80. Corporation as subject or alien. As a corporation is not ordinarily held to be a citizen, so it is not a subject. An act permitting service on "British subjects" out of the jurisdiction does not refer to a corporation created by a state of the British empire.74 On the other hand a corporation chartered in a foreign country is an alien; thus in case of war between the countries it is subject to the disabilities of an alien enemy.75 And conversely a corporation formed within the State is not an alien, though all its stockholders are aliens, and it is forbidden for that reason to hold land within the State that created it.76 § 81. Personality of a corporation. Although not a citizen, a corporation is everywhere recognized as included under the term "person;" and, indeed, the very definition of corporation is a "legal person." It is therefore protected by any safeguard given to "persons by the Constitution of the United States and its amendments and by the State constitutions." A corporation is within a statute which provides that "no person who shall have a place in said city for regular transaction of business shall be deemed a non-resident." 78 Under a statute taxing the property of "white persons" for schools, it was held that the property of corporations was taxable, at any rate unless it was proved that all its stockholders were black; the statute being interpreted as meaning all persons but black persons.? 79 74 Ingate v. Lloyd Austriaco, 4 C. B. (n. s.) 704 (semble); Connell v. Neill & Co., 7 New So. Wales, W. N. 6; Lempriere v. New Pinnacle Group S. M. Co., 25 Vict. L. R. 363; Moore v. Moodyville L. & S. M. Co., 26 Vict. L. R. 226. 75 Society for the Propagation of the Gospel v. Wheeler, 2 Gall. 105, Fed. Cas. No. 13,156. 76 Hastings v. Anacortes Packing Co., 29 Wash. 274, 69 Pac. 776. 77 Pembina C. S. Mining & M. Co. v. Pennsylvania, 125 U. S. 181, 31 L. ed. 650; Charlotte, C. & A. R. R. v. Gibbes, 142 U. S. 386, 35 L. ed. 1051; Smyth v. Ames, 169 U. S. 466, 42 L. ed. 819; Pittsburgh, C. C. & S. L. R. R. v. Montgomery, 152 Ind. 1, 49 N. E. 582, 71 A. S. R. 300; Hammond Beef & Provision Co. v. Best, 91 Me. 431, 40 Atl. 338, 42 L. R. A. 528. 78 Scharmann & Sons v. De Palo, 72 N. Y. S. 1008, 66 App. Div. 29. 79 Trustees v. Bell County C. & I. Co., 96 Ky. 68. TITLE II. OF THE ACTION OF A CORPORATION IN A FOREIGN STATE. CHAPTER IV. NATURE AND POWERS OF A CORPORATION OUTSIDE THE STATE OF ITS CHARTER. 101. A corporation cannot exist | 106. What is recognized as a cor outside the State of charter. 102. A corporation is everywhere recognized as existing within the State of charter. 103. A corporation may act outside the State of charter. 104. Comity. 105. The corporation of another State is a foreign corporation. I poration. 107. A corporation may exercise 109. A foreign corporation may § 101. A corporation cannot exist outside the State of its charter. A corporation gets its power to act as an entity, distinct from the individuals who compose it, by grant from the State. The law of that State makes it a corporation; if the law ceased to exist, the body of individuals would cease to be a corporation. The association itself would of course still exist; it is not created by the law, but by agreement of its members; but its legal nature, powers, and rights, would be changed.1 The association can exist as a corporation only where that law prevails which makes it such, that is, within the terri 1 Duke v. Taylor, 37 Fla. 64, 19 So. 172, 53 A. S. R. 232, 31 L. R. A. 484. See March v. Eastern R. R. Co., 40 N. H. 548, 578, 77 A. D. 732; Erie Ry. Co. v. State, 31 N. J. L. 531, 544, 86 A. D. 226. 3 torial limits of the State of its charter; 2 for the law of a country has no extra-territorial operation. The consent of another State to its action cannot alter the matter. "A corporation," said Taney, C. J., "can have no legal existence out of the boundaries of the sovereignty by which it is created. It exists only in contemplation of law, and by force of the law; and where that law ceases to operate, and is no longer obligatory, the corporation can have no existence. It must dwell in the place of its creation, and cannot migrate to another sovereignty."4 If, therefore, the parties who are associated as a corporation should in a foreign State attempt to act as a corporation (not merely as agents for the corporation), while their association in the act would be recognized, it could not be regarded as a corporate act. If they did business, they would be held as partners; if they bought land they would be tenants in common. And the same result would follow a refusal by a state to recognize a foreign incorporation. § 102. A corporation is everywhere recognized as existing within the State of its charter. The fact, however, that a corporation exists as such in the 2 Taylor v. Branham, 35 Fla. 297, 17 So. 552; Chapman v. Hallwood Cash Regis. Co., (Tex. Civ. App.) 73 S. W. 969. 3 Aspinwall v. Ohio & M. Ry., 20 Ind. 492, 83 A. D. 329. • Bank of Augusta v. Earle, 13 Pet. 519, 588, 10 L. ed. 274. 5 Taylor v. Branham, 35 Fla. 297, 17 So. 552; March v. Eastern R. R., 40 N. H. 548, 77 A. D. 732; Erie Ry. v. State, 31 N. J. L. 531, 544, 86 A. D. 226. In the latter case Beasley, C. J., said: “A statute that should abolish the rule of comity, or should refuse a recognition of foreign corporations, would, it is conceived, have this effect and no more, i. e., to convert the foreign corporators, as to the State enacting the supposed law, into a partnership of individuals; and thus, although the corporation as such could not, by suit or otherwise, assert its right to protect the property, the members of the company would be under no such disability.” It would seem to follow-and it has been so held-that if the corporation so-called cannot be shown to be a corporation de facto, the participants in the attempted organization will be liable as partners in any foreign State in which they have acted. Duke v. Taylor, 37 Fla. 64, 19 So. 172, 53 A. S. R. 232, 31 L. R. A. 484. State of its charter must, if properly proved, be fully recognized everywhere. This is simply recognizing the existence of a fact, and neither court nor legislature can possibly do otherwise. A statute which should try to declare that it was not a corporation would be void, like a statute to make black white; it is not the function of legislation to alter facts, but to make laws. Whenever, therefore, the rights of parties, which are in litigation anywhere, depend merely on an incorporation in a foreign State, it is only necessary to prove the fact of incorporation. 8 Since the fact of legal incorporation must be accepted in a foreign State, such State cannot treat the corporation as a mere unincorporated aggregation of individuals. For this reason it has been held in England that a foreign corporation cannot be registered under the Companies Act. That act applies to ten or more persons doing business together; but a corporation already formed in a foreign State is but a single person. Its individual members might register as individuals, and form another company; but they could take no steps under the act as members of the foreign corporation." And where a foreign corporation does business through an agent, the individual members are not doing business in the country; the agent does business for the corporation, not for them. The number of persons doing business is, therefore, not the number of members of the corporation; business is done by only one, the corporation.10 $103. A corporation may act outside the State of charter. Although a corporation cannot exist outside the State that creates it, it may nevertheless send its agents into another State, just as an individual may do; and if the latter State allows the agents to act, the corporation, though not present, 7 See Bonham's Case, 8 Co. 107; London v. Wood, 12 Mod. 669, 687, per Lord Holt. Duke v. Taylor, 37 Fla. 64, 19 So. 172, 53 A. S. R. 232, 31 L. R. A. 484. Bulkeley v. Schutz, L. R. 3 P. C. 764. 10 Bateman v. Service, 6 App. Cas. 386. may acquire rights and become subject to liabilities. A corporation of one State may therefore act in another, just as an individual who never leaves one State may act in another. It may make contracts, commit torts, acquire and convey property, and in short, do all acts that may be done through an agent. "Natural persons, through the intervention of agents, are continually making contracts in countries in which they do not reside, and where they are not personally present when the contract is made; and nobody has ever doubted the validity of these agreements. And what greater objection can there be to the capacity of an artificial person, by its agents, to make a contract within the scope of its limited powers, in a sovereignty in which it does not reside; provided such contracts are permitted to be made by them by the laws of the place? The corporation must no doubt show that the law of its creation gave it authority to make such contracts, through such agents. Yet, as in the case of a natural person, it is not necessary that it should actually exist in the sovereignty in which the contract is made. It is sufficient that its existence as an artificial person, in a state of its creation, is acknowledged and recognized by the law of the nation where the dealing takes place; and that it is permitted by the laws of that place to exercise there the powers with which it is endowed." 11 But is is to be borne in mind that one who purports to represent a corporation outside the charter State must do so only as an agent; and that his appointment as agent must precede this power to act. The corporation in creating the agency, as in all its affairs, can act only in its own State. The organization of the corporation and the appointment of its principal agents, at least, must therefore be done in the charter State.12 § 104. Comity. It has been seen that the power of a foreign corporation to 11 Bank of Augusta v. Earle, 13 Pet. 519, 588, 10 L. ed. 274. 12 See post, chap. xiv. |