Michigan, the directors and stockholders of one of the banks, organized under that law, which had become insolvent. The Supreme Court of Michigan having declared the law unconstitutional, and the Federal court being bound on this question to follow the State court, the learned justice found it " difficult to find any principle on which the obligations of such associations can be enforced." "They have," said he, "no standing within the protection of the law, they having been established in defiance of its prohibitions. As between the individuals concerned, as particeps criminis, the law could give no aid; and it is not perceived how an individual can become indebted to the bank, or have a claim on it, without being involved in its illegality." He therefore sustained the demurrer to the bill. The Supreme Court of New York seems to have had the same trouble in respect of the New York banking law of 1838. The court, following its previous decision,2 held that the act was unconstitutional, and therefore, in an action of assumpsit on a promissory note, by a bank created under the act, gave judgment in favor of the defendant; but the Court of Errors, being of opinion that the act was constitutionally passed, reversed this judgment.3 § 655. Validity of a Statute Allowing a Depositor to Appoint a Person to whom his Deposit shall be Paid after his Death. It is, of course, no objection to the validity of a statute incorporating a saving fund society, and providing that a book shall be kept at the office in which every depositor shall be at liberty to appoint some person to whom, at his death, his deposit shall be paid, if not otherwise disposed of by will, that it is contrary to the statute of wills. As one act of the legislature, both being within its constitutional power, is as good as another, it is no objection to the validity of such a statute that it is contrary to another statute, or that it creates an exception to it.4 § 656. Unconstitutional Law may Operate as a Legislative License. Where certain persons had been indicted for setting up and carrying on a lottery, and they justified under a statute incorporat 1 Nessmith v. Sheldon, 4 McLean (U. S.), 377. This decision was affirmed, as to the point that it was the duty of the Federal to follow the State court, by the Supreme Court of the United States, on a certificate of divis ion, sub nom. Nessmith v. Sheldon, 7 How. (U. S.) 712; ante, §632, n. 2. Debow v. People, 1 Denio (N.Y.), 9. 8 Gifford v. Livingstone, 2 Denio (N. Y.), 380. 4 Knorr's Appeal, 89 Pa. St. 93. ing them as a company for that purpose, "to raise funds for the common school system of Alabama," the court reached the conclusion that although their act of incorporation was void, as being in conflict with the clause of the constitution which prohibited the legislature from creating corporations by special act, except for municipal purposes, yet that it might operate as a legislative license to carry on the lottery, and would, in some way or other, estop the State from punishing the corporators for carrying it on. The court had no difficulty in finding that the defendant "acted in good faith and verily believed he was doing what the State, by the statute, clearly authorized him to do."'1 § 657. Charters Exempting Corporations from General Laws. A constitutional provision empowering the legislature to grant "such charters of incorporation as they may deem expedient for the public good," has been held not to empower them to grant a charter of incorporation exempting the corporation from the usury laws of the State, by authorizing it to issue its mortgage bonds, bearing a higher rate of interest than that fixed by general law. Notwithstanding such a charter provision, a bill in equity was entertained, brought by general creditors, the object of which was to confine the bondholders of the corporation to the rate of interest prescribed by the general law of the State, and to subject the surplus to the payment of the debts of the complainants, and a decree granting this relief was affirmed. The bill was well brought as to such of the complainants as were judgment creditors.2 § 658. Statutes may be Valid in Part and Void in Part.— It is a principle of constitutional law that a statute may be valid in part and void in part. If a provision, which is not obnoxious to any constitutional objection, is found, even in the same section, with another provision which is repugnant to the constitution, the provision which is in itself valid must be sustained, unless the two are so united that it must be presumed that the legislature would not have adopted the one without the other.3 An appropriate case for the application of this principle is where the objects of the statute which are held to be unconstitutional, and those parts of it which are valid, are 1 Brent v. State, 43 Ala. 297. The decision is destitute of either legal or moral sense. 2 McKinney v. Memphis Overton Hotel Co., 12 Heisk. (Tenn.) 104. 3 Robinson v. Bidwell, 22 Cal. 379; People v. Nally, 49 Cal. 482; Ex parte Frazer, 54 Cal. 94; Com. v. Hitchings, 5 Gray (Mass.), 485. wholly independent of each other, so that the latter may be carried into effect without reference to the former. When the parts of a statute are so mutually connected and dependent, as conditions, considerations or compensations for each other, as to warrant a belief that the legislature intended them as a whole, and that, if all could not be carried into effect, the legislature would not have passed the residue, independently, if some parts are unconstitutional and void, all the provisions, which are thus dependent, conditional, or connected, must fall with them." § 659. Illustrations. It has already been seen that if'a part of a statute is not expressed in the title, and such part is severable from the rest, it may be declared void, and the rest allowed to stand, under a constitutional provision that an act shall contain but one subject, which shall be expressed in its title.3 So, if we refer to some of the principles discussed in the preceding article in regard to restraints upon the enacting of laws, we shall find that where it is ascertained from the journals of the two houses of the legislature that a particular amendment to a bill was not passed in conformity with the requirements of the constitution, but that the bill without the amendment was passed, the courts may, it has been held, sever the amendment from the bill and 1 Warrenv. Mayor of Charlestown, 2 Gray (Mass.), 98; French v. Teschemaker, 24 Cal. 518, 548; Ex parte Frazer, 54 Cal. 94; St. Louis v. St. Louis R. Co., 14 Mo. App. 221; Harris v. Niagara County Supervisors, 33 Hun (N. Y.), 279; Tripp v. Overocker, 7 Col. 72; Gunnison County Comm'rs v. Owen, Id. 467; People v. Jobs, Id. 475; Franklin Co. v. Nashville &c. R. Co., 12 Lea (Tenn.), 521; South & North Ala. R. Co. v. Morris, 65 Ala. 193; State v. Clark, 54 Mo. 17; Rood v. McCargar, 49 Cal. 117; Mobile &c. R. Co. v. State, 29 Ala. 573; People v. Hill, 7 Cal. 97; Lathrop v. Mills, 19 Cal. 513; Robinson v. Bidwell, 22 Cal. 379; Campbell v. Union Bank, 7 Miss. (6 How.) 625; Exchange Bank v. Hinds, 3 Ohio St. 1; State v. Commissioners, 5 Id. 497; Bank of Hamilton v. Dudley, 2 Pet. (U. S.) 526; Duer v. Small, 4 Blatchf. 263; Mills v. Sargent, 36 Cal. 379; Nelson v. People, 33 Ill. 390; McCulloch v. State, 11 Ind. 424; Santo v. State, 2 Iowa, 165; Fisher v. McGin, 1 Gray (Mass.), 1; Matter of DeVaucene, 31 How. Pr. (N. Y.) 289; State V. Copeland, 3 R. I. 33; State v. Snow, 3 R. I. 62. 2 Warren v. Mayor &c., 2 Gray (Mass.), 84; Commonwealth v. Clapp, 5 Id. 97; Commonwealth v. Hitchings, Id. 482; Commonwealth v. Pomeroy, Id. 486; Slauson v. Racine, 13 Wis. 398; Campau v. Detroit, 14 Mich. 276; San Francisco v. Spring Valley Water Works, 48 Cal. 493; State v. Pugh, 43 Ohio St. 98; O'Brien v. Krenz, 36 Minn. 136; Hinze v. People, 92 Ill. 406; Eckhart v. State, 5 W. Va. 515. 3 Ante, §625; People v. Hall, 8 Colo. 485. declare the amendment void and the rest of the law valid.1 A general act authorizing the formation of corporations may, like any other statute, be valid in part though void in part. For instance, although a statute authorizing the creation of rafting or boom companies, may be invalid in so far as it gives a corporation the right to take exclusive possession of a public navigable stream and bar the rights of all others therein, yet in so far as it merely provides for the formation of corporations with the power to make contracts, it is constitutional and valid.2 By analogy to the rule that a statute may be valid in part and void in part, it has been held that an order of court made in pursuance of such a legislative authorization, organizing a corporation for the purpose provided by a general law, is valid to the extent of the provisions of that law, and void only so far as it confers powers or privileges in excess of those authorized by the statute.3 As an illustration of the principle, it has been held that a portion of a section of a general statute regulating the incorporation of cities, which prescribes the form of judgment to be rendered on appeal, may be judicially stricken out as unconstitutional, without impairing the rest or without impairing the rights of suitors. Applying this principle, it has been held that a statute imposing a tax on telegraphic messages being invalid as to interstate messages, the whole statute must fall.5 1 Berry v. Baltimore &c. R. Co., 41 Md. 446. 2 Ames v. Port Huron &c. Co., 6 Mich. 266. The court do not decide that the statute is void even in the particular case. 3 Heck v. Ewen, 76 Tenn. 97. 5 Western Union Tel. Co. v. State, 62 Tex. 630. A more difficult question is presented where the court cannot sustain some part of the constitution itself without disregarding some other part. The Supreme Court of Texas has been called upon to hold that where there is an irreconcilable conflict between two provisions of a constitution, the more comprehensive and specific provision should control. Gulf &c. R. Co. v. Rambolt, 67 Tex. 654. It is scarcely necessary to say that an unconstitutional statute acquires no force by being subsequently incorporated in a revision of the statutes. Cock v. Stewart, 85 Mo. 575. 511 SECTION СНАРТER XIII.1 NATIONAL CORPORATIONS. 665. Definition - division - introduction. 666. Within the states: historical sketch: national banks. 667. Transcontinental railway compa nies. 668. Maritime Canal Company of Nicaragua. 669. Other corporations chartered by congress. 670. Formation of national corporations. 671. Power of congress to confer franchises on them: exemption from state control and taxation. 672. Power to confer right of eminent domain within the state. SECTION 674. Protection under the fourteenth 675. Status of national corporations 676. Further of this subject. 678. Power of congress to revoke 679. Effect of reservation of right to 680. Not dissolved by state action. 683. State corporations holding fed- Introduction. § 665. Definition · Division The term national corporation, as used in this chapter, means a corporation existing under a franchise conferred by the national government. A corporation existing under a franchise conferred by a State of the Union is not within the definition. National corporations may be divided with convenience into two classes: 1. Those authorized to act within the States. 2. Those authorized to act within the territories and the District of Columbia. Some corporations fall within both classes. Corporations of the first class, of which national banks and the Pacific Railway Companies are examples, are of general interest, both from the legal ques 1 This chapter was written by RusSELL H. CURTIS, Esq., of the Chicago bar, and was first published in 21 Am. Law Rev. 258. It is now republished, with the consent of its original publish. ers and of Mr. Curtis, after a revision of the text and notes by him, to bring them down to date. |