lishing the agreement under which the consolidation had been made. It was held by the Supreme Court of Connecticut that this might be done, and that, when the legal existence of the corporation in the State of New York became thus established, it satisfied the requirements of the Connecticut statute, and the new company became possessed of all the rights in the State of Connecticut which had been possessed by the old company.1 § 319. Consolidation with Foreign Corporation. As already seen, there is no insuperable difficulty in the creation of one corporation by the concurrent legislation of two States of the Union, though there are theories that such legislation operates to create two corporations, and not one. Pursuing that subject further, we find that the old view was that expressed by Mr. Justice Story at circuit, that, where two corporations, created by the legislation of two States, for the purpose of constructing a public improvement extending across the boundary between such States, are united by new concurrent acts of the legislatures of the two States, by which the stockholders of each are made stockholders in the other, they do not cease to exist as distinct corporations; that the effect of such legislation is a mere union of stocks and interests, but not a merger of powers. This doctrine, it is to be observed, remained that of the United States down to the year 1861,5 and still inheres in our jurisprudence to a qualified extent. -- § 320. Remains a Domestic Corporation in Each of the Concurring States. From the foregoing observations, we are justified in the conclusion that a corporation created by the concurrent legislation of two or more States, exists in each of such States as a domestic corporation of that State. This conclusion 1 Mead v. New York &c. R. Co., 45 Conn. 199. 2 Ante, § 47. 3 Ante, § 48. 4 Farnum v. Blackstone Canal Corp., 1 Sumn. (U. S.) 46. 5 Ohio &c. R. Co. v. Wheeler, 1 Black (U. S.), 297. Ante, § 47. Rece v. Newport News &c. Co., 32 W. Va. 164; 9 S. E. Rep. 212. See also Farmers' Loan & Trust Co. v. So held in Re St. Paul &c. R. Co., 36 Minn. 85. The constitution of Colorado so provides in express terms, thus: "If any railroad, telegraph, express, or other corporation organized under any of the laws of this State shall consolidate by sale or otherwise, with any railroad, tele is justified by a comparatively recent decision by the Supreme Court of the United States, in a case where a railroad corporation, chartered in Connecticut, had bought the franchises and properties of a railroad corporation created under the laws of Connecticut and of Rhode Island. The legislature of Rhode Island ratified the sale, and authorized the Connecticut company to exercise the rights thus acquired. It was held that the Connecticut company thus became the successor of the consolidated company, and, as to so much of its road as existed within the State of Rhode Island, a corporation of that State.' This is quite in conformity with the observation of the same court, speaking through Mr. Justice Swayne, in a former case: "Nor do we see any reason why one State may not make a corporation of another State, as there organized and conducted, a corporation of its own, quoad any property within its territorial jurisdiction." It was reaffirmed by the Supreme Court of Illinois in 1868, that court holding that a contract of consolidation, validated by subsequent legislation, created substantially a new corporation with a new name, but that such corporation, in a legal point of view, remained a distinct corporation in each State. That is to say, there was a Wisconsin corporation of a given name and an Illinois corporation of the same name, although the officers graph, express or other corporation organized under any laws of any other State or territory, or of the United States, the same shall not thereby become a foreign corporation, but the courts of this State shall retain jurisdiction over that part of the corporate property, within the limits of this State in all matters which may arise, as if said consolidation had not taken place." Colo. Const. of 1876, art 15, § 14. One of the results of such a doctrine is that the provisions of the law of each of the States whose legislature has concurred in creating the united company, relating to the service of process on domestic corporations, applies to such a corporation. Re St. Paul &c. R. Co., 36 Minn. 85. Circumstances of concurrent legislation under which a company organized under the laws of one State, and afterwards consolidated with a company created by another State, might increase its capital stock, in pursuance of the law of the State of its creation: Attorney-General v. Boston &c. R. Co., 109 Mass. 99. 1 Clark v. Barnard, 108 U. S. 436. 2 Railroad Co. v. Harris, 12 Wall. (U. S.) 65, 82. That this may be done, seems to have been the view of the same court in the previous case of Ohio &c. R. Co. v. Wheeler, 1 Black (U. S.), 297; ante, § 47. See also Railway Co. v. Whitton, 13 Wall. (U. S.) 270; Railroad Co. v. Vance, 96 U. S. 450; Memphis &c. R. Co. v. Alabama, 107 U. S. 581. and stockholders of both corporations were the same. From such a refinement it would seem to follow that, when the persons composing the two corporations acted in Illinois, there was present a domestic corporation and also a foreign corporation, — that is to say, they were there as an Illinois corporation and also as a Wisconsin corporation; and so, conversely, when they acted in Wisconsin. The court, however, went so far as to concede that "the principle that a single corporation cannot be created by the joint legislation of two States, while an irresistible inference, from the established law in regard to corporate bodies, is nevertheless a technical and abstract principle; and when adjoining States authorize consolidations, as in the present instance, and the consolidated lines are placed under a common. board with a common name and seal, such board will naturally act as one company; and when their contracts assume that form, the courts must, for the protection of the public, and to enforce good faith, hold, as we have done in this case, that the contract is to be construed as made by the corporation of each State in which the subject-matter of the contract lies: ut res magis valeat quam pereat. The court accordingly held that where, after such a consolidation, a mortgage had been made in the name conferred upon the corporation by the legislation of each State, by the officers of the corporation as consolidated, upon the line of railroad of the corporation in Illinois, the mortgage would stand as the sole mortgage of the Illinois corporation, and as such be legal and valid. That such a corporation is a corporation created by the laws of each of the concurring States, cannot be denied; and accordingly it has been well reasoned that, for the purpose of taxation, a corporation created by the concurrent legislation of the State of Illinois and other States is a company, "incorporated under the laws of this State," within the meaning of a statute of Illinois relating to revenue and taxation. Obviously, the effect of such legislation is not to displace the local law of either of the States in regard to the mode of condemning land, or of acquiring the right of way for the use 1 Racine &c. R. Co. v. Farmers' Loan & Trust Co., 49 Ill. 331. Ibid., p. 352. 3 Ibid. 4 Ohio &c. R. Co. v. Weber, 96 Ill. 443 (following Quincy Bridge Co. v. Adams County, 88 Ill. 615). of the consolidated railway company thus created, nor to import into a particular State a provision of the statutes of the other concurrent States in that regard.1 § 321. Foreign Law not Transferred: Local Law not Displaced. — Such statutes do not transfer the law of one State to the other, except permissively, nor displace the local law, unless otherwise expressly provided. Thus, a statute of Illinois, authorizing the consolidation of a railway company created by the laws of that State, with companies created by the laws of other States, contained the following recital: "And the said corporation shall also possess all the faculties, powers, authorities, immunities, privileges and franchises at any time held by the said Pittsburgh, Ft. Wayne and Chicago Railway Company, or by any of the corporations heretofore consolidated into the said company, or conferred on the said company, the said corporations, or either of them, by an act or law of this State, or of either of the States of Ohio, Indiana or Pennsylvania, and shall have power and capacity to hold and exercise within each and every of the said States, and so far as it may be deemed necessary to the general objects of its business, within any other of the United States, all the faculties, powers, authorities, privileges, and franchises, and all others which may hereafter be conferred upon it by or under any law of this State, or of any of the aforesaid States, and to hold meetings of stockholders and directors, and do all corporate acts or things within any of the aforesaid States, as validly as it might do the same within this State; and may consolidate with any corporation of said other States authorized to hold, maintain and operate the aforesaid railroad." It was held that this statute had no reference to the subject of the acquisition of the right of way by the company to which it related. The court said: "It relates purely, as the language unmistakably shows, to the faculties, powers, authorities, privileges and franchises which may be deemed necessary to the general objects of its business within any other of the United States. It relates to the corporation itself, and is designed to make it a unit in each and all of the States in which its line is located; but it does not assume to affect the local law in regard to the mode of acquiring title to the right of way. It has the same power and capacity to take and hold right of way in this State that it does in the other States; but the mode of acquiring right of way is obviously very different from the capacity to take and hold it. The control of streets, and the mode of regulating their use, and the mode of executing and acknowledging deeds and effecting condemnations are matters of local law, affected, to some ex 1 Pittsburgh &c. R. Co. v. Reich, 101 Ill. 157. tent, by local constitutions, which it would doubtless be impossible to place under precisely the same law in each of these four States. At all events, we feel quite confident no such attempt has been here made." 1 § 322. With what Powers and Liabilities. — In respect of the financial powers possessed by the consolidated company, it can be safely said that it succeeds to whatever power of issuing bonds and mortgaging its property and franchises was possessed by both of the preceding companies under their governing statutes. But whether, in case the governing statute of one of the companies conferred upon it larger powers than that conferred by its governing statute upon the other, the united company would succeed to the larger class of powers, may be a question of difficulty. Where the act of consolidation passed by the legislature of each of the concurring States provided that the holders of the stocks of the two companies should, when consolidated, hold, possess and enjoy, all the property, rights and privileges and exercise all the powers granted to and vested in the companies, or either of them, by that law or any other law or laws of that State, or of the concurring State, it was held that the purpose of the two provisions was to vest in the new company the rights and privileges which the original companies had previously possessed under their separate charters, - the rights and privileges which one of the original companies had enjoyed in the State of its creation, and the rights and privileges which the other had in like manner enjoyed in the State of its creation, and not to transfer to either State or to enforce therein the legislation of the other. The new company, after the consolidation, stood in each State as the original company had previously stood in that State, invested with the same rights, and subject to the same liabilities.3 As elsewhere seen, specific liens upon the property of a railway company follow the property into the hands of the new company after the consolidation. The effect of the consolidation is not, unless otherwise provided in the governing statute, to enlarge the rights of the lien-holders, and 1 Pittsburgh &c. R. Co. v. Reich, 101 Ill. 157, 174. 2 Mead v. New York &c. R. Co., 45 Conn. 199, 221. 3 Delaware Railroad Tax, 18 Wall. (U. S.) 206. Post, § 365, et seq. |