Maler (1993) Revolutionary Origins of The American Corporation PDF

The Revolutionary Origins of the American Corporation
Author(s): Pauline Maier

Reviewed work(s):
Source: The William and Mary Quarterly, Third Series, Vol. 50, No. 1, Law and Society in
Early America (Jan., 1993), pp. 51-84
Published by: Omohundro Institute of Early American History and Culture
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The Revolutionary Origins of the

American Corporation
Pauline Maier
NE of the great unansweredquestionsabout the AmericanRev-
olution is why, during the 178os, state legislatures began creating

corporations in record numbers. With Independence, the legislatures acquired the power to incorporate, which in Britain was a prerogative of the crown. Their willingness to exercise that power remains
puzzling, however, since corporations were considered so much a part of
the old order that in I79i revolutionary France outlawed them altogether.1 No doubt the proliferation of American corporations reflected a sense
of legislative empowerment and also drew upon widespread enthusiasm
for the "improvement" of the new nation. But social and economic
development could have been accomplished in other ways. The British,
for example, virtually ceased to develop the corporation for business or
profit-seeking purposes between the passage of the Bubble Act in I720
and its repeal t05 years later: there the partnership became the characteristic legal device of the industrial revolution.2 In the United States, by
Pauline Maier is William R. Kenan, Jr., Professor of American History at the
Massachusetts Institute of Technology. This article developed from a i990 conference paper that has been published as "The Debate over Incorporations:
Massachusetts in the Early Republic," in Conrad Edick Wright, ed., Massachusetts
in the New Nation (Boston,
I 992),
73-I
I7.
An intermediateversion was pre-
sented as the Jefferson Memorial Lecture at the University of California, Berkeley,

in April I 99 I. Research was done under a grant from the John Simon Guggenheim
Foundation. The author wishes to thank Thomas N. Brown, James Henretta,
Morton J. Horwitz, Alex Keyssar, David Konig, Stanley I. Kutler, Charles S.
Maier, Peter Onuf, and particularly Kent Newmyer, whose suggestions over
several years have been exceptionally helpful.
'The best general account of late eighteenth-century American corporate
development remains Joseph Stancliffe Davis, Essays in the Earlier History of
American Corporations, 2 vols. (Cambridge, Mass., I9I7).
On France see, for
example, William H. Sewell, Jr., Workand Revolutionin France; The Language of
Laborfrom the Old Regimeto 1848 (Cambridge, i980), esp. 86-IOO, I03.
2Armand Budington DuBois, The English Business Company after the Bubble
Act, I720-1800
(New York, I938), esp. 38-40, and Bishop Carleton Hunt, The
Developmentof the Business Corporationin England, 1800-1867 (Cambridge, Mass.,
I936). The modern British corporation emerged only after the Company Acts of
i844 and i855 and evolved from "the unincorporated partnership, based on
mutual agreement, rather than from the corporation, based on a grant from the
state." Even in the mid-twentieth century, when American corporate law was
"incomparably richer and more highly developed than its English parent," an
informed observer noted that British lawyers rarely examined American precedents because they assumed that the American system was "entirely alien . . . with
The William and Mary Quarterly, 3d Series, Vol. L, No. i, January I993
52
WILLIAMAND MARYQUARTERLY
contrast, the handful of business corporations created in the I 7 8osamong many others-multiplied until by i830 "charters of incorporation
for mere economical purposes, as the construction of roads and canals, and
carrying on of banking, insurance, manufactures, &c.," were recognized to
be "more frequent ... than in any other country."3
To add to the mystery, corporations increased in number despite
formidable opposition. Americans in the I 7 8os and I 790S elaborated
French and British anticorporate arguments, founded their authority on
the ideals of the Revolution, and gathered them into what Louis Hartz
called an "anti-charterdoctrine." The Constitutional Convention's failure
to grant Congress the explicit power to incorporate (probably for fear it
would further hazard the Constitution's ratification) and the torrent of
opposition that greeted Congress's incorporation of the first Bank of the
United States in I 79I served to establish the states as the primary creators
of American corporations and as the sites where arguments against corporations developed most fully. The anticharter doctrine that took form in
states such as Pennsylvania soon after Independence persisted into the
nineteenth century but failed to undercut Americans' enthusiasm for
corporations. "The demand for acts of incorporation is continually increasing," New York's Chancellor James Kent observed in i827, "and the
propensity is the more striking, as it appears to be incurable; .. . we seem
to have no moral means to resist it."4
The precociousness of corporate development in the United States
meant that legislators and jurists could not simply follow European models
but were forced to innovate. The institutions they created differed in
critical ways from their nearest English predecessors and from the British
corporation as it finally emerged in the mid-nineteenth century. The
American corporation faithfully reflected the society that gave it form and
also suggests much about the meaning and impact of the American
Revolution, which seems paradoxically to have both provided the occasion
for the corporation's development and inspired opposition to it.
To resolve that paradox and explain the attractiveness of the corporation, this article based on documentary sources drawn mostly from
Massachusetts and Pennsylvania and on several secondary studies of those
and other states-examines early regional patterns of corporate development, then turns to the arguments raised against corporations and their
impact on municipal and business corporations. It suggests that the proponents of anticharter doctrine were not, as Hartz's term implies, oppodifferent statutes and different principles." L.C.B. Gower, "Some Contrasts between British and American Corporate Law,"Harvard Law Review, LXIX (1 956),
I369-I402,
esp. I37I-I372,
I400-I401.
3 "Corporation," in Francis Lieber, ed., EncyclopaediaAmericana, III (Philadelphia, i830), 548; see also James K. Angell and Samuel Ames, Treatise on the Law
of Private CorporationsAggregate(New York, I972; orig. pub. i832), V.
4Hartz, EconomicPolicy and Democratic Thought: Pennsylvania, 1776-1860
(Cambridge, Mass., I948); Davis, Essays, II, I2-I6,
I3 n. 2; James Kent, Commentarieson American Law, II (New York, i827), 220.
REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION
53
nents of all corporations so much as supporters of an agenda for the design of corporate charters who drew on the Revolution's fascination with
the construction of constitutions to adapt the corporation to American
circumstances. In doing so, they made the corporation a part of the
Revolutionary heritage with far-reaching implications for American government and society.
I
If there is a key to the corporation's popularity, it must lie in the history
of New England and particularly of Massachusetts. Although the immediate post-Revolutionary surge in incorporations was not confined to any
one region-Virginia, for example, chartered several important corporations for the development of inland navigation in the I78os-New
England, and above all Massachusetts, soon led the nation in creating
corporations. Massachusetts's "greater propensity to multiply corporations than any where else" compelled its jurists to confront and resolve
problems in corporate law at a relatively early date. Its statutes and court
decisions therefore provided, as an i830 article in the influential American
Jurist and Law Magazine suggested, a model to which other states could
turn for guidance. Several principles fundamental to American corporate
law were first enunciated in Massachusetts courts of the early nineteenth
century.5
Studies of the early history of American corporations have usually
focused on business corporations, but this emphasis distorts the course of
corporate history by suggesting that it involved little more than capitalist
advancement. In fact, about two-thirds of the acts of incorporation passed
by the Massachusetts General Court in the first decade under the state
constitution of I780, and nearly half of those enacted in the I790s, made
"bodies politic" of towns, districts, or other units of local government.
Among the rest, by far the greater part chartered religious associations,
educational institutions, and groups formed for charitable or other nonprofit purposes such as the Massachusetts Historical Society. In the I78os,
the General Court also incorporated a few business corporations including
5 "Corporations," AmericanJurist and Law Magazine, IV (Oct. i830), 304. See
William E. Nelson, Americanizationof the CommonLaw: The Impactof Legal Change
on Massachusetts Society, 1760-1830
(Cambridge, Mass., I975), and Dale A.
Oesterle, "Formative Contributions to American Corporate Law by the Massachusetts Supreme Judicial Court from i 8o6 to i 8 io," forthcoming in a volume edited
by Russell Osgood celebrating the 300th anniversary of the Massachusetts Supreme Judicial Court. On the history of corporations in Massachusetts see also
Oscar Handlin and Mary F. Handlin, Commonwealth:A Study of the Role of
Governmentin the American Economy:Massachusetts, 1774-1861,
rev. ed. (Cambridge, Mass., i969; orig. pub. I947); Edwin Merrick Dodd, American Business
Corporationsuntil i86p, With SpecialReferenceto Massachusetts(Cambridge, Mass.,
I954);
and William E. Rappard, Les CorporationsD'Affaires au Massachusetts:Etude
d'Histoire tconomique et de LUgislationComparee... (Paris, i908). Morton J. Horwitz found a systematic treatment of corporation law unnecessary in The Transformation of AmericanLaw, I780-1860 (Cambridge, Mass., I977) because so many
"excellent studies" were already available (p. xii).
54
WILLIAM AND MARY QUARTERLY
the Massachusetts Bank (I784),
the Charles River Bridge Company
andthe Beverly Cotton Manufactory(I789). Their numberbegan

to grow in the I790S, when the legislaturepassed some 200 acts of
(I785),
incorporation, about twice the total for the previous ten years. Among
these were acts chartering seven new banks and three manufacturing
companies as well as six insurance companies, two mills, and so many
groups proposed to build bridges, booms, canals, sluiceways, waterworks,
and turnpikes or to develop harbors that internal improvement companies
constituted almost a quarter of all Massachusetts acts of incorporation in
that decade.6
Although state legislatures elsewhere generally created fewer corporations than Massachusetts, those they did create were similar in range and
variety for reasons tied to the advantages incorporation brought.7 In the
late eighteenth century, incorporation allowed a group to make binding
rules for its self-government, to function in law as a single person with the
right to hold property and to sue and be sued-and so to protect its
assets-and to persist after the lifetimes of its founding members. Those
privileges were as important-to towns, churches, charities, and colleges as
to business companies. The special legislative acts by which most pre-Civil
6Pauline Maier, "The Debate over Incorporations: Massachusetts in the Early
Republic," in Conrad Edick Wright, ed., Massachusettsin the New Nation (Boston,
I992),
76-77. This summary is based on acts listed in The Laws of the Commonwealth of Massachusetts,Passedfrom the Year I780, to the End of ... I8oo, 2 vols.
(Boston, i8oi), corrected and expanded by an examination of Private and Special
Statutes of the Commonwealthof Massachusetts,From the Year 1780, To ... 1 805, I,
II (Boston, i805), which includes the texts of acts listed only by name in the earlier
volumes. The totals are necessarily approximate because of inconsistencies in the
language of the acts of incorporation that continued an imprecision in colonial
incorporation laws. See Andrew McFarland Davis, "Corporations in the Days of
the Colony," Publications of the Colonial Society of Massachusetts, I, Transactions,
1892-1894
(Boston, i895), i83-2I4,
esp. 2II.
7 See, for example, the broad range of corporations created by the Pennsylvania
legislature between Independence and i837 listed in Proceedingsand Debatesof the
Convention of the Commonwealthof Pennsylvania to Propose Amendments to the
Constitution, Commencedand held at Harrisburg on the SecondDay of May, 1837
(Harrisburg, Pa., i837-i839),
III, 2 I3-368,
esp. 367-368. See also James Neal
Primm, EconomicPolicy in the Developmentof a WesternState: Missouri, 1820-1860
and Milton Sydney Heath, ConstructiveLiber(Cambridge, Mass., I954), 32-33,
alism: The Role of the State in EconomicDevelopmentin Georgia to I86o (Cambridge,
In The Origins of the American Business CorpoMass., I954),
297-299,
303-306.
ration, I 784-1855: Broadeningthe Conceptof PublicServiceDuring Industrialization
(Westport, Conn., i982), Ronald E. Seavoy writes that in New York early
benevolent and religious corporations served as a precedent for the "public
service" or franchise corporations created after I790, which in turn gave way to
more "modern" business corporations formed for shareholder profit maximization
after i 8I5 (72-75,
78 n. 2I, I04, and passim). Many other works focus exclusively
on chartered companies that sought pecuniary profit. See, for example, William
Miller, "A Note on the History of Business Corporations in Pennsylvania, i8ooi 86o," QuarterlyJournal of Economics,LV (I 940-I
I 50-I 6o; James Willard
94I),
Hurst, The Legitimacyof the Business Corporationin the Law of the United States,
I 780-1970
(Charlottesville, Va., I970), esp. I7-i8;
and George Heberton Evans,
Jr., Business Incorporationsin the United States, 1800-1943
(New York, I948).
55
War corporations were created could also bestow other advantages, but, as
Oscar and Mary F. Handlin demonstrated in an important article of I945,
the attributes generally cited to explain the particular attractiveness of the
corporate form for businesses-a singular capacity for the efficient management of capital, limited liability, and a "perpetual freedom from state
interference"-were not yet established when the American corporation's
dramatic development began.8 In late eighteenth-century law, moreover,
"different kinds of corporations" were "treated without distinction and,
with few exceptions, as if the same rules were applicable to all alike."9
Categories familiar to us-above all, those that separate public from
private corporations-are the inventions of nineteenth-century jurists.
Nowhere were corporations more alike than in the requirement, based
on English precedent, that they serve a public purpose, which the acts of
incorporation often specified. For example, the I78i act incorporating the
Massachusetts Medical Society explained that it would protect- the "health
and lives of many valuable individuals" by screening "candidates for the
practice of physic and surgery" and certifying those who were "properly
qualified." In much the same way, the I789 act incorporating the Beverly
Cotton Manufactory said that "the promotion of useful manufactures, and
particularly such as are carried on with materials of American produce
within this Commonwealth," would advance "the happiness and welfare
thereof, by increasing the agriculture and extending the commerce of the
country."'10Everywhere, in fact, corporations were considered "agencies
of government ... for the furtherance of community purposes." In Georgia, the connection between corporations and public service was so close
that many early corporations emerged out of commissioned public boards;
if they failed, their responsibilities were sometimes again delegated to
public agencies."
By granting charters, then, legislatures could enlist or encourage private
efforts to improve or develop their states and in some instances spare
taxpayers the cost of such projects. But corporations' public nature alone
cannot explain why they were so popular or, as the Handlins suggested,
why some forms of enterprise were incorporated and not others. Turnpikes, they argued, "not trade, banks, not land speculation," were the
corporation's "province because the community, not the enterprising
capitalists, marked out its sphere of activity."'12In fact, the English had
long since incorporated trading companies that sought to open new
markets for English goods, and in the eighteenth century Massachusetts
provided for the incorporation of, in effect, land speculators. Moreover,
8Handlin and Handlin, "Origins of the American Business Corporation,"
Journal of EconomicHistory, V (I 945), I-23.
9 Samuel Williston, "History of the Law of Business Corporations before
i 8oo," Harvard Law Rev., II (i 888), I 04.
0Private and Special Statutes, I, 24-26, 224-226.
11 Primm, EconomicPolicy in a WesternState, 33; Heath, ConstructiveLiberalism,
299-30I.
12
Handlin and Handlin, "Origins of the American Business Corporation,"
22.
56
corporations were generally granted on private petition, not public initiative, and the General Court drew no line between the public interest and
that of "enterprising capitalists." That a particular venture would benefit
the private estates of individuals seems to have been of no concern-or to
have been a positive consideration-as long as the public's welfare was also
served. The act of I784 incorporating the Massachusetts Bank said, for
example, that the bank "will probably be of great public utility, and ...
particularly beneficial to the trading part of the community." Similarly, an
act of I790 that incorporated a company to erect booms in the Merrimack
River noted that "under proper regulations and restrictions" such a corporation would both "promote the public interest, and be greatly advantageous to individuals."'13
The peculiar readiness of Massachusetts to create corporations after
Independence reflects the state's long familiarity with the corporate form.
Under its charter of i629,
the Bay Colony was itself a corporation and
legally incapable of creating other corporations. It nonetheless commissioned several bodies that resembled corporations while avoiding the
explicit language of incorporation until the i650s, when the execution of
Charles I removed the need to respect monarchical prerogatives. The
colony's i 69i charter allowed the General Court to pass acts of incorporation with the consent of the king through his representatives, butchastened, perhaps, by the rejection of charters proposed for Harvard
College between i692 and I700-it
at first used that power cautiously.
Then, in the I 750S, the legislature began to approve the incorporation of

a growing number of districts, parishes, schools, church officers, Boston's
Overseers of the Poor (I772),
the proprietors of Boston's Long Wharf
(I772),
and organizations such as marine societies in Boston (I754),
Salem (I772), and Marblehead (I773) and the American Academy of Arts
and Sciences (I 7 8o)-groups essentially like those chartered in greater
numbers after ratification of the state's first constitution.14
Colonial Massachusetts even developed laws strikingly like later general
acts of incorporation, by which groups can be incorporated without special
acts of the legislature. Such general acts of incorporation have usually been
described as new and untried devices in the I780s and I790s, when
several states adopted them for the incorporation of religious, charitable,
or educational bodies.15 As early as I 753 Massachusetts enacted, in effect,
13Laws of the Commonwealth,
I780o-800,
I, I I 5; Privateand SpecialStatutes,I,
265.
14
General Court incorporated Harvard College in i650. Since that charter
was apparently annulled with the provincial charter in i684, the legislature tried
repeatedly in the decade after i69i to secure a new one. The Privy Council or
governor rejected draft charters, it seems, because they included objectionable
clauses. Finally, in I707, the General Court simply declared that the i650 charter
had never been repealed or annulled. Davis, "Corporations in the Days of the
and passim.
Colony," 203-209,
15 See, for example, John W. Cadman, Jr., The Corporation in New Jersey:
Business and Politics, 1791-1875
(Cambridge, Mass., I949),
5-6; Seavoy, Origins
of the American Business Corporation,5-7; and Davis, Essays, II, i6-i8.
57
a general law of incorporation to facilitate "the settlement and improvement" of lands that lay "within no township or precinct." That law
emerged from a long series of earlier statutes concerned with the management of lands within towns and also provided a direct precedent for
another general act of incorporation adopted in I784 "for the better
managing Lands, Wharves, and other Real Estate, lying in Common." The
beneficiaries of these measures, to judge by the work of Roy Akagi, were
often speculators, although the act of I784 affected not only persons but
"towns, villages, trustees of schools," and others who held title to adjacent
lands, wharfs, or other forms of real estate. The laws of I753 and I 784
allowed owners of property within the designated categories to form
associations with the characteristic powers of a corporation, including the
power to discipline members, by petitioning a justice of the peace to issue
warrants for a first meeting. These laws provided the basis for an entire
chapter in Massachusetts's corporate code as compiled in the state's
RevisedStatutes of i836, one that had emerged from early colonial laws on
town government piece by piece, almost without a seam.16
Given that background, the ready acceptance of corporations in Massachusetts might well be considered a latter-day manifestation of an old
Puritan "talent for association, for organization, for concerted effort" that,
George Wilson Pierson once argued, became embedded in New England's
culture. The first settlers of Massachusetts covenanted with each other to
form towns and churches; their eighteenth-century descendants created
corporations that, in effect, sanctioned covenants that were similarly civic
and sometimes also religious in character. Where post-Revolutionary
Massachusetts incorporated the proprietors of new towns, Virginia, the
product of a different tradition, appointed trustees to divide and sell land,
assuring the purchasers that they would hold all the "rights, privileges and
immunities which the freeholders and inhabitants of other towns in this
state not incorporated by charter have, hold and enjoy." So, too, where
Virginia authorized individuals to build bridges, Massachusetts created
corporations. There, however, the relative poverty of New Englanders
compared to southern wealth holders probably reinforced custom, forcing
Northerners to combine their assets to accomplish what others, such as
the early bridge builders of Virginia, could apparently do alone.17
16 For the act of 1 753 see The Acts and Resolves,Public and Private, of the Province
of the MassachusettsBay, III (Boston, i878), 669-670. For some of its precedents
see ibid., I (Boston,

408, 425-426,
1780-i800,
i869),
io65-Io66.
407704, and II (Boston, i874),

64--68, i82-i83,
The act of 1784 is in Laws of the Commonwealth,
I, 138-142, and see also, for another of its colonial precedents, Acts
and Resolves,II, 758-759. Roy H. Akagi, The Town Proprietorsof the New England
Colonies:A Study of their Development,Organization, Activities and Controversies,
RevisedStatutes of the Common(Philadelphia, 1924), 50-84, 209-2i9.
i620-1770
wealth of Massachusetts... (Boston, i836), chap. 43, 356-362.
17Pierson, "The Obstinate Concept of New England: A Study in Denudation,"
New England Quarterly,XXVIII (I95 5), I3. For a later example of a precorporate
*"covenant," or articles of association, see Nathan Appleton, Introduction of the
Power Loom,and Origin of Lowell (Lowell, Mass., i858), 19-22. William Waller
58
In the early nineteenth century, the New England habit of forming

associations and pooling resources became national. Alexis de Tocqueville
testified that "Americans of all ages, all conditions, and all dispositions
constantly form associations," among which were not only "commercial
and manufacturing companies, in which all take part, but associations of a
thousand other kinds." They did so, Tocqueville suggested, for reasons
tied to the nature of their society. In aristocratic communities private
associations were unnecessary because the followers and dependents of
wealthy and powerful individuals were already bound together in "permanent and compulsory" associations. But in democratic nations, where
citizens were "independent and feeble," they had to "learn voluntarily to
help one another" or be "powerless.'8
When in the I78os Virginians undertook river improvement projects
more costly than even the wealthiest individuals among them could or
would finance alone, they, too, formed corporations to overcome that
Tocquevillian powerlessness. Later, when the emergence of national markets brought opportunities whose realization required more capital than
individuals anywhere could supply and the government was able or willing
to provide, the business corporation would become the predominant form
of American enterprise, whose power and visibility obscured the great
variety of earlier corporations among which it had emerged.
The need to assemble capital from a large number of relatively small
investors and put it under "firmcentral direction" has long been accepted
as a practical imperative that alone can explain the triumph of business
corporations in the United States.19 But before that victory could occur,
Americans had to confront and come to terms with an anticharter doctrine
that insisted that corporations were not only economically harmful but,
Tocqueville notwithstanding, radically at odds with the nature of a republican society.
II
Critics of corporations sometimes quoted David Hume's comment that
"one great cheque to industry in England, was the erecting of corporations, an abuse which is not yet entirely corrected." They also cited Adam
Smith's The Wealth of Nations, which described "the exclusive privileges of
(Richmond and
Hening, The Statutes at Largeof Virginia, X-XIII (for 1779-1792)
139-140,
esp. XI, 29-30 (quotation), ioo-101,
Philadelphia, i822-i823),
XII,
220-22 1, XIII, 49. On wealth differences see Alice Hanson Jones, Wealth of a
Nation to Be: The AmericanColonieson the Eve of the Revolution(New York, I 980).
For another study of how "experiences and pasts" shaped "property preferences,
... ways of doing business, and ... commercial institutions" see William H. Pease
and Jane H. Pease, The Webof Progress:Private Valuesand PublicStylesin Bostonand
(Athens, Ga., i99i; orig. pub. I985), esp. 17-22 (quotaCharleston, i828-i843
tion at 22), 62-69, i85-i86.
18 Alexis de Tocqueville, Democracyin America,ed. Phillips Bradley (New York,
orig. pub. i835), II, i06-I07.

19See, for example, Hurst, Legitimacyof the Business Corporation,esp. 47.
1945;
59
corporations" as an encroachment "upon natural liberty."20 Sometimes

such statements were inspired by those great chartered English companies, mainly of the sixteenth and seventeenth centuries, that held monopolistic rights over branches of foreign trade or other economic activities.
Smith saw such corporations as badly managed anachronisms that survived
only because of legal privileges that injured the commonweal by restricting competition. The incorporation and the granting of temporary monopolies might be justified to encourage new trade ventures, but the
joint-stock device-by which most modern corporations raised capitalseemed to Smith appropriate only for endeavors that required more funds
than individuals or partnerships could raise, provided an unusual public
service, and did not involve exclusive privileges. Banking, insurance,
canal, and aqueduct companies, he thought, could alone fulfill those
criteria. For other endeavors such as manufacturing, joint-stock companies "scarce ever fail to do more harm than good."'21
With greater force and frequency British critics of corporations condemned the incorporation of trades or of cities and boroughs. Guilds and
similar organizations restricted access to several profitable employments
and raised costs to the public. Similarly, incorporated municipalities regulated trade in their own interest at the cost of the commonweal. Both
Smith and Hume also noted that municipal corporations were first instituted by the crown to curb the feudal nobility but had persisted to an age
when landed aristocrats no longer threatened the freedom of townsmen.22
That background explains why, beginning in the I78os and I790s,
critics of corporations who frequently acknowledged their debt to Hume
or Smith described corporations as outmoded instruments of feudal privilege.23 As late as i848, Pennsylvania's Governor Francis Rawn Shunk
insisted that corporations were "behind the times," that they belonged "to
an age that is past" and were out of place in republican America:
The time was, in other countries, where all the rights of the people
were usurped by despotic governments, when a grant by the King to
a portion of his subjects, of corporate privileges, to carry on trade, or
20 Hume quotation from "Remarks on the Memorial of the Grand Jury of the
City of Philadelphia, praying that the Legislature would grant a Charter to the said
city," PennsylvaniaPacket(Philadelphia), Aug. 30, 1786. Smith, An Inquiry into the
Nature and Causes of the Wealth of Nations,2 vols., ed. R. H. Campbell and A. S.
Skinner(Indianapolis,Ind., i98i; orig. pub. 1776), esp. I, 470.
21 Smith, Wealth of Nations, II, 733-7 58, esp. 73 1-735,
754-7 58 (quotation at
758).
22 Ibid., I, 135-159,
400-405.
See alsoJon C. Teaford,The MunicipalRevolu-
tion in America:Origins of ModernUrban Government,i650-i825
(Chicago,
1975),
esp. 3-15.
23 See, for example, "Remarks on the Memorial. .. ," Pa. Packet,Aug. 30, 1786;
speech by Albert Gallatin in the Pennsylvania legislature in the GeneralAdvertiser
(Philadelphia), Jan. 17, 1792; James Cheetham, A Dissertation concerningPolitical
Equality, and the Corporationof New-York (New York, i8oo), 39-40; [David
Henshaw], Remarksupon the Rights and Powersof Corporations. .. By a Citizen of
Boston (Boston, i837), 4.
6o
for municipalpurposes,was a partialenfranchisement,and made the

meansof resumingsome of their civil rights.Then and there, corporationshad merits,and were cherishedby the friendsof liberty. But,
in this age and country,underour free system,where the people are
sovereign,to grantspecialprivileges,is an invertion[sic] of the order
of things.It is not to restore, but to take awayfrom the people, their
common rights, and give them to a few. It is to go back to the dark
ages for instructionin the science of government,and havingfound
an example, to wrest it from its originalpurpose, and to make it the
instrumentof restoringthe inequalityand despotism,which its introduction tended to correct.24
Americans'familiaritywith Englishanticharterargumentsalso helps explainwhy proposalsto incorporateprofessionalassociationsor mechanics'
associationsprovoked ready opposition in the late eighteenth and early
nineteenthcenturies.25But Americananticharterdoctrinetook form in a
more lastingway duringdebates over the incorporationof Boston, Philadelphia,and other communitiesthroughoutthe United Statesduringthe
last quarterof the eighteenthcentury,when urbangovernmentbecame a
major subject of public contention.26
In Boston, that controversyhad deep historicalroots. Like other New
since it functionedas a
Englandtowns, Boston was a "quasi-corporation"
body politic, exercisingmanyof the powers of a corporation,but lackeda
charter.Beginningin the seventeenthcentury,reformersrepeatedlyproposed that the town should be formallyincorporatedand replaceits town
meeting and board of selectmen with a mayor, aldermen,and common
council like those of Englishmunicipalcorporations.That proposalwas,
however, alwaysdefeated, sometimesin extraordinarilytumultuoustown
meetings,until i822, when Boston finallyoutgrewits colonialinstitutions
and agreed to become a city.27
24Shunk, Annual Message to the Legislature, Jan. 5, i848, in Pennsylvania
(Harrisburg, 1902),
Archives, 4th Ser., vol. 7: Papers of the Governors,i845-i858
208.
25 See the denunciation of the Connecticut Medical Society, which was refused
a charter by the legislature, as "a combination of the doctors ... directly against
liberty ... a very dangerous thing, . . . a monopoly," in ConnecticutCourant, June
4, 1787, cited in Davis, Essays, II, 304; Joseph F. Kett, The Formation of the
AmericanMedical Profession(New Haven, Conn., I 968), esp. i-68; the New York
Council of Revision's veto, Mar. 8, 1785, of a bill "incorporating several tradesmen and mechanics of the city and county of New York," in Alfred B. Street, ed.,
The Council of Revision of the State of New York (Albany, i859), 261-264; and
Joseph T. Buckingham, Annals of the MassachusettsCharitableMechanicAssociation
(Boston,
i853),
esp. 6-9,
13-i6,
49-51,
57-58,
8o, 9i-96.
26Teaford, Municipal Revolutionin America, 64-78, esp. 67, and also Hendrik
Hartog, Public Propertyand Private Power:The Corporationof the City of New York
(Chapel Hill, N. C., i983).
in American Law, 173o-i870
270n
"quasi-corporations" and the nature of Boston's government see Kent,
Commentaries,II, 22i, and AmericanJurist, IV, 304-305 ("quasi-corporations ...
must in truth be corporations, or they are nothing"); "Thwackum" and "Old
6i
Economic considerationswere an importantpart of colonial Boston's

anticharterdoctrine:an English-stylecharteredgovernmentwould be too
expensive, opponents insisted in I 7I4, its restrictions on employment
would distress people who liked to practice several trades at once, and the
"dues and duties" of its regulated markets would push business from
Boston to the neighboring unincorporated towns of Roxbury and Charlestown. Colonial anticharter spokesmen opposed even more strongly the
abandonment of their traditional democratic town meeting for a government under which only a relatively few qualified freemen would be
enfranchised. They also preferred their old political system, in which
"Rich and Poor Men" were "jumbled together in Town offices," to one
that would probably confine power to the rich.28 The Revolution reinforced these old objections with a new ideological authority. Those who
fought proposals to incorporate Boston in the I78os and in I792 insisted
that incorporation would "destroy that equality which ought to subsist in
all republics." Its proponents were "in their hearts .. . inveterate enemies
of republicanism" who favored the "introduction of aristocracy-a government of all others . . . the worst."29
Many of these arguments were repeated in Philadelphia, whose I70I

charter expired with Independence and where proposals to reincorporate
the city provoked intense opposition through much of the I780S. There,
too, opponents objected to the restrictions on employment and regulation
of trade and markets traditionally associated with incorporated cities and
boroughs. English commercial towns, argued an anticharter petition
signed by some I,400 people in I783, "flourished or declined in direct
proportion as they have been freed from or fettered by incorporations."
Corporations had served a purpose when they granted "exemptions from
the domination of feudal barons, who devoured all the profits of the
industrious" and gave "a degree of legislative power to those who previously had no share in the laws by which they were governed." But in a
republic, where "every one of our citizens is equally free," such grants
were not just anachronistic but harmful. Members of a corporation were
given special rights and privileges, but because privileges granted exclusively to some citizens infringed the rights of others, city charters served
not to "advance .. . the freedom of the people, but [to] abridge it" and
violated that "equal and common liberty which ought to pervade a repubWhackum," MassachusettsCentinel (Boston), Nov. 30 and Dec. 3, 1785, and "A
Friend to Good Order," ColumbianSentinel (Boston), Feb. II, 1792. Remarks by
Albert Matthews in Publications of the Colonial Societyof Massachusetts,X, Transactions, i904-o6
(Boston, 1907), 352-356, and Josiah Quincy, A Municipal
History of the Town and City of Boston During Two Centuriesfrom Septemberi7,
i630, to September17, i830 (Boston, i852), esp. 22-33,
40.
28"A Dialogue Between a Boston Man and a Country Man" and "My son, fear
thou the Lord . ..
," pamphlets
of
1714
reprinted in Publications of the Colonial
Societyof Massachusetts,X, 345-352,

quotations at 346, 352.
29"A Mechanick," "Publicola," and Samuel Adams in town meeting debates,
Mass. Centinel, Oct. 29, Nov. 9, 1785, May 15, 1784.
62
lic." If, moreover, the electorate in a reincorporated Philadelphia were

confined, as opponents assumed, to freemen who satisfied a property
requirement, it would be far smaller than the body of adult male taxpayers
whose votes controlled the legislatively authorized commissions that governed Philadelphia in the immediate wake of Independence. The proposal
to recharter the city therefore constituted a "strange attempt to disfranchise three-fourths" of its people, subject them to "a few great men," and
thus "establish an aristocracy." Indeed, all city charters were "aristocratic
in... tendency."30
To these arguments Philadelphians added another: corporations violated the sovereignty of the people by granting privileges to a limited
number of persons separated from the rest of the community. Furthermore, because incorporated cities had an "interest and influence" apart
from that of the "body of the people," their creation would promote
"discord in the state, and produce much greater mischief and embarrassment than they were intended to correct," especially if their charters were,
as some insisted, incapable of being altered or revoked. In I 785, the New
York Council of Revision also described corporations as "to most purposes independent republics,' which raised the specter of imperia in
imperio, of governments within a government, which to eighteenth-century observers threatened endemic conflict, even civil war, and the dissolution of the republic.
Defenders of corporations differed from opponents not in their principles but in the conclusions drawn from them. The incorporated cities of
past times, they said, were little republics, which suggested an appropriateness for the American political system. They emphasized the historic
role of corporations in advancing freedom and opposing aristocracy, not
their feudal origins. "An aristocratical government," insisted a procorporation essayist, "is a government of nobles,hereditary in its nature, and in
which the people have no voice." Because the charters proposed for
Boston provided for annual elections and established restraints on officers'
powers, they were not "aristocratic."The new American state constitutions had eliminated aspects of British government incompatible with a
republic; surely, the same could be done in city charters. "Without
abridging the rights or privileges of the citizens-without an innovation
that would not be advantageous-without the introduction of aristocracy,"
argued a defender of corporations who took the pseudonym "Anti-Aristocratick," "A CONSTITUTION MAY BE FORMED, that will be productive of
all those publick and private benefits, which flow from a well regulated
society."32
30 Petition to the Pennsylvania Assembly, Sept. 4, 1783, in Samuel Hazard, ed.,
The Registerof Pennsylvania, II (Philadelphia, i828), 327; "Remarks on the Memorial ... ," speech of John Smilie, and "One of the People," in Pa. Packet, Aug.
30, Sept. 25, 27, 1786.
31 Smilie in Pa. Packet, Sept. 25, 1786; Street, Council of Revision, 276.
32"A Town-Born Child" and "A Friend to Good Order," Columbian Sentinel,
Feb. 4, II, 1792; "Anti-Aristocratick," Mass. Centinel, Oct. 29, 1785.
63
Within a little over a decade after Independence, the fourteen incorporated cities and boroughs of late colonial North America had more than
doubled: by I789 about twenty previously unincorporated communities
had been granted charters. Moreover, where late colonial municipal corporations were all located between between Virginia and New York,
several of the new ones were in New England (Norwich, New London,
Middletown, Hartford, New Haven, and Newport, all I784) and the
South, including Charleston (I783) and Savannah (I789).33 The governing institutions of these chartered communities were remarkably varied34
but had some common traits. Everywhere "closed" or self-perpetuating
corporations like that of colonial Philadelphia (and the greater part of
English corporations) gave way to elected governments, often with relatively broad electorates.35 Urban charters were shaped in part by the need
to satisfy anticharter spokesmen whose arguments together constituted, in
effect, a program of constitutional design. They argued, for example,
against "perpetual" charters and for those of limited duration that, by
making legislative renewals necessary, allowed the legislature to "retain all
its powers, undiminished." They also insisted that charters define and limit
city officials' terms of office and make them fully accountable, above all for
revenues entrusted to them, restrict the amount of landed property a city
could hold, and avoid a concentration of executive, legislative, and judicial
powers, which, as the New York Council of Revision said in vetoing a
charter the legislature had granted the town of Hudson, would prove
"destructive of the rights and liberties" of the people.36
Soon even "open" or elective corporations such as that of New York
City, whose "Montgomerie Charter" of I 73i had survived Independence
33Teaford, Municipal Revolution in America, I7, 64, 119-120
ln. 5, 129 n. i. On
colonial incorporations see also Ernest S. Griffith, History of American City Government: The Colonial Period (New York, 1938).
34The Connecticut charters, for example, provided for the continuation of town
meetings with substantial powers but set up mayors-who
were largely ceremonial-with
virtual life tenure. See Leonard Woods Labaree, comp., The Public
Records of the State of Connecticutfor ... 1783 and 1784 (Hartford, 1943), 257-277,
and Teaford, Municipal Revolution in America, 129 n. 6. Newport's
343-373,
controversial charter also provided for a town meeting but tipped power toward a
city council; John R. Bartlett, ed., Records of the State of Rhode Island and Providence
Plantations In New England, X, I784-I 792 (Providence, i865), 30-33. Other city
governments worked complex variations on traditional forms of urban government: Edward P. Allinson and Boies Penrose, Philadelphia, i68i-i887:
A History
of Municipal Development (Baltimore and Philadelphia, i887), 60-62; James T.
Mitchell and Henry Flanders, The Statutes at Large of Pennsylvania from 1682 to
I8oI, XIII, I 787-1 790 (Harrisburg, i908), 193-214;
Jerome J. Nadelhaft, The
Disorders of War: The Revolution in South Carolina (Orono, Me., i98i),
i00-I02;
and William Harden, A History of Savannah and South Georgia, I (Atlanta, i969;
orig. pub. 1913),
255-256.
35Teaford, Municipal Revolution in America, 6, 29, 64-67. Williamsburg and
Norfolk also had "closed" corporations in the colonial period.
36Ibid., 67-75; petition, 1787, against the Newport Charter (which was then
repealed) in Bartlett, ed., Records of R. I., X, 233; "Democritus" in Pa. Packet, Sept.
2, 4, 1783; veto of Apr. 20, 1785, in Street, Council of Revision, 275.
64
and had long been cited as a model for American cities, or of Philadelphia
under the charter it received in 1789, came under attack. Reformers
wanted mayors as well as aldermen and common councillors elected, the
principle of separation of powers respected, property-holding qualifications for office and the vote abandoned, ward representation adjusted for
population changes, and, in general, an urban political system less congenial to "kingly government" and better adapted to "the more modern and
plain republican institutions of the present day." In imposing such "republican" reforms, legislatures firmly established their authority over
municipal corporations. That development has complicated American
urban government but saved cities from criticism as imperia in imperio
whose privileges reduced the power of the sovereign people.37
Within a few decades, "charters for municipal purposes" became so
uncontroversial that a delegate to the Pennsylvania constitution convention of i837-i838
could describe them as "of all others least objectionable." Acceptance came, however, only after urban charters had been
substantially transformed on the insistence of critics determined not to
preclude their enactment but to extend the Revolution's advances in the
art of government, as New York's James Cheetham proposed, "to every
political institution within our land."38The acceptance and development
of the American business corporation followed a similar pattern.
III
If the "origin of charters"lay "with certainty" in the English "Institution
of boroughs," as a writer in the PennsylvaniaPacketclaimed in I 786, some
American corporations were, it seemed, of a different sort, and their
differences might have far-reaching political and legal implications. Late
eighteenth-century essayists and legislators sometimes struggled to distinguish charters that granted general governmental powers from those "to
superintend the application of certain property to certain particular uses"
37 Cheetham, Dissertation, chap. 2, and [Cheetham], Annals of the Corporation,
memorial
Relativeto the Late ContestedElections... By Lysander(New York, i802);
to the assembly adopted "at a numerous meeting of the citizens of Philadelphia,"
IndependentGazeteerand Agricultural Repository(Philadelphia), Dec. I, 1792, and
Teaford, Municipal Revolutionin America, chap. 6, esp. 80-go. See also Hartog,
PublicPropertyand PrivatePower,esp. 82-I00,
126-I
57. Teaford argues that
reformers turned to the legislatures to circumvent the opposition of an entrenched
Federalist elite. Hartog instead says that, because the legislature acted to empower
city government, New York's leaders willingly accepted those post-Revolutionary
changes that in time made the city "a dependent tool of central power" (p. 157).
On colonial precedents for legislative power over cities see Howard Lee McBain,
"The Legal Status of the American Colonial City," Political ScienceQuarterly, XL
(1925),
177-200.
On the legal history of the city over the centuries see Gerald E.
Frug, 'The City as a Legal Concept," Harvard Law Rev., XCIII (1980), io591154.
38
Proceedingsand DePennsylvania Constitutional Convention of I837-I838,

bates, V, 6io, and also VI, i89, where municipal corporations are described as
"administering to the happiness, good order and peace of all who live within their
limits"; Cheetham, Dissertation, v.
65
or from what one contender called "pecuniary"corporations.39 Such efforts could find little or no support in English legal treatises. For example,
Sir William Blackstone's Commentarieson the Laws of England, first published in 1765, divided "aggregate"corporations into those that were lay
or ecclesiastical and said that lay corporations were either eleemosynary
(with bequests for charitable purposes) or civil. In the last of these
categories he included not just towns and districts but churchwardens,
professional and literary societies, the universities of Oxford and Cambridge, and companies "for the advancement and regulation of manufactures and commerce." Both cities and business companies were therefore
civil corporations.40 English case law was no more helpful. Justice Joseph
Story cited an English precedent to support the line he drew in Dartmouth
v. Woodward(i 8i9) between public and private corporations as well as his
categorization of business corporations as private. But the case he cited,
Philips v. Bury (i694), distinguished governmental from eleemosynary
corporations and failed to consider English corporations formed for profit.41
Given the time it took to establish appropriate legal distinctions among

corporations, it is not surprising that arguments raised against emergent
business corporations were much like those against the incorporation of
cities. In Pennsylvania, in fact, the struggle in the I780s against the
reincorporation of Philadelphia coincided not only with a controversy
over the charter of the College of Philadelphia (later the University of
Pennsylvania) but, more important here, with the landmark battle over the
Bank of North America (BNA), which the state first chartered in I782.
Those disputes pitted many of the same opponents against each other.42
The strength of anticharter spokesmen varied from state to state they
were, for example, more prominent in Pennsylvania than in Massachusetts-and opposition emerged later in some places than in others. But the
arguments central to those debates were essentially the same in Pennsylvania, Massachusetts, and, it seems, other states as well. Moreover, objections raised against business corporations such as the BNA and New
Jersey's Society for Useful Manufactures (SUM) in the I78os and I790S
remained at the center of anticharter doctrine a half century later.43
39See, for example, "Atticus," "Letter the Third," in the Pa. Packet, May
22,
1786, and Gallatin in Pennsylvania legislative debates in the Philadelphia General
Advertiser,Jan. 17, 1792. For a less tentative and somewhat later distinction see
[Cheetham], Annals of the Corporation,83-86.
40Blackstone, Commentarieson the Laws of England, ed. George Sharswood
(Philadelphia, i 86o), bk. I, chap. i 8, esp. 468-47 1; Williston, "History of the Law
of Business Corporations,"105-106.
41 R. Kent Newmyer, SupremeCourt Justice Joseph Story: Statesman of the Old
n. 68.
Republic(Chapel Hill, N. C., I985), 133, 412-413
42These disputes are described in Robert L. Brunhouse, The Counter-Revolution
in Pennsylvania, 1776-1790 (Harrisburg, 1942), passim.
43 Hartz asserted, but did not demonstrate, that continuity in EconomicPolicyand
DemocraticThought, 78-79. Anticharter doctrine "did not have a laborious career"
in Pennsylvania, he said, but "emerged astonishingly full-blown in the controversy
66
Throughout that period, opponents characterized business corporations, like incorporated cities, as aristocratic and so antirepublican because
they gave privileges to the few at the cost of the many. Critics cited
provisions in state bills of rights that government was instituted for "the
common benefit, protection, and security of the people, nation, or community," and that, as Virginia's 1776 bill of rights put it, "no man, or set
of men, are entitled to exclusive or separate emoluments or privileges
from the community, but in consideration of publick services; which, not
being descendible, neither ought the offices of magistrate, legislator or
judge to be hereditary." Such clauses generally associated the legal privileges of incorporation with hereditary rule, which had been firmly rejected in I776.44 They also drew on an English antimonopoly tradition,
going back at least to the reign of Elizabeth I, that insisted that the crown
could grant exclusive privileges only where their use would serve the
public interest. That demand became an established part of English law
with cases such as Darcy v. Allen (i602) and with the Statute of Monopolies (i624). In the English context, the recipients of exclusive privileges
were not condemned as "aristocratic." That charge was American; it
signaled the marriage of English antimonopoly tradition with an indigenous republicanism.45 ,
Corporations met especially protracted opposition as aristocratic institutions when privileges were extraordinary and their public service
questionable. For example, the brief document of I782 with which the
Pennsylvania legislature incorporated the BNA extended "forever," failed
to reserve a legislative right to amend the charter, and allowed a limited set
of self-perpetuating corporation members to hold up to $ i o million in real
over the Bank of North America in 1785." Although its concepts persisted, he
suggested, their content began to shift in the I840s and i85os as corporations
attempted to appropriate the identity and values associated with "individual
enterprise."
For descriptions of the arguments offered against corporations see ibid., 69-70;
Davis, Essays, I, 387-388, 427-453, II, 303-309; Heath, ConstructiveLiberalism,
322-323; Cadman, Corporationin New Jersey, 428-433; and Hurst, Legitimacyof
the Business Corporation, 30-44, 48. These accounts are often striking for their
authors' bewilderment at and even hostility to anticharter doctrine. Hartz, for
example, saw the arguments against corporations as largely polemical and marked
by "unreality" (p. 76), mainly because he mistakenly assumed that anticharter
spokesmen denied the legitimacy of all corporations. Davis attributed anticorporate arguments to "prejudice" (I, 450, II, 303), and Hurst described a standard
statement of anticharter doctrine as "muddled" and proceeded to correct its
"confusion" (30, 3iff.).
44 Articles III and IV of the Virginia Bill of Rights, in Hening, Statutes at Large
io9-i io, and see also Article VI of the
of Virginia, IX (Richmond, i82i),
Massachusetts Declaration of Rights of 1780, in Handlin and Handlin, eds., The
PopularSourcesof Political Authority: Documentson the MassachusettsConstitution of
I 780 (Cambridge, Mass., I 966), 443-444.
45 Walter Adams and Horace M. Gray, Monopolyin America:The Governmentas
Promoter(New York, 1955), 25-38 (quotation at 34); see also Harold G. Fox,
Monopoliesand Patents (Toronto, 1947).
67
and movable property and to exercise a banking monopoly until the

conclusion of the RevolutionaryWar. Because the bank issued only a
limited amount of stock, its substantialdividends made a handful of
wealthymen wealthier.Opponentschargedthat it was founded upon "no
principlebut that of avarice"and that it was incompatiblewith the state's
republicanconstitution,"whichdoes not admitof grantingpeculiarprivileges to any body of men."46
Similar objections were raised against the SUM, which planned to
found a large textile manufactoryat Paterson,New Jersey. In 1791, the
SUM received a state charterthat was perpetual,includedno reservation
of legislativerightsto amendor repeal,allowedthe corporationto hold $4
million in property,and exempted its employees from taxes and military
duty except in case of invasion.It also allowed the SUM to raise funds
through a public lottery, to "open and clear"waterwaysand construct
canalsto transportgoods and materials,takingprivateland and materials
in doing so, and to chargetolls for the use of those facilitiesby others. As
an almost gratuitousgoad to critics, the SUM's charter-which was secured with the support of Alexander Hamilton, secretaryof the Treasury-provided for the future incorporationof the town of Paterson.47
Much of the protest that greeted the SUM came from persons who
feared its competitionfor workers,raw materials,and markets.Yet "not
only the manufacturers. .. immediatelyinterested"were alarmed,"but
also the friends of equal liberty"who saw in such "corporationswith
exclusive privileges"all their "favoriterepublicanprinciplesviolated"above all, that the "citizensof a free governmentought equallyto partake
of the advantagesthat are derived from society, and bear the burdens
which it imposes." Such incorporationsalso favored persons already
wealthy, embodying them, as Pennsylvania's George Logan said, "in classes" and artificially reinforcing a natural and "inevitable inequality of
fortune" with "honorary and political distinctions."48
The same objection applied to bank charters since, as William Findley
observed in Pennsylvania debates of I786, "none but men of wealth have
money to spare to be bankers." Moreover, banks received advantages like
those of the "most enormous monopolies": the Bank of Massachusetts, as
Attorney General James Sullivan explained in The Path to Riches (I792),
could issue loans with paper money beyond the value of its capital. As a
46 Laws of the Commonwealthof Pennsylvania, III (Philadelphia, I1803), I188-189;
Brunhouse, The Counter-Revolutionin Pennsylvania, I 11-112,
150; Mathew
Carey, ed., Debates and Proceedingsof the General Assemblyof Pennsylvania, on the
Memorials Praying a Repeal of Suspension of the Law Annulling the Charter of the
Bank (Philadelphia, 1786), esp. 66, 77. See also Janet Wilson, 'The Bank of North
America and Pennsylvania Politics: 178 1-1787," PennsylvaniaMagazine of History
and Biography, LXVI (1942),
3-28.
47 Davis, Essays, I, 379-387; Laws of the State of New-Jersey... (Trenton, i821),
i08-125,
132-1I33.
48 "An Observer" in General Advertiser,Jan. 7,
in Davis, Essays, I, 430;

1792,
[Logan], Five LettersAddressedto the Yeomanryof the United States (Philadelphia,
1792),
12.
68
result, it earned a higher rate of return on its assets than the 6 percent limit
stipulated by law. But the attack on bank charters, like the campaign
against the SUM, asserted principles that had a far broader application.
"Whenever the laws ... give to one man, or one order of men, an
exclusive right to acquire property, or a greater and more advantageous
opportunity to improve his, or their talents, than is given to all," Sullivan
declared, "there is a just cause of complaint."49 Essentially the same
argument was repeated by a New Yorker who observed in i827 that
"every act of incorporation for the purpose of pecuniary profit, carries
with it . .. privileges" that "the great mass of people cannot exercise"; by
Robert Rantoul, Jr., an outspoken nineteenth-century Massachusetts critic

of corporations; by Pennsylvania's governors Simon Snyder in i 8i3 and
Shunk in i847, and, indeed, by anticharter spokesmen everywhere. In
insisting that the public receive "a fair equivalent" for monopolies and
exclusive privileges granted at its expense, and that American government
"shower its favors alike on the high and the low, the rich and the poor,"
President Andrew Jackson's bank veto message of i832 simply restated
principles that had been an essential part of American anticharter doctrine
since the 1780S.50
Critics also attacked the creation of business corporations, like that of
municipal corporations, because it implied "granting .. . an inherent right
of sovereignty to individuals" and thus reduced the power of the people.
The power of self-government that incorporation granted opened corporations to that objection, which acquired more force when they received
additional public rights such as grants from the state's right of eminent
domain. A newspaper essay of 1785 described the BNA as an example of
"that solecism in politics, a governmentwithin a government,"and in i802
Sullivan noted soberly that "the creation of a great variety of corporate
interests
..
. must have a direct tendency
to weaken
the powers
of
government." Thirty-five years later, an anticharter delegate to the Pennsylvania constitutional convention of i837-i838
declared that "whatever
power is given to a corporation, is just so much power taken from the
State, in derogation of the original power of the mass of the community."
That danger increased with the number of corporations. By i827, Massachusetts governor Levi Lincoln expressed concern that "government,
49Findley in Carey, ed., Debates and Proceedings,74; [Sullivan], The Path to
Riches.An Inquiry into the Origin and Use of Money... By a Citizen of Massachusetts
(Boston, 1792), in Magazine of History, extra no. i84, XLVI, No. 4 (1933), esp.
37-39, 42-43, quotation on iO.
50 Letteron the Use and Abuse of Incorporations,
Addressedto the Delegationfrom the
city of New-York, in the State Legislature.By one of their Constituents (New York,
i827), 3; account of a speech from the BostonPost in Robert Rantoul, Jr., Memoirs
Speechesand Writings, ed. Luther Hamilton (Boston, I 854),33 6-317; Pennsylvania
Archives,4th Series, vol. 4: Papersof the Governors,I 785-1817 (Harrisburg, i900),
8o6, ibid., VII, 153-157, and see also Pennsylvania Constitutional Convention of
I 837- I 838, Proceedingsand Debates,I, 366. Jackson's veto message, July I,O. 832,
in Messagesof Gen. AndrewJackson(Concord, N. H., and Boston, i837), 147-i68,
esp. 148, i67.
69
unsparingly and with an unguarded hand, shall multiply private corporations, and grant privileges without limitation, until only the very shadow
of sovereignty remains."51The Dartmouth College decision compounded
the problem by defining incorporations of educational, charitable, and
business associations as contracts that legislatures could not alter or repeal
without the corporations' consent (a position defenders of the BNA had
taken already in the 178os). But when such corporations were beyond
legislative control, they became "private monopolies and perpetuities,"
which, as one critic noted, "our institutions abhor."52
Corporations were also charged with promoting the maldistribution of
wealth by circumventing what critics called the American "law of distributions." The argument grew from sturdy eighteenth-century roots: as
Shunk explained, the nation's founders "abolished the laws of primogeniture and entails, and enacted our equal laws of descent and distribution"
to avoid "a permanent aristocracy of wealth." In fact, the laws mandated
partible inheritances only in cases of intestacy. Nonetheless, even so
eminent a jurist as Story once described "our statute of descents and
distributions" as "the only true and legitimate agrarian law" and said it
prevented wealth from becoming "a permanent distinction of families."
When the rich "pass to the tomb,
..
their children divide their estates"
and "the mass heaped up by the toil and diligence of a long life of
enterprise and industry" was "silently and quietly" dissolved. That periodic "revolution" in property holding, as Shunk described it, not only
divided property but put it "into circulation," so that "the industrious and
skillful secure their full share ...
as independent
men, until death,
accident or extravagance changes the ownership." But since corporations

never died, they could continue to hold and accumulate property as
generations came and went.53
Contenders differed over whether all corporations were equally subject
51 Snyder in Pennsylvania Archives, 4th Ser., IV, 807; "Strictures on the Bank,
and on a Paper Currency," Pa. Packet, Mar. 31, 1785; Sullivan, "Opinion of the
Attorney General of Massachusetts, on the Life of the Corporation, 1802," in
Handlin and Handlin, Commonwealth,260; Ingersoll in Pennsylvania ConstituProceedingsand Debates, I, 366-367; Lincoln,
tional Convention of I837-I838,
message explaining his veto of an act establishing the Warren Bridge Corporation,
Mar. IC, I827, in Resolvesof the GeneralCourtof Massachusetts..., 1824-1828
(Boston, [828]), 520. See also Hartz, EconomicPolicy and DemocraticThought,
72-7452
[Henshaw], Remarksupon the Rights and Powersof Corporations,9-I0.
53 Shunk's address to the Pennsylvania legislature, Jan. i8, I848, and veto
message, Mar. 9, I846, in Pennsylvania Archives, VII, 236, 86-87; Journal of
Debates and Proceedingsin the Conventionof Delegates to Revise the Constitution of

Massachusetts begun ... at Boston, November 15, 1820, I (Boston, I853), 286
(Story); see also p. 31I2 (Daniel Webster). Story and Webster seem to have ignored
the fact that rich men were relatively unlikely to die intestate. Moreover, in the
early nineteenth century Massachusetts began to develop family trusts that allowed
the perpetuation of wealth across generations, an apparent anomaly worth further
study. See Robert F. Dalzell, Jr., EnterprisingElite: The Boston Associatesand the
WorldTheyMade(Cambridge,Mass., I987),
100-103,
and LawrenceM. Fried-
man, "The Dynastic Trust," Yale Law Journal, LXXIII (i964),
547-592.
70
to that criticism. Lincoln, for example, also saw a threat to the nation's
"political fabric" in corporations' privileged evasion of the American
"statute of distributions," but he was particularly concerned with corporations formed for purposes such as charity or education. Their property
remained "locked up from individual control, . .. subtracted from the
mass of transmissible wealth, and .. . held in perpetuity, to be applied only
to the purposes and objects, to which it was originally destined." Harvard
College and other similar "mortmain institutions" were often targets of
attacks because their property was unaffected by "our laws of distribution."54 Business corporations might in fact be less dangerous, since the
shares they issued were distributed among heirs or returned to the market
on the death of their owners. However, some anticharter leaders, such as
Shunk and Massachusetts governor Marcus Morton, insisted that unless
the duration of such corporations was limited by charter, they could "live
forever" and that property "thus holden in perpetual succession" could
never "come under the full operation of our statute of distribution." All
"corporations for the purpose of holding and managing property" therefore involved "a kind of mortmain inconsistent with the spirit of our laws
and the genius of our government," which demanded "the prohibition of
entailments, and the equal distribution of property."55
The problem of wealth locked in corporate hands became worse as
corporations multiplied. The assets any one corporation could legally hold
under the terms of its charter might be small. For example, the Mozart
Association of Salem, Massachusetts, whose incorporation provoked an
emotional veto message from Governor Lincoln in i827, would have been
authorized to hold only $ io,ooo in real estate and the same in more liquid
assets. But if the value of the property that thousands of chartered groups
could legally accumulate was added together, and if, as Lincoln said,
corporations would in fact eventually hold the full component of assets
they were authorized to hold, then the multiplication of corporations
implied a massive shift of American property from individual to corporate
ownership. Lincoln estimated that Massachusetts over the previous five
years had authorized "aggregate incorporate Institutions" to hold more
than $30 million, or about a fifth of the commonwealth's taxable property,
and he was not about to let a flood of local music societies add to the
problem.56 After surveying similar figures, a writer in the AmericanJurist
concluded that, "unless restrained," corporations would "absorb the greatest part of the substance of the commonwealth." That concern was shared
54Lincoln, message vetoing the incorporation of the Mozart Association in
Salem, Feb. i6, I827, in Resolvesof the GeneralCourtfor 1824-1828,
esp. 474-477;
[Henshaw], Remarksupon the Rights and Powersof Corporations,13-14.
55Morton, address to the legislature, Jan. I840, in Acts and Resolvespassed by the
Legislatureof Massachusetts,. .. I839-1842
(Boston, i842), 300.
56Lincoln, Mozart Association veto, in Resolvesof the General Court for I824I828, 474-476. The $30 million figure apparently excluded the capital of new
banking, insurance, and canal companies. Had Lincoln considered lawful assets of
groups incorporated previous to i822, the total would, of course, have been even
higher.
7I
in Pennsylvania, where data solicited by the constitutional convention of

i837-i838
showed that the I,I42 corporations chartered by the legislature between the Revolution and i837 were authorized to hold some
$I58,453,550
in capital and 75,450 acres of land.57
Americans were not the first to confront that problem. The original
English laws of mortmain sought, as James Kent recalled, "to check the
ecclesiastics from absorbing in perpetuity, in hands that never die, all the
lands of the kingdom, and thereby withdrawing them from public and
feudal charges." For that purpose they restricted grants of property to the
church and also, beginning in the reign of Richard II, to chartered cities
and boroughs, guilds, and other similar organizations. As early as I 783, an
American anticharter essayist cited a I736 addition to the English laws of
mortmain "incapacitatingcorporations generally from making any new or
additional purchases of land or property" in attacking a bill for reincorporating Philadelphia that lacked any constraint on corporate landholding.
If such restrictions were "politic and proper" in England, he asserted, they
would be even more "prudent and suitable" in the United States.58
Americans were, however, opposed to the accumulation of assets by
corporations for reasons other than those that had inspired the English
laws of mortmain. They were concerned not with protecting tax revenues
or other obligations claimed by the crown at the death of wealthy subjects
but with the tendency of mortmain institutions to undercut the liquidity of
capital and thus reduce its availability to future generations' most industrious and entrepreneurial individuals. Moreover, the accumulation of real
estate in corporate hands suggested that "at no far distant period, a humble
and dependent tenantry," the "Lessees of Corporations," would work the
land, replacing "that high minded and independent yeomanry" that had
"hitherto stood upon the soil" and remained essential to the republic even
for many supporters of commercial development. In the end, Lincoln
predicted, "the grievous and intolerable pressure of corporate power over
individual possession" would be relieved only by the violent intervention
of law or revolution, which would return property "to those, who by the
laws of nature, had the original right to its enjoyment."59
Corporations were also attacked as sources of both private and public
corruption. When "by an inequality of operation in the laws" men were
able to "accumulate fortunes, and live in unequalled splendor," their
example "corrupts the taste" of others, encouraging a "spirit of envy" and
57AmericanJurist, IV, 300; Pennsylvania Constitutional Convention of i837Proceedingsand Debates, III, 368.
58Kent, Commentaries,II, 228; "Democritus," Pa. Packet, Sept. 4, 1783. On the
English laws of mortmain see also Carl Stephenson and Frederick George Marcham, Sourcesof English Constitutional History (New York and London, 1937),
i838,
I69-170,245-246.
59Lincoln, Mozart Association veto, in Resolvesof the General Court for I824474-476. See also Lincoln's veto message of Mar. 20, i833, Resolvesof the
General Court ...,
I832-I834
(Boston, [i834?]), 405-406; Rantoul speech,
i835, in Hamilton ed., Memoirs, 314-3i6,
and a veto message of Pennsylvania
Gov. William Bigler, Mar. 29, i852, in Pennsylvania Archives, VII, 56o.
I828,
72
prompting them to abandon productive occupations for more lucrative

and often speculative ones. Suddenly, the possession of a simple "competency," by which an individual could support himself and his family in
modest comfort, became a mark of "inferiority" and "relative poverty,"
which was "clearly wrong in a free and equal government." Those objections, raised by Sullivan in The Path to Riches, seem decidedly of the
eighteenth century, but the same sentiments were expressed at the Pennsylvania constitutional convention of i837-i838
by Charles Ingersoll, a
critic of corporations and especially of the "bank dominion," which he
blamed for stimulating the extravagant excesses of his time by leading men
to spend most of their time "striving and straining ... to live as others do,"
"upon stilts," enjoying "the inordinate luxuries of the times." These
arguments were repeated in i840 by Massachusetts governor Morton.60
Charges that corporations corrupted the political system became commonplace during the i83os after the Second Bank of the United States
bestowed substantial favors on Congressmen in an effort to have its
charter renewed. A half century earlier, however, opponents of that
"political monster," the Bank of North America, already recognized that
"the wealth and influence of the Bank may become dangerous to the
government." The danger was difficult to avoid as long as associations of
individuals with substantial assets could secure profitable advantages from
legislators. By the mid-nineteenth century, proponents of anticharter
doctrine proclaimed that the threat of corporate corruption had been
realized: corporations, they said, "judge our judges; they govern our
governors; . .. they dictate law to our legislature," and had become, in
short, "our masters."61
Finally, critics argued that corporations promoted economic development less effectively than companies owned by individuals or partnerships. As George Logan explained in a broad-gauged attack on the SUM
in I792, corporations were managed by "uninterested Agents," salaried
employees who acted with less intelligence and commitment than those
who owned as well as managed a business "on the success of which" they
and their families "depended for bread." That argument (which appeared
as well in Smith's Wealth of Nations) remained a fundamental part of
60 [Sullivan], Path to Riches, 7, 9-10,
32-33,
35, and also "An Observer,"
GeneralAdvertiser,Jan. 7, 1792, in Davis, Essays, I, 431; Ingersoll in Pennsylvania
Constitutional Convention of i837-i838,
Proceedingsand Debates, VII, 87-88;
and Morton, address to the legislature, Jan. 22, i840, in Acts and Resolves...
I839-1842,
294.
BUS: Robert Rantoul (1778-i858,

father of Robert Rantoul, Jr;, I805I852), autobiographical reminiscences in Historical Collectionsof the EssexInstitute,
VI (i864),28; on the danger of corporate patronage see also Rantoul, Jr., Memoirs,
3 i6. BNA: An Addressto the Assemblyof Pennsylvania, on the Abolition of the Bank
of North-America (Philadelphia, 1785), 21. Fulfillment: Pennsylvania Convention
of i837-i838,
Proceedingsand Debates, VI, 84, and see also Official Reportof the
Debates and Proceedingsin the State Convention,assembledMay 4th, i853, to Revise
and Amend the Constitution of the Commonwealthof Massachusetts(Boston, i853),
II, 259, 260 ("the railroad interest is now too strong even for the legislature"), III,
61
59.
73
anticharter doctrine in Pennsylvania, where privately owned and managed,

unincorporated businesses were more common than in Massachusetts,
most notably in mining and manufacturing. It was also used by Morton
against proposals that Massachusetts assume the ownership and development of internal development projects. The state, Morton said, could
"never ... compete with individual shrewdness and diligence."62
Although Massachusetts resisted state ownership of canals and other
forms of enterprise, other states gave in. They hoped to repeat the success
of New York's Erie Canal and acted on an old republican argument that all
citizens should share equally in the opportunities and profits such internal
improvements brought. But by the mid-nineteenth century, real or threatened bankruptcy induced many states to follow Massachusetts's example
and delegate both the costs and potential profits of development to private
corporations.63 Even the comparative efficiency argument could be used,
it turned out, to assuage fears of corporations. Thus William Soden
Hastings of Massachusetts argued that because a corporation was less
profitable and effective than an enterprise owned by an "individual, who
works with his own hands upon his own capital"and "superintends his own
business," corporations could never replace "the small manufacturer, or
... fill the place, which, but for them, individuals of skill with ordinary
capitals, might, or would occupy."64
Corporations were by implication appropriate for projects beyond the
capacity of individuals, and, as opportunities for capital-intensive enterprise increased, their numbers grew. The proliferation of corporations did
not, however, necessarily mark the failure of anticharter doctrine, whose
objectives and impact were more complex than that Hartzian title suggests.
IV
Although anticharter arguments were frequently stated as if they applied to all corporations without exception, in practice opposition usually
settled on some corporations only. Even the Pennsylvania legislators who
campaigned against the BNA and the reincorporation of Philadelphia
62 [Logan], Five Letters, i6, and Hartz, EconomicPolicy and DemocraticThought,
57-62. Morton, address to the legislature, Jan. 22, i840, in Acts and Resolves...
I839-i842,
301-302.
See, for example, Hartz, EconomicPolicy and DemocraticThought, and Harry

N. Scheiber, Ohio Canal Era: A Case Study of Government and the Economy,
I820-i86i
(Athens, Ohio, i987; orig. pub. i968); Seavoy, Origins of the American
Business Corporation, 266-267. Virginia, however, invested heavily in private
internal improvement companies on the assumption, stated in a report of i8i5,
that those improvements would "be more economically made, and better repaired,
if their management be left to the individuals who subscribe to their stock with a
view to private gain, than if confided to public officers or agents"; Carter Goodrich,
"The Virginia System of Mixed Enterprise: A Study of State Planning of Internal
Improvements," Pol. Sci. Q., LXIV (I949),
355-387, quotation at 360.
" Hastings, in Hastings and Uohn] Pickering, Remarksmade in the Senate upon
the Manufacturing Bill (Boston?, I 829?), 3.
63
74
apparently raised no objections to the charters granted "every day," as one

legislator put it in I786, to "half a dozen or 20 people for some purpose
or another." Similarly, in I792 James Sullivan carefully distinguished the
incorporation of a bank from that "to build a bridge, or to cut a canal,"
which he found unobjectionable. Banks were probably assailed more
often than any other kind of corporation. But consider the position of a
delegate to the Massachusetts constitutional convention of i853 who
launched a rhetorically powerful attack on corporations "of a business
character." Among corporations "for other purposes," which were apparently exempted from his criticisms, he included railroads, insurance companies, and banks!65
Because their condemnations were selective, anticharter spokesmen
could participate in corporations without hypocrisy. In Massachusetts, for
example, Sullivan and even the radical Robert Rantoul, Jr., were active
members of several different business corporations.66 Complexities in the
anticharter position also help explain why divisions over corporations
rarely followed strict party lines. To be sure, most vocal critics of corporations were Democrats or, in earlier years, men of that political bent. But
partisan control of state legislatures seems to have had little effect on the
rate at which corporations were created. Legislators irrespective of party
supported constitutents' applications for incorporation, securing the votes
of colleagues by returning the favor. Such log-rolling multiplied corporations while inhibiting anticorporate rhetoric among legislators. The strongest proponents of anticharter doctrine among public office holders were
often governors, who served the state at large and were less beholden to
local interests, or delegates to constitutional conventions who lacked
ordinary legislative power.67
The definition of party differences on corporations was also difficult
65Remark in Pa. Packet, Sept. 26, 1786; [Sullivan], Path to Riches, 44, also
5 3-54; Massachusetts Constitutional Convention of i853, Debatesand Proceedings,
III: 6o; Heath, ConstructiveLiberalism,323.
66Davis, Essays,II, 69, and Dictionary ofAmericanBiography,XVIII (New York,
1936), i90-i9i;
Robert S. Rantoul (son of Robert Rantoul, Jr.), Personal RecolA speaker in the Pennsylvania Conlections (Cambridge, Mass., i9i6),
24-28.
also asserted that Findley and Smilie,
stitutional Convention of i837-i838
prominent opponents of the BNA, with Gallatin, "laid the foundation of the Bank
of Pennsylvania." See Proceedingsand Debates, VII, 177.
67 Hartz, EconomicPolicy and DemocraticThought, 62-66, 76-78, 292-293,
and
Evans, Business Incorporations,esp. 3. See also William Meredith in the Pennsylvania Constitutional Convention of i 837-i838,
Proceedingsand Debates,VII, 107:
"It would be difficult to turn to the journals of any [legislative] session, without
finding in them the passage of some act of incorporation.... By every party, and
by every shade of party, that has ever been represented in the state legislature,
have these institutions been founded." See Handlin and Handlin, Commonwealth,
L.
2 i6; Primm, EconomicPolicy in the Developmentof a WesternState, esp. 126-127;
Ray Gunn, The Decline of Authority: Public EconomicPolicyand Political Development
in New York, i8oo-i86o (Ithaca, N. Y., I988), 233, and Cadman, The Corporation
in New Jersey, 433, 435. According to Eric Foner, suspicion of corporations was
common among Republicans; see Foner, Free Soil, Free Labor, Free Men: The
Ideologyof the RepublicanParty beforethe Civil War (New York, 1970), 22-23.
75
because the defenders of business corporations, like those of municipal

incorporations, shared their opponents' values and often also their reservations concerning specific charters.68Beginning in the I78os, however,
they denied that corporations were intrinsically aristocratic or antirepublican, and insisted that some, including banks, were particularlywell suited
to republics. A half century later, even discerning critics of corporations
such as the Massachusetts Democrat David Henshaw could sometimes
join corporations' supporters in describing those institutions as "exceedingly useful" in the United States, where property was widely distributed,
because they "supply the place of the large capitalists in Europe." Corporations were also "peculiarly adapted to benefit persons of small means and
limited knowledge of business" who could, by pooling their assets, "come
into fair and safe competition with the skillful and wealthy." The spread of
corporations therefore reflected the republic's "minute division" and
"general distribution" of property and enabled "persons of small means"
to undertake what they could not otherwise attempt. Great wealth in the
hands of a corporation might even be "much safer, and more consonant
with the spirit of our government, than when in the hands, and under the
sole control of an individual."69But corporations had to be "judiciously
granted, and suitably regulated" to ensure that they were "wisely directed
in effecting the great public and private good, of which they are capable,
and restrained from inflicting the public and private evils within their
power ... to which they are often tempted by their own views of interest."
On the need for such regulation the critics and defenders of corporations
generally agreed, though they often differed on what restrictions were
required and on whether limitations should be imposed by legislative
enactment or constitutional mandate.70
Anticharter spokesmen were distinguished above all by the rigor with
which they insisted upon a set of rules for the granting and design of
charters that seem to have become virtually standard in state after state.
Legislatures should create corporations, they said, only when necessary to
serve the public welfare in ways that were beyond the capacities of
individuals. To curtail the proliferation of corporations, they sometimes
68 For a striking example see the "answers"of two state legislators, Reps. Sturgis
and Thayer, to an attack on corporations by Robert Rantoul, Jr. in Boston Commercial Gazette, Jan. 29, i835. Sturgis said he opposed "granting a perpetuity to
corporate bodies, and would reject all applications for incorporation, unless they
were proved to be desirable, or of public utility." Thayer even expressed reservations about the "great number" of corporations being created.
69Hastings and Pickering, Remarks,2; [Henshaw], Remarks,esp. 5-7. See also
Thomas Paine's argument of 1786 that corporations helped prevent monopoly by
keeping a few people with great assets from dominating the market; Paine,
"Dissertations on Government; the Affairs of the Bank; and Paper Money," in
Philip S. Foner, ed., The CompleteWritings of ThomasPaine (New York, I945), II,
398.
70 [Henshaw], Remarks,9, and AmericanJurist, IV, 301; see also Hastings and
Pickering, Remarks,2, and Ingersoll in Pennsylvania Constitutional Convention of
i837-i838,
Proceedingsand Debates, VII, 78, and, for a defense of corporations
that assumes they are "subject to all proper restrictions," ibid., 107-109.
76
favored provisions such as that in the New York constitution of i821

requiring a two-thirds vote of both houses of the legislature for creation or
renewal of charters. Charters should be limited in duration or, alternatively, explicitly reserve the legislature's power to amend or repeal them.
They should also define the sphere of a corporation's activities and the
amount of property it could hold. Moreover, to the extent possible,
corporations should be denied privileges such as limited liability that were
not held by individuals and unincorporated groups. Even public service
ceased to justify legal privilege, which by the mid-nineteenth century was
frequently described as a form of monopoly, a word that came to include
any advantage not open to all.71 Finally, proponents of anticharter doctrine became advocates of general incorporation laws for business companies, which would have been impossible had they denied, as Hartz
assumed, the legitimacy of corporations. By standardizing the terms upon
which corporations were created and making incorporation a bureaucratic
process, such laws would supposedly undercut special privilege and make
the advantages of incorporation more generally available. Moreover, by
removing responsibility for granting charters from the legislatures, general
incorporation laws promised to eliminate a major cause of political corruption and allow legislators to devote more time to bills of wider public
concern.
Several states adopted general incorporation laws for business companies before the Civil War without realizing these promised benefits.
Applicants continued to seek special legislative charters in part to avoid
the restrictions imposed under the mid-nineteenth century's general incorporation laws, but also, it seems, because special charters were prestigious. Moreover, legislatures proved willing to grant special charters in
volume until late in the nineteenth century, when constitutional amendments proscribed all incorporations except under general laws and so,
finally, brought an end to the era of the special charter.72
The impact of anticharter doctrine must therefore be measured not by
the numbers of corporations created but by the evolving character of
charters. Even the Pennsylvania controversy over the BNA was centered
on the restrictions to which it would be subject; the fact of its incorporation, according to Robert Brunhouse, was assumed. Anticharter spokesmen wanted the bank's charter to be issued for seven years, reserve the
legislature's rights of amendment and repeal, and restrict the bank's
ownership of land. Because those demands were ignored, a period of
turmoil followed, and in I785 a "radical"legislature repealed the bank's
charter. Two years later, in March I787, a "conservative" legislature,
71For examples of that use of the word see Massachusetts Convention of i853,
Proceedingsand Debates, III, 55-56, 64, 71, 173. The use of the word was
sometimes attacked; ibid. 171.
72Russell Carpenter Larcom, The Delaware Corporation(Baltimore, I937), esp.
1-3,
3 n. 7, and Evans,BusinessIncorporations,
3, IO, ii. See also Handlin and
Handlin, Commonwealth,2 i8, Hartz, EconomicPolicy and DemocraticThought, and
Cadman, Corporationin New Jersey, esp. xi-xii, 434-438.
REVOLUTIONARYORIGINS OF THE AMERICANCORPORATION
77
noting that "a bank under proper regulations" could be "useful to the
commerce and agriculture of the state," reincorporated the bank with a
series of new "limitations and restrictions" on its duration, sphere of
activities, capital assets, and landholding much like those first proposed by
the anticharter faction seven years earlier. In short, the BNA was, as its
critics demanded, "new modelled" so that it would better "harmonize with
the government of this country."73
By then, the bank's critics had come to advocate additional changes,
particularly in its governing structure. They proposed, for example, that
directors be subject to a rotation in office and that all shareholders have
equal votes and be allowed to vote only in person, not by proxy. Alternatively, they suggested that corporate voting rights be distributed under
a system that favored small shareholders over large. Because the BNA let
shareholders vote in proportion to their shares, opponents charged, it
gave "a few great stockholders" the power to perpetuate themselves and
their friends in office. Even the Bank of England provided against that
contingency "by giving each proprietor of five hundred pounds a vote, and
by not permitting any man to have more." Many other British corporations allocated votes among shareholders in a similar way.74 By allowing
small shareholders at least one vote and capping those of large shareholders, charters might not only limit "aristocratic"power but build into the
very structure of corporations a check on their "vast influence and magnitude," a democratic "counterpoise" to corporate power such as other
societies found, as William Findley observed in Pennsylvania legislative
debates of 1785, in kings, nobles, and great landed families. British
73Brunhouse,
Counter-Revolutionin Pennsylvania, esp. 111-II2,
196-197;
Mitchell and Flanders, Statutes at Large of Pennsylvania, XII, 1785-1787 (Harrisburg, i906), 57-58, 412-4i6; [Tench Coxe], Cool Thoughts on the Subject of the
Bank (Philadelphia, 1786), i6.
74 [Coxe], Cool Thoughts, 4; [Coxe], Thoughts Concerning the Bank of North
America(Philadelphia, 1787), 2-3, and passim, and "FurtherThoughts concerning
the Bank, respectfully submitted to the Honorable THE GENERAL ASSEMBLY
OF PENNSYLVANIA," ibid., 7ff. Coxe drew his information on the Bank of
England from Michael Godfrey's Short Account of the Bank of England (i695),
reprinted as an appendix to John Francis, History of the Bank of England, Its Times
and Traditions, II, 3d ed. (London, i848), 241-257, esp. 242. See also "Strictures
on the Bank," Pa. Packet, Mar. 3i and Apr. II, 1785; "Atticus," esp. "Letter the
Fourth," ibid., June 28, 1786, and "Philadelphiensis," Freeman'sJournal (Phila.),
Mar. 2, 1785.
Voting in early English profit-seeking corporations such as the East India
Company allowed all shareholders single votes since "the units of which the
corporation was composed were still considered to be the members, as is the case
in municipal corporations and guilds," not shares. Later, as with the Chelsea Water
Company (1723), larger shareholders were given additional votes up to a maximum that remained disproportionate to their holdings. Such checks on the power
of large shareholders were designed, as a 1766 act of Parliament explained, to
protect "the permanent welfare of companies" from being "sacrificedto the partial
and interested views of a few." See Williston, "Law of Business Corporations "
I 56-I 58, quotations at I 56, 1 57, and DuBois, English Business Companyafter the
BubbleAct, 288-289, 3i6-317 notes 47, 48, 50.
78
precedent served American purposes so well that systems of disproportional shareholder voting were included in many early state charters as
well as that of the first Bank of the United States (1791).
In Maryland,
"practicallyall of the charters granted" between I784 and i8i8 included
some such provision.75 Such safeguards made for increasingly complex
charters. Even the much-criticized charter New Jersey granted the SUM
was a long and detailed document that gave shareholders substantial
powers over management.76
Restrictions were sometimes applied to certain types of corporations
but not to others, or they might be abandoned in a process of change that
has never been fully traced or explained. Alternatively, what were at first
experimental innovations could be absorbed in a course of development
such as marked the early history of Massachusetts banking charters. In
I792
the General Court simply added new provisions to the "rather
crude" document by which it had chartered the Massachusetts Bank eight
years earlier. Then it imposed more restrictions when it incorporated the
new Union Bank, whose charter became a model to which further refinements were added in subsequent bank charters. In short, charters were
limited in duration, restricted banks' assets and activities, and specified
their internal government in detail, mandating, for example, skewed
shareholder voting systems. Banks were also required to issue regular
dividends from profits, which would prevent their perpetual accumulation
of property removed from the "law of distributions." These and other
provisions were collected in a General Banking Act of i 829 that bound all
banks subsequently incorporated or reincorporated by the legislature. A
similar process shaped the development of other types of corporations so
that by i836, when the commonwealth published a comprehensive set of
Revised Statutes, it included a unit on corporations with chapters on
libraries and lyceums, banks, insurance companies, manufacturing, and
other types of corporations, as well as another-chapter 44-that declared
all subsequent acts of incorporation "subject to amendment, alteration, or
repeal, at the pleasure of the legislature." Thereafter, legislative charters
characteristically included a few provisions specific to the group being
75Findley in Carey, ed, Debates, 65; Joseph G. Blandi, Maryland Business
(Baltimore, 1934), 65-66. See also Pease, Web of
Progress,i8, 269 n. 14. In proposing the BUS, Hamilton endorsed those provisions for officers' rotation and disproportionate shareholding voting favored by
Pennsylvania radicals while criticizing the restrictions Pennsylvania posed on the
duration and capitalization of the BNA. M. St. Clair Clarke and D. A. Hall,
comps., Legislative and Documentary History of the Bank of the United States
(Washington, D. C., i832), esp. 25-28, 32.
76Laws of New-Jersey(i821),
Davis, Essays, I, 378-387. Davis conio8-I25;
cludes that the SUM "was subject to practically no control beyond that of its
stockholders," but on that control see pp. 382-383. For a brief summary of
restrictions imposed through charters in New York see Gunn, Decline of Authority,
I 20-I
2 1: "in the first half of the nineteenth century, the corporate charter was the
only regulatory device in most industries."
Corporations,1783-i852
79
incorporated, then declared it subject to appropriate chapters in the

RevisedStatutes.77
Court decisions increased the significance of charters. The Dartmouth
College case, which held that the charters of "private" corporations were
contracts which the state could not unilaterally violate or change, left in
place restrictions imposed at the time of their incorporation since they
were, in effect, terms of the original contract. Meanwhile, American
courts increasingly denied corporations those "rights without limitation"
that, according to the AmericanJurist, they could claim under English
common law and allowed them to exercise only powers "plainlygranted in
their charters, or . . . clearly necessary to effect the useful purposes for
which they were created." By the time of the Civil War, judges throughout
the country declared null and void "ultra vires" acts that went beyond
those limits.78
Widespread use of the "ultra vires doctrine" in nineteenth-century
corporate law resembled the establishment of judicial review in constitutional law, and for good reason: charters and constitutions were understood as essentially the same. "A corporation," according to the definition
in Francis Lieber's EncyclopaediaAmericana (i830), "is a political or civil
institution ... conducted according to the laws of its constitution." Moreover, "all the American governments" were "corporations created by
charters, viz. their constitutions," and could act "as corporators" only
within "the limits of the objects and powers of the institution."79The close
relationship of charters with constitutions meant that debates over the
internal structure of corporations and the management of power, even
specific proposals such as rotation in office, could easily draw on precedents from state and federal constitutions. But influence could also go the
other way: the insistence on a broad-based electorate for municipal and
business corporations seems in some measure to have anticipated agitation
over state franchise requirements. The similarity of charters and constitutions, of course, recalled the fact that the charters of several colonies had
initiated Americans into the habit of living under written documents
similar to the constitutions they drafted after Independence. The constitution-like character of charters may even have contributed to the corporation's popularity in the United States. At any rate, an article in the
77Laws of the Commonwealth, 1780-1800,
I, II5-I17,
II, 544-552;
Revised
Statutes, 308-366,
quotation at 366; Edwin Merrick Dodd, "The First Half
Century of Statutory Regulation of Business Corporations in Massachusetts," in
Roscoe Pound, ed., Harvard LegalEssaysWritten in Honor of and PresentedtoJoseph
Henry Beale and Samuel Williston (Cambridge, Mass., I934), esp. 70-82 (comment
on act of I 784 on p. 7 i). For a similar development in New York, which, however,
quickly moved on to enact general incorporation laws, see Gunn, Decline of
Authority, esp. chap. 8.
78 "Corporations," AmericanJurist, IV, 305-306;
Kent, Commentaries,II, 239240;
Morton J. Horwitz, The Transformationof American Law, 1870-i960
(New
York, I992), 77-78, on the significance of "ultravires doctrine" and its demise in
the twentieth century.
79 Lieber, Encyclopaedia
Americana, 547.
8o
AmericanJurist for i830 attributed Americans' virtually boundless enthusiasm for corporations to "the genius of our institutions." The corporate
form, defined in written charters, seemed at home in a nation whose
"governments, political and municipal, are founded on corporate principles."80
Restrictions and regulations written into corporate charters were sometimes ignored or interpreted in ways most favorable to enterprise, particularly where enthusiasm for development was strong, and in the late
nineteenth and early twentieth centuries, many such provisions gave way
entirely, as the power of shareholders was reduced and corporations were
increasingly left to determine their own forms of governance.81 The forces
behind that "liberalization"of the law were already at work in antebellum
New Jersey, which had from the early years of the republic granted
generous charter privileges in an effort first to attract business from
neighboring states, then to secure the fees companies paid for incorporation. Incentives to incorporate in a state such as New Jersey increased as
companies' legal capacity to operate in other states was established, and
the United States Supreme Court's decision in Bank of Augusta v. Earle
(i839)
provided an important (though limited) step in that direction.82
Remnants of the old tradition nonetheless persisted far longer than
most accounts indicate. The assumption that corporations had to serve the
public good outlived the i83os, assertions to the contrary by the Handlins
and others notwithstanding.83 Story's opinion in the Dartmouth College
case designated some corporations as "private"because their assets came
from private sources, not because they served private purposes; it therefore in no way denied that even "private" corporations had to serve a
public function.84 As late as i875 a revised edition of the pioneering
80
Ibid.,
300.
See also Hurst, Law and EconomicGrowth: The Legal History of the
LumberIndustryin Wisconsin,i836-1915
(Cambridge,Mass., i964),
which
4I3,
lists among the attractions of incorporation for businessmen its provision of "a
constitution . . . for resolute central direction of pooled interests."
81 Scheiber, Ohio Canal Era, esp. 276-282;
Adolf A. Berle, Jr., and Gardiner C.
Means, The ModernCorporationand Private Property(New Brunswick, N. J., i99i;
orig. pub. 1932), esp. Bk. II, i i9ff. See also Thomas C. Cochran, "The Social
History of the Corporation in the United States," in Caroline F. Ware, ed., The
Cultural Approachto History (New York, I940),
i68-i8i, esp. I74-I75.
82Cadman, Corporationin New Jersey,440-44
i, and passim. On Bank ofAugusta
v. Earle compare Charles Warren, History of the Harvard Law Schooland of Early
LegalConditionsin America,II (New York, I970;
orig. pub. i908),
I 50-I
52,
with
Horwitz, Transformation of American Law, i870-i960,

79, which stresses the
decision's recognition that states could still exclude "foreign" corporations (that is,
those from other states as well as countries), and the more detailed discussion of
the case in Gerard Carl Henderson, The Position of Foreign Corporationsin American Constitutional Law (Cambridge, Mass., i9i8), 42-49.
The rights of corporations in states other than those in which they are chartered were, it seems,
established in good part by court decisions of the twentieth century.
83Handlin and Handlin, Commonwealth,I57-i60.
See also Gunn, Decline of
and Heath, Constructive

Liberalism,325.
84 Newmyer, "Justice Joseph Story's Doctrine of 'Public and Private Corpora-
Authority,107-Io8,
8i
American Treatise on the Law of Private CorporationsAggregate(i832)

by
Joseph K. Angell and Samuel Ames continued to describe "the successful
promotion of some design of public utility" as the purpose of corporations, although the book also said, like Massachusetts incorporation acts of
the I 78os and I790s, that they could, "at the same time, be established for
the advantage of those who are members of it."85According to Richard M.
Abrams, a historian of the Progressive period, corporations were finally
accepted in Massachusetts as instruments "primarily for private profit,
rather than public service, with minimal obligations to the community"
only after I 900.86
Nor, it seems, did regulatory state charters disappear suddenly after the
Civil War. According to Horwitz, passage of New Jersey's permissive
general incorporation act of i889, which allowed the state. to pay all its
expenses with fees from corporations, led to competition between states
for the business of incorporation that finally undermined serious efforts at
restriction. Delaware abandoned its old regulatory tradition only in i899,
when it adopted the generous law that would make it a mecca for
companies seeking incorporation. As late as I902, Theodore Roosevelt
praised Massachusetts corporate laws as a model of how the nation might
solve its "trust problem." In the following year, however, the Bay State
modified its corporate code in an effort to undercut the "general practice"
of Massachusetts companies' organizing under the laws of other states.
And by I932, the old, post-Revolutionary corporate order had, it seems,
so thoroughly disappeared that Adolf A. Berle and Gardiner C. Means
could announce in The Modern Corporationand Private Propertythat "the
American corporation had ... become an institution" that "resembles the
state in character"and propose that it "serve not alone the owners . .. but
all society" as if those ideas were "wholly new."87
The early history of the American corporation is rich in implications for
the meaning and impact of the Revolution. It provides little evidence of a
hostility toward commerce or capitalism that some scholars have associated with republicanism: civic humanist heroes such as George Washington joined the rank and file of democratically elected legislatures in their
enthusiasm for the economic as well as the social and political improvetions' and the Rise of the American Business Corporation," DePaul Law Review,
XXV (I 976), 825-84I, esp. 832-835.
85Angell and Ames, Treatise on the Law of Private CorporationsAggregate, i oth
ed., "Revised, Corrected, and Enlarged, by John Lathrop" (Boston, i875; orig.
pub. i832), 7 (introduction,paragraphI3).
86Abrams, Conservatismin a ProgressiveEra: MassachusettsPolitics, 1900-1912
(Cambridge, Mass., i964), 79.
87Horwitz, Transformationof American Law, 1870-i960,
83-85; for a general
account that confirms the late emergence of modern understandings of the corporation see ibid., 65-I07;
Larcom, Delaware Corporation, chap. i, including
quotation from the Massachusetts Committee on Corporation Law of I902 on p.
IO; Abrams, Conservatismin a Progressive
Era, I0, I4-I 5, 77-7 9; Berle and Means,
The Modern Corporation,v, 3 5 3, 3 56.
82
ment of the nation and in acceptingthe corporationas an instrumentfor

thatpurpose,one thatharnessedprivateprofit-seekingto the publicweal.
Moreover, the essential continuityof anticharterdoctrine between the
I780s and i830s casts doubt on the notion that a sudden, powerful,
revolutionaryideologicaltransitionoccurredwithinthose yearsas "republicanism"gave way to "liberalism,"or, in Gordon S. Wood's more recent
The society, economy, and politics of the
formulation,to "democracy."88
United States were of course radicallytransformedin those years. But
from the I780s throughthe mid-nineteenthcentury, Americanslooked
back to I776 as the criticalbreak in their history, judged innovations
againstthe ideals of that time, and fought even for a broad-basedfranchise-a democraticissue if ever there was one-in the name of a Revolutionarytraditionthat they designatedwith the word "republican."
The structureof the new society thatemergedafterIndependencealso
looks differentgiven the proliferationof corporations,which represented
the most significantform of collectivismto emerge from the Revolution.
Accordingto the conventionalview, the integrated,hierarchicalsociety of
the monarchicalpastgave way by the age of Jacksonto a nationof isolated
individualsworkingalone for theirprivateinterests.It is possibleto argue,
however,thatAmericanssubstitutedfor the old bonds between superiors
and dependents new social ligaments voluntarilycontracted by equal
citizens through constitutionsof their own design and within voluntary
associationsthat frequentlyreceivedofficialsanctionthroughthe process
of incorporation.For contemporaries,the proliferationof corporations
could signal, in effect, an extension of Americanfederalismdown into
day-to-day,local associationalrelationships,so that "the whole political
system"was "madeup of a concatenationof variouscorporations,political, civil, religions, social and economical,"in which the nationitself was
a "greatcorporation,comprehendingall others."89Fromthat perspective,
well-constructedcorporationswere not embodimentsof faction but units
in an integratedsocialandpoliticalsystem,all workingfor the publicgood
and neatly tucked under the supervisoryauthorityof state legislatures,
whichacted as agentsof the sovereignpeople. Thus, for example,in I 784
the Society of the Cincinnatirecommended that state chapters seek
legislativechartersin an effort to offset criticismas "self-created"political
groups founded without "the sanctionor patronageof any legislativeor
civil authority whatever"-groups whose concern with public issues
"properonly for the congnizanceof the legislative... or of such other
bodies as are known in the constitution,or authorizedby the laws of the
land,"raisedthe prospect of an "Imperiumin Imperio."90
88Wood, The Radicalism of the AmericanRevolution(New York, I992), passiM.
89"Corporations," in Lieber, EncyclopaediaAmericana, III, 547. For a similar
English statement of I702 see Williston, "Lawof Business Corporations," I i0.
90Report of the Committee of the Massachusetts General Court to inquire into
Chronicle,Mar. 25, I784; A
the Cincinnati, Mar. 23, I784, in (Boston) Independent
Circular LetterAddressedto the State Societiesof the Cincinnati by the GeneralMeeting
Convenedat Philadelphia, May 3, I 784 (Philadelphia, I784), 3.
REVOLUTIONARYORIGINS OF THE AMERICANCORPORATION
83
Such a redefinition of early American society necessarily carries implications for understanding the state. The charge of imperium in imperio
leveled against the Cincinnati was central to the debates of the Revolutionary era in which Americans tried to reconcile first colonial with
British, then state with national authority. Its recurrence in deliberations
over incorporations, which sought to reconcile corporate with state authority, suggests again the continuity between designing constitutions and
drafting corporate charters. Both contributed to the creation of a "compound" republic that was "extensive" not only geographically but in its
penetration of the social and economic life of the new nation. The
American state has therefore never conformed to the "monist" model that
fits most European countries but has been described instead as a "pluralist"
state in which "the state is conceived of as a 'plurality of corporations.' "91
Above all, the early history of the American corporation suggests the
centrality of institutional change to the Revolution and so confirms the
emphasis contemporaries such as Thomas Paine placed on the "revolution" Americans effected "in the principles and practise of governments"
and that younger men such as Cheetham or Shunk put on the Revolution's
contributions to the "art"or "science" of government. Indeed, for Noah
Webster the very definition of revolution lay in "a material or entire
change in the constitution of government."92 The emergence of the
American corporation also reveals the process by which revolutionary
transformations were accomplished. Americans salvaged from a rejected
past those English legal traditions and practices that suited their republic,
modified them to fit, as Angell and Ames put it, "an enlightened age,"93
and began a trajectory of development that, in time, produced results
dramatically different from the precedents with which it began. They
rescued the corporation, an all-but-moribund institution in late eighteenth-century England, and utilized its capacity to empower individuals
whose resources were unequal to their imaginations. They attempted to
recreate it as an agent of opportunity rather than a recipient of privilege,
to limit its tendency to exacerbate inequalities of wealth, to devise checks
on its potentially dangerous power, to harness it more firmly to the public
good.
Good persons will differ over the extent to which those original intents
were realized and over their relevance for modern corporations. But the
91Mauro Calise, "The Corporate Sea-Change: How Modern American Corporations Succeeded Where Ancient European Corporations Failed," unpublished
paper presented at a conference on "Private Governments, Public Choices" at
Trent, Italy, June IO-I2,
I992.
For a different study that similarly stresses the
centrality of corporations in American culture see Peter Dobkin Hall, The Organization ofAmerican Culture, I 700-1900.
Private Institutions, Elites, and the Origins
of American Nationality (New York, I982).
92 Paine, "Rights of Man, Part Second" (I792),
in Foner, ed., CompleteWritings
of Paine, I, 354. "Revolution" in Webster, An American Dictionary of the English
Language, II (New York, i828).
93 Angell and Ames, Treatiseon the Law of Private Corporations,vii (in both i 832
and i875 eds.).
84
charters granted in the United States after Independence created corporations undeniably distinct from those of an earlier day that had inspired
the hostility of Hume, Smith, and the leaders of revolutionary France. In
attempting to construct corporations appropriate for republican America,
state legislators of the late eighteenth and early nineteenth centuries
grafted them firmly onto the institutional structure of the United States.
The corporation therefore became, and remains, a child of the American
Revolution and a testament to its enduring impact, for good and for ill, on
the political and social structure as well as the economic welfare of the
United States.

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The Revolutionary Origins of the American Corporation

Author(s): Pauline Maier

The Revolutionary Origins of the

NE of the great unansweredquestionsabout the AmericanRev-

olution is why, during the 178os, state legislatures began creating

in the New Nation (Boston,

An intermediateversion was pre-

sented as the Jefferson Memorial Lecture at the University of California, Berkeley,

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

WILLIAM AND MARY QUARTERLY

the Massachusetts Bank (I784),

the Charles River Bridge Company

andthe Beverly Cotton Manufactory(I789). Their numberbegan

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

Handlin and Handlin, "Origins of the American Business Corporation,"

WILLIAM AND MARY QUARTERLY

College between i692 and I700-it

at first used that power cautiously.

Then, in the I 750S, the legislature began to approve the incorporation of

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

see ibid., I (Boston,

407704, and II (Boston, i874),

In the early nineteenth century, the New England habit of forming

orig. pub. i835), II, i06-I07.

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

corporations" as an encroachment "upon natural liberty."20 Sometimes

See alsoJon C. Teaford,The MunicipalRevolu-

tion in America:Origins of ModernUrban Government,i650-i825

WILLIAM AND MARY QUARTERLY

for municipalpurposes,was a partialenfranchisement,and made the

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

Economic considerationswere an importantpart of colonial Boston's

Many of these arguments were repeated in Philadelphia, whose I70I

reprinted in Publications of the Colonial

Societyof Massachusetts,X, 345-352,

WILLIAM AND MARY QUARTERLY

lic." If, moreover, the electorate in a reincorporated Philadelphia were

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

WILLIAM AND MARY QUARTERLY

Proceedingsand DePennsylvania Constitutional Convention of I837-I838,

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

Given the time it took to establish appropriate legal distinctions among

1786, and Gallatin in Pennsylvania legislative debates in the Philadelphia General

WILLIAM AND MARY QUARTERLY

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

and movable property and to exercise a banking monopoly until the

48 "An Observer" in General Advertiser,Jan. 7,

in Davis, Essays, I, 430;

WILLIAM AND MARY QUARTERLY

Robert Rantoul, Jr., an outspoken nineteenth-century Massachusetts critic

. must have a direct tendency

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

their children divide their estates"

men, until death,

accident or extravagance changes the ownership." But since corporations

[Henshaw], Remarksupon the Rights and Powersof Corporations,9-I0.

Debates and Proceedingsin the Conventionof Delegates to Revise the Constitution of

and LawrenceM. Fried-

man, "The Dynastic Trust," Yale Law Journal, LXXIII (i964),

WILLIAM AND MARY QUARTERLY

REVOLUTIONARY ORIGINS OF THE AMERICAN CORPORATION

in Pennsylvania, where data solicited by the constitutional convention of