"as the basis of their association the articles of agreement made and entered into by the members thereof as proprietors of mills, bearing date April 26, 1853." Article 5 of the by-laws provided that the capital stock should consist of $2,500 divided into shares of $25 each, and that the money already advanced for the purpose of the association should go in part payment for the shares. It is clear that the corporation succeeded to and took the place of the association. The members of the latter became and were members of the former, and the evident intention was that as the members of the corporation died or conveyed their mills, mill-dams, or mill privileges, those who succeeded to their respective estates as heirs or purchasers should become members of the corporation in their stead, and succeed to their respective interests in it. The uniform practice since the corporation was formed shows that this was and has been the understanding.

Ordinarily, membership in a private trading corporation arises from the ownership of stock which has been issued by it, but it is not always so. In re Philadelphia Savings Institution, I Whart. 461. Shares might have been issued in the present case, or could be issued now. Instead of issuing shares, however, the members in substance agreed that their rights in the joint or capital stock of the corporation should pass with the mills, mill-dams and mill privileges, thus confining the membership to persons directly interested in the maintenance of the dams. In the absence of any restriction in the charter, we think that in the case of a corporation like this there can be no valid objection to a membership so constituted, and therefore that the objection that the corporation has been dissolved by the death of the original members can not be sustained. Watuppa Reservoir v. Fall River, 134 Mass. 267.

Exceptions sustained upon other points.

Note. See Russell v. M'Lellan, 14 Pick. (Mass.) 63.

Sec. 243. Loss of integral part.

PHILIPS v. WICKHAM ET AL.

1829. IN THE COURT OF CHANCERY OF NEW YORK. I Paige (N. Y.) Ch. Rep. 590–601.

[By an act of 1807, drainage commissioners were created, with powers to cease on the first Tuesday in June, 1808, at which time the owners of lands affected were to meet at a designated place, and select other commissioners for one year, and so on annually. In 1828, no election was held, and the old commissioners continued to act. In 1829, new commissioners,-the defendants,-were elected. Their power was denied on the ground that the failure to elect in 1828 terminated their official existence.]

THE CHANCELLOR (Walworth).

If a corporation con

sists of several integral parts, and some of those are gone, and the remaining parts have no power to supply the deficiency, the corpora

tion is dissolved. As in the case in Rolle (1 Roll. Abr. 514, I.), where the corporation was to be composed of a certain number of brothers, and a certain number of sisters, and all the sisters were dead, it was admitted that all grants and acts done by the brothers afterward were void; for, after the sisters were dead, it was not a perfect corporation. But the case, which is immediately afterwards stated by Rolle, shows that if the brothers had possessed the power to appoint other sisters in the place of those who were dead, the corporation might have been revived. So, Baron Comyn says, if a corporation refuses to continue the election of officers till all die who could make an election, the corporation is dissolved. (4 Com. Dig. 273, tit. Franchises, G. 4.

The incapacity to receive or resuscitate the powers of a corporation may arise from three causes: 1. The absence of the necessary officers who are required to be present when the deficiency is supplied, or their incapacity or neglect to do some act which is requisite to the validity of the appointment. 2. The want of the necessary corporators who are required to unite in the appointment; and 3. The want of the proper persons from whom the appointment is to be made. The case of The Corporation of Banbury, before referred to, appears to be one of the first description. And the case cited from Rolle and that put by Chief Baron Comyn, as well as the King v. Passmore (3 Term Rep. 199), and The Corporation of Maidstone and The Borough of Teverton, referred to in that case, all appear to belong to the two last classes of cases. The statute, II Geo. 1, ch. 4 (15 Stat. at Large 178), has provided for the first class of cases, but the sixth section of the act expressly excludes the second class, and no provision is made for cases of the third class. The result of an examination of all the cases on this subject is the principle so ably and successfully contended for by Serjeant East in the King v. Passmore, that if the corporators have the power in themselves to supply the deficiency in their body their rights are not extinguished but only dormant. If, however, that power is gone, and they can not act until the deficiency is supplied, the corporation is dissolved. In the language of Lord Macclesfield, this is not a forfeiture for non-user, but is a consequence of law. "The corporation is dead, and not barely asleep.'

[The court then concluded that because of the fact that the electors could meet at a fixed time and place without the intervention of the commissioners, there was nothing requiring a continued succession of such commissioners and hence new commissioners could be elected at any annual meeting.]

Note. See 2 Kyd Cor. 448. 1717, Banbury's Case, 10 Mod. 346; 1803, Rex v. Morris, 3 East 213; 1833, Lehigh R. B. Co. v. Lehigh Coal Co., 4 Rawle (Pa.) 9; 1838, State University v. Williams, 9 Gill & J. (Md.) 365, 421, 31 Am. Dec. 72; 1854, State v. Vincennes Univ., 5 Ind. 77; 1875, Harris v. Mississippi V. R. Co., 51 Miss. 602.

Sec. 244. Surrender.

THE MECHANICS' BANK v. HEARD.1

1867. IN THE SUPREME COURT OF GEORGIA. 37 Ga. Rep. 401-422.

[Suit by Heard against the bank upon bills which it refused to pay. The sheriff's return showed personal service upon "T. S. Metcalf, president of the Mechanics' Bank," September 12, 1866. Metcalf put in a traverse averring that he was not at that time president of the bank, and that it had at a meeting of the stockholders on February 20, 1866, duly called, and by a unanimous vote of the directors, surrendered the charter to the state, and by order of said meeting notice of such surrender was sent to, and received by, the governor of the state, thus dissolving the corporation. The bank asked for a special jury to try this collateral issue, and the court refused, allowing this issue to be tried with others in the case. The jury found for the plaintiff. Among the errors assigned was the refusal of a special jury to try the collateral issue as to the surrender of the corporate existence.]

HARRIS, J. It can not be denied that all banking corporations in America are the creatures of legislative will, and that no power to create such corporations belongs to either of the other departments of the state government. Nor can it be denied that every act of the legislature creating a banking corporation upon its acceptance becomes an executed contract between the state and corporation. This principle, decided in Dartmouth College v. Woodard, 4 Wheaton 518, places plaintiff in error within the protection of the constitution of the United States. Under such protection it follows that the act creating the Mechanics' Bank as a corporation can not be modified or repealed by the legislature of Georgia without the free assent of the corporators, and then only when such alteration or repeal does not affect the rights of its creditors. It may be safely asserted that the legislature, its creator, has no power of its will merely to dissolve it. As long as it performs its engagement by the act creating it, it has a corporate existence within the limit of time fixed by the act which can not be shortened.

This brings us to consider the grounds on which corporations (private) could be dissolved at common law.

2. Surrender of char

They are: 1. Death of the corporators. ter accepted and enrolled. 3. Forfeiture. Section 3, Burrows Repts. 1866.

But counsel for plaintiff in error have gravely, and with seeming earnestness, asserted a dissolution of a corporation by a voluntary surrender was unknown to the common law, that such a privilege was the creation of our code, and upon this assumption rests the plaintiff's Let us see if it can stand the test of examination. It is said of corporations created by letters-patent from the crown, that the 1 Statement abridged; arguments, part of opinion, and dissenting opinion of Walker, J., omitted.

case.

king could not ex mero motu alter or resume his grant. It could be dissolved upon the free consent of the corporators surrendering their franchises under the seal of the corporation. Grant on Corporations, p. 303. Rex v. Lanier, Salk. 168; 8 Meeson and Welsby, 1.

Here then we find that surrender was a mode whereby a corporation might be dissolved. It was voluntary, for it proceeded from the free consent of the corporators. The franchise could not be re'sumed unless the grantees concurred. Rex v. Lanier, Salk. 168; 8 Meeson and Welsby, 1. Thus we have the definition of surrender; its characteristic is that it is voluntary, springing from the free consent of the corporators. Can more be necessary to satisfy the enquirer that a voluntary surrender was a mode whereby a dissolution of a corporation might be effected according to the common law? To make it complete, such surrender required the assent or acceptance of the creator of the corporation, duly enrolled and of record. The English authorities cited established these doctrines.

Our code, in enumerating the grounds whereby corporations are dissolved, but repeats those existing at common law. "Surrender" is one of them. In a subsequent clause, voluntary surrender is defined, thus clearly showing that in the minds of the codifiers they were one and the same mode.

An identity is thus shown between "surrender" at common law, and the surrender or voluntary surrender of the code, proceeding alike from the free will of the corporators. 'Tis this which distinguishes them from another mode of dissolution by forfeiture; this last is the result solely of the coercion, compulsion by the judgment of a court. In England the surrender was required to be made to the creator of the corporation. In Georgia, the code requires it to be made to the state, by which the legislature, as the creator by law of banking corporations, must necessarily be understood.

Counsel have throughout confounded the resolution to make a surrender with an actual dissolution of a corporation. These things are entirely distinct, proceeding from different parties. A surrender is not a dissolution; it is but a mode, a way, a means to an end. The corporators consent to surrender their franchise, tender it back to the legislature and ask to be dissolved as a corporation. This is their free act and proceeds from one party to the contract. If the surrender is formal under the seal of the corporation and the legislature, the other party to the contract in behalf of the state accepts it by an act or ordinance in some authoritative form, and that is authenticated as law and ordinances usually are, then, and not till then, is the dissolution of the corporation upon surrender and the evidence of it complete.

Now corporations in Great Britain were created either by virtue of the royal prerogatives or by act of parliament; if by the crown, by letters-patent under its seal and duly enrolled; if by parliament, by an act of the three estates duly enrolled and with the great seal attached.

In the case of crown grants, when dissolved upon surrender by the

grantees, the acceptance of the king of such surrender was required to be enrolled and of record. 3 Burr. Rep. 1866; 1 Wooddeson's Lectures, 500; 1 Salk. Rep. 191. Parliamentary could only be dissolved by act of parliament. See Grant on Corporations.

The foregoing are familiar principles regulating the creation and dissolution of corporations, and they are in accordance with a maxim pervading the common law in other departments. Nihil tam conveniens est naturali aequitati quam unum quoque dissolet eo ligamine quo ligatum est.

Again, "a corporation aggregate may surrender and in that way dissolve itself, but then the surrender must be accepted by government, and be made by some solemn act to render it complete.

Com. 209.

2 Kent's

An act of the legislature repealing the act of incorporation, passed with the assent of the corporators, would undoubtedly be sufficient to effect a dissolution. Revere v. Boston Copper Co., 15 Pick. R. 35I.

The surrender must be by, a formal act of the corporation under seal; and it can not avail but by an acceptance of such surrender by an enrolled act or law. There must be the same agreement to dissolve as to make. The power in a corporation to dissolve by its own act is too dangerous to be supposed to exist. See Boston Glass Co. v. Langdon, 24 Pickering Rep. 49.

In this country, where corporations are usually created by act of the legislature, no mode of surrender is pointed out by the books as necessary to be pursued, differing from that in England, where corporations are usually created by charter from the crown. It is said a surrender, if accepted, will be sufficient. Angell and Ames on Corporations, 638; 2 Kent. Com. 250; 15 Pick. Rep. 351.

As the identity of surrender at common law as a mode of dissolution of a corporation, with the surrender defined by the code, can not but be conceded by every lawyer who will take the trouble of investigating the subject, and no mode or form is prescribed by the code as necessary to be pursued in order to make it effectual, there seems to me no escape from the necessity of alleging, and, in support of such allegation, exhibiting, some act or ordinance of the legislature, approved by the governor, assenting to or accepting the proposed surrender of their franchise by the Mechanics' Bank.

A dissolution at the will of corporators would leave no evidence of the surrender but the entry of the resolution of the corporators on the minutes of the bank, and when thus dissolved who can say where will be the depository of the minutes?

In fine the proposition of plaintiff in error involves, besides what has been said in reference to it, this striking inequality, that a law containing a contract of the highest importance between the corporation and the state may be set aside and annulled at the will of the corporators by a mere resolution, notice of which is given to the governor, whilst the state can not alter or repeal that law, or resume the franchises granted, or compel their delivery up or cause a dissolution