New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1876-02-11

tracts, shall be passed; nor vested rlghte DC
Invested, unless for purposes OF puoic
utility, and for adequate compensation
made
Article one, section ten, of the federal
constitution, prohibits the States from
passing any law 'impaiciug the obligation
of contracts"
Now, the qnes:ion ia whether the charter
Of the lO' :eIy CON psnv, as contained II act
No e5 falls under she prohibitions Of the
above CONSTR utional provisions. In other
words, does that act Of Incorporation coz
tain contract between the State of Louis
isnr and the lottery company, the "Obliga-
ton of which would be impaired BY its re-
peal! And, further, whether the lottery
company have acquired "vested rights
under their charter, which would be Id
vested" by repeal thereof, unless for ''a0.
equate compensation made"
As to what lie a contract, and what Will
impair it's obligation, as to what IL veste d
right, and what will divest it, we have to
refer TO elementary writers on cOnst;tu-
tional law, and to the adjudicated cases
wherein the construction OF these provis-
ions have been passed upon by the highest
STORY on the Constitution" third edition.
Gays: "A contract is defined to be an agree
ment to do. or not to do, particular thing
or compac: between two or more persons
A contract is either eXecutory or ex-
ecuted' AN executory contract is one in
which q party binds himself to do, or not to
do particular thing IAN executed con-
tract lie one in which the object of the con-
tract is performed The executed con-
tract, he saye, differs in nothing from a
grant, and falls within the protection Of the
Constitution. In paragraph 1891 he says
grant is contract within the mean
ing of the constitution, and the
prohibition reaches all interferences
with private grants; but states, ct has
been made question whether it applies, IN
the same extent, to contracts and grants OF
a State. created directly by law or made by
some authorized agent in pursuance Of a
law stating that it has been suggest
cd that, ''in such cases it is 70 be deemed
and act of the legislative power. and that
all laws are repealable by the same author
ity which enacted them" He adds, how
ever, that lit has been decided upon solemn
argument that contracts and grants made
by State, are no less within the reach of
the prohibition han contracts and grants
by private person." That the question is
no. whether SUCH contracts an6 grams axe
made directly by law, Z rle .o.n CT legis-
lation, or any othe: form. bat whether they
exist at all. The Legislature may, by law,
directly make grant, and such grant,
can not be constltu-iOnallv impaired.
So the legislature may make a
contract with iIdividua,e, directly by law.
pledging the State 70 performance OF It.
and then, whea It IS accepted, il IS equally
under the protection OF the constitution.
He states further, that: 1T may be laid
down as general principle that whenever
a law is in it's OWE nature contract, and
absolute rights have vested under r, re-
peal OF that law can not dives. those rights
or anuihilate or impair the ...le TO &C
CURED
Paragraph 1899 he says: "A charter ls
certainly in form and substance a rtracr,
il is a grant Of powers, rights and privileges.
and it usually gives capacity TO take and
hold property. When a charter creates cor
poration it emphaticai!v conters this capa-
city, for it is an incident TO corporation
(unless prohi5ited) TO take and 10 hold
property. A charter granted to private
persons, for private purposes, 10 within
the terms and reason OF the prohlbl-
ton. 1t confers rights and privileges
upon the faith Of which i is accepted. 1t
iupar,s obligations and duties on their part
when they are not at liberty to disre gard,
and il implies q contract, on the part OF the
Leg;slature, that the rights and privileges
so granted ehall be enjoyed. All corporate
franchises are legal estates; they are powers
coupled with an interest, and the corpora
tors have vested rights in their character as
corporaturs' In Angel Il Ames on Cor
porations, paragraph 1o7, the authore re-
mark. IN speaking of private corporations,
that Il. is happy feature in the constr
tuition of our own government that the
power of the Legislatures Of the different
States resembles. in this particular. the pre-
rogative OF the King Of Great Britain, who
fy,tc n Gl0aOIVp C0rnOTA
ton, or, without rs consent, alter or amend
is charter
In discussing tina. clause Of the tenth sec
ton of the federal constitution. which pro
hib;-s States from impsiTing the obi cation OF
contracts they say under this clause !,
has been settled that the charter OF prl
vare corporation, whether civil or ele
mosynarv. is an executed contract between
the government and corporators. snd that
the Legislature can Eot repeal, impair OF
alter il against the consent or without the
default of the corporation, judicia1sy ascer
tanned and declared" Mr.. Justice Cooley
in his valuable work on constitutional lin
irationp. in quoting the language Of Chief
Justice Marshall, IN the case Of Fletcher
We. Peck IN 4 Cranch. 1873. says that this
decision settles Two important points: hret
that an executed contract is within the
provision of the prohibition: and second
that j. protects from violation the contract
OF States equally with those entered into
between private individuals Cooley. page
rs. On page 279 he Gums no the law or
the subject as follows: Those charters O.
| iucorI oration, however, which are granted
not a. A par. of the machinery Of govern
ment. but for the private benefit or pur-
| poses of tie corporatOrs are held TO be con
| tracts between the Legislature and tb'
corporasors. based for their consideration
| on The liabilities and duties which the cor
| porators assume in accepting them and IN
| grant of the franchise, can no more b'
| resumed by the Legislature or lts beneht
| diminished or impaired without the consen
! of the grantees than any gran: OF property
or valuable thing. unless the right to 90 81
| ia reserved IN the charter itself" II mus
be perfectly clear to any legal mind fron
| these authorities that act No. - OF the SEE
sion of 1868 chartering the lottery company
| embodies contract between the State an
that corporation; that under that contrac
| they have become vested with the franchls
| and exclusive right for limited time, o
selling lottery tickets in this STATE
and that the Legislature can not aort
CRATE that charter without VIC
ating section ten OF article on
of the federal constitution. and article !,
of the constitution Of the State Of Louis
ana. The only way to legally get rid {
this oppressive incubus will be BY iudicis
proceedings for q violation of the charte
il such violation occur or by an exercise {
the right of eminent domain and that ca
only be done under article ITO Of the Sta,
constitution upon adequate compensate
made
For these reasons can not concur in th
majority report.
| COMMITTEE ON JUDICIARY,
! New Orleans, February 9, 1916
To the Honorable Speaker and Members OF II
| House of Representatives:
The undersigned members Of the Judicial
Committee. to whom was referred Hou
nil No. 6l begs leave 70 make the follO'