Historical background in the United States Corporate personhood

during colonial era, british corporations chartered crown business in north america. practice continued in united states. granted monopolies part of chartering process. example, controversial bank bill of 1791 chartered 20-year corporate monopoly first bank of united states. although federal government has time time chartered corporations, general chartering of corporations has been left states. in late 18th , 19th centuries, corporations began chartered in greater numbers states, under general laws allowing incorporation @ initiative of citizens, rather through specific acts of legislature.

the degree of permissible government interference in corporate affairs controversial earliest days of nation. in 1790, john marshall, private attorney , veteran of continental army, represented board of college of william , mary, in litigation required him defend corporation s right reorganize , in process remove professors, rev john bracken v. visitors of wm & mary college (7 va. 573; 1790 supreme court of virginia). supreme court of virginia ruled original crown charter provided authority corporation s board of visitors make changes including reorganization.

as 19th century matured, manufacturing in u.s. became more complex industrial revolution generated new inventions , business processes. favored form large businesses became corporation because corporation provided mechanism raise large amounts of investment capital large business required, capital intensive yet risky projects such railroads.

the primary purpose of 14th amendment undoubtedly protect freed slaves. however, amendment applies americans, not freed slaves , descendants.

following reasoning of dartmouth college case , other precedents (see below, case law in united states), corporations exercise rights of shareholders , these shareholders entitled of legal protections against arbitrary state action. cause strengthened adoption of general incorporation statutes in states in late 19th century, notably in new jersey , delaware, allowed form corporations without particular government grant or authorization, , without government-granted monopolies had been common in charters granted crown or acts of legislature. see delaware general corporation law. in santa clara county v. southern pacific railroad (1886), supreme court held fourteenth amendment applied corporations. since court has repeatedly reaffirmed protection.