In re Tiburcio Parrott

• Decision Date: 01 March 1880
• Parties: In re TIBURCIO PARROTT.
• Court: United States Circuit Court, District of California

1 F. 481

In re TIBURCIO PARROTT.

United States Circuit Court, D. California.

March, 1880

[Copyrighted Material Omitted]

Hall McAllister, Delos Lake and T. I. Bergin, for petitioner.

A. L Hart, Attorney General; David L. Smoot, State District Attorney; Crittenden Thornton, Davis Louderback and Robert Ash, for respondent.

HOFFMAN J.

The return in this case shows that the petitioner is imprisoned for an alleged violation of the act of the legislature of this state, approved February 13, 1880.

Article 19, Sec. 2, of the recently adopted constitution of this state is as follows:

'No corporation now existing, or hereafter formed under the laws of this state, shall, after the adoption of this constitution, employ, directly or indirectly, in any capacity, any Chinese or Mongolians. The legislature shall pass such laws as shall be necessary to enforce this provision.'

In pursuance of this mandate the legislature enacted the law under which the petitioner has been arrested. It is as follows:

'An act to amend the penal code by adding two new sections thereto, to be known as sections 178 and 179, prohibiting the employment of Chinese by corporations.

'The People of the State of California, represented in Senate and Assembly, do enact as follows:

'Section 1. A new section is hereby added to the penal code, to be numbered section 178.

'Sec. 178. Any officer, director, manager, member, stockholder, clerk, agent, servant, attorney, employe, assignee, or contractor of any corporation now existing or hereafter formed under the laws of this state, who shall employ, in any

manner or capacity, upon any work or business of such corporation, any Chinese or Mongolian, is guilty of a misdemeanor, and is punishable by a fine of not less than $100 nor more than $1,000, or by imprisonment in the county jail of not less than 50 nor more than 500 days, or by both such fine and imprisonment; provided, that no director of a corporation shall be deemed guilty under this section who refuses to assent to such employment, and has such dissent recorded in the minutes of the board of directors.

'1. Every person who, having been convicted for violating the provisions of this section, commits any subsequent violation thereof after such conviction, is punishable as follows:

'2. For each subsequent conviction such person shall be fined not less than $500 nor more than $5,000, or by imprisonment not less than 200 days nor more than two years, or by both such fine and imprisonment.

'Sec. 2. A new section is hereby added to the penal code, to be known as section 179, to read as follows:

'Sec. 179. Any corporation now existing, or hereafter to be formed under the laws of this state, that shall employ, directly or indirectly, in any capacity, any Chinese or Mongolian, shall be guilty of a misdemeanor, and, upon conviction thereof, shall, for the first offence, be fined not less than $500 nor more than $5,000; and, upon the second conviction, shall, in addition to said penalty, forfeit its charter and franchise, and all its corporate rights and privileges, and it shall be the duty of the attorney general to take the necessary steps to enforce such forfeiture.

'This act shall take effect immediately.'

It is claimed on behalf of the petitioner that this provision of the constitution, and the law passed in pursuance of it, are void because in violation of the fourteenth amendment of the constitution of the United States, and the law passed to enforce its provisions known as the civil rights law; and also of the treaty between the United States and the Chinese Empire, commonly called the Burlingame Treaty.

The fourteenth amendment enacts that 'no state shall deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.'

The civil rights bill provides that all persons within the jurisdiction of the United States shall have the same rights in every state and territory to make and enforce contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of person and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other. Rev. St. 1977.

Section 2164 provides that no tax or charge shall be imposed or enforced by any state, upon any person immigrating thereto from a foreign country, which is not equally imposed and enforced upon every person immigrating thereto from a foreign country.

Article 5 of the Burlingame Treaty recognizes 'the mutual advantage of the free immigration and emigration of the citizens and subjects' (of the United States and of the Emperor of China) 'respectively, from the one country to the other for purposes of curiosity, or trade, or as permanent residents.'

Article 6 provides that 'reciprocally, Chinese subjects visiting or residing in the United States shall enjoy the same privileges, immunities, and exemptions in respect to travel, or residence, as may there by enjoyed by the citizens or subjects of the most favored nation.'

It was not disputed by the attorney general of California that these provisions of the treaty are within the treaty-making power of the United States, nor that the law under which the petitioner has been arrested, if in violation of those provisions, or those of the fourteenth amendment, or of the civil rights bill, is void, anything in the constitution of the state to the contrary notwithstanding.

But it is urged that the article of the constitution of this state which permits corporations to be formed under general laws, reserves the right to repeal, alter, or amend those laws at the discretion of the legislature; that their repeal would at once put an end to the corporate existence of the corporations, and that the right to put an end to their existence involves the right to prescribe the conditions upon which their existence shall be continued; that this right is theoretically and practically without limit, and may be exercised by imposing upon corporations laws for the conduct of their business, and restrictions upon the use and enjoyment of their property, which would be unconstitutional and void if applied to private persons, and which may have the effect to defeat the object of the association, or to impair or even destroy the beneficial use of its property.

The state may, therefore, in the exercise of this reserved power, prescribe what persons may be employed by corporations organized under its laws, their number, their nationality, perhaps even their creed. It may determine what shall be their age or complexion, their height or their weight, the number of hours they shall work in a day, or the number of days in a week, and the rate of their wages.

These illustrations may seem extravagant, but they were all either recognized by counsel as within the scope of the reserved power, or else they are legitimate examples of the mode in which the reserved power, as claimed, might be exercised. For all such legislation the only remedy of the corporations is to disincorporate and cease to exist.

Such being the reserved power of the state over the creatures of its laws, it is urged that the treaty was not intended, and cannot be construed, to impair that right any more than it could be deemed to abridge the right to enact laws in the interest of the public health, safety, or morals, usually known as police laws, or to regulate the making of contracts by providing who shall be incompetent to make them, as infants, married women, and the like.

When we consider the vast number of corporations which have been formed under the laws of this state, the claim thus put forth is well fitted to startle and alarm. It amounts in effect to a declaration that the corporations formed under the laws of this state, and their stockholders, hold their property, so far as its beneficial use and enjoyment are concerned, at the mercy of the legislature, and that rights which in the case of private individuals would be inviolable, have for them no existence.

The circumstances which led to the insertion in charters of incorporation of the reservation in question are well known.

The supreme court having decided that a charter of a literary institution was a contract, and therefore protected by the provision in the constitution which forbids the states to make any law impairing the obligation of contracts, the reservation clause was introduced in order to withdraw the contract from the operation of the constitutional inhibition, and to retain to the authority which created the corporation the right to resume the granted powers, or to modify them, as the public interests might require.

It may confidently be affirmed that it was not intended to authorize the exercise of the unrestrained power over the operations of corporations, and the use of their property, contended for at the bar.

The adjudged cases, though they contain no precise definition of the extent and limits of this power applicable to all questions which may arise, are nevertheless full of instruction on the subject.

In The Sinking Fund Cases, 9 Otto, 720, Mr. Chief Justice Waite delivering the opinion of the court, says: 'That this power has a limit, no one can doubt. All agree that it cannot be used to take away property already acquired under the operation of the charter, or to deprive the corporation of the fruits actually reduced to possession of contracts lawfully made, but, as was said by this court, through Mr. Justice Clifford, in Miller v. The State, 15 Wall. 498, 'it may be safely affirmed that the reserved power may be exercised and to almost any...