YAZOO FRAUD. A term commonly ap- • plied to the transaction by which the State of Georgia, through an act of the Legislature of Januar/. 7, 1705. granted a large portion of her western territory chiefly to four land com panies known as the Yazoo Companies from the region thus deeded. The consideration was $500,000, and the area of the tract conveyed was about 35,000,000 acres. The territory was described as extending from the Alabama and Coosa rivers to the Mississippi and from the thirty-fifth to the thirty-first paral lel of latitude. It was believed that the Legis lature had acted from corrupt motives, as it ap peared that every member of that body except one was a shareholder in one or more of the com panies. Many of the buyers were notorious speculators, and many were residents of other States. The people of the State were indignant and a party was formed to agitate for the repeal of the sale. A new Legislature was elected, and the repeal was brought about. By the statute of February 13, 1796, the records of the transaction were burned in the presence of the Governor and Legislature, and in 179S a State convention made the repealing act a part of the Constitution, on the ground that the State had the right to re pudiate a contract founded on improper motives.
The territory in question was ceded by Georgia to the United States in 1802. in 1803 a com mission was appointed by President Jefferson under an act of Congress to investigate the Yazoo claims. Madison as chairman recom mended a compromise, but Georgia refused to compensate the claimants. Their claim, however, was sustained by the United States Supreme Court in the case of Fletcher rs. Peck, 6 Cranch. S7 (1810), Chief Justice Marshall holding that the charge of bribery in 1795 could not be brought before the court as a collateral issue, that the Legislature could not in 1796 declare invalid its own act of 1795, that the grant of 1795 was in the nature of a contract, and that the law of 1796 was unconstitutional as in effect all (.c post facto law destructive of the vested estate of the grantees under the act of 1795. Accordingly ill 1S14 Congress ordered the lands to be sold and appropriated 35,000,000 for ex tinguishing the rights of the claimants. Three years later the Treasury reported a final settle ment, which involved the payment of $4,282.151. Consult: llaskin, Yazoo Land Companies (New York, 1S91) ; and henry Adams, History of the United States, vole. i. and ii. 3S9-91).