conferred upon another corporation named, and further declaring that all of the provisions, sections and clauses in the charter of the first named company, not inconsistent with the particular provisions of the charter of the second company, should be fully extended to the president and directors of the latter corporation, is a sufficient charter for such company, in the absence of constitutional restraints upon this mode of legislative action. It is not unusual or objectionable to grant vast corporate powers in a short act, by referring to and adopting provisions of other incorporating acts.2

§ 42. Legislative Deviations from the Rules of the Common Law. — 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 where one claims its origin from such source, its rules must be regarded in deciding upon its legal existence. But the legislature have power to create a corporation, not only without conforming to such rules, but in disregard of them; and where a corporation is thus created, its existence, powers, capacities, and the mode of exercising them, must depend upon the law creating it.3

§ 43. Who included in the Word" Associates." —It has been pointed out that, where a charter is granted to certain persons named, and their "associates," the word "associates" may mean those who are already associated with the persons named, or those who may come in afterwards. Speaking upon this question, it was said by Chief Justice Shaw: "If articles of association were drawn up and signed, by which they had agreed to unite in applying for an act of incorporation, and an act should be passed conferring corporate powers on two or three of the first named, and their associates, referring to such articles, this would make the articles evidence, and make the act apply to

1 Post, §§ 539, 573.

2 Binghampton Bridge Case, 3 Wall. (U. S.) 78.

Penobscot Boom Corp. v. Lamson, 16 Me. 224. The character and

purposes of an incorporated institution are to be gathered solely from its charter. Nicholson's Succession, 37 La. An. 346.

ASSOCIATES.'

all the parties there named, conformably to the maxim, certum est, quod certum reddi potest. The question in all such cases is, what the legislature intended; it is a question of the construction of their words. Even if the parties to the enterprise ad an understanding between themselves, which was not communicated to the legislature, or not acted upon by them, either in the words of their act, or referred to in it by necessary or reasonable implication, such understanding can not aid in construing the act." In determining this question it is admissible, if necessary, to consider any competent evidence outside the charter, in explanation of the ambiguity. If, upon such evidence, it appears that a charter, granted in terms to several persons therein named and their associates, was in fact granted upon the joint request and application of those named, and others associated with them in applying for it, it may reasonably be supposed that the legislature intended to embrace them all within the grant, and that the word "associates" is used to designate those who are not specifically named in the charter. If, however, the evidence discloses the fact that the grantees so named had no actual associates at the time, or if it discloses that the charter was given by the legislature of its own motion, and without solicitation or application from any one, the use of such term in the connection here found may properly be regarded as intended to apply to such persons as may become members of the corporation, upon and after its organization. Where the charter of a bank was granted by the legislature to six persons named, "and their associates," the court heard evidence outside the charter, and determined thereon that the charter could not have been intended to include other persons who did not sign the petition for

1 Lechmere Bank v. Boynton, 11 Cush. (Mass.) 369, 380.

2 State v. Sibley, 25 Minn. 387, 399. "We are not prepared to say that a grant may not be made to certain persons by a certain and definite description, as well as by name; and when such words of description are used, it is always competent to go into parol or other evidence aliunde, to ascertain the person or thing embraced in the description. Even when a grant

is made to one by name, and it turns out that there are two or more persons of the same name, it is in the nature of a latent ambiguity, and evidence aliunde is admissible." Shaw, C. J., in Lechmere Bank v. Boynton, 11 Cush. (Mass.) 369, 379.

8 State v. Sibley, 25 Minn. 387, 399. As to the effect of a grant of land to a person named and his associates, see Duncan v. Beard, 2 Nott & McCord (S. C.), 400.

the bank, but who merely subscribed for stock in the same, in sundry books prepared and circulated at the meeting at which the enterprise originated and at which the petition to the legislature was drawn up and signed.1

in esse.

$ 44. How Legislative Grant made and Corporation Organized. - It has been reasoned by Mr. Justice McLean: "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 subscriptions of stock. And when the amount shall be subscribed, and the necessary payments made, the stockholders elect directors, who appoint a president and cashier. The organization being completed, existence is given to the artificial being, and the agency commences. It is now in esse, but before this it was not. Vitality is given to it by the voluntary association and organization of its members. Had they remained passive, the law could have had no effect. In this case, then, the grant of the franchise is not made to a person or persons The commissioners did not constitute the corporation, nor was the franchise, in any form or degree, vested in them. This is the general mode in which corporations are created, and it has stood the test of time and of legal scrutiny. No valid objection is perceived to it. In regard to this objection the act under consideration [a general law authorizing the formation of banking corporations] rests upon the same ground as other and more special acts on the same subject. The franchise is not vested in either until the organization be completed, and this depends upon the voluntary association of individuals. In a special act commissioners are named to open the books and receive subscriptions of stock; in the act under consideration the clerk and treasurer of each county are required to perform this duty. They are commissioners for this purpose. And, so far as the grant is concerned, if it be valid under one law it must be so under the other." 2 If in the organization of a corporation, all the requirements of the charter are observed, although not in the order prescribed, the organization is sufficient. Thus, where the charter requires that the directors shall be named in the articles of association, it is sufficient compliance with the requirement that the articles are adopted at the time of electing the directors. And the requirement is only directory.3

1 Lechmere Bank v. Boynton, 11 Cush. (Mass.) 369.

2 Falconer v. Campbell,2 McLean (U. S.), 195; s. c. 10 Myer Fed. Dec., § 10.

Eakright v. Logansport &c. R. Co., 13 Ind. 404; Covington &c. Plank Road Co. v. Moore, 3 Ind. 510.

- If a

§ 45. What if the Commissioners Refuse to Act. majority of the commissioners corruptly refuse to proceed to the organization of the corporation, in accordance with the law, it seems that the minority may proceed to execute the power. Such seems to have been the conclusion of the Supreme Court of Pennsylvania in a case where the legislature appointed nine commissioners, who, or any three of them, were authorized to organize a bank. A majority of the whole number corruptly agreed to transfer the franchise to a citizen of another State. It was held that, in such case, three other of the commissioners had valid authority to proceed with the organization, and that letters-patent, issued in pursuance of such organization, were valid.1 If it should appear, that commissioners, appointed by an act of the legislature to open books for receiving subscriptions to the capital stock of a bank, have refused, after having accepted their appointment and assumed to act in the premises, to proceed in the execution of the trust confided to them, without sufficient cause for such refusal, and that thereby the act of incorporation may fail of being carried into effect, a court possessing jurisdiction would, upon proper application, issue a writ of mandamus to compel the commissioners to perform the services required of them by law. But where the act of incorporation requires, that the books for receiving subscriptions to the capital stock shall be opened under the direction of seven commissioners named," or a majority of them," the majority have full power to discharge the duties required of the commissioners, without the concurrence of the others; and if all except one are willing to act, the court will not grant a peremptory mandamus to compel that one to act, for the reason that the issuing of such writ is unnecessary.2

§ 46. When Charter Provisions deemed a Substitute for Provisions of a General Act. Where the charter of a corporation contains provisions in terms similar to provisions of a general act, and provides that the corporation shall be subject to such provisions of the general act as are applicable, the provisions in the charter will be deemed a substitute for the provisions of the general act.3

1 Commonwealth v. McKean County

Bank, 32 Pa. St. 185.

2 Matter of White River Bank, 23 Vt. 478.

3 Briggs v. Cape Cod Ship Canal Co., 137 Mass. 71.

§ 47. Whether Corporations created by the Concurrent Action of Two States. Whether one corporation can be created by the concurrent legislation of two States has been a subject of judicial controversy. The question seems to have been first raised in the Supreme Court of Errors of Connecticut, and that court took substantially the view that there is no legal difficulty in the way of the creation of a single corporation by the concurrent action of two or more States; nor of the creation of a new corporation out of two or more corporations already existing; nor of the creation, by one State, of such a corporation, where one of the constituent corporations is a foreign one. The court saw no objection, technical or otherwise, to the parting, by two or more States unitedly, in the exercise of their sovereign au thority, with such of their respective powers as should be neces sary in order to confer upon persons, real or artificial, the franchise or privilege of being a corporation, and with such powers and privileges as they should deem it proper to grant them. The court further observed that this power had been not infrequently exercised by the States, without question or objection.1 It cannot escape attention, however, that this view is contrary to what might be regarded as the States' rights view of the question, and that it cannot be made to rest upon a strictly logical basis. If we are to accept as still true the doctrine of the leading case in the Supreme Court of the United States touching the status of foreign corporations, we must still conclude that a corporation can have but one domicile and must dwell in the place of its creation. Adhering to this theory, the same court at one time held that a railroad corporation created by the concurrent legislation of two States, with the same capacities and powers, for the same objects, referred to in the laws of the States as one corporate body, composed of the same persons, and represented by one name, was nevertheless, as a matter of legal and constitutional necessity, two distinct and separate corporations, upon the ground that a corporation is the creature of the sovereignty which brings it into being, and can have no jurisdiction beyond that sovereign. This theory was suitable to the casuistry of one

1 Bishopv. Brainerd, 28 Conn. 289,299. 2 Bank of Augusta v. Earle, 13 Pet. (U. S.) 521.

Ohio & Mississippi R. Co. v. Wheeler, 1 Black (U. S.), 286.