immunities are those common to two States, not special privileges to citizens of either. Art. IV, § 2, of the Constitution does not give State laws operation beyond State lines except by permission of the other State. Recognition and enforcement of contracts of corporations rest upon comity. Yet corporations are persons for the purpose of extending Federal judicial power, and are citizens of different States for the purpose of removal of causes from State courts.

1

"State law subordinating claims of foreign residents to those of citizens does not violate the Fourteenth Amendment, but the court looks behind the corporate entity and permits the members of a corporation who were citizens of another State to stand on the same plane as residents on the ground that to subordinate their claims would violate the privileges and immunities clause, Article IV, § 2, of the Constitution of the United States." Generally a corporation is legally a person liable civiliter for the torts of agents,3 and for acts quasi-criminal or tortious.'

A corporation, then, has status, and is clothed with jural relations. A State may exclude the corporations created by other States only under police laws. If they are engaged in interstate commerce they may

1 Paul v. Virginia, 75 U. S. 168.

2 Blake v. McClung, 172 U. S. 247.

3 Denver & Rio Grande R. Co. v. Harris, 122 U. S. 597. Salt Lake City v. Hollister, 118 U. S. 256.

'Brown v. Maryland, 12 Wheat. 419; Ex parte Siebold, 100 U. S. 393; Gibbons v. Ogden, 9 Wheaton, 1; Gilman v. Philadelphia, 3 Wall. 730; Patterson v. Kentucky, 97 U. S. 505; Passenger cases, 7 How. p. 400; License Cases, 5 How. 504; R. R. Co. v. Husen, 95 U. S. 465; Kimmish v. Ball, 129 U. S. 221; Plumly v. Massachusetts, 155 U. S. 461; Mo. K. & T. R. R. v. Haber, 169 U. S. 613; L'Hote v. New Orleans, 177 U. S. 587; Austin v. Tennessee, 179 U. S. 349; Rasmussen v. Idaho, 181 U. S. 198; Smith v. R. R., 181 U. S. 248; Compagnie Française v. Board of Health, 186 U. S. 380; Crossman v. Lurman, 192 U. S. 189.

not be excluded merely because they are foreign,1 and the State must make the rules for admission reasonable in other cases.3 The distinction between the admission of a corporation and permission to exercise its powers is illusory. The admission of a corporation by another State is not by comity, because it is not voluntary and is not the act of a sovereign.* It is enforced distinctly by three clauses of the United States Constitution.5

§ 27. THE SCOPE OF STATE LAW IS LIMITED TO THE PURPOSES OF LOCAL SELF-GOVERNMENT AND POLICE.

"The right to exclude is based upon the right to selfgovernment and to put foreigners on a par with citizens, and a denial of the right of other States to encroach upon the right to self-government by the extensive and extraordinary powers of artificial persons it creates.'

It is not in the power of one State, when establishing regulations for the conduct of private business of a particu

1

24 L. R. A. 311, and cases cited. Robbins v. Taxing District, 120 U. S. 489; New York v. Miln, 11 Pet. 132; Escanaba Co. v. Chicago, 107 U. S. 678; Willson v. Blackbird Co., 2 Pet. 245; Cooly v. Port Wardens, 12 How. 299; Pembina Mining Co. v. Pa., 125 U. S. 181.

2 Hennington v. Georgia, 163 U. S. 303; Plessy v. Ferguson, 163 U. S. 561; Minnesota v. Barber, 136 U. S. 313.

3 24 L. R. A. 289, and cases cited.

• See obiter, as to exclusiveness of Federal Quarantine statute if passed, Morgan v. Louisiana, 118 U. S. 464; Louisiana v. Texas, 176 U. S. p. 1; and Compagnie Française v. Board of Health, 186 U. S. 380. See Webster's Argument, Works, Vol. VI, p. 121.

Art. IV, sec. 1, of full faith and credit clause; Art. IV, sec. 2, cl. 1, privileges and immunities clause; Fourteenth Amendment, sec. 1. "All persons subject to the law must be treated alike. It is conceded that corporations are persons within the meaning of the amendment," Missouri R. R. Co. v. Mackay, 127 U. S. p. 209; see also cases just cited supra.

• Blake v. McClung, 174 U. S. 239.

lar kind, to give its own citizens essential privileges, connected with that business, which it denies citizens of other States.

"1

In Yick Wo v. Hopkins,2 where persons had been denied by municipal ordinance licenses to open laundries, it was held that there must be a fair exercise of the police power, and that it must fall equally upon citizens of the State, citizens of the other States, and foreigners. The rule in Blake v. McClung,3 was approved by a State Court which upheld a municipal regulation restricting the issue of permits for clamdigging to residents." The right to the exercise of the police power and to self-government is no attribute of sovereignty and belongs to all political bodies equally; in the case of the States it is so extended by the Constitution as to preserve the right from encroachment by the exercise of similar or other rights by other States.

But

The power of a State over a corporation of its own creation is as limited as that over a citizen. The movement of modern peoples has been from status to contract.5 It was formerly considered that a State could control the vested rights of corporations. when in Dartmouth College v. Woodward, it was held that a State could not take back what had been granted, this idea was abandoned, and no private grants were made.' In People v. O'Brien,' the court held that

1 Blake v. McClung, 174 U. S. 239.

2 118 U. S. 356.

3 174 U. S. 239. • Commonwealth v. Hilton, 174 Mass. 29, 32.

Maine, Ancient Law, 170.

6 4 Wheat. 518.

' Baldwin, Corporations before 1789, Am. Hist. Review, Vol. VIII, P. 449, and same material in Two Centuries of Legal Growth.

though the State could wind up the corporate existence of a company formed to operate a street railway in New York City yet the property right to use certain streets, which right the corporation had previously assigned, could not be reached by the State through control of the corporate entity which it claimed to have created and had clothed with the power of eminent domain. Only future exercise of the delegated power of eminent domain could be reached. With the past, present, or future contract relations of the individuals composing the corporation the State was not concerned. With the growth of corporate enterprise, police regulation of corporations was considered necessary. Thus, having abandoned the attitude of granting charters and privileges, and with a truer estimate of their powers, the States passed general incorporation laws, under which a certain number of individuals made a contract, for certain purposes and objects, to exercise powers. That this is the true notion of the power of the State over corporations is shown not only by the laws of the various States upon the subject but also by the decisions of their courts upon national corporations. It being considered that these corporations are merely the permanent contractual relations between individuals under the regulation of the rules of the national law upon the subject, they are considered not empowered to assume the existence of these relations within the States without conforming to the regulations of the But it was the argument of Webster, in asking for the decision, that the State Legislature had ample power to deal with abuses in corporate management. See Miller v. State, 15 Wall. 478; People v. O'Brien, 111 N. Y. 1; Metropolitan St. Ry. v. Commissioners, 174 N. Y. 714, Douglas v. Kentucky, 168 U. S. 488.

State. The use of public property and the exercise of a common or public calling has no necessary relation to corporate existence. "A railroad," for example, “is a public highway and none nor the less so because constructed and maintained through the agency of a corporation deriving its existence and powers from the State."1 A railroad's right of way has the substantiality of a fee and it is private property even to the public in all else but an interest and benefit in its uses.2 · Both corporations performing public services and the people beneficially interested have rights in the property used in the exercise of public franchises. That, therefore, which requires regulation in the public interest is not the corporate contract but the exercise of the public calling. The incorporated partnership doing a local manufacturing or trading business is no more a subject for government regulation than the individual. The essential is above and beyond the corporate contract and has no relation to it.

§ 28. STATE LAW CANNOT ABRidge Rights GUARANTEED BY NATIONAL LAW. States have assumed to empower corporations originating within their borders to do in other States that which they are forbidden. to do by the laws under which they are incorporated. Thus the State of New Jersey permits the corporations formed under its laws to claim the power of constructing and operating railroads anywhere except in the State of New Jersey. The right of a foreign corporation

1 Mr. Justice Harlan in Smyth v. Ames, 169 U. S. 466.

2 Western Union Tel. Co. v. Pennsylvania, 195 U. S. 540; Pumpelly v. Green Bay Co., 13 Wall. 166, 181; Scranton v. Wheeler, 179 U. S. 153; Chicago, Milwaukee & St. Paul Railway v. Minnesota, 134 U. S. 418.

3 Smyth v. Ames, 169 U. S. 466.