in various kinds of currency, and providing punishment for violation of such requirements by fine and imprisonment. The bank protested that this was an undue interference with its rights, and the War Department declined to hear the complaint on the ground that banks and banking are subject to legislative regulation and control. In the opinion given by the Law Officer of the War Department we find this statement:

"Banking is a lawful calling, and the right to pursue a lawful calling may be a valuable property right. A well-known author in his treatise on banking uses the following language: At common law, the right of banking pertains equally to every member of the community. Its very exercise can be restricted only by legislative enactment (1 Morse on Banks, Sec. 13).' The business of banking by reason of its very intimate relations to the fiscal affairs of the people and the revenues of a State is and has ever been considered the proper subject of control and strictly within the domain of the international police power of every State."

In the Veazie Bank v. Fenno 2 a tax upon the bank, which was incorporated under a charter by the State of Maine, was sustained on the ground that the franchise of a bank was property. The Court says (p. 547):

"But it cannot be admitted that franchises granted by a State are necessarily exempt from taxation; for franchises are property, often very valuable and productive property; and when not conferred for the purpose of giving effect to some reserved power of a State, seem to be as properly objects of taxation as any other property."

In that case the power to issue bank bills was assimilated to the power of a Railroad Company to issue freight receipts, bills of lading or passenger tickets, although the exemption from taxation was sought upon the ground that the bank had been chartered by the State for the purpose of carrying into effect part of the governmental powers of the State and that it was a governmental agency which should not be taxed.

"It seems difficult," says the Court, "to distinguish the taxation of of notes issued for circulation from the taxation of these railroad contracts. Both descriptions of contracts are means of profit to the corporations which issue them; and both, as we think, may properly be made contributory to the public revenue" (pp. 547, 548).

1 State v. Woodmanse, (N. Dak. 1890) 46 N. W. 970; Magoon, pp 258, 259.

2

2 (1869) 8 Wall. 533.

A bank charter was also the subject under discussion in Planters' Bank v. Sharp,1 and the Court says:

"A bank charter which gave the Planters' Bank the power to receive money on deposit and discount bills of exchange and notes and make loans was held to be a contract and violated by a further law declaring that it should not be lawful for any bank in the State to transfer any note, bill receivable or other evidence of debt" (pp. 319, 320).

The right and privilege to do banking and to issue notes is in no wise a necessary government function. Indeed, many of the wisest economists doubt whether it is a proper government function, and it is by no means certain whether it is wise for the Government to go beyond affixing its certificate to the purity and weight of coin, or, if need be, to the safety and sufficiency of notes secured by deposits made with it.

But surely it is no more a governmental function than the maintenance of the highways of commerce, post roads, mail routes, etc., or toll bridges across navigable streams, and all of these functions, it is universally conceded, are the proper subjects of franchises and contracts which are recognized in law as valuable property rights.

The case of the West River Bridge" sustained the charter rights of the Bridge Company as property and the charter as a contract between the State and the Company, which, like all other private rights of property, was sacred against invasion, but subject to condemnation under the right of eminent domain.

The Binghamton Bridge Case3 not only upheld a bridge contract as property, but sustained the exclusive right to maintain such a bridge within an indicated distance, as an inviolable contract, preventing the construction, under the authority of the State, of any other bridges within. the limits fixed, for a period which was itself unlimited. The Court there says:

"The constitutional right of one legislature to grant corporate privileges and franchises, so as to bind and conclude a succeeding one, has been denied."

That seems to be the position with those who insisted that the Government of Spain could not grant a corporate

1 (1847) 6 How., 300. 2 (1847) 6 How. 507. 3 (1865) 3 Wall. 51, 63.

privilege and franchise so as to bind its successor in the government of the realm. As to this contention the Court says:

"We have supposed, if anything was settled by an unbroken course of decisions in the Federal and State courts, it was that an act of incorporation was a contract between the State and the stockholders. All courts at this day are estopped from questioning the doctrine. The security of property rests upon it, and every successful enterprise is undertaken in the unshaken belief that it will never be forsaken."

"It received its ablest exposition in the case of Dartmouth College v. Woodward, which case has ever since been considered a landmark by the profession and no court has since disregarded the doctrine, that the charters of private corporations are contracts, protected from invasion by the Constitution of the United States."

In the more recent case of Pearsall v. Great Northern Railway Company,1 these doctrines are again reaffirmed, and after citing the Dartmouth College Case as laying down the broad propositions in regard to the inviolability of charters, the Court continues:

"Subsequent cases have settled the law that, wherever property rights have been acquired by virtue of a corporate charter, such rights, so far as they are necessary to the full and complete enjoyment of the main object of the grant, are contracts, and beyond the reach of destructive legislation."

In view of the particular exemptions from taxation accorded to colonial banks under the Spanish law, as a necessary inducement to the investment of capital in such remote regions, and in view of Commissioner Ide's suggestion, that under the protection of the doctrine in Veazie Bank v. Fenno a heavier taxation, amounting to destruction, would be the easy way of compelling submission on the part of Spanish corporations to the exigencies of their new masters, the following extract from the same case is interesting:

"This court has had, perhaps, more frequent occasion to assert the inviolability of corporate charters in cases respecting the power of taxation than in any other, and in a long series of decisions has held that a clause imposing certain taxes in lieu of all other taxes, or of all taxes to which the company or stockholders therein would be subject, is impaired by legislation raising the rate of taxation, or imposing taxes other than those specified in the charter."

1 (1895) 161 U. S. 646, 661, 664.

Then quoting from State Bank of Ohio v. Knoop:1

"The rate of discount, the duration of the charter, the specific tax agreed to be paid, and other provisions essentially connected with the franchise, and necessary to the business of the bank, cannot, without its consent, become a subject for legislative action.”

The Court says further:

"Within the same principle are grants of an exclusive right to supply gas or water to a municipality or to occupy its streets for railway purposes. "So, if a company be chartered with power to construct and maintain a turnpike, erect toll-gates and collect tolls, such franchise is protected by the Constitution.

"If it be provided in the charter of a bank that the bills and notes of the institution shall be received in payment of taxes or of debts due to the State, such undertaking on the part of the State constitutes a contract between the State and holders of the notes, which the State is not at liberty to break.”

The State which granted privileges to the colonial banks in Porto Rico and the Philippines was Spain. By their charters certain property rights were conferred upon them. According to these decisions of "the State" which succeeded to the rights and duties of Spain, it would seem it cannot successfully repudiate the due observance of stipulations so made, especially as in the act of cession of the territory in which these banks are situated it was stipulated that the cession should not in any respect impair the property or rights which by law belong to the peaceful possession of property of all kinds.

It is evident that this subject might be pursued into all its ramifications to the completion of a volume, but such a treatment would not be in consonance with the purpose of a review.

If this imperfect memorandum suggests a train of reasoning or a subject of investigation to your readers, and awakens in any of them an interest in the problems that are confronting the Judiciary and the Legislative, as well as the Executive, Departments of our country, it will, I trust, have served a useful purpose.

PAUL FULLER.

1

1 (1853) 16 How., 369.

CHANCELLOR KENT.

CONCERNING ERECTION OF A MONUMENT TO HIS MEMORY.1

The two great figures eminent over all in our early constitutional, judicial and legal history are those of John Marshall and James Kent. I said early history, and this is true; and it is largely true that their pre-eminence remains down to the present.

They were contemporaries. Marshall was born in Virginia, in 1755; Kent, in New York, in 1763. Both had reached manhood at the time of the adoption of the Constitution of the United States. Marshall had served for six years as a soldier in the War of the Revolution, and in the pitiable weakness of the Confederation he formed his wellknown principles as to a national government, strong enough to protect itself against the world and against the encroachment of its several members. Kent, younger than Marshall, was too young to take any part in the War of the Revolution, but having been settled as a young lawyer at Poughkeepsie, he was present in the summer of 1788, when the Constitution, by the narrow margin of three,-30 to 27was ratified by the State of New York, largely through the labors by tongue and pen of Alexander Hamilton. Chancellor Kent has himself left on record his presence at the opening of the Convention, in June, and the intense public interest in the proceedings from day to day, and of his attendance upon the Convention daily and steadily during the entire six weeks of the session. Both Marshall and Kent not only saw the birth of the Republic, but witnessed the feebleness and perils, many and great, which attended its earlier history, more than once threatening its continued existence. The lives of both were graciously prolonged in health and unclouded intellectual vigor to an extreme age. Chief Justice Marshall died at the age of eighty years in the discharge of his duties as Chief Justice of the Supreme Court, in Philadelphia, July 6, 1835, after a continuous

1Address before New York State Bar Association at Albany, January 21, 1903.