In the Fourteenth Amendment part of their defense, the railroad said:
That the provisions of the constitution and laws of California "- are in violation of the fourteenth amendment of the constitution, in so far as they require the assessment of their property at its full money value, without making deduction, as in the case of railroads [that are only] operated in one county, and of other corporations, and of natural persons, for the value of the mortgages "-(Emphasis added)
The italic portions say, in essence, "The state is taxing us railroads on the whole value of our property, instead of deducting our mortgage the way people do. That's not fair. Nobody else gets taxed that way."
The implication, of course, is that the state has no right to decide that corporations get different tax rates than humans. And the railroad was using the former slaves' Equal Protection clause (the Fourteenth Amendment) as its shield.
The legal difference between "artificial" and "natural persons"
In the Supreme Court, cases are typically decided a year after arguments are presented, allowing the Justices time to research and prepare their written decisions. So it happened that on January 26th, 1885 (a year before the 1886 decision was handed down), Delphin M. Delmas, the attorney for Santa Clara County, made his case before the Supreme Court in exquisitely persuasive language:
The defendant claims [that the state's taxation policy]"-violates that portion of the Fourteenth Amendment which provides that no state shall deny to any person within its jurisdiction the equal protection of the laws. "- In defending the provisions of our Constitution, permit me, in the first place, to reply to this attack made upon it, which, if tenable, would place the organic law of California in a position ridiculous to the extreme. "- If this be so, it is safe to say that there is hardly a State in this Union whose revenue system is not in danger of overthrow. "-
The shield behind which [the Southern Pacific Railroad] attacks the Constitution and laws of California is the Fourteenth Amendment. It argues that the amendment guarantees to every person within the jurisdiction of the State the equal protection of the laws; that a corporation is a person; that, therefore, it must receive the same protection as that accorded to all other persons in like circumstances. "-
To my mind, the fallacy, if I may be permitted so to term it, of the argument lies in the assumption that corporations are entitled to be governed by the laws that are applicable to natural persons. That, it is said, results from the fact that corporations are [artificial] persons, and that the last clause of the Fourteenth Amendment refers to all persons without distinction.
The defendant has been at pains to show that corporations are persons, and that being such they are entitled to the protection of the Fourteenth Amendment. "- The question is, Does that amendment place corporations on a footing of equality with individuals?
Blackstone says, "Persons are divided by the law into either natural persons or artificial. Natural persons are such as the God of nature formed us; artificial are such as are created and devised by human laws for the purposes of society and government, which are called corporations or bodies politic.'
This definition suggests at once that it would seem unnecessary to dwell upon, that though a corporation is a person, it is not the same kind of person as a human being, and need not of necessity - nay, in the very nature of things, cannot - enjoy all the rights of such or be governed by the same laws. When the law says, "Any person being of sound mind and of the age of discretion may make a will,' or "any person having arrived at the age of majority may marry,' I presume the most ardent advocate of equality of protection would hardly contend that corporations must enjoy the right of testamentary disposition or of contracting matrimony.
The equality between persons spoken of in the Fourteenth Amendment obviously means equality between persons of the same nature or class, and not quality between persons whose very natures are absolutely dissimilar - equality between human beings, if the rights of natural persons are involved; equality between corporations of the same class, if the rights of artificial persons are involved. The whole history of the Fourteenth Amendment demonstrates beyond dispute that its whole scope and object was to establish equality between men - an attainable result - and not to establish equality between natural and artificial beings - an impossible result.
The evolution of the Fourteenth Amendment began with the first Civil Rights Bill, which provided that -
""All persons born in the United States"-are hereby declared to be citizens of the United States and such citizens of every race and color"-shall have the same right in every state and territory in the United States to make and enforce contracts, to sue, be parties, and give evidence, to inherit, purchase, lease, sue, hold, and enjoy real and personal property, 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.'
