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In this Country, there is only one mode of creating corporations, and that is by statute, or in other words, by grant, from the sovereign power. This is a well settled principle in our jurisprudence. Whatever diversity of opinion there may have been and still is, respecting the power of the Federal Government to create corporations, for purposes within its acknowledged powers and duties; all agree, that the several States have full authority to create them for all objects within the range of their legislative action. They have exercised this portion of sovereign power freely, and in some instances perhaps too freely; but an ample apology for this is found in the reflection, that strength lies in union, and emphatically so in this Country, yet in its youth and comparatively without capital. It has been only by uniting and combining our means and efforts, that the resources of the country have been so rapidly developed; and corporations have furnished a natural, safe and easy form of association.
The usual, and I think it may safely be said, the only mode of creating corporations in this country, is by clear and direct legislative enactment; declaring that certain persons thereby are, and shall be a body corporate; or, that if any persons shall perform certain prescribed acts, then they shall be a body corporate. In either case, the corporation is brought into being by the declared will of the sovereign power. It may be stated, without qualification, that there is not a corporation in this State, (and it is believed there is not one in this Country,) which has not been created by statute, containing a direct and explicit declaration of the will of the Legislature to that effect; and it may well be doubted, if not directly asserted, that a court ought not to hold an association to be a corporation, which the Legislature has not clearly declared shall be one. This view of the subject will be hereafter adverted to and more fully enforced.
As it is not pretended, however, that the associations under the General Banking Law are corporations, by virtue of a direct and unequivocal legislative enactment, but are so, in consequence of the Legislature having conferred on them corporate powers; let us meet the question, first, in this aspect.
The proposition being undeniable, that in this Country, and especially in this State, corporations can only be created by Statute, it is evident, that the Legislature must call them into being, either by a direct act, or, by conferring on voluntary associations the peculiar characteristics and essential requisites of a corporation. And the Counsel for the defendant contends, that the Legislature has, in the latter mode, constituted the associations authorised by the General Banking Law, corporations. This leads directly to an inquiry after the peculiar features and essential requisites of a corporation.
The result of my reflection and investigation is, that there are only four distinctive indicia which mark an aggregate corporation, and separate it from every thing else.
They are, FIRST: A collective existence by name, created by the sovereign power, eacercised directly or mediately.
This characteristic is often expressed in different language. Chancellor Kent calls it, “a capacity to have perpetual succession, under a special denomination, and an artificial form.” [2 K. C. 277, 2d ed.] This phraseology indicates mere being by name, to which may be attached the qualities of beginning, end, pepetuity, enjoyment of rights and the performance of duties. Chief Justice Marshall, who always appears, when discussing a subject, to have his mind constantly fixed on the principles
and true nature of things, speaks of this feature of a corporation in this way: “A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of its creation consers upon it. * * * Among the most important are immortality, and, if the expression may be allowed, individuality; properties, by which a perpetual succession of many persons are considered as the same, and may act as the single individual.” [Dartmouth College vs. Woodward, 4 Wheat. Rep. 636.]
The existence of a corporation enables many persons to have succession in the enjoyment of the franchise conferred; and if its existence is perpetual, then perpetual succession. Succession, however, is a property of the individuals who exercise the corporate rights. They succeed each other. But to say that the corporation itself has perpetual succession, which is the expression in general use, and sufficiently accurate for general purposes, appears to be a solecism. Besides, there may be aggregate corporations which have no succession. Twenty individuals may be incorporated on the principle of tontine, or in other words, till the death of all the corporators but one; and the share of each, instead of being transferable, to belong to the survivors, and the last one, to take the whole corporate fund. And in a great variety of other forms, aggregate corporations may be created, without giving to them the property of succession. Every corporation will be without it, whose charter confines the exercise of its corporate rights to certain designated individuals. Perpetual succession is wholly inapplicable to corporations created for a given time. It can only apply to those which have perpetuity, of which there are many, but not near so many as there are, whose existence is to continue for a definite period. Whatever there is of succession, connected with a corporation which has a fixed period for its termination, is continued succession.
But succession is not peculiar to corporations. It often is, and may always be, a property of voluntary associations, if the associates choose so to agree in their articles of association. Strict partnerships are frequently formed under an agreement to admit succession of membership. Almost all the voluntary associations which have been formed in this Country, within the last four or five years, and there have been not a few, for the purchase of, and speculation in lands, have contained provisions for succession of associates. The joint stock companies in England, for banking and other purposes, also have succession.
When, therefore, we apply the term succession, to a corpo. ration, as a property peculiar to it, we express no more than mere continuation or being. A corporation has an existence independent of succession, and is known to the law without that property. In grants of lands to corporations, the word, “successors,” though usually inserted, is not necessary to convey a fee simple. (Ang, and Am. p. 89, ch. 5, sec. 5.) An aggregate corporation includes the idea of an association of two or more individuals; and hence it is, a collective existence. And as its existence is only in contemplation of law, it can only be known by name; and hence is a collective existence, by name. And as it can only be created by the sovereign power, exercised directly in calling it into being, or more circuitously, by prescribing certain acts, the performance of which shall constitute a body corporate, embracing those who perform them, it is, created by the sovereign power eacercised directly or mediately.
Creation by sovereign power, is the peculiar feature of the existence of a corporation. A partnership, joint stock company, and every other voluntary association, has a collective existence, and by name. But such existence and name rest on •ontract: they arise from the voluntary agreement of the associates: they have their origin in the will of individuals. Not so with a corporation. It derives its being from a higher source, —from the sovereign power. The Legislature, in which that power rests, speaks, and the corporation comes into being, with the properties of beginning, continuance and end, unless the creating power declares its existence shall be perpetual—and then, with the properties of beginning and perpetual continuance. Not only the being itself, but the name also, by which it shall be known, must come from the same source, to distinguish a corporation from other associations. This name, too, in the language of the books, must be a common name ; that is, fixed, uniform, unchangable, not dependent on the will of individuals. And although a corporation may have two names, one, “by which it may take and grant, and another, by which it may plead and be impleaded,” (Ang. and Am. 56,) yet whatever name it has, must come, I apprehend, from the creating power, and be conferred by it. It is impossible to conceive of a legal entity, taking, giving, and enforcing rights, without a name. With its creation, therefore, must be given its name—they are inseparable. This intangible, invisible existence, can only be known by its proper designation, and the name must represent the collective existence, not an officer of the corporation, not an individual, not any thing, except the corporation. It is the name of the corporation.
SEcoMD : A standing in Court as a collective existence, by a given name or designation, with the rights and liabilities of a party litigant.
This is obviously an essential requisite of a corporation. It can neither have nor maintain a legal existence, unless it is able to resort to the judicial tribunals of the State to enforce its rights; nor could the community tolerate a being, which had power to enforce rights in its favor, and yet was not amenable