Parsons, Theophilus

PARSONS, THEOPHILUS

Theophilus Parsons served as chief justice of the Massachusetts Supreme Judicial Court from 1806 to 1813. A man of wide interests and learning, he is recognized for a series of decisions that defined legal principles that have shaped the American business corporation.

Parsons was born February 24, 1750, in Byfield, Massachusetts. He graduated from Harvard University in 1769 and was admitted to the Massachusetts bar in 1774. He established a successful legal practice in the area of Massachusetts that later became Portland, Maine. He gained prominence for his outspoken opinions at the essex junto, a 1778 gathering of merchants and lawyers from New England, the majority of whom resided in Essex County, Massachusetts. This group endorsed a state constitution that gave the state government broad authority.

Parsons strongly supported ratification of the U.S. Constitution. As a delegate to the 1788 Massachusetts Constitutional Convention that ratified the document, Parsons attempted to calm the fears of those delegates who worried about a strong federal government.

From 1787 to 1791, he served in the Massachusetts legislature. He maintained a lucrative commercial law practice and became recognized as a distinguished lawyer. John Quincy Adams, future president of the United States and a member of the prominent Boston Adams family, read the law under Parson's tutelage during this period.

In 1805 Parsons again entered the state legislature, but his tenure was brief. In 1806 he was appointed chief justice of the Massachusetts Supreme Judicial Court, the state's highest court. His commercial law background proved valuable on the court because he decided cases involving shipping and insurance. More importantly, Parsons had the experience and confidence to decide cases involving business corporations at a time when very little common law was available to guide him.

Much of what became common law in U.S. corporate law was first developed while Parsons served as chief justice. In 1799 Massachusetts became the first state to enact a set of laws governing business corporations. During this period corporations had to obtain their charters from the legislature. The legislature was liberally granting these charters, and soon the courts were filled with legal issues concerning this new type of private business entity.

The Massachusetts Supreme Judicial Court, under the influence of Parsons, assumed an activist role in defining the rights and responsibilities of corporations. In a series of decisions between 1806 and 1810, the court announced several basic principles. It recognized that a corporation was a private arrangement, closer to a contract than to a municipal government corporation. The court held that a corporation has a duty to be fair to its shareholders and that the shareholders have limited liability for the debts and obligations of the corporation. The court

also ruled that a corporation could be sued in tort. All of these decisions became part of U.S. corporate law in the nineteenth century.

"The love of precedent and stability … gives to judicial decisions an authority almost like that of law itself."
—Theophilus Parsons

Parsons was a Renaissance man. He studied mathematics and theoretical astronomy and was the author of many scientific studies. He died October 13, 1813, in Boston, Massachusetts.

further readings

Osgood, Russell K., ed. 1992. The History of the Law in Massachusetts: The Supreme Judicial Court 1692–1992. Boston: Supreme Judicial Court Historical Society.

cross-references

Massachusetts Constitution of 1780.