1869, the Louisiana legislature enacted a statute granting seventeen people the exclusive right to operate the only slaughterhouse in Orleans. All other slaughterhouses were required to close down. Any butcher who desired to continue his trade would be permitted to do so in the new slaughterhouse and would be charged “reasonable” prices.
Twenty-five butchers filed suit to declare the statute in violation of the recently enacted 14th Amendment to the United States Constitution. The case reached the Supreme Court of the United States. Representing the butchers was John A. Campbell, the best lawyer in the South. Campbell had graduated from the University of Georgia at the age of eleven and had been appointed to the U.S. Supreme Court at the age of 42 (he resigned in allegiance to the Confederacy at the outset of the Civil War). Representing the slaughterhouse was Matthew Hale Carpenter, the leading attorney in the Midwest.
Campbell’s task was daunting. For centuries, people had believed that governments had the legitimate power to grant monopolies. But Campbell believed that the United States was different from all other countries in history. He argued that monopolies were prohibited by the common law, the 13th Amendment (abolishing slavery), and the “privileges and immunities,” “due process,” and “equal protection” clauses of the 14th Amendment. After presenting an extensive historical review of monopolies in England and France — and their ultimate condemnation by the citizenry of those countries — Campbell concluded with this emotional appeal:
“What did the colonists and their posterity seek for and obtain by their settlement of this continent?. . . Freedom. Free action, free enterprise — free competition. It was in freedom they expected to find the best of auspices for every kind of human success…. They believed that equal justice, the impartial reward which encouraged to effort in this land, would produce great and glorious results. They made no provisions for … monopolies
But by a five-to-four vote, the court ruled in favor of the monopoly. Writing for the majority, Justice Samuel F. Miller held that the police powers of the states permitted them to grant monopolies. The majority held that the 13th Amendment abolished slavery in its traditional sense but did not protect those who had been Put out of business by legislation. And the five justices held that the right to operate, slaughterhouse was not a “privilege and immunity” of citizenship and, moreover, was not protected by the due process and equal Protection clauses of the 14th Amendment.
The real significance of the slaughterhouse decision, however, Jay with the dissent. One of the dissenters, Justice Stephen 1. Field, wrote that monopolies were unconstitutional infringements on the fundamental right of people to sustain their lives through labor. Observing that the granting of monopolies had long been illegal under the common law of England, Field showed that the antimonopoly attitude characterized Americans as well:
“No privilege was more fully recognized or more completely incorporated into the fundamental law of the country than that every free subject in the British Empire was entitled to pursue his happiness by following any of the known established trades and occupations of the country, subject only to such restraints as equally affected all others. The immortal document which proclaimed the independence of the country declared as self-evident truths that the Creator had endowed men ‘with certain inalienable rights.’. . . ”
To reinforce his view that the right to labor was one of these inalienable rights, Field quoted from Adam Smith’s Wealth of Nations:
“The property which every man has in his own labor, as it is the original foundation of all other property, so it is the most sacred and inviolable. The patrimony of the poor man lies in the strength and dexterity of his own hands; and to hinder him from employing this strength and dexterity in what manner he thinks proper, without injury to his neighbor, is a plain violation of this most sacred property.”
Relying on the due process clause, Justice Bradley, another dissenter, made the same point: “In my view, a law which prohibits a large class of citizens from adopting a lawful employment, or from following a lawful employment previously adopted, does deprive them of liberty as well as property, without due process of law. Their right of choice is a portion of their liberty; their occupation is their property.”
Although the dissenters lost the battle, their ideas ultimately prevailed. For they planted the seed for two of the most revolutionary legal doctrines ever devised” — substantive due process” and “liberty of contract” Substantive due process meant that there were certain fundamental rights that no government could legitimately take away from the citizenry, even if traditional legal procedures were followed. Liberty of contract meant that the state could not prevent people from entering into mutually beneficial exchanges with one another. These two doctrines captured the minds of lawyers and judges all across America and, until they were overruled in 1937, ultimately became the law of the land in the United States.
