Dartmouth College case, also called Dartmouth College v. Woodward, upheld the constitutional freedom from unreasonable government interference with contracts. The Supreme Court of the United States decided this case in 1819. The decision helped protect the rights of private property and encouraged the development of the free enterprise system.
In 1769, King George III of Britain granted Dartmouth College a charter as a private school. This charter was to last “forever.” The various states succeeded to the rights and obligations of such charters when they became independent. But in 1816, New Hampshire tried to make Dartmouth College the state university by canceling the charter. Former trustees of the college claimed that the royal charter was still valid. They sued to recover the school seal and records from William H. Woodward, the college secretary. Daniel Webster, a graduate of Dartmouth, presented the trustees’ case before the Supreme Court in one of his greatest arguments. The court held for the trustees. It ruled that the state had “impaired the obligation” of the charter in violation of Article I, Section 10 of the Constitution. Because of this case, legislatures today put time limitations in charters or include provisions allowing cancellation under proper circumstances.
