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Opinion of the Court.
“ Whatever objection there may be to it as security for such advances from the prohibitory provisions of the statute, the objection can only be urged by the government.” To the same effect are Swope v. Leffingwell, 105 U. S. 3, and Reynolds v. Crawfordsville Bank, 112 U. S. 405, 412.
In Smith v. Shelley, 12 Wall. 358, 361, which was an action of ejectment, the question was collaterally raised as to the validity of the title acquired by a banking institution, under a deed of the premises, in consideration of a certain sum paid by it to the grantor. The bank was created by an act of the territorial legislature of Nebraska, with power “to issue bills, deal in exchange, and to buy and possess property of every kind.” But when that act passed, there was in force an act of Congress, which provided that “no act of the territorial legislature of any of the Territories of the United States, incorporating any bank or any institution with banking powers or privileges, hereafter to be passed, shall have any force or effect whatever, until approved and confirmed by Congress.” The act of the territorial legislature incorporating the bank, above referred to, never was approved or confirmed by Congress. It was urged, as an objection to the deed made to the bank- upon which deed one of the parties relied - that it was not a competent grantee to receive title. This court said: " It is not denied that the bank was duly organized in pursuance of the provisions of an act of the legislature of the Territory of Nebraska; but it is said, it had no right to transact business until the charter creating it was approved by Congress. This is so, and it could not legally exercise its powers until this approval was obtained; but this defect in its constitution cannot be taken advantage of collaterally. No proposition is more thoroughly settled than this, and it is unnecessary to refer to authorities to support it. Conceding the bank to be guilty of usurpation, it was still a body corporate de facto, exercising at least one of the franchises which the legislature attempted to confer upon it; and, in such a case, the party who makes a sale of real estate to it is not in a position to question its capacity to take the title, after it has paid the consideration for the purchase. If, prior to the execution of
Dissenting Opinion : Miller, J.
the deed, there had been a judgment of ouster against the corporation at the instance of the government, the aspect of the case would be different." See also Myers v. Croft, 13 Wall. 291, 295; Jones v. Guaranty and Indemnity Co., 101 U. S. 622, 628; Fortier v. New Orleans Bank, 112 U. S. 439, 451.
To the above cases may be added those holding that an alien may take by deed or devise and hold against any one but the sovereign until office found. Cross v. De Valle, 1 Wall. 1, 13; Governeur v. Robertson, 11 Wheat. 332; National Bank v. Matthews, 98 U. S. 621, 628; Phillips v. Moore, 100 U. S. 208. Also, those holding that the question whether a corporation, having capacity to purchase and hold real estate for certain defined purposes, or in certain quantities, has taken title to real estate for purposes not authorized by law, or in excess of the quantity permitted by its charter, concerns only the State within whose limits the property is situated. It cannot be raised collaterally by private persons unless there be something in the statute expressly or by necessary implication authorizing them to do so.
Cowell v. Springs Company, 100 U. S. 55, 60; Jones v. llabersham, 107 U. S. 174, 188.
It results from what has been said that the court erred in rendering judgment for the plaintiff for any part of the premises described in the complaint. The judgment is reversed, with directions to enter judgment
upon the agreed statement of facts for the defendants.
MR. JUSTICE MILLER dissenting.
I earnestly dissent from the opinion of the majority of the court. I do not enter into the question of the circumstances under which a foreign corporation can do business within the limits of the State of Colorado under section 23 of the General Statutes of 1883 of that State, nor do I here consider or attach importance to the question of how far a party dealing with a foreign corporation which has not complied with the rules prescribed by the State to enable it to do business in the State is estopped by the presumption that, in making contracts with
Dissenting Opinion : Miller, J.
it, it has recognized its official existence and its right to contract. I base my dissent in the present case upon the following emphatic language in the laws of that State:
“No foreign or domestic corporation established or maintained in any way for pecuniary profit of its stockholders or members shall purchase or hold real estate in this State except as provided for in this act.”
It is very clear that the words “as provided for in this act” bave relation to the acts, prescribed for all corporations, of filing with the Secretary of State, and the recorder of deeds of the county in which that business is carried on, the necessary statement of their corporate existence, properly certified, and the appointment of agents in the State residing in its principal place of business. The language I have just cited from this statute is unambiguous, and is not a declaration of powers and rights conferred upon these corporations; but it is prohibitory, and declares that no corporation shall purchase or hold real estate that has not complied with this requirement. It has been a recognized doctrine of this court for a great many years, perhaps a century, that the transfer of title to real estate, whether by inheritance, by purchase and sale, or by any other mode by which title to property is acquired, is rightfully governed by the laws of the State in which the land is situated. The policy of permitting corporations to hold real estate has always been a restricted one. Corporate bodies, whether for public use or for private purposes, have always been subjects of limitation on their right to hold real estate. It may be prohibited altogether. It may be allowed with distinct limitations as to amount either in quantity or in value. In this respect it is wholly within the control of legislative action. I can conceive of cases where corporations have been authorized to acquire a limited amount of real estate such as the legislature may conceive to be useful and necessary to the purpose for which they are organized, or to take property for specific uses, in which the question as to whether they have exceeded that amount or perverted the use may be one for the State alone, and not of any private citizen. But the positive declaration that a corporation shall not purchase or hold real
estate, which is not a grant of power, but an express denial of its power to hold any real estate under the circumstances mentioned, is in my opinion destructive of the right to hold any real estate at all under those circumstances. Whenever it is shown that any of these corporations have not complied with the requirements of the statute, they are forbidden to purchase or hold real estate. Any such purchase is therefore void. It is the positive declaration of the law of the land. The title does not pass, and it needs no inquest of the State to establish that fact. The title which would have passed if the corporation had a right to purchase does not pass. It remains in the party who attempted to grant or convey it. The grantee can neither purchase nor hold real estate. The assumption of the opinion of the court is that it may purchase and it may hold real estate. I have not time to give the authorities on this subject. They are numerous; but they are generally applicable to cases in which the granting power of the corporation is wanting in sufficient language to enable it to purchase and hold, and not to statutes which are in their terms prohibitory, forbidding and peremptory.
No. 89. Argued and submitted November 8, 1889. - Decided November 25, 1889.
In Ohio it is the duty of a municipal corporation to keep the streets of the
municipality in order; and a person receiving injuries in consequence of its neglect so to do, has a right of action at the common law for the
damage caused thereby. A building permit by municipal authorities authorizing the occupation of
part of a public street as a depository for building materials, and requiring proper lights at night to indicate their locality, does not relieve the municipality from the duty of exercising a reasonable diligence to prevent the holders of the permit from occupying the street in such a way as to endanger passers-by in their proper use of it.
Statement of the Case.
The case as stated by the court in its opinion was as fol. lows:
This is an action to recover damages for personal injuries which the defendant in error, who was the plaintiff below, alleges were sustained by him in consequence of the failure of the city of Cleveland, by its officers and servants, to exercise due care in keeping one of its streets in proper and safe condition for use by the public. At the trial, the city objected to the introduction of any evidence in behalf of the plaintiff, on the ground that the petition did not state facts sufficient to constitute a cause of action. The objection was overruled and the defendant excepted. When the evidence for the plaintiff was concluded, the defendant asked a peremptory instruction in its behalf. This motion was denied, and to that ruling of the court an exception was taken. After the whole evidence was closed, and the court had charged the jury, the defendant asked an instruction to the effect that there was not sufficient legal proof of negligence on the part of the city, its officers or agents, to entitle the plaintiff to recover. This request having been denied, an exception was taken to the ruling of the court. The case having been submitted to the jury, a verdict was returned for ten thousand dollars against the city
Upon that verdict a judgment was rendered for the plaintiff.
The petition, after referring to Bank Street as a common public street and highway in the city of Cleveland for the free passage and travel, at all times, of persons on foot and with horses and vehicles, and averring that, under the statutes of Ohio, the duty rested upon the city to cause the street to be kept open, in repair, and free from nuisances, alleged that the defendant, on the 12th day of November, 1879, wrongfully placed, and permitted to be placed, large quantities of dirt, sand, rubbish, stones, boxes and other materials for building purposes in and across said street at or near and before a building owned by one Rosenfeld, and negligently and wrongfully suffered and permitted the same to extend across and occupy more of the street than was reasonable or