Ch. 10 Online: Dartmouth Decision

How was the future of businesses impacted by the ruling in Dartmouth College v. Woodward?

Your Answer:

The future of business was impacted by the Supreme Court’s ruling in the case of Dartmouth College v. Woodward because it established the basic principle of honoring a contract between parties.

The State of New Hampshire wanted to convert Dartmouth College from a private institution to a state university. Senator Daniel Webster led the charge in favor of Dartmouth’s right as a private institution stating that the original charter of 1769 that the college had made with the state was valid and irrevocable. Under this charter, Dartmouth College was deemed a private university. The Supreme Court ruled in favor of Dartmouth College and Webster. Chief Justice John Marshall, regarding the verdict of the case stated that “This is an action of trover, brought by the Trustees of Dartmouth College against William H. Woodward, in the state court of New Hampshire, for the book of records, corporate seal, and other corporate property, to which the plaintiffs allege themselves to be entitled. A special verdict, after setting out the rights of the parties, finds for the defendant, if certain acts of the legislature of New Hampshire, passed on the 27th of June, and on the 18th of December 1816, be valid, and binding on the trustees, without their assent, and not repugnant to the constitution of the United States.”

A sufficient example in action of the ruling in Dartmouth v. Woodward is when a football player signs a contract with a team. If the contract states that the player is to be signed for five years and receive twenty million dollars in compensation for his services, then the team must honor the requirements under the contract, unless both the player and team decide to deem the contract void. If the team or player fails to honor the requirements of the contract, they could face some sort of penalty for doing so.

In conclusion, the ruling of Dartmouth College v. Woodward established a principle in which parties involved in a contract must honor their duties in that said contract and the contract cannot be changed unless all parties involved agree upon the modification. This jurisdiction therefore affected the future of businesses in America.