Dollars and No Sense: Money = Free Speech, Zombies Rule

“A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law.  Being the mere creature of law, it possesses only those properties which the charter of its creation confers upon it.”
--Chief Justice John Marshall in in Dartmouth College v. Woodward



Santa Clara County v. Southern Pacific Railroad Company was a United States Supreme Court case dealing with taxation of railroad properties. The case is most notable for the obiter dictum statement that corporations are entitled to protection under the Fourteenth Amendment.

At the California Constitutional Convention of 1878-79, the state legislature drew up a new constitution that denied railroads "the right to deduct the amount of their debts [i.e., mortgages] from the taxable value of their property, a right which was given to individuals."  Southern Pacific Railroad Company refused to pay taxes under these new changes. The taxpaying railroads challenged this law, based on a conflicting federal statute of 1866 which gave them privileges inconsistent with state taxation.

San Mateo County, along with neighboring counties, filed suit against the railroads to recoup the massive losses in tax revenue stemming from Southern Pacific's refusal to pay. After hearing arguments in San Mateo County v. Southern Pacific Railroad Company, the California Supreme Court sided with the county. Using the Jurisdiction and Removal Act of 1875, a law created so black litigants could bypass hostile southern state courts if they were denied justice, Southern Pacific was able to appeal all the way to the U.S. Supreme Court.

The decisions reached by the Supreme Court are promulgated to the legal community by way of books called United States Reports. Preceding every case entry is a headnote, a short summary in which a court reporter summarizes the opinion as well as outlining the main facts and arguments. For example, in U.S. v. Detroit Timber and Lumber (1905), headnotes are defined as "not the work of the Court, but are simply the work of the Reporter, giving his understanding of the decision, prepared for the convenience of the profession."

Bancroft Davis, the Court Reporter and former president of Newburgh and New York Railway, wrote the following as part of the headnote for the case:

"The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of the opinion that it does."

In other words, corporations enjoyed the same rights under the Fourteenth Amendment as did natural persons. However, this issue is absent from the court's opinion itself and in fact is not at all representative of the court's opinion.

The rest is history.