is it so limited in the opinion delivered. On the contrary, it was distinctly placed on the ground that the interests of the community were concerned in preserving, undiminished, the power then in question; and whenever any power of the state is said to be surrendered or diminished, whether it be the taxing power or any other affecting the public interest, the same principle applies, and the rule of construction must be the same. No one will question that the interests of the great body of the people of the state, would, in this instance, be affected by the surrender of this great line of travel to a single corporation, with the right to exact toll and exclude competition, for seventy years. While the rights of private property are sacredly guarded, we must not forget that the community also have rights, and that the happiness and well-being of every citizen depends on their faithful preservation.
Adopting the rule of construction above stated as the settled one, we proceed to apply it to the charter of 1785, to the proprietors of the Charles River Bridge. This act of incorporation is in the usual form and the privileges such as are commonly given to corporations of that kind. It confers on them the ordinary faculties of a corporation, for the purpose of building the bridge; and establishes certain rates of toll, which the company are authorized to take: this is the whole grant.
There is no exclusive privileges given to them over the waters of Charles River, above or below their bridge; no right to erect another bridge themselves, nor to prevent other persons from erecting one; no engagement from the state that another shall not be erected; and no undertaking not to sanction competition, nor to make improvements that may diminish the amount of its income. Upon all these subjects, the charter is silent; and nothing is said in it about a line of travel, so much insisted on in the argument, in which they are to have exclusive privileges. No words are used, from which an intention to grant any of these rights can be inferred; if the plaintiff is entitled to them, it must be implied, simply, from the nature of the grant, and cannot be inferred from the words by which the grant is made.
The relative position of the Warren Bridge has already been described. It does not interrupt the passage over the Charles River Bridge, nor make the way to it, or from it, less convenient. None of the faculties or franchises granted to that corporation have been revoked by the legislature; and its right to take the tolls granted by the charter remains unaltered. In short, all the franchises and rights of property enumerated in the charter, and there mentioned to have been granted to it, remain unimpaired.
But its income is destroyed by the Warren Bridge; which, being free, draws off the passengers and property which would have gone over it, and renders their franchise of no value. This is the gist of the complainant; for it is not pretended that the erection of the Warren Bridge would have done them any injury, or in any degree affected their right of property, if it had not diminished the amount of their tolls. In order, then, to entitle themselves to relief, it is necessary to show that the legislature contracted not to do the act of which they complain; and that they impaired, or in other words, violated, that contract by the erection of the Warren Bridge.
The inquiry, then, is, does the charter contain such a contract on the part of the state? Is there any such stipulation to be found in that instrument? It must be admitted on all hands that there is none; no words that even relate to another bridge, or to the diminution of their tolls, or to the line of travel. If a contract on that subject can be gathered from the charter, it must be by implication and cannot be found in the words used.
Can such an agreement be implied? The rule of construction before stated is an answer to the question: in charters of this description, no rights are taken from the public or given to the corporation beyond those which the words of the charter, by their natural and proper construction, purport to convey. There are no words which import such a contract as the plaintiffs in error contend for, and none can be implied; and the same answer must be given to them that was given by this Court to Providence Bank.
The whole community are interested in this inquiry, and they have a right to require that the power of promoting their comfort and convenience, and of advancing the public prosperity, by providing safe, convenient, and cheap ways for the transportation of produce and the purposes of travel shall not be construed to have been surrendered or diminished by the state; unless it shall appear by plain words that it was intended to be done.
But the case before the Court is even still stronger against any such implied contract, as the plaintiffs in error contend for. The Charles River Bridge was completed in 1786; the time limited for the duration of the corporation, by their original charter, expired in 1826. When, therefore, the law passed authorizing the erection of the Warren Bridge, the proprietors of Charles River Bridge held their corporate existence under the law of 1792, which extended their charter for thirty years; and the rights, privileges, and franchises of the company must depend upon the construction of the last-mentioned law, taken in connection with the Act of 1785.
The Act of 1792, which extends the charter of this bridge, incorporates another company to build a bridge over Charles River; furnishing another communication with Boston, and distant only between one and two miles from the old bridge. The first six sections of this act incorporate the proprietors of the West Boston Bridge, and define the privileges, and describe the duties of that corporation. In the 7th Section, there is the following recital: "And whereas, the erection of Charles River Bridge was a work of hazard and public utility, and another bridge in the place of West Boston Bridge may diminish the emoluments of Charles River Bridge; therefore, for the encouragement of enterprise," they proceed to extend the charter of the Charles River Bridge, and to continue it for the term of seventy years from the day the bridge was completed; subject to the conditions prescribed in the original act, and to be entitled to the same tolls.
It appears, then, that by the same act that extended this charter, the legislature established another bridge, which they knew would lessen its profits; and this, too, before the expiration of the first charter, and only seven years after it was granted; thereby showing that the state did not suppose that, by the terms it had used in the first law, it had deprived itself of the power of making such public improvements as might impair the profits of the Charles River Bridge; and from the language used in the clauses of the law by which the charter is extended, it would seem that the legislature were especially careful to exclude any inference that the extension was made upon the ground of compromise with the bridge company, or as a compensation for rights impaired. On the contrary, words are cautiously employed to exclude that conclusion; and the extension is declared to be granted as a reward for the hazard they had run, and "for the encouragement of enterprise." The extension was given because the company had undertaken and executed a work of doubtful success; and the improvements which the legislature then contemplated might diminish the emoluments they had expected to receive from it.
It results from this statement that the legislature, in the very law extending the charter, asserts its rights to authorize improvements over Charles River which would take off a portion of the travel from this bridge and diminish its profits; and the bridge company accept the renewal thus given, and thus carefully connected with this assertion of the right on the part of the state. Can they, when holding their corporate existence under this law, and deriving their franchises altogether from it, add to the privileges expressed in their charter an implied agreement, which is in direct conflict with a portion of the law from which they derive their corporate existence? Can the legislature be presumed to have taken upon themselves an implied obligation contrary to its own acts and declarations contained in the same law?
It would be difficult to find a case justifying such an implication, even between individuals; still less will it be found where sovereign rights are concerned, and where the interests of a whole community would be deeply affected by such an implication. It would, indeed, be a strong exertion of judicial power, acting upon its own views of what justice required, and the parties ought to have done, to raise, by a sort of judicial coercion, an implied contract, and infer it from the nature of the very instrument in which the legislature appear to have taken pains to use words which disavow and repudiate any intention, on the part of the state, to make such a contract.
Indeed, the practice and usage of almost every state in the Union, old enough to have commenced the work of internal improvement, is opposed to the doctrine contended for on the part of the plaintiffs in error. Turnpike roads have been made in succession, on the same line of travel; the later ones interfering materially with the profits of the first. These corporations have, in some instances, been utterly ruined by the introduction of newer and better modes of transportation and traveling. In some cases, railroads have rendered the turnpike roads on the same line of travel so entirely useless that the franchise of the turnpike corporation is not worth preserving. Yet in none of these cases have the corporation supposed that their privileges were invaded or any contract violated on the part of the state.
Amid the multitude of cases which have occurred, and have been daily occurring, for the last forty or fifty years, this is the first instance in which such an implied contract has been contended for and this Court called upon to infer it, from an ordinary act of incorporation, containing nothing more than the usual stipulations and provisions to be found in every such law. The absence of any such controversy, when there must have been so many occasions to give rise to it, proves that neither states, nor individuals, nor corporations ever imagined that such a contract could be implied from such charters. It shows that the men who voted for these laws never imagined that they were forming such a contract; and if we maintain that they have made it, we must create it by a legal fiction, in opposition to the truth of the fact and the obvious intention of the party. We cannot deal thus with the rights reserved to the states; and, by legal intendments and mere technical reasoning, take away from them any portion of that power over their own internal police and improvement which is so necessary to their well-being and prosperity.
And what would be the fruits of this doctrine of implied contracts on the part of the states, and of property in a line of travel by a corporation, if it would now be sanctioned by this Court? To what results would it lead us? If it is to be found in the charter to this bridge, the same process of reasoning must discover it in the various acts which have been passed, within the last forty years, for turnpike companies. And what is to be the extent of the privileges of exclusion on the different sides of the road? The counsel who have so ably argued this case have not attempted to define it by any certain boundaries. How far must the new improvement be distant from the old one? How near may you approach without invading its rights in the privileged line?
If this court should establish the principles now contended for, what is to become of the numerous railroads established on the same line of travel with turnpike companies, and which have rendered the franchises of the turnpike corporations of no value? Let it once be understood that such charters carry with them these implied contracts, and give this unknown and undefined property in a line of traveling, and you will soon find the old turnpike corporations awakening from their sleep and calling upon this Court to put down the improvements which have taken their place. The millions of property which have been invested in railroads and canals, upon lines of travel which had been before occupied by turnpike corporations will be put in jeopardy. We shall be thrown back to the improvements of the last century and obliged to stand still until the claims of the old turnpike corporations shall be satisfied; and they shall consent to permit these states to avail themselves of the lights of modern science, and to partake of the benefit of those improvements which are now adding to the wealth and prosperity, and the convenience and comfort, of every other part of the civilized world.
Nor is this all. This Court will find itself compelled to fix, by some arbitrary rule, the width of this new kind of property in a line of travel; for if such a right of property exists, we have no lights to guide us in marking out its extent, unless, indeed, we resort to the old feudal grants, and to the exclusive rights of ferries, by prescription, between towns; and are prepared to decide that when a turnpike road from one town to another had been made, no railroad or canal, between these two points, could afterward be established. This Court are not prepared to sanction principles which must lead to such results.
Justice Story: I maintain that, upon the principles of common reason and legal interpretation, the present grant carries with it a necessary implication that the legislature shall do no act to destroy or essentially to impair the franchise; that (as one of the learned judges of the state court expressed it) there is an implied agreement that the state will not grant another bridge between Boston and Charlestown, so near as to draw away the custom from the old one; and (as another learned judge expressed it) that there is an implied agreement of the state to grant the undisturbed use of the bridge and its tolls, so far as respects any acts of its own or of any persons acting under its authority. In other words, the state, impliedly, contracts not to resume its grant, or to do any act to the prejudice or destruction of its grant.
I maintain that there is no authority or principle established in relation to the construction of crown grants or legislative grants which does not concede and justify this doctrine. Where the thing is given, the incidents, without which it cannot be enjoyed, are also given. ... I maintain that a different doctrine is utterly repugnant to all the principles of the common law, applicable to all franchises of a like nature; and that we must overturn some of the best securities of the rights of property before it can be established.
I maintain that the common law is the birthright of every citizen of Massachusetts, and that he holds the title deeds of his property, corporeal and incorporeal, under it. I maintain that under the principles of the common law there exists no more right in the legislature of Massachusetts to erect the Warren Bridge, to the ruin of the franchise of the Charles River Bridge, than exists to transfer the latter to the former, or to authorize the former to demolish the latter. If the legislature does not mean in its grant to give any exclusive rights, let it say so, expressly, directly, and in terms admitting of no misconstruction. The grantees will then take at their peril, and must abide the results of their overweening confidence, indiscretion, and zeal.
My judgment is formed upon the terms of the grant, its nature and objects, its design and duties; and, in its interpretation, I seek for no new principles, but I apply such as are as old as the very rudiments of the common law.
But if I could persuade myself that this view of the case were not conclusive upon the only question before this Court, I should rely upon another ground, which, in my humble judgment, is equally decisive in favor of the plaintiffs. I hold that the plaintiffs are the equitable assignees (during the period of their ownership of the bridge) of the old ferry belonging to Harvard College, between Charlestown and Boston, for a valuable consideration; and, as such assignees, they are entitled to an exclusive right to the ferry, so as to exclude any new bridge from being erected between those places during that period. If Charles River Bridge did not exist, the erection of Warren Bridge would be a nuisance to that ferry, and would, in fact, ruin it. It would be exactly the case of Chadwick v. The Proprietors of Haverhill Bridge; which, notwithstanding all I have heard to the contrary, I deem of the very highest authority.
But, independently of that case, I should arrive at the same conclusion upon general principles. The general rights and duties of the owners of ferries, at the common law, were not disputed by any of the learned judges in the state court to be precisely the same in Massachusetts as in England. I shall not, therefore, attempt to go over that ground with any further illustrations than what have already ... been suggested. I cannot accede to the argument that the ferry was extinguished by operation of law by the grant of the bridge and the acceptance of the annuity. In my judgment, it was indispensable to the existence of the bridge, as to its termini, that the ferry should be deemed to be still a subsisting franchise; for, otherwise, the right of landing on each side would be gone.
I shall not attempt to go over the reasoning by which I shall maintain this opinion, as it is examined with great clearness and ability by Mr. Justice Putnam in his opinion in the state court, to which I gladly refer as expressing mainly all my own views on this topic. Indeed, there is in the whole of that opinion such a masculine vigor, such a soundness and depth of learning, such a forcible style of argumentation; such illustration, that in every step of my own progress I have sedulously availed myself of his enlightened labors. For myself, I can only say that I have as yet heard no answer to his reasoning; and my belief is that, in a judicial sense, it is unanswerable. ...
Upon the whole, my judgment is that the act of the legislature of Massachusetts granting the charter of Warren Bridge is an act impairing the obligation of the prior contract and grant to the proprietors of Charles River Bridge; and, by the Constitution of the United States, it is, therefore, utterly void. I am for reversing the decree of the state court (dismissing the bill), and for remanding the cause to the state court for further proceedings, as to law and justice shall appertain.
SourceReports of Cases Argued and Adjudged in the Supreme Court of the United States, Richard Peters, ed., New York, 1884 (3rd edition), Vol.11, p. 419.
