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Osborn

V.

and proceedings of the federal Courts, we admit, without hesitation, that it is entitled to the exemption it claims. The States cannot tax the ofU.S. Bank fices, establishments, and operations, of the national government. It is not the argument of the opinion, in M'Culloch v. Maryland, but the premises upon which that argument is founded, that we ask the Court now to re-examine and reconsider.

Banking is, in its nature, a private trade; and is a business in which individuals may at all times engage, unless the municipal law forbid it. Where this is not the case, it is competent for individuals. to contract together, and create capital to be employed in lending money, and buying and selling coins, bullion, promissory notes, and bills of exchange. No law is necessary to authorize a contract between individuals for concentrating capital to be thus employed; nor does the business itself depend upon any special laws for its creation or existence. An association thus formed, may take to themselves a name, and may establish rules and regulations to govern them in the transaction of their business, and to determine their relative rights and duties among themselves. The general law not only recognises the obligation of this contract between the parties; it recognises also the capacity of the association thus formed, to make contracts in the name they have assumed, and the right of the individuals, as joint partners, or one party, to enforce those contracts. The whole is a private concern: the capital is private property; the business a private and individual trade; the

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convenience and profit of private men the end and object. Such is the true character of a bank, constituted by individual stockholders. Its rights and privileges, its liabilities and disabilities, are all U.S. Bank. the rights, privileges, liabilities, and disabilities of private persons.

If the individuals thus associated apply for and obtain, from the legislative power of the country, a special law, creating them a corporation, what change does it effect in their condition? A better answer cannot be given, than that contained in the definition of a corporation by this Court: "A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of its creation confers upon it, either expressly, or as incidental to its existence. These are such as are supposed best calculated to effect the object for which it was created. Among the most important are immortality, and, if the expression may be allowed, individuality; properties by which a perpetual succession of many persons are considered as the same, and may act.as a single individual. They enable a corporation to manage its own affairs, and to hold property, without the perplexing intricacies, the hazardous and endless necessity of perpetual conveyances, for the purpose of transmitting it from hand to hand. It is chiefly for the purpose of clothing bodies of men with these qualities and capacities, that corporations were invented and are in use."'a

a Dartmouth College v. Woodward, 4 Wheat. Rep. 634.

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If the character of a corporation, as here defined, be regarded in granting a charter to a banking company in the case stated, the change efU. S. Bank. fected in the condition of a company by the charter, can be easily and readily comprehended. It relates to their character, not to their rights. It would not change the nature of their business, but would afford facility in transacting it. It would confer upon the whole one individual character, comprising, for particular purposes, the capacities of an individual; but it would exempt them from liabilities, only so far as an express exemption was stipulated or granted. By the charter, they would be constituted an invisible, intangible, and artificial being, capable of perpetual existence, and of acting as an individual in the management of their appropriate affairs. But this would operate only to change the form, it would not alter the substance of things. These would still consist of the individuals that composed the association, and of the business in which they were engaged.

This was distinctly decided in the case of the United States Bank v. Deveaux. In that case it was contended, that the character of the individuals was completely merged in the charter of incorporation. But this Court adjudged otherwise; they determined that they could look behind the charter, and notice the character of individuals; and the cases and the principles upon which this decision is founded, also establish, that

a 5 Cranch, 84.

Courts may look beyond the charter for all sub- 1824. stantial and beneficial purposes.

When individuals, associated to carry on the trade of banking, apply to the Legislature of the country for an act of incorporation, they found their application upon some benefit to be derived to the public from conferring upon them the character they ask. This public benefit may consist of the facilities afforded to the State, in the management of its fiscal concerns; or it may consist in the convenience to the community in the transaction of mercantile and other money affairs. It may arise from the payment of annual revenue, or a stipulated sum, into the public treasury. If the benefit to the public be considered a sufficient compensation for the faculty conferred, the corporation is created. But from this fact, in the language of this Court," nothing can be inferred which changes the character of the institution, or transfers to the

government any new power over it. The character of civil institutions does not grow out of their incorporation, but out of the manner in which they are formed, and the objects for which they are created."a

If, then, a banking association be formed, the capital collected, the mode of transacting the business settled, and the whole concern regulated and established, before any application be made for a charter, it is clear that the mere fact of enacting a law, creating the association a corporation, could not change its character. It was a company of

a Dartmouth College v. Woodward, 4 Wheat. Rep. 638. VOL. IX.

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U. S. Bank.

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U.S.Bank.

1824. individuals, conducting a private trade, before it was incorporated, and it retained the same character afterwards. The charter was granted to give facility to the individuals in the management of their private affairs; not that, in virtue of that charter, they might share in the civil government of the country. For special purposes, it constituted them an immortal being; but of this being it has been correctly said, that "its immortality no more confers on it political power, or a political character, than immortality would confer such power or character on a natural person."

If in fact the incorporation be obtained before the association is formed, does it vary the principle? It is supposed and insisted that it does not. If the corporation be originated for the management of an individual concern; if it be based upon contract between individuals; if its great end and principal object be private trade and private profit, its character must be the same, whether the trade commenced precedent or subsequent to the incorporation; whether the individuals solicited the charter, or the Legislature invited the individuals. The character of the association must be ascertained by the same rules, and it must be subject to the same legal consequences.

We may suppose, then, that individuals resident in every part of the Union, and in foreign countries, have associated for the purpose of establishing a bank, with a capital of 28,000,000 of dollars; that they have actually collected this ca

a 4 Wheat. Rep. 656.