Where You Stand


The individual [a natural man or woman] may “stand” upon his constitutional rights as a citizen. He is entitled to carry on his “private” business in his own way. His “power to contract is unlimited”. He owes no duty to the State or to his neighbors to divulge his business, or to open his doors to an investigation, so far as it may tend to criminate him. He owes no such duty to the State, since he receives nothing therefrom beyond the protection of his life and property. His rights are such as existed by the “law of the land” long antecedent to the organization of the State, and can only be taken from him by “due process of law”, and in accordance with the Constitution. Among his rights are a refusal to incriminate himself and the immunity of himself and his property from arrest or seizure except under a warrant of the law. He owes nothing to the public so long as he does not trespass upon their rights.

Upon the other hand, the corporation is a “creature of the State”. It is presumed to be incorporated for the benefit of the public. It receives certain special “privileges” and franchises, and holds them subject to the laws of the State and the limitations of its charter. Its “powers are limited” by law. It can make no contract not authorized by its charter. Its rights to act as a corporation are only preserved to it so long as it obeys the laws of its creation. There is a reserved right in the legislature to investigate its contracts and find out whether it has exceeded its powers. It would be a strange anomaly to hold that a State, having chartered a corporation to make use of certain franchises, could not, in the exercise of its sovereignty, inquire how these franchises had been employed, and whether they had been abused, and demand the production of the corporate books and papers for that purpose.

Citation (emphasis added), Hale vs. Henkel, 201 U.S. 43 (1906).
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