izing the erection of the boom, and that the action was not maintainable. The judge did not thus instruct them, but directed them to inquire, if the evidence submitted to them proved the existence of such a corporation as is named in the writ; and if not, they would return a verdict for the defendants. But if such corporation had been proved, it not being denied that the sum claimed in this action was due, if the contents of the logs had been legally ascertained, they would find for the plaintiff. They were also directed to inquire if the boom had been erected and continued by authority of the Penobscot Boom Corporation. The jury returned a verdict for the plaintiff, and being inquired of at the request of the counsel for the defendants, stated that they found the boom to have been erected and continued by the authority of the Penobscot Boom Corporation. The defendants excepted.

SHEPLEY, J. The existence of such a corporate body is denied, and it is said that it does not come within the legal description of a corporation, either sole or aggregate, as defined by any code of laws. Corporations originating according to the rules of the common law. must be governed by it in their mode of organization, in the manner of exercising their powers, and in the use of the capacities conferred. And when one claims its origin from such a course, its rules must be regarded in deciding upon its legal existence. The legislature may, however, create a corporation, not only without conforming to such rules, but in disregard of them, and when a corporation is thus created, its existence, powers, and capacities, the mode of exercising them, must depend upon the law of its creation. It was the pleasure of the legislature in this case to create a corporate body, without requiring a conformity to the usual mode of organization known to the law. The grant is to one person who was at liberty to associate others, or to have a succession without it. No provision is made for a division of the property allowed to be held into shares, or for the call of any meeting, or the choice of a clerk, or any other officer, or the keeping of any records, or any mode of organization. And yet many important powers and privileges are granted with an evident design to permit their exercise. The grant being to one person and without any such provisions, the inference necessarily is that it was the intention of the legislature to permit that one person or his successor to exercise all the corporate powers, and to make his acts when acting upon the subject-matter of the corporation and within its sphere of action and grant of power the acts of the corporation.

There does not appear to be any other mode of carrying into effect the intention of the legislature. And if there are doubts whether the person controlling the corporation has acted in behalf of the corporation, they are necessarily to be solved by proof. And if any evils have arisen or shall arise from any proceedings under the act, the legislature may provide a remedy. The answer to the arguments against its existence arising from a want of organization and choice of officers is, that the act requires them. In the case of Day v. Stetson, 8 Greenl. 365, where a charter was granted to one, and provision was

made for taking associates and calling a meeting of them, it was decided that it was a condition subsequent, and that the neglect would not prevent the act taking effect, or the exercise of the powers granted by it. The case finds that, "it was proved that the boom was erected under the direction of R. Dwinal, and went into operation in the spring of 1832, and continued so ever since," and this sufficiently proves that the acceptance of the act of incorporation, for it could not be lawfully done but by virtue of the act, and the presumption of the law is that one acts lawfully when he may do so by a special grant of authority for that purpose. There is not the same finding in all the other cases, but there is sufficient testimony to prove that the boom was erected, and that it has been maintained by the one professing to own the franchise and to act under it. And the acceptance may be presumed from the exercise of the corporate powers. United States v. Dandridge, 12 Wheat. 71; Trott v. Warren, 2 Fairf. 227. And the act of incorporation, with proof of the exercise of the corporate powers since 1832, was sufficient evidence of the existence of the corporation. Utica Ins. Co. v. Caldwell, 3 Wend. 296; Day v. Stetson, 8 Greenl. 365. There being no provision for the call of any meeting, or for the choice of any officer, when a sale of part of the franchise to Veazie required some evidence of the assent of two minds to perform a corporate act, there might be more difficulty in proving the acts of the corporation, but it is not perceived that the mode of proof would be changed.

Bank of the

It is contended, also, that if the corporation has existed, it has been dissolved. In what manner corporations may be dissolved, and what will not operate as a dissolution, has been determined in many decided cases. A corporation will not be dissolved by a sale of the franchise, or of all the corporate property and a settlement of all its concerns and a division of the surplus, or by a cessation of all corporate acts, or by any neglect of corporate duty, or any abuse of corporate powers, or by doing acts which cause a forfeiture of the charter, without a judgment declaring such forfeiture. Such dissolution can take place only: 1. By an act of the legislature, where, as in this state, power is reserved for that purpose. 2. By a surrender, which is accepted, of the charter. 3. by a loss of all its members, or of an integral part, so that the exercise of the corporate functions can not be restored. 4. By forfeiture, which must be declared by judgment of court. Slee v. Bloom, 5 Johns. Ch. Rep. 367; Trustees of Vernon Society v. Hills, 6 Cowen 23; Bank of Niagara v. Johnson, 8 Wend. 645; Wilde v. Jenkins, 4 Paige 481; Canal Company v. Railroad Company, 4 Gill. & Johns. 121; Russell v. McLellan, 14 Pick. 63; Revere v. Boston Copper Company. 15 Pick. 351; Porter v. Kendall, 6 B. & C. 703; 2 Kent 312.

Exceptions overruled.

Note. 1 Hamilton's Works iii; 1819, McCulloch v. Maryland, 4 Wheat. (U.S.) 316; Osborn v. Bank of U. S., 9 Wheat. 738; 1840, Falconer v. Campbell, 2 McLean 195, infra, p. 287; 1844, Green v. Graves, 1 Doug. (Mich.) 351, infra, p. 292; 1844, People v. Marshall, 6 Ill. 672; 1851, Myers v. Manhattan

Bank, 20 Ohio 283; 1873, Robinson v. Jones, 14 Fla. 256; 1874, Stowe v. Flagg, 72 Ill. 397; 1874, Hadley v. Freedman's Sav. & T. Co., 2 Tenn. Ch. 122, 126; 1874, United States v. Ins. Co., 22 Wall. (U. S.) 99; 1875, Mayor of Mobile v. Moog, 53 Ala. 561; 1876, Cotton v. Mississippi Boom Co., 22 Minn. 372; 1876, Gordon v. Association, etc., 12 Bush (Ky.) 110; 1876, Williams v. Creswell, 51 Miss. 817, 822; 1878, Nelson v. McArthur, 38 Mich. 204.

Sec. 57. Same. As to form of exercising such authority: (1) Special or general law.

(a) Policy of general laws.

FALCONER AND HIGGINS v. HENRY M. CAMPBELL ET AL.1 1840. IN THE CIRCUIT COURT OF THE UNITED STATES, 7TH CIRCUIT. 2 McLean's Reports (U. S. Circuit Ct.) 195-213.

Action against the directors of the Detroit bank to recover the amount of bill of exchange, drawn by the bank in favor or the plaintiffs on a New York bank, and protested for non-payment. The declaration set forth the organization of the bank under the general banking law of 1838. The defendants filed a general demurrer raising the questions (among others) stated below.

Opinion by MCLEAN, J.

First: Are the associations authorized by the general law corporations?

Second: Had the legislature power to pass such a law?

The act in question is entitled "an act to organize and regulate banking associations." The first, second, third, fourth, fifth, sixth and seventh sections provide in what mode the associations shall be formed. Application is to be made, in writing, to the treasurer and clerk of the county, where the business is to be transacted, stating the amount of capital proposed. Of this application public notice is required to be given. Bond, in the sum of thirty thousand dollars, to be approved of by the treasurer and clerk, must be entered into. The capital stock is limited, and the subscriptions are to be received and apportioned, etc. Ten per cent. on shares subscribed are required to be paid.

And when the capital stock of the proposed association shall be subscribed and ten per cent. paid, on notice being given to the stockholders, they are authorized to meet and elect nine directors, a majority of whom are authorized to manage the affairs of the association. They are required to elect one of their number president; and in the ninth section it is provided, that "all such persons as shall become stockholders of any such association shall, on compliance with the provisions of the act, constitute a body corporate and politic in fact and in name, by such name as they shall designate and assume to themselves, etc., and by such name they and their successors shall and may have continued succession, and shall, in their corporate capacity, be capable 1 1 Arguments and part of opinion omitted.

and

of suing and being sued, pleading and being impleaded, etc., in all courts whatsoever; and that they and their successors may have a common seal, and by such name as they shall designate, adopt and assume as aforesaid, shall be in law capable of purchasing, holding and conveying any estate, real or personal," etc. By the 15th section the directors, for the time being, or a majority of them, have power to make by-laws.

The ordinary powers of a corporation are-1. Perpetual succession. 2. To sue and to be sued, and to receive and grant by their corporate name. 3. To purchase and hold lands and chattels. 4. To have a common seal; and 5. To make by-laws.

Some of these powers are incidents to a corporation, but they are all generally expressly given by a statute in this country, and these powers are all given in the act under consideration. It expressly provides that the association authorized by the act, when formed, shall "constitute a body corporate and politic in fact and in name."

The act not only gives in terms all the requisites to constitute a corporation, but the body, when formed, is technically designated by it as such. Where then is the ground for argument or doubt on the subject? Did not the legislature comprehend the force of the language they used? They have created an artificial being, giving to it in well defined terms its just proportions and powers, and have called it by its appropriate and technical name. Could the legislature in language more clear and forcible have created a corporation? Not a quasi corporation, not a joint stock company, or a limited partnership, but substantially and technically a corporation.

In illustration of this act of the legislature, it is unnecessary to refer to the mode of creating corporations in England by grant from the crown, or point out the distinction which may exist between a body thus created and one created by a statutory grant, or between an ancient and modern being of this sort. It is enough to know that it is not essential to the character of a corporation, that its powers should be equal to any similar association, either ancient or modern. It is sufficient if in its corporate name it exercises the powers and rights of a natural person, in the management of its concerns.

We can entertain no doubt that the associations authorized under the above act were intended to be, and are, in fact, corporations.

Had the legislature power to pass this law? This is the great question in the case, and it is fully and fairly presented by the demurrer. The second section of the twelfth article of the constitution of Michigan declares that "the legislature shall pass no act of incorporation, unless with the assent of at least two-thirds of each house." And it is earnestly, ingeniously and ably contended that this is an inhibition of the creation of corporations by a general law. That corporate powers, under it, can only be conferred by express enactment in each

case.

We are told that the people of Michigan were jealous of monopolies, and especially of bank monopolies, and that by the introduction of the above section into their constitution they intended to restrict the

powers of the legislature in making such grants. That such was their intention is clear from the language of the section. A law which confers corporate powers can only be passed by a vote of two-thirds of the members of each house. But must each corporation be created by a separate act? This is the ground taken in support of the demurrer. No act of incorporation shall be passed by the legislature, unless with the assent of at least two-thirds of each house, are the words of the section. The word act is used in the singular, but does it necessarily import that not more than one corporation can be created in the same act?

Suppose ten distinct applications were made to the legislature for bank incorporations at the same session, and the legislature were disposed to grant each application, must they pass ten acts of incorporation, or may not the ten corporations be granted in the same act? Would not such a law be within the letter and spirit of the constitution? Of this there would seem to be little doubt.

As distinctive a character may be given to each corporation in such an act as if it were established by a special law. In 1834 an act was passed by the legislative council of the territory of Michigan, entitled "An act to establish branches of the Bank of Michigan, Farmers' and Mechanics' Bank of Michigan, and Bank of the River Raisin." Such acts are common, and it is believed never to have been supposed that the legislative power might not be exercised in this mode. The restriction in the constitution does not prohibit it.

And if this may be done under the constitution, then the construction, that each corporation must be created by a special law, can not be sustained.

At the time the constitution of Michigan was adopted, in many of the states and in this territory, it was the ordinary course of legislation to create corporations by a general law. This was the case in Ohio, and in many of the other states. And it can be of no importance whether banking or other associations were thus incorporated. The power was exercised. Does the constitution prohibit the exercise of this power?

It has already been shown that an act which shall establish several banking corporations is not repugnant to the constitution. And this reduces the objections to the law under consideration to two points:

First. That a corporation being a grant must be made to a person or persons in esse.

Second. The indefinite number of banking corporations which, under the law, may be established.

The first objection on examination will be found to have but little force.

The creation of a corporate existence can never take effect until the association be formed and the organization completed." Commissioners are generally designated in the act, who are to superintend the opening of the books and receive the subscriptions of stock. And when the amount shall be subscribed and the necessary payments

19-WIL. CASES.