Imágenes de páginas
PDF
EPUB

The common law powers here referred to may be enumerated as follows: (1) the right to the use of a corporate name; (2) the right to perpetual succession; (3) the right to acquire, hold, and dispose of corporate property; (4) the right to appoint corporate officers and agents; (5) the right to establish by-laws for the government of the corporation, its officers and members; (6) the right to sue and be sued.

An examination of the various corporate acts in force in the several States and Territories will serve to show that without exception they contain an enumeration more or less full of the common law powers above referred to. In Indiana the statute refers to them as common law powers, and proceeds to enumerate them.1

§ 10. Right to a Corporate Name. The right to the use of a corporate name is a power well recognized both at common law and by statute. Corporations have a property right to the use of such name in the transaction of their business which the courts will always protect.2 They are recognized in law only by their corporate name.3

The name is said "to be the very being of their constitution; the knot of their combination; without which they could not do their corporate acts; for it is unable to implead and be impleaded, to take any action until it hath gotten a name." 4

The action of State officials in granting the use of a name, it may be observed, is not conclusive, for courts of equity will nevertheless protect corporations in the use of their name.5 State officials have, however, the power to protect the use of corporate names when applications are made for charters, even when the proposed name is not exactly similar to that of existing corporations.6

The right to have a corporate name is in itself a common law power; but it is one which is not alienable.7

§ 11. Right of Perpetual Succession. The "right of perpetual succession" under a designated corporate name is one of the common law powers of a corporation. The words "perpetual 6 State ex rel. v. McGrath, 92 Mo. 355; 5 S. W. 29.

1 Ind. Session Laws, 1901, ch. 127, § 28.

2 L. D. Co. v. Massachusetts, 10 Wall.

(U. S.) 566; see also ante, § 3.

3 Curtiss v. Murry, 26 Cal. 633.

4 Smith v. Company, 30 Ala. 650.

7 State v. Company, 40 Kan. 96; 19 Pac. 349; Detroit Citizens' Street Ry. Co. v. Common Council, 125 Mich. 673; 85

Grand Lodge, etc. v. Graham, 96 N. W. 96.

Ia. 592; 65 N. W. 837.

succession" do not refer to the duration of the life of the corporation, where this is specifically limited either by statute or by the articles of incorporation, but merely operates to grant the continuation of corporate life during the period so prescribed.1 Perpetual succession ordinarily merely conveys the right of continued unbroken succession for the period of time limited for the corporate existence.2

3

§ 12. Right to adopt and use a Corporate Seal. It is an inseparable incident to every corporation that it may have a common seal, and make, alter, and renew the same at pleasure. The doctrine of the common law requiring the use of a corporate seal in the execution of corporate contracts is practically obsolete, and the seal is now required, in the absence of express statute, only when it would be required of a natural person under similar circumstances. Ordinarily the exercise of this power is delegated by the stockholders to the directors by means of an appropriate by-law.5

[ocr errors]

§ 13. Power to acquire, hold, and dispose of Real and Personal Property. No doctrine of the common law is more clearly and undeniably established than that which concedes to corporations an inherent right to acquire and hold title to real and personal property, except so far only as they may be restricted by the objects of their creation or the limitations of their charter. The power to acquire such property, when not restricted by statute, is only limited by the rule that it must be such as is reasonably necessary or convenient to enable it to accomplish the purposes for which it was created."

Formerly the amount of real property which a corporation might purchase and hold was very generally limited by statute in most of the Commonwealths. The existence of such statutes may be traced to the policy of the common law and to the existence in England of statutes known as statutes of mortmain, which prohibited corporations from taking and holding real estate without licenses from the king or Parliament. However, in most of the

797.

1 State v. Payne, 129 Mo. 468; 31 S. W.

2 Scanlon v. Crawshaw, 5 Mo. Ap. 337; see, however, Fairchild v. Association, 71 Mo. 526.

8 Ransom v. Bank, 13 N. J. Eq. 212; Thomas v. Dakin, 22 Wend. 9.

4 Green Co. v. Blodgett, 55 Ill. Ap. 556. 5 Woodman v. Company, 50 Me. 549. 6 Lathrop v. Bank, 8 Dana (Ky.), 114; Thompson v. Waters, 25 Mich. 214.

7 Brown v. Hogg, 14 Ill. 219; Richardson v. Association, 131 Mass. 174.

8 Leazure v. Hillegas, 7 Ser. & R. (Pa.)

States such restrictions have been done away with, and corporations may now hold such property, both real and personal, as the attainment of their corporate purposes may require. In any event, the general power of a corporation to hold real estate is primarily a question betwen the corporation and the State, and cannot ordinarily be raised by third parties.1 Where such statutes exist the corporation has of course no power to exceed the statutory limit as against the State.2

The general rule is that corporations, unless forbidden by statute, have implied power to take property by devise. The same rule applies with respect to the power of taking and holding property in trust, provided in so doing it acts within its corporate powers. The power of a corporation to sell and convey is as broad as the power to purchase and hold, and is granted on the same terms.5

§ 14. Power to appoint Corporate Officers and Agents. At common law corporations have the inherent power, irrespective of statute or charter provision, to elect directors and executive officers and to appoint such agents as the business of the corporation require.

§ 15. Power to establish By-laws. - Every corporation has the implied power to enact such by-laws as may be necessary for the proper government of the corporation, its officers, and stockholders.7

Sometimes the statutes prescribe the nature of the by-laws to be adopted and authorize penalties for violation thereof.8

313; White v. Howard, 38 Conn. 342;
Page v. Heineberg, 40 Vt. 81; Rivanna
Nav. Co. v. Dawsons, 3 Grat. (Va.) 19;
Moore v. Moore, 4 Dana (Ky.), 354; Mal-
lett v. Simpson, 94 N. C. 37; Trustees v.
Manning, 72 Md. 116; 19 Atl. 599; First
M. E. Church v. Dixon, 178 Ill. 260; 52
N. E. 887.

1 C. B. & Q. R. R. Co. v. Lewis, 53 Ia. 101; 4 N. W. 842.

2 Market St. Ry. Co. v. Hellman, 109 Cal. 571; 42 Pac. 225; In re McGraw's Estate, 111 N. Y. 66; Andrews v. Andrews, 110 Ill. 223; Graves v. Niles, 1 Walker (Mich.), 332.

3 White v. Howard, 38 Conn. 342; Ravanna Nav. Co. v. Dawsons, 3 Grat. (Va.) 19.

4 Vidal v. Girards Executors, 2 How. (U. S.) 127; Morris v. May, 16 Ohio, 469; F. L. T. Co. v. H. F. N. Co., 41 N. Y. 619; White v. Rice, 112 Mich. 403; 70 N. W. 1024; Greene v. Dennis, 6 Conn. 304.

6 Miners' Ditch Co. v. Zellerbach, 37 Cal. 543; People v. College, 38 Cal. 166.

Kearney v. Andrews, 10 N. J. Eq. 70; A. R. R. Co. v. Kidd, 29 Ala. 221.

7 Wells v. Black, 117 Cal. 157; 48 Pac. 1090; People v. Society, 24 Barb. N. Y. 570; Martin v. Association, 2 Coldw. (Tenn.) 418; Mechanics' Bank v. Smith, 19 Johns. (N. Y.) 115; Steger v. Davis, 8 Tex. Civ. App. 23; 27 S. W. 1068.

8 Cahill v. Company, 2 Doug. (Mich.) 128; Mobile v. Yuille, 3 Ala. 137.

[ocr errors]

§ 16. Power to sue and be sued. It has been the rule of the courts from time immemorial to recognize and enforce the power of corporations to sue and be sued under and by their corporate name as incident to such corporate existence.1

[ocr errors]

§ 17. Express Powers, Definition of; Enumeration of. Express powers are those which are either granted to all corporations alike by statute, whether inserted in the charter or not, or else are those which are permitted by statute to such corporations as may see fit to take advantage of them, by reserving such powers in the charter itself. Statutes of the character first referred to are construed by the courts to be ipso facto read into the charter, thereby becoming part and parcel of it. On the other hand, the last-named powers can only be availed of by the corporation when, as has been stated, they are specifically reserved or set forth in the articles of incorporation. Express powers relate not only to the right to engage in a special line of business as set forth in the statement in the articles of the object or purposes for which the corporation is formed, but they relate as well to other powers which are here termed "express," inasmuch as they depend upon the existence of specific statutes authorizing their exercise by such corporations as desire to avail themselves thereof. These express powers may be divided into twenty-eight classes, enumerated as follows: (1) power to purchase its own capital stock; (2) power to subscribe for, purchase, and hold stock in other corporations; (3) power to consolidate with other corporations; (4) power to transact all or any part of its business outside of the State of its origin; (5) power to extend its corporate existence; (6) power to change its corporate name; (7) power to increase or decrease its capital stock; (8) power to issue preferred stock; (9) power to change the corporate purposes; (10) power to change the number of directors; (11) power to change its domiciliary office or place for the transaction of its business; (12) power to acquire and enforce a lien upon stock of the corporation to secure the payment of debts due the corporation from stockholders; (13) power to levy assessments against the stockholders with the right to forfeit the stock for non-payment thereof; (14) power to authorize voting at stockholders' meetings. by proxy; (15) power to allow cumulative voting at the election of directors; (16) power to issue stock as full paid and non1 S. W. Co. v. Armstrong, 17 Me. 34.

assessable in exchange for property or services; (17) power to sell the corporate assets; (18) power to voluntarily dissolve the corporation without recourse to the courts; (19) power to insert in the charter provisions for the regulation of the internal affairs of the corporation; (20) power to authorize directors to adopt bylaws; (21) power to authorize appointment of executive committee from board of directors; (22) power to enlarge or diminish corporate powers; (23) power to change par value of shares ; (24) power of bondholders to vote at elections of directors; (25) power to classify directors; (26) power to amend articles before organization; (27) power to surrender charter before organization; (28) power given to minority stockholders to compel purchase of their holdings upon consolidation.

Of the foregoing enumerated powers, the following when expressly authorized by statute are applicable to all corporations alike, whether reserved or enumerated in the articles of incorporation, to wit: The power to consolidate with other corporations; to perform constituent acts outside of the State of its origin; to extend its corporate existence; to change its corporate name; to increase or decrease its capital stock; to change the corporate purposes, the number of its directors, its domiciliary office or place for the transaction of its business; to acquire and enforce a lien upon stock of the corporation to secure the payment of debts due the corporation from stockholders; to levy assessments against the stockholders with the right to forfeit stock for non-payment thereof; to authorize voting at stockholders' meetings by proxy; to permit cumulative voting at election of directors (unless such right is merely made permissible by statute); to issue stock as full paid and non-assessable in exchange for property or services; to sell the corporate assets in their entirety; to voluntarily dissolve the corporation without recourse to the courts; to authorize the directors to adopt by-laws (unless such authority is by statute required to be reserved in the articles of incorporation); to appoint an executive committee; to enlarge or diminish the corporate powers; to change the par value of shares; to amend articles before organization; to surrender charter before organization; power given to minority stockholders to compel purchase of their holdings upon consolidation.

Of the remaining express powers it is probably in accord with the general current of authority in this country to say that to be

« AnteriorContinuar »