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vations annexed to a charter, is that contained in the act of the legislature of New York, of February 28th, 1822, c. 50, where it is declared, by way of express proviso, that the legislature may, after the expiration of five years alter and modify and expunge the act, upon condition, nevertheless, that no alteration or modification shall annul or invalidate the contracts made by or with the cor
poration, and that the corporation may still contin*308 ue a *corporation, so far as to collect, and recover,
and dispose of their estate, real and personal, and pay their debts, and divide the surplus.a A corporation may also be dissolved when an integral
part of the corporation is gone, without whose ex*309 istence *the functions of the corporation cannot be
exercised, and when the corporation has no means of supplying that integral part, and has become incapable of acting. The incorporation becomes then virtually dead or extinguished. But in the case of The King v. Passmore, in which this subject was most extensively and learnedly discussed, the K. B. seemed to consider such a dissolution not entirely absolute, but only a dissolution to certain purposes.d The king could interfere and grant
2 By the New-York Revised Statutes, vol. i. p. 600. sec. 9, upon the dissolution of a corporation, the directors or managers existing at the time (when no other persons are specially appointed for the purpose.) are declared to be trustees for the creditors and stockholders, with power to set. tle the concerns of the corporation, pay the debts, and divide the surplus property among the stockholders. This is a just and wise provision, and gets rid altogether of the inequitable consequences of the rule of the common law. And in Indiana, also, whenever a corporation is dissolved, all its property vests in the state in trust to pay its debts and discharge its contracts, and the residue, if any, is to be paid over to the stockholders. Revised Statutes of Indiana, 1838, p. 149. In North Carolina, a similar provision is made as to the payment of debts and the distribution of the surplus when a corporation is dissolved. Revised Statutes of North Car. olina, 1837, p. 120.
b Rol. Abr. 514. 1. 1. • 3 Term Rep. 199.
d So, in the case of the Lehigh Bridge Company v. The Lehigh Coal Coinpany, 4 Rawle's Rep. 1, the loss of an integral part of a corporation
a new charter, and he could renovate the corporation either with the old or with new corporators. If renovated in the sense of that case, all the former rights would revive and attach on the new corporation, and, among others, a right to sue on a bond given to the old corporation, But if not renovated, then the dissolution becomes absolute, because the corporation has become incapable of acting. In the case of a new incorporation, upon the dissolution of an old one, the title to the lands belonging to the old corporation does not revive in the new corporation except as against the state. In England, it would require an act of parliament to revive the title as against the original grantor, or his heirs ;a but it would be at least questionable whether any statute with us could work such an entire renovation, because vested rights cannot be divested by statute. When a corporation has completely ceased to exist, there is no ground for the theory of a continuance of the former corporation under a new name or capacity. It becomes altogether a new institution, with newly created rights and privileges.
It is said, that a corporation may be dissolved by a voluntary surrender of its franchises into the hands of government, as well as by an involuntary forfeiture of them, through a total neglect of using them, or using them illegally and *unjustly.b But in the *310 case of The King v. The City of London, Sir George Treby (afterwards Lord Ch. J.) very forcibly contended, that a corporation could not be dissolved by a voluntary surrender of its property, because a corporation might exist without property; and upon that argument he shook, if not destroyed, the authenticity of the note at the end of the case in Dyer, of The Archbishop of Dub
was held to work a dissolution for certain purposes only, and that an entire dissolution was the result of a permanent incapacity to restore its deficient part, and did not happen when the legitimate existence of the part was not indispensable to a valid election.
11 Preston on Abstract of Titles, 273. 01 Woodd. Lec. 500. Salk. Rep. 191.
lin v. Bruerton, in which it was stated, that a religious corporation might be legally dissolved and determined by a surrender of the dean and chapter, even without the consent of the archbishop. So, also, in the case of The Corporation of Colchester v. Seaber,b the corporation consisted of a mayor, eleven aldermen, eighteen assistants, and eighteen common council; and though the mayor and aldermen were judicially ousted in 1740, and those offices continued vacant until 1763, when a new charter was granted and accepted, it was held by the K. B., that the corporation was not dissolved by all these proceedings, including the natural death of the mayor and aldermen, subsequent to their ouster. This case shows, that a corporation possesses a strong and tenacious principle of vitality, and that a judgment of ouster against the mayor and aldermen, notwithstanding they were integral parts of the corporation, was not an ouster, though a judgment against the corporation itself might be. It was held in argument in that case, that a corporation could not be dissolved but in three ways: 1. By abuse or misuser, and a consequent judicial forfeiture; 2. By surrender accepted on record; 3. By the death of all the members. It was admitted on the other side, that the corporation in that case was not dissolved, though it had become incapable of enjoying and exercising its franchises; and the court held, that the loss of the magistracy did not dis
solve the corporation. The better opinion would *311 seem to be that a corporation aggregate may *sur
render, and in that way dissolve itself: but then the surrender must be accepted by government, and be made by some solemn act, to render it complete. This is the general doctrine, but in respect to the private cor
. 3 Dyer's Rep. 382. b. 63 Burr. Rep. 1866.
• Boston Glass Manufactory v. Langdon, 24 Pick. 49. Angell f. Ames on Corporations, p. 656, 2d ed. In the case of the charter of Connecticut, where there had been for some time an involuntary nonuser of its privileges, by submission to the authority of Sir Edmund Andross, the ablest
porations, which contain a provision rendering the individual members liable for corporate debts due at the time of dissolution, a more lax rule has been indulged. It was held, in the court of errors of New York, in Slee v. Bloom, a that the trustees of a private corporation may do what would be equivalent to a surrender of their trust, by an intentional abandonment of their franchises, so as to warrant a court of justice to consider the corporation as in fact dissolved. But that case is not to be carried beyond the precise facts on which it rested. It ought only to be applied to a case where the debts due at the time of the dissolution are chargeable on the individual members, and then it becomes a safe precedent. It amounts only to this, that if a private corporation suffer all their property to be sacrificed, and the trustees actually relinquish their trust, and omit the annual election, and do no one act manifesting an intention to resume their corporate functions, the courts of justice may, for the sake of the remedy, and in favor of creditors, who, in such case, have their remedy against the individual members, presume a virtual surrender of the corporate rights, and a dissolution of the corporation. This is the utmost extent to which the doctrine was *carried, and in *312 such a case it is a safe and reasonable doctrine. So, in Briggs v. Penniman, where a manufacturing corporation established under the general act of 22d March, 1811, for twenty years, became insolvent within
counsel in England, consisting of Mr. Ward, John (asterwards Lord Chancellor) Somers, and George (afterwards Lord Ch. J.) Treby, were of opinion, that the charter remained good and valid in law, inasmuch as there was no surrender duly made and enrolled, nor any judgment of record against it. See the opinion at large, in 1 Trumbull's Hist. of Connecticut, 407. Hutchinson's Hist. of Massachusetts, vol. i. p. 406.
• 19 Johns. Rep. 456. It was decided, in that case, that a by-law of a corporation, allowing the stockholders, on paying 30 per cent. on their shares, to forfeit them, was void as to creditors. See, to the same point, Hume v. Wynyaw, Carolina Law Journal, No. 2. p. 217.
b 1 Hopkins, 300. S. C. 8 Cowen, 387. • Laos of N. Y. 8e88. 34, ch. 67.
the time, and incompetent to act by the loss of all its funds, and under the provision that “ for all debts which shall be due and owing by the company at the time of its dissolution, the persons then composing the company should be individually responsible to the extent of their respective shares of stock in the company, and no further,” it was decided that the corporation was to be deemed dissolved for the purpose of the remedy by the creditors against the stockholders individually, and that the statute contemplated a dissolution as an event which might happen in this way at any time within the twenty years, and any mode of dissolution, in fact, was sufficient to afford this special remedy to the creditor. But the old and well established principle of law remains good as a general rule, that a corporation is not to be deemed dissolved by reason of any misuser or nonuser of its franchises, until the default has been judicially ascertained and declared.b It was adjudged, in South
. The right of forfeitures of a stockholder's share to the company, does not take away the common law remedy by suit for non-payment of instalments due on his subscription. D. & S. Canal Com. v. Lawson, 1 Binney, 70. Worcester T. Corporation v. Willard, 5 Mass. R. 80. Gosben T. Com. v. Hustin, 9 Johnson R. 217. Graty v. Redd, 4 B. Monroe, 193.
• Peter v. Kendell, 6 Barnw. f. Cress. 703. Slee v. Bloom, 5 Johns. Ch. Rep. 379. 6 Cowen, 26, S. P. Story, J., 9 Cranch, 51. 4 Wheaton, 698. The Atchafalaya Bank v. Dawson, 13 Lou. Rep. 497. 506. It was declared in this last case, that a cause of forfeiture of a corporation charter could not be taken advantage of or enforced, except by a direct proceeding for that purpose by the government, notwithstanding the charter was to be ipso facto forfeited in the case alleged. In Wilde v. Jenkins, 4 Paige's Ch. Rep. 481, it was held, that an incorporated manufacturing society was not dissolved, though all its property and effects, together with the charter, were sold by the trustees and stockholders, and purchased by three part. ners with partnership funds, and who elected themselves trustees of the corporation. The stock of the corporation became partnership property, and the legal title in the corporate properly was still in the corporation for the benefit of the copartners. And in Russell v. M'Lellan, 14 Pick. 63, it was held, that though a corporation had been without officers for more than two years, and had done no corporate act in that time, it was not thereby dissolved. So again in the case of the State v. The Bank of South Carolina, it was adjudged in the court of general sessions at Charles