James Willard Hurst, Law and the Conditions of Freedom in the Nineteenth Century United States [University of Wisconsin Pres, 1964].

This material protected by copyright. Reprinted by permission of The University of Wisconsin Press.
 

One day in February of 1836, in the scarce-born village of Pike Creek on the southeastern Wisconsin shore of Lake Michigan, Jason Lothrop--Baptist minister, schoolteacher, boarding house proprietor, and civic leader--set up on a stump a rude press of his own construction and with ink which he had made himself printed a handbill setting forth tile record of the organizational meeting of "The Pike River Claimants Union... for the attainment and security of titles to claims on Government lands."

The settlers whose Union this was had begun to move into the lands about Pike Creek beginning in the summer of l835. They were squatters; put less sympathetically, they were trespassers. They might not lawfully come upon the lands before the federal survey was made, and this was not completed in this area until about February 1, 1836; they might not make formal entry and buy until the president proclaimed a sale day, and presidents Jackson and Van Buren withheld proclaiming these newly surveyed lands until 1839; they might not establish claims by pre-emption, for the existing pre-emption law expired by limitation in June, 1836, and was not immediately renewed because of objections to speculators' abuses. These were formidable legal obstacles. The settlers' reaction tells us some basic things about the working legal philosophy of our nineteenth-century ancestor's.

Jason Lothrop recalled twenty years later:

Much conflicting interest was manifest between the settlers, from the first, in making their claims. Some were greedy in securing at least one section of 640 acres for themselves, and some as much for all their friends whom they expected to settle in the country. Before the lands were surveyed, this often brought confusion and disputes with reference to boundary lines, and still greater confusion followed when the Government surveys were made in the winter at 1835-36. These contentions often led to bitter quarrels and even bloodshed.

Whereas, a union and co-operation of all the inhabitants will be indispensably necessary, in case the pre-emption law should not pass, for the securing and protecting of our claims:

We, therefore, as well meaning inhabitants, having in view the promotion of the interest of our settlement, and knowing the many advantages derived from unity of feeling and action, do come forward this day, and solemnly pledge ourselves to render each other our mutual assistance, in the protection of our just rights....

The preamble of the Pike Creek Claimants Union reflects in miniature two working principles by which we organized tire relations of legal order and social order in the nineteenth-century United States. I speak particularly of "working" principles, principles defined and expressed primarily by action. It is in this aspect that the Pike Creek document is most relevant to our purpose. For these essays seek to understand the law not so much as it may appear to philosophers, but more as it bad meaning for workaday people and was shaped by them to their wants and vision. Of course, this is not the only viewpoint from which to appraise the legal order. Nor is law that is formed largely by the imperatives of action necessarily the best law. We are simply trying one angle of vision provided by history for the distinctive reality it may disclose. Whatever its limitations, it is a point of view warranted by the central principle of our legal order,that law exists for the benefit of people and not people for the benefit of law. Such a legal order cannot in the long run be true to itself and at the same time be better than the values or vision of its beneficiaries. Moreover, emphasis on "working" principles seems peculiarly in point when we are trying to understand ourselves. Our history amply validates Tocqueville's observation that we have been a people not given to general theory; one usually senses that he is closer to apprehending the decisive faiths and beliefs of our nineteenth-century ancestors when he reads these out of what they did and said as they acted, rather than out of their self-conscious philosophizing.

The base lines of nineteenth-century public policy implicit in the Pike Creek document are three: (I) Human nature is creative, and its meaning lies largely in the expression of its creative capacity; hence it is socially desirable that there be broad opportunity for the release of creative human energy. (II) Corollary to the creative competence which characterizes human nature, the-meaning of life for men rests also in their possessing liberty, which means basically possessing a wide practical range of options or choices as to what they do and how they are affected by circumstances. (III) These propositions have special significance for the future of mankind as they apply in the place and time of the adventure of the United States; here unclaimed natural abundance together with the promise of new technical command of nature dictate that men should realize their creative energy and exercise their liberty peculiarly in the realm of the economy to the enhancement of other human values.

From these premises we drew two working principles concerning the uses of law. (1) The legal order should protect and promote the release of individual creative energy to the greatest extent compatible with the broad sharing of opportunity for such expression. In pursuit of this end, law might be used both (a) to secure a man a chance to be let alone, free of arbitrary public or private interference, while he showed what he could do, and (b) to provide instruments or procedures to lend the support of the organized community to the effecting of man's creative talents, even where this involved using the law's compulsion to enforce individual arrangements. (2) The legal order should mobilize the resources of the community to help shape an environment which would give men more liberty by increasing the practical range of choices open to them and minimizing the limiting force of circumstances. The people at Pike Creek wanted the community to guarantee their claims to be let alone in working their land and to lend its force to support their dealings with the land, that they might realize their "fair prospects." They also wanted the general government to use its resources positively to enlarge their opportunities as they sought to "overcome" "the many difficulties and obstructions of a state of nature"; to this end they wanted a pre-emption law or at least some affirmative legal preference of settlers over speculators.

Philosophers have expressed the ebullient force of western society by declaring that the end of law is to promote the maximum assertion of individual free will. This is too abstract talk to catch the policy flavor of our nineteenth-century statutes and court decisions. That policy looked toward very tangible ends and at the same time expressed a faith in human talent for creation and human need for creative expression which is not adequately conveyed by the philosophers' emphasis on "will." However inadequately they expressed the vision, people in the nineteenth-century United States had already sighted the promise of a steeply rising curve of material productivity as the dynamic of a new kind of society. Some saw this dynamic mainly as a means to create new power and positions of leadership, and themselves as the men to take over these opportunities. Some visioned an enlarged, more self-respecting and creative life for great numbers of people, a higher ethic to be built paradoxically on material foundations. All had in common a deep faith in the social benefits to flow from a rapid increase in productivity; all shared an impatience to get on with die job by whatever means seemed functionally adapted to it, including the law.

Impatient confidence in productivity, and hence in any positive or restrictive uses of law which would free more units of production, was natural to our situation. We came from a scarcity-conscious Old World into a rude new land where our own capital scarcity was a fact continuously weighing on us. We were the more dominated by the virtue of overcoming scarcity because the contrast between our limited resources and our vast opportunities constantly challenged and tantalized. Our prime inheritance was of middle-class ways of thinking. We continually experienced the tangible accomplishments of individuals, small groups, and local effort, with a heady sense of living in a fluid society in which all about him all the time one saw men moving to new positions of accomplishment and influence. Our background and experience in this country taught faith in the capacities of tire productive talent residing in people. The obvious precept was to see that this energy was released for its maximum creative expression.

If one took at face value some judicial expositions of doctrines of "vested rights," or those economic propositions which Henry Carey set forth as axioms of nature, one might believe that law played a minimum positive role in shaping our nineteenth-century society. It has been common to label nineteenth-century legal policy as simple laissez faire, and political debate of the last sixty years has propagated a myth of a Golden Age in which our ancestors--sturdier than we--got along well enough if the legislature provided schools, the sheriff ran down horse thieves, the court tried farmers' title disputes, and otherwise the law left men to take care of themselves.

The record is different. Not the jealous limitation of the power of the state, but the release of individual creative energy was the dominant value. Where legal regulation or compulsion might promote the greater release of individual or group energies, we had no hesitancy in making affirmative use of law. Relative to the greater simplicity of structure in the Wisconsin community of 1836-1870, for example, there was hardly less readiness to use the positive power of the state than one sees in 1905-1915 as we usher in the twentieth century of administrative regulation.

However, there is likely to be some Basis in experience for every myth. Tile myth of our laissez faire past rests on two important aspects of our eighteenth-and nineteenth-century development: (1) tile central place of the modem institution of private property in our politics as well as in our economic organization; (2) the extent to which the challenge of the unopened continent dominated our imagination until the last quarter of the last century.

Nineteenth-century preoccupation with tile market as a key social institution led men to think of private property as an idea almost solely economic in its significance. But to the men whose bid for power formed the working institution of modern private property in the seventeenth and eighteenth centuries, property was chiefly a political idea. To them the heart of the matter was that law should define and guarantee a wider dispersion of tile powers of decision in the community; this it did by committing to private hands legally protected control over the bulk of economic resources. Before the full tide of the disturbing forces we call the Commercial and Industrial revolutions, power was tightly held in England. In various combinations at different times, it lay within a close circle of the Crown and its friends, tile established church, the military, and the greater and lesser landed men. Commerce and industry put new means of influence into the hands of new men; these consolidated their opportunities by achieving a legal order which gave them large autonomy in commanding the economic resources on which their influence was founded.

Regarded thus as a political institution affecting the distribution of power, private property involved three central ideas in its English development, to which we added a fourth. (1) Since a high value was put on men's right to be let alone--to be "private"--there must be a reasonable public interest to justify imposing the public force on individuals' activities. This is the substance of what in the United States we eventually called "due process of law." (2) Such limits as government imposed on private freedom of decision most be declared according to a legitimate, public procedure, designed to keep law responsive to some influential nonofficial opinion. In our seventeenth-century inheritance this meant that an elected assembly should be the chief policy maker, its supremacy residing in its control of the public purse and its authority to ask questions about how the executive spent the public money. The original relation of this principle to the rise of the middle class was underlined by the property qualifications set upon the right to vote or hold legislative office, as well as by a traditional distrust of the executive as the historic source of arbitrary intrusions on privacy. (3) The legal order must provide every man with means to make formal insistence that law be applied to him fairly and impartially. Otherwise Crown grants of monopolies to court favorites or discriminatory taxes might soon make a sham of private freedom of action. In modern terms, there must be a guarantee of the equal protection of the laws for that framework of reasonable expectations within which alone private property would be meaningful. (4) Nineteenth-century United States legal growth added the elements of a judiciary given constitutionally guaranteed tenure during good behavior and authority to refuse effect to legislation found by the judges to be unconstitutional. Ready access to courts so armed added a factor that made itself deeply felt in our further definition of the property principle.

These doctrines defined private property in terms of a legally assured measure of autonomy for private decision makers as against the public power. Of course, others than officials could threaten the security of private property; very old roles of criminal and tort law remind us that property is also the creation of the law's protection against the intrusions of arbitrary private force. Dirt this latter role of the law was so taken for granted in early nineteenth-century policy as not to contribute much that is distinctive; as I have noted, despite easy generalizations about the "lawless" frontier, nothing is plainer than that settlement quickly brought demand for this kind of legal order. Some developments in nineteenth-century tort and criminal law promoted the release-of-energy policy. Otherwise, concern about the threat of private power to private property does not bring a fresh clement into our legal history until the late-century interest in railroad and anti-trust regulation.

The order of events in time thus emphasized for the early nineteenth century the constitutional aspect of private property. In this context, property was primarily a bundle of legal limits on the intrusion of official power into nonofficial decision making; tile seventeenth-century drama of conflict with the Crown had given a purely negative aspect to the institution. However, there was nothing merely negative about the tone of life in the nineteenth-century United States. This obvious fact alone casts doubt on the adequacy of an exposition of nineteenth century public policy which describes it solely in terms of negative propositions. We were a people going places in a hurry. Men in that frame of mind are not likely to be thinking only of the condition of their brakes. Thus, as we examine further we find that prevailing nineteenth-century attitudes in fact made private property pre-eminently a dynamic, not a static institution. Our situation was inappropriate to the growth of a dominant rentier interest, merely sitting on its possessions. We did not devote the prime energies of our legal growth to protecting those who sought the law's shelter simply for what they had; our enthusiasm ran rather to those who wanted the law's help positively to bring things about. The sign of this was the overwhelming predominance of the law of contract in all its ramifications in the legal growth of the first seventy-five years of tile nineteenth century.

The challenge of the unexploited continent was the second factor in disguising the actual extent of positive resort to law in shaping our society. This was what gripped our imagination and what has dominated our retrospect upon the century. The generally superficial and haphazard constitutional debates in the new states, the early established pattern of wholesale borrowing of statutes from older states, tile fumbling, trial-and-error method by which new legislation evolved, all testify that we were conscious that we needed a legal framework, but were impatient of the time and effort it took to provide it. After the extraordinary generation of political activity that accompanied and followed tile Revolution, for most of the nineteenth century we put little of our creative talent into making the basic framework of law except in areas which we saw most directly contributing to the release of private energy and the increase of private options. Politics in the grand sense had been the focus of our creative energy from 1765 to 1800, when first the impact of imperial policy and then the novelty of new governments forced us to attend to problems of the organization of power. With these matters apparently settled, and confronting the challenge of the continent, the nineteenth century was prepared to treat law more casually, as an instrument to be used wherever it looked as if it would be useful. This instrumentalist view tended to put aside consideration of the larger problems of tile organization or limitation of power and to take for granted the law's framework-setting function to an extent that did not do justice to its actual importance.

Let us turn back to this central institution of private property. It consisted in very important degree of legal limitations on the power of government and so far seems to exalt laissez faire as the keystone policy. But the law of private property--the law of the autonomy of private decision makers--included also positive provision of legal procedures and tools and legal compulsions to create a framework of reasonable expectations within which rational decisions could be taken for the future. Of course, businessmen's invention--and, even more, their initiative--joined that of lawyers to fashion instruments of dealing; and of course, men abide by their agreements for other reasons than fear of lawsuits. But it does not exaggerate the role of law to see that its procedures and compulsions were inextricably involved in the growth of our market economy. By providing authoritative forms of dealing and by enforcing valid agreements, we loaned the organized force of the community to private planners.

Throughout the enthusiastic nineteenth-century expansion of contract, two sobering strains of doctrine attested that the courts never wholly lost sight of the fact that their enforcement of promises involved delegating the public force in aid of private decision making. The first of these doctrines was that of consideration. Consideration has undoubtedly served various purposes, the origins and relative weight of which we still know remarkably little about. But, so far as its requirements induced deliberation in the parties, limited the law's support to seriously intended undertakings, or refused the law's aid to unconscionable coercion, the doctrine implicitly recognized that delegation of the public power was at stake and must be handled responsibly. To the same effect was the caution with which courts held on to a residual authority to refuse to enforce agreements which they found to be against public policy. By enforcing a contract, the public power supported the decisions the agreement represented and so far inescapably shared moral responsibility for the social consequences. Mr. Chief Justice Dixon crisply summarized the point for the Wisconsin court: "The law will not aid in enforcing an unlawful contract...." Another contract he found "to be illegal, corrupt, and contrary to the principles of public policy, and just such a contract as no court should sit in judgement upon, except to pronounce it void, and to dismiss any action brought to enforce it. (Refer to Footnote #9) The United States Supreme Court put the issue in a twentieth-century context, in Barrows v. Jackson, when it ruled that a state court might not, consistent with the Fourteenth Amendment, entertain an action for damages for the vendee's breach of a covenant against conveyance of realty to a person "not wholly of the white or Caucasian race":

When ... the parties cease to rely upon voluntary action to carry out the covenant and the State is asked to step in and give its sanction to the enforcement of the covenant, the first question that arises is whether a court's awarding damages constitutes state action under the Fourteenth Amendment. To compel respondent to respond in damages would be for the State to punish her for her failure to perform her covenant to continue to discriminate against non-Caucasians in the use of her property. The result of that sanction by the State would be to encourage the use of restrictive covenants. To that extent, the State would act to put its sanction behind the covenants. It the State may thus punish respondent for her failure to carry out her covenant, she is coerced to continue to use her property in a discriminatory manner, which in essence is the purpose of the covenant. Thus, it becomes not respondent's voluntary choice but the State's choice that she observe her covenant or suffer damages.

The nineteenth-century presumption always favored the exercise of the autonomy which the law of contract gave private decision makers. Thus, the restrictive features of the doctrine of consideration were offset by the general rule that, absent such gross inadequacy of consideration as to evidence fraud, mistake, or duress, the courts would not make the existence of a contract turn on the judges' appraisal of the worth of the exchange. So far as the illegality of agreements was concerned, the classic formulation by an English judge also expressed the working attitude of courts in the United States:

If there is one thing more than any other which public policy requires, it is that men of full age and competent understanding shall have the utmost liberty or contracting, and that contracts, when entered into freely and voluntarily, shall be held good and shall be enforced by courts of justice. (Refer to Footnote #12)

almost all the farmers of the United States combine some trade with agriculture; most of them make agriculture itself a trade. It seldom happens that an American farmer settles for good upon the land which he occupies; especially in the districts of the Far West, he brings land into tillage in order to sell it again, and not to farm it; he builds a farmhouse on the speculation that, as the state of the country will soon be changed by the increase of population, a good price may be obtained for it.

Responding to the needs of a growing commerce, the courts in the first half of the nineteenth century enlarged the array of procedures and instruments to promote dealing at a distance and on credit, and gave a contract emphasis to relations of employment, agency, and lease. The roots of this growth ran into the eighteenth century. But the bulk of the job was done after 1800; it understates the vigor and ingenuity of the work done to regard it simply as a consolidation of earlier beginnings. This was the outstanding area of common law development in the first half of the century, as judges exercised their invention in the law of negotiable instruments (notes, bills of exchange, bills of lading, warehouse receipts), of factors, of agency, of insurance, of banking.  Thinking did not yet run to extensive federal legislation in economic matters; state legislatures lacked experience and during a good number of decades were under a cloud; hence state and federal court judges did most of the work. The main area of legislative contribution, running through the century, was to elaborate liens and debtors' exemptions, relevant to the very important matter of the finance of small business, whether in trade, farming, building construction, or lumbering.

Two lines of emphasis wove a varying pattern over the nineteenth century in this expansion of contract. On the one hand, the development of contract meant increasing the scope of individual discretion in the management of resources. This was especially marked in the first half of the century, as elements contributed by the parties' agreements were allowed to loom larger in situations where rights and duties once were almost wholly determined by relation. The terms of the contract, explicit or "implied," took on greater importance in shaping the relation of master and servant; leaseholds Lost surviving vestiges of feudal incidents; the married women's property acts were a significant step in increasing the self-determining role of the wife in the household and outside. But the general extension of contract expressed, above all else, the increasing dominance of the market in social organization. As the market expanded, its functional needs tended toward greater emphasis on the regulatory rather than the individualizing aspect of contract law. Of course, all social living puts a premium on reasonable expectation and safe reliance on others' conduct; but the development of the market steadily increased die interlocking character of operations in this society and thus tended to raise men's need to be able to rely on one another's performance. Various features of our growing law of agreements reflected this. In more and more instances, from mid-century on, the law itself provided a framework for the parties' dealing, unless they explicitly contracted out of the transaction which tire rules of law shaped for them. This was notably true in respect to the instruments of commerce-bills of lading, warehouse receipts, stock transfer documents--and the forms of association, especially the partnership or corporation. This development was a particularly important form of the more general, growing confidence of the courts in implying agreements from the parties' dealings and construing their agreements in the light of trade custom. An "objective" measure supplanted the test of "a meeting of minds" as the formula by which courts decided whether parties had made an agreement; as we shall note hereafter, this seems part of an effort broader than the field of contract law to provide people with more definite frames of reference for their ventures. Analogous efforts to supply some of the assurance which the market required may have been involved in doctrines of consideration which in effect required the parties to channel their transactions into recognized forms of dealing, and in judicial attempts to state rules of illusory simplicity, to determine the materiality of a failure in performance under an agreement. In the held of commercial transactions, especially. absolute concepts of property rights as a form of individual liberty yielded to doctrines intended to enforce the security of transactions. In all of these ways, contract law invoked the compulsive force of the state to set a framework for dealing, to an extent which must materially qualify appraisal of the laissez faire element in our policy.

The creative area of contract law in the middle span of the century concerned the business corporation and its financial techniques. The corporation was the most potent single instrument which the law put at the disposal of private decision makers. In making it available, the law lent its weight to the thrust of ambitions which reshaped not only the business of the country but also its whole structure of power. Here the legislature played a larger role; indeed, it was largely the legislature's mistakes and misdeeds in regard to corporate business which damaged legislative standing in public opinion from about 1830 on. It was inevitable that the legislature play a larger part in regard to corporation law. It did not lie in judicial power to grant charters, and men saw issues in this held too broad and turbulent to fit within the confines of lawsuits.

The first issue was drawn between two different working ideas of what a corporation was. One saw it as a device of mercantilist policy, useful in great adventures for building the resources of the state. The other saw it as a convenient instrument of private enterprise. At the beginning of the nineteenth century we were still accustomed to thinking of the East India Company as the type of the corporation--a rare thing, an unusual grant of special privileges in law for purposes of high policy. At first, the facts of the situation were not such as to lead us much beyond this conception. Early business needs and capacities were too modest to generate much pressure for broad and routine resort to incorporation. Many nineteenth-century corporation charters justifiably took the form of "special" acts because they did in fact deal with special cases; government could not issue a charter for a central bank or for a major trunk line railroad-enterprises which would be felt through the length and breadth of a state and shape the whole future direction of its growth--as if no more were involved than chartering a clothespin manufacturer. Because so much was at stake, these special cases presented natural occasions for the spirited clash of interest groups and, directly or indirectly, furnished most of the well publicized instances of proved or suspected legislative corruption. These circumstances of cleavage and melodrama deeply colored popular attitudes toward the chartering of corporations, tending to confirm the East India Company stereotype. A corporation must inherently be a very unusual, and probably dangerously favored, creature when so much weighty controversy swirled about charters and the affairs of chartered companies. In this atmosphere of debate, it is not surprising that it took some time for men to begin to distinguish among kinds of corporations and to see that there was an emerging demand for a convenient business association, with affairs of limited impact on the community, far removed from high politics.

Thus the grant of corporate status became a notable issue in the years of Jacksonian Democracy. This did, indeed, involve serious issues concerning the power structure of the society; the Jacksonian polemics on this score forecast the issues in the background of the Granger Movement and the Sherman Act. But, aside from the sensitive matter of banks, currency, and credit, the demand for freer incorporation, deep down, fitted the dominant temper of the times, Jacksonian as well as Whig. Hence the Jacksonians appear increasingly uncomfortable in their opposition. The special charters which 811 so many bulky volumes of state session laws of 183~1880 are on the whole disappointing to a searcher for melodrama or moral conflict. They tend soon to fall into patterns; quite evidently most of them answered to rather standard demands for the means of reaching rather standard business ends. Mostly their provisions deal with powers or privileges which strike a twentieth-century observer as commonplaces of modern business. The reader must scan their standardized clauses with a very careful eye it he would find the small variations which may represent the hidden grab or privilege which historical legend associates with the special charter era. When the special provisions are found, few are such as to give rise to any plausible suspicion that they represent sinister gain at the expense of public welfare. The more familiar one becomes with nineteenth-century special charters, the more he suspects that if there was corruption it likely took the form of charging unofficial toll for steering perfectly routine charters through the bustle of a session. Many special charters set limitations on corporate life, on landholdings of the corporation, and on its capital, to remind us of the contemporary distrust. Yet the charters are there on the books by the hundreds. That legislatures filled with turbulent debate over the privilege of incorporation nonetheless ground out special charters in quantity for fifty years indicates that some very basic policy of the times was being fulilled. The later course of the public debate showed this; with considerable anticlimax, after the melodrama of earlier years, a main argument against continued special chartering came to be that it put an undue drain on the time of legislatures in meeting a standard and routine demand. Jacksonian Democracy reached its resolution of the matter by finding that the public interest was satisfied if the privilege of incorporation for ordinary business purposes was made available to all on equal terms.

The substance of what business wanted from law was the provision for ordinary use of an organization through which entrepreneurs could better mobilize and release economic energy. Partly this business demand was to get rid of a limiting governmental policy; it sought release of the law's jealously restrictive control over this type of association. But it is characteristic of the nineteenth century that there was here also a demand for positive help from the law. Merely to be let alone to combine capital was not the substance of the entrepreneurs' desire. There, as so often, a lively and pervasive sense of capital scarcity, relative to our opportunities, supplied the dynamic of public policy. One did not mobilize and discipline scattered resources merely by exhorting government to keep its hands off. Entrepreneurs wanted the positive prestige of the sanction of the state implicit in the charter grant. They wanted the aid of an orderly capital subscription procedure under which capital could be fed into the enterprise on a defined installment plan, with provisions for periodic assessments of stockholders and forfeitures to enforce assessments. The influence of provisions for the limited liability of corporate stockholders for the debts of the business has perhaps been exaggerated as a source of the pressure for incorporation. But, whatever the relative weight of this element, there is no doubt that the grant of the limited liability privilege was sought as a positive aid by law to the enlistment of capital. Entrepreneurs wanted, too, a form of organization which firmly and broadly delegated power over mobilized capital to managers and directors.

The last quarter of the nineteenth century made still clearer the fact that capital mobilization and discipline were the heart of the matter. For this, Entrepreneurs wanted the law to provide them with a still more elaborate apparatus. Out of the ingenuity of lawyers and judges they got what they wanted in the development of the corporate trust indenture from the old real estate mortgage, in the fashioning of preferred and common stock, no par common stock, debentures, and auxiliary financing devices such as the equipment trust certificate.

The years 1800-1875 were, then, above all else, the years of contract in our law. Behind this ebullient invention and expansion in contract were the restless spirit and hopeful ambition which struck Tocqueville as he looked at the United States in the 1830's. In such a society as this, he observed,

nothing is greater or more brilliant than commerce; it attracts the attention of the public and fills tile imagination of the multitude; all energetic passions are directed towards it.... Those who live in the midst of democratic fluctuations have always before their eyes the image of chance: and they end by liking all undertakings in which chance plays a part. They are therefore all led to engage in commerce, not only for the sake of the profit it holds out to them, hut far the love of the constant excitement occasioned by the pursuit. ... In the United States the greatest undertakings and speculations are executed without difficulty, because the whole population are engaged in productive industry, and because the poorest as well as the most opulent members of the commonwealth are ready to combine their efforts for these purposes.... But what most astonishes me in the United States is not so much the marvelous grandeur of some undertakings as the innumerable multitude of small ones...

Proof of criminal intent--often, of a specific criminal intent--was the general requirement in the standard catalog of crimes in the first half of die century. This was so as to crimes against property or involving business dealings, in notable contrast to developments a hundred years later. Corollary to this, proof of reasonable mistake of fact would generally make out a defense. Of course, the requirement of a guilty mind as an essential to make out a crime had very old roots. Partly it responded to belief in tile freedom of tile human will and the consequent moral responsibility attending its exercise. But, also, tire requirement was, as Mr. Justice Jackson observed, "as congenial to an intense individualism, and took deep and early root in American soil."

The restrictive use of the intent element may best be seen where it is invoked on the shadowy borderline of criminality. Nineteenth-century judges, for example, showed a significant uneasiness when they confronted the vague contours of the crime of conspiracy, as that offense came down to them in Star Chamber precedent. One way to hold tile expanding offense within definable bounds was to insist strictly on a showing of wrongful intention. A leading Pennsylvania opinion of 1821, by Justice Gibson, reflects the concern felt lest there be undue encroachment on freedom of action and decision:

When the crime [of conspiracy] became so far enlarged as to include eases where the act was not only lawful in the abstract, but also to be accomplished exclusively by the use of lawful means, it is obvious that distinctions as complicated and various as the relations and transactions of civil society, became instantly involved ...It will therefore be perceived that the motive for combining, or, what is the same thing, the nature of the object to be attained as a consequence of the lawful act is, in this class of cases, the discriminative circumstance. Where the act is lawful for an individual, it can be the subject of a conspiracy, when done in concert, only where there is a direct intention that injury shall result from it, or where tire object is to benefit the conspirators to the prejudice of the public or the oppression of individuals, and where such prejudice or oppression is the natural and necessary consequence.

The nineteenth-century law of damages expressed similar policy. It was socially desirable that men should take risks in the interest of production. The law should not lightly add risks of its own creation to those inherent in the business situation. This direction of policy was made explicit in an 1880 Wisconsin decision. A statute provided for enhanced damages against converters of timber; timber theft was a constant threat to the integrity of long-range investments in forest land, and the act plainly sought to give greater security to the long-term investor or speculator. But the Wisconsin court construed the statute strictly, so as not to allow the enhanced damages against a bona fide purchaser of stolen logs who had bought them for manufacturing purposes. The opinion shows a marked preference for dynamic as compared with static capital, as the court argues that

if such dealers [as the present defendant] are held responsible for every trespass committed by those who cut the lags purchased by them in good faith, and are subjected to the statutory rule of damages, no one could purchase logs, timber or lumber in the market with any safety. The result of such responsibility would necessarily be to embarrass and check an important business, and greatly to injure an important industry of the state.

Characteristically, nineteenth-century criminal and tort law involved not only limitations in the interest of free private decision, but also positive regulations looking to that end. Criminal law extended its reach in tile eighteenth and nineteenth centuries nowhere more conspicuously than in the law of theft. Growth of the law concerning embezzlement, theft by bailees, and the receipt of stolen goods went along with the expansion of the market economy; increased dealings at a distance, in reliance on others, and in volume created an impersonality of dealing which called for more intervention by law to secure the working minimum of reliable conduct.

Nor was nineteenth-century tort law simply a collection of rules limiting liability for the consequences of private decision making. Where the courts believed that tort liability would contribute to the basic framework of reasonable expectations necessary to encourage men to venture and to rely on others for productive ends, the judges were prepared to see liability extended. A marked example was the growth and refinement of the law concerning a principal's liability in tort for acts of his agent. The principal's liability might contribute to the energies of an expanding market. For, said a South Carolina judge in 1841,

the principal is represented by the agent, and unless he is liable, the great operations of life cannot be carried on--no man would have adequate security for his person or his property. The owner of goods would not trust them on a railroad, or a steamboat, it his only security was the liability of the mere servants employed. No passenger would commit his safety to a railroad, steamboat or stage coach, if, in case of injury, he could look to none but the agents usually employed about these modes of transportation. So, also, no man would have any guarantee for the security of his property, if his only remedy fur negligence was the irresponsible or insolvent agents which another might employ....

Concern for objectivity inheres in any system of official order where there is enough emphasis on generality and consistency to entitle the system to be called "law." Moreover, any legal system has its own administrative necessities, one category of which is shaped by the practical problems of proving matters of fact. There is no way in any case to prove a man's mental state except by some kind of external evidence; on the other hand, this necessary insistence on proof by overt event certainly does not mean that the law's often announced concern with intention is either fictitious or hypocritical.

Law emphasizes "objective" measures of liability, then, for reasons which have no peculiar relation to the particular circumstances of the nineteenth century. But it is also true that these objective measures had a special, functional importance in a society which made the market a key institution and a belief in the beneficence of released energy a prime article of faith. Such a society had a peculiar need to create and maintain a framework of reasonably well defined and assured expectations as to the likely official and nonofficial consequences of private venture and decision. Only within some minimum framework of reasonably predictable consequences were men likely to cultivate boldness and energy in action. Precedents for the objective measures of proof and standards of conduct in tort, crime, and contracts run back of the Commercial Revolution. But the clear-cut and substantial emphasis in this direction grows with the centuries of modern commerce and industry. Writing in 1855, Theophilus Parsons emphasized the framework function of law in a way distinctively characteristic of a market-oriented society:

The importance of a just and rational construction of every contract and every instrument, is obvious. But tile importance of having this construction regulated by law, guided always by distinct principles, and in this way made uniform in practice, may not be so obvious, although we think it as certain and as great. If any one contract is properly construed, justice is done to the parties directly interested therein. But tile rectitude, consistency, and uniformity of all construction enables all parties to do justice to themselves. For then all parties, before they enter into contracts, or make or accept instruments, may know the force and effect of the words they employ, of the provisions which they make in their own behalf, or permit to be made by other parties.

It would be quite a stretch of construction for this court to hold that the heavy burdens of sec. 1818 were intended by the legislature to be imposed on electric interurban railways under the, term "railroads," when the legislature could use and is accustomed to use the more speci8c description in legislation concerning the interurbans· Where a statute is drastic and its burdens heavy, it is not permissible to bring within its terms by latitudinarian construction there not named therein. This merely recognizes the intention which ordinarily accompanies any such command, and this principle lies at the basis of what is called strict construction.

We identify no legal development more sharply with the nineteenth century than the judicial protection of "vested rights." The modem concept of private property began with the tradition of the Parliamentary Revolution, involving reliance upon a legislative assembly responsive to propertied interests and armed with powers of purse and inquiry to curb the arbitrary intrusions of the executive. But legislatures in the United States did not rest on such well-defined and limited class interest as did the seventeenth- and eighteenth-century House of Commons. Soon repenting of tile broad authority given the legislative branch in our earliest state constitutions, substantial interests pressed successfully for limitations written into constitutional form and supported the courts' authority to enforce the superiority of constitution over statute. A realistic understanding of the nineteenth century's faith in release of energy involves relating this to these vested rights doctrine.

'Vested rights" sounds Like pure standpattism, as if it connoted merely protection of what is because it is, because nothing is valued more than stability. But on the whole, the nineteenth-century United States valued change more than stability and valued stability most often where it helped create a framework for change. The century so highly valued change because imagination could scarcely conceive that it could be other than for the better. We may look somewhat wryly on this faith, but we must acknowledge it as a prime fact in our nineteenth-century public policy making. Thus, the more one looks at the lines along which the vested rights doctrine grew, the less satisfied is he to appraise it as a simple expression in favor of the status quo. Dynamic rather than static property, property in motion or at risk rather than property secure and at rest, engaged our principal interest.

We were concerned with protecting private property chiefly for what it could do; as one looks at the facts of cases and pays somewhat less attention to the sonorous language of judicial opinions, he is impressed that what we did in the name of vested rights had less to do with protecting holdings than it had to do with protecting ventures. There is no key instance where vested rights doctrine protected a simple rentier interest. We abolished primogeniture and entail, disestablished the few established churches we had, and gave married women control of their property, all without serious barrier from vested rights doctrine. The Federal Constitution forbade tile nation or the states to grant any title of nobility. The Northwest Ordinance and the consistent policy of Congress under its constitutional authority to admit new states together foreclosed development of a privileged Old State class by providing for entry of new states out of our western lands and fixing the policy that these be admitted on terms of political equality with the old. The bulk of the nineteenth-century cases which developed vested rights doctrine involved tile conduct of business or capital venture, including land speculation. The later decisions which protected freedom of contract, or entrepreneurs' freedom, as a "liberty" guaranteed by the Fourteenth Amendment were only the most explicit indicators of the main current of our concern for vested rights. Looking back from a mid-twentieth-century United States characterized by steady expansion of one form or another of securities holdings among the upper middle class, one might see the Income Tax decision (1895) as an expression of rentier interest But in its contemporary context the major significance of the decision was for large-scale capital formation and the shape of big business. The principal nineteenth-century vested rights cases which protect property simply as a claim to hold onto what one has are those concerning the valuation of property in eminent domain proceedings. Even these rest less on protection of vested rights as such than on a kind of insistence on equal protection of the laws, that a particular individual should not be made to bear out of his own resources the cost of a community benefit.

Nineteenth-century vested rights doctrine developed chie8y in relation to protection of venture capital and the limited autonomy of business because through most of the century we were scarce of capital and of necessity were preoccupied with opening up the continent. We had neither the means nor the time for an important rentier class. Circumstances through the first three-quarters of the century thus never called for a major test of attitudes toward protecting the status quo simply as such, unless one counts the issue of slavery as an instance. No single neat formula can contain the whole of the tension between North and South or the whole of the moral problem presented by property in human beings. One element in northern support far confiscating the property in slaves was the conviction that slavery had proved to be a system which did not fulfill the proper property function of generating a constantly expanding reach of human creative power. Nor should we forget that Lincoln drew the ultimate issue as the preservation of Union, whether any particular form of private property stood or fell."' Of course, there were decisions, and there was much judicial language, looking to the protection of property considered simply as a claim to the maintenance of what someone had or the situation he was in. But it is important to note that the main current ran to the protection of property in action, for otherwise we may be surprised by some of the limits the nineteenth century put on protection of vested rights. A Wisconsin Supreme Court opinion of 1860 expresses the period's central concern with the safeguarding of venture capital. Asked to overrule an 1849 decision which had sustained the constitutionality of the milldam act, the court refused, though it indicated that as an original matter it would not now sanction the statute, which in effect delegated the power of eminent domain to waterpower developers who wished to flow others' land. Since the 1849 case, said Justice Cole, it was fair to assume that large amounts of capital had been invested in reliance on it.

And, although the period has been comparatively brief since the [18491 case ... was decided, yet we all know that within that time enterprising towns and flourishing villages have grown up, whose wealth and prosperity are mainly dependent upon their hydraulic power, and whose business relations and industrial resources would be seriously affected, if we were now to overrule that case.... The rule stare decisis, has great force in such a state of things, and emphatically applies.

In no just sense do such governmental regulations deprive a person of his property without due process or law. They simply require each individual to so conduct himself for the general good as not unnecessarily to injure another. . . .Every member of a political community must necessarily part with some of the rights which, as an individual, not affected by his relation to others, he might have retained. Such concessions make rip the consideration he gives for the obligation of the body politic to protect him in life, liberty, and property. Bankrupt laws, whatever may be the form they assume, are of that character.

Although such changes are in general exceedingly unwise and unjust, yet if from sudden and unlooked-for reverses or misfortune, or any other cause, the existing remedies become so stringent in all or a particular class of actions that great and extensive sacrifices of Property will ensue, without benefit to the creditor or relief to the debtor, a relaxation of the remedies becomes a positive duty which the State owes to its citizens.

It was natural to its buoyant optimism and its confidence in the release of energy that nineteenth-century law coupled concern for vested rights with a high regard for keeping open the channels of change. This was one aspect of the bankruptcy and insolvency laws. It is a viewpoint implicit in the type of decisions just noted, in which judges were alert to protect the community authority to deal with shifting conditions affecting the functional integrity of the whole system. The classic statement of policy in favor of freedom for creative change as against unyielding protection for existing commitments was Taney's opinion in the Charles River Bridge case. Public grants should be strictly construed in favor of the public; nothing should pass by implication; hence the legislative grant of a franchise to build and operate a toll bridge should not be held by implication to give the grantees an exclusive charter, so that they might prevent the building of a nearby competing bridge under a later grant.

· · [I]n a country like ours, free, active, and enterprising, continually advancing in numbers and wealth, new channels of communication are daily found necessary, both for travel and trade; and are essential to the comfort, convenience, and prosperity of the people. A State ought never to be presumed to surrender this power [of promoting the happiness and prosperity of the community, because, like the taxing power, the whole community have an interest in preserving it undiminished. . . . No one will question that the interests of the great body of the people of the State, would, in this instance, be affected by the surrender of this great line of travel to a single corporation, with the right to exact toll, and exclude competition for seventy years. While the rights of private property are sacredly guarded, we must not forget that the community also have rights, and that the happiness and well being of every citizen depends on their faithful preservation.

If this court should establish the principles now contended for, what is to become of the numerous railroads established on the same line of travel with turnpike companies; and which have rendered the franchises of the turnpike corporations of no value? Let it once be understood that such charters carry with them these implied contracts, and give this unknown and undefined property in a line of travelling, and you will soon end the old turnpike corporations awakening from their sleep, and calling upon this court to put down the improvements which have taken their place. The millions of property which have been invested in railroads and canals, upon lines of travel which had been before occupied by turnpike corporations, will be put in jeopardy. We shall be thrown back to the improvements of the last century, and obliged to stand still, until the claims of the old turnpike corporations shall be satisfied, and they shall consent to permit these States to avail themselves of the lights of modern science, and to partake of the benefit of those improvements which are now adding to the wealth and prosperity, and the convenience and comfort of every other part of the civilized world.

The improvement may be for the public good, the tolls fixed may be fair and reasonable, but nearly all such measures affect the interests of many who know nothing of their pendency and are unheard as to their effect. In the nature of things it is impracticable for the legislature to make thorough and exhaustive investigation in each case, and to know the precise effect upon all interests of the measures asked for. Moreover, what may be an improvement in the situation of affairs to-day, may be very far from an improvement a few years hence; and what may be fair compensation far maintaining dams and other public improvements to-day, may not be fair or reasonable after the lapse of time. So that the public interest would seem seriously to demand that the legislature in all such grants should reserve to itself the right, should the public interest require it, to revoke the same, or to continue them upon new terms and subject to additional restrictions.

General policy, expressed in practice more often than in formal declaration, favored the release of individual creativity in areas of life apart from the market. But the law played a quite indirect role in this. So far as colonial laws set limits on men's freedom to choose their religion or to gather with their fellows in sociable groups or to set their personal patterns of expenditure and their personal choices of pleasure, these were largely repealed or fallen into disuse amounting to practical repeal by the end of the first quarter of the nineteenth century. Where there was formal legal action to remove old limitations, as in the disestablishment of churches, it is difficult to believe that law brought about the change, rather than ratifying changes produced by social facts -by our fluid class structure, our abundance of land, our growing population with its recurrent waves of immigration.

The most important nineteenth-century uses of law in relation to social problems involved the control of the general environment. So far as concerns the simple release of individual energy in social affairs, law had its principal influence in the tolerance, protection, sometimes fostering, of associations of all kinds. Legally assured freedom of religious association was in the background of one of the most dynamic elements of the Erst half of the century: the evangelical Protestant movement in the rural areas, especially on the frontier, whose credo of individual dignity generated much of the emotional fervor of agrarian politics. Freedom of association let loose another dynamic factor for individualism in the Abolitionist societies. Liquor control became a fighting issue because there could be temperance societies; liquor and suffrage both came into the arena because women could organize groups on such public issues before they were able to vote or to manage property. Outside of the economic area religion was involved in the most serious conflicts over free association, in controversies over Masonic lodges, Catholic convents and schools, and Mormon communities. These figured in local and national politics in rather sporadic bursts of attention. Some legislation went on the books regulating secret societies; some additions were made to that pragmatic store of precedents which constitutes our policy of "separation of church and state"; some serious violence reminded us that effective civil liberty requires the positive protection of law. In the Erst half of the century these matters have significance primarily as parts of our history of middle-class morals and values, and of population growth and immigration; they involve legal history only indirectly. Freedom in political activity expressed a number of important public policies, besides promoting release of the individual's creative energies. Political participation is relevant to social interest in human dignity, in the legitimacy and distribution of power, and in the simple administrative necessity of getting questions settled. But, among these other objectives, a continuing inheritance from Jefferson was the faith that broad popular political activity would multiply fruitful thought, insight, invention in public affairs, to the general benefit.

The removal of property qualifications on voting or holding office was the outstanding action in law to set free men's political energies. The current set firmly in this direction as early as the New York constitutional convention of 1821, where the aged Kent futilely opposed it. In the newer states white male suffrage was not a serious issue, but the vote for free Negroes, for immigrants, and for women stirred controversies throughout the century. Emancipation of the slaves brought problems which called for positive implementation in law, if political freedom were to be real, and which remained as unresolved civil liberties issues of the nineteenth century.

Political freedom for individuals involves other civil liberties besides the right to vote: rights of free speech, press, assembly and petition, and of access to and enjoyment of the proper procedures of the civilian courts. The Alien and Sedition Acts, the Civil War and Reconstruction, and the con8icts over labor organization late in the century produced the notable problems on these fronts. The enforced lapse of the Alien and Sedition Acts was the dearest substantial victory of the century for the release-of-energy principle in these fields. The great civil liberties decision arising out of the Civil War-Ex parte Milligan--came after the crisis that produced the issue had abated. The transfer of political leadership from Radical Republicans to men whose prime interest was in economic growth, and the acquiescence of the Supreme Court in this direction of policy, ended for the nineteenth century any aggressive program in law to implement the liberty granted the Negroes in the South. No firm precedent for individual liberty emerged from the labor difficulties of the end of the century except so far as Altgeld's courageous pardon of the Haymarket anarchists admonished of the fundamental importance of a fair and temperate trial process. More typical of the indecisiveness of the law's role in civil liberties in these years was the flamboyant resurrection of an obsolete theory of "treason" to indict leaders of the Homestead strike, followed after a time by quiet dropping of the charges.

The nineteenth century produced some important issues for individual civil liberties, but showed no impressive record of grappling with them. It is symbolic that the most decisive episode, the controversy leading to the nonrenewal of the Alien and Sedition Acts, came at the opening of the century, in our classic generation of high politics. There is little that happens after 1800, until the Holmes-Brandeis dissents begin to build a supporting body of opinion in the 1920's, to suggest the presence of a really substantial public opinion interested in and prepared to pay the costs of supporting individual civil liberties. It would distort the view of our nineteenth-century life to say that it embodied any substantial, defined hostility to individual political freedoms; the accepted and revered political generalities all exalted individual liberty. But die century was so market-focused as to be politically naive. Its prevailing attitudes tended to range from indifference to impatience with matters that distracted attention from "progress," defined as increase of capital and consumable wealth. Toward the end of the century the right of association took on high importance in practice, but this was felt then more as a matter of redressing the general balance of power in the society than as an issue of individualism. All this is part of our inheritance, along with the Bill of Rights. One could not be certain how different was the alignment of working belief on the value of individual civil liberty in the mid-twentieth century, except that in the later time we were more impatient with what distracted from attention to "security" than we were with interruptions to "progress." At least in the 1950's, however, the weight to be placed on individual civil liberties was recognized as a major political issue; in that respect, the situation stood in marked contrast to that of most of the nineteenth century.

Belief in the release of private individual and group energies thus furnished one of the working principles which give the coherence of character to our early nineteenth-century public policy. This principle found expression in no simple removal of legal restrictions or staying of the regulatory hand. Limitations on official power were very important elements of this pattern of policy. But so, too, was a complicated affirmative use of law to furnish instruments and procedures and to impose as well as enforce patterns of dealing. In this aspect, our nineteenth-century policy involved a good deal less of simple laissez faire than has often been claimed for it. Joseph Spengler has properly cautioned against exaggerating the extent of legal intervention in the economy by way of regulatory laws: such government operations tend to leave a larger residue of records, especially in comparison with the relatively simple, nonbureaucratized business of the early part of the century; moreover, in their nature such intervention and the advocacy of such intervention are more likely to leave positive records of initiatives taken or proposed than is the advocacy of a negative position. It is true, however, as Chapter Two will note, that we made considerable use of legal compulsion to meet the challenge of our environment and that by no means did we always treat the release of energy as wholly beneficent. When these regulatory uses of law are taken together with the framework of legal compulsion within which the regime of contract operated, it is plain that while the enlargement of men's freedom was the objective, it was, indeed, freedom under law.