CORPORATIONS-AMENDMENT OF CORPORATE CHARTERS-POWER OF THE LEGISLATURE TO AUTHORIZE CHANGES IN INTRACORPORATE AFFAIRS

Authors

Abstract

In 1819, in the leading Dartmouth College case, Justice Story suggested that a state might easily retain control over its corporations by the simple expedient of reserving the power to alter, amend, or repeal the charter. The states were quick to accept the suggestion, but the real extent of this reserved power has never been definitely ascertained. A minority of the state courts, led by New Jersey, have held that this reserved power extends only over the contract between the state and the corporation; whereas a great majority have adopted the view that it extends over the contract between the corporation and the stockholders and the contract among the stockholders as well, so long as the exercise of the power does not impair vested rights or defeat or impair the object of the grant. But when it comes to defining a vested right those courts have split on nearly every situation that has arisen.

Recommended Citation

CORPORATIONS-AMENDMENT OF CORPORATE CHARTERS-POWER OF THE LEGISLATURE TO AUTHORIZE CHANGES IN INTRACORPORATE AFFAIRS, 34 Mich. L. Rev. 859 (1936).
Available at: https://repository.law.umich.edu/mlr/vol34/iss6/7