8 7713. Proof of Corporate Existence in Criminal Cases. In criminal prosecutions, when the question arises whether a company is incorporated, for instance, in the case of a prosecution for a larceny of the property of an alleged corporation, or for a forgery of the bills of an alleged banking corporation, it is only necessary to show that the corporation exists de facto,' and this may be proved by general reputation,2-in other words, by proving by oral testimony that it is a corporation de facto, doing business as such. In such a case, proof of a statute chartering a corporation under a particular name, and of the subsequent public exercise of the franchises thereby granted, for many years, by an association under that name, will warrant a finding of the actual existence of the corporation, and of its management and ownership of the property which it employs in exercising such franchises, for the purpose of a criminal proceeding,3-or, indeed, for any other purpose, where the question of its existence as a corporation arises collaterally. There are holdings, but they are destitute of reason, to the effect that it is necessary in a criminal case, we will say in an indictment for uttering a forged order of a certain corporation, --to go further, and prove not only a charter, but an organization under the charter."

1 People v. Caryl, 12 Wend. (N. Y.) 547; People v. Frank, 28 Cal. 507; Smith v. State, 28 Ind. 321. Compare ante, § 7652.

'State v. Thompson, 23 Kan. 338; 8. c. 33 Am. Rep. 165; Reed v. State, 15 Ohio, 217. See also People v. Barric, 49 Cal. 342; People v. Davis, 21 Wend. (N. Y.) 309; Johnson v. People, 4 Denio (N. Y.), 364; People v. Chadwick, 2 Park. Cr. (N. Y.) 163; Sasser v. State, 13 Ohio, 453. And so by statute in Missouri.

• Com. v. Bakeman, 105 Mass. 53. State v. Murphy, 17 R. I. 698;

8. c. 24 Atl. Rep. 473. In this case the senseless holding was made that, for the purposes of such an indictment, there was not sufficient proof of the existence of a company of the name laid in the indictment, and that it had a president and treasurer, as though it could make the least possible difference, for such a collateral purpose as the guilt of a felon who had forged an instrument of writing purporting to have been executed by it, whether it were incorporate or unincorporate.

6123

SECTION

ARTICLE IV. EFFECT OF DISSOLUTION.

7720. Effect of dissolution of the corporation.

7721. Insolvency of corporation no defense to actions against it.

SECTION

7722. Dissolution by reason of nonuser not pleadable.

7723. What actions abate and what survive.

7724. Effect of dissolution on suits commenced by attachment.

§ 7720. Effect of Dissolution of the Corporation. - As already seen,1 after the charter of a corporation has expired by its own limitation, or after the corporation has been dissolved by a court of competent jurisdiction, its artificial existence is at an end. It is thereafter incapable of executing a conveyance of its lands. Thereafter it can maintain no action to enforce rights acquired during the life of its charter, unless its capacity in this respect has been continued by the provisions of its charter, or otherwise by statute. In the absence of such a statutory reservation, upon the happening of either event, all actions pending against the corporation must abate,*

1 Ante, § 6718, et seq.

'Marysville Invest. Co. v. Munson, 44 Kan. 491; s. c. 24 Pac. Rep. 977.

Saltmarsh v. Bank, 14 Ala. 668; 8. c. 17 Ala. 761; Bank of United States v. McLaughlin, 2 Cranch C. C. (U.S.) 20; Smith v. Frye, 5 Cranch C. C. (U. S.) 515; Miami Exporting Co. v. Gano, 13 Ohio, 269; Bank v. Wrenn, 3 Smedes & M. (Miss.) 791; Renick v. Bank, 13 Ohio, 298; Consolidated Asso. v. Claiborne, 7 La. An. 318; Campbell v. Mississippi Union Bank, 6 How. (Miss.) 625; Blake v. Portsmouth &c. Railroad, 39 N. H. 435; Sturges v. Vanderbilt, 73 N. Y. 384; 8. c. sub nom. Sturgis v. Drew, 11 Hun (N. Y.), 136; Ingraham v. Terry, 11 Humph. (Tenn.) 572; Rider v. Nelson &c. Factory, 7 Leigh (Va.), 154; 8. c. 30 Am. Dec. 495; Krutz v. Paola Town Co., 20 Kan. 397; Pendelton v. Russell, 144 U. S. 640;

Wilcox v. Continental Life Ins. Co., 56 Conn. 468; 8. c. 16 Atl. Rep. 244; National Pahquioque Bank v. First Nat. Bank, 36 Conn. 325, 334; 8. c. 4 Am. Rep. 80. That the common-law rule that an unqualified dissolution of a corporation extinguishes all rights of action in favor of or against it is not changed by Conn. Gen. Stat., § 1322, specifying the power of receivers, see Wilcox v. Continental Life Ins. Co., 56 Conn. 468; s. c. 16 Atl. Rep. 244. That in an action on a note by a corporation it is no defense that the charter fails to define the period of its duration, -see East Tenn. Iron Man. Co. v. Gaskell, 2 Lea (Tenn.), 742.

Mumma v. Potomac Co., 8 Pet. (U.S.) 281; National Bank v. Colby, 21 Wall. (U.S.) 609; Merrill v. Suffolk Bank, 31 Me. 57; 8. c. 50 Am. Dec. 649; City Ins. Co. v. Commercial Bank, 68 Ill. 348; Thornton v. Marginal Freight

-though statutes providing for the continuation of such actions have generally been enacted.' It follows that a judgment rendered against a corporation under such circumstances is voidable, in the sense that it will be reversed on error,2 or that the execution of it will be perpetually enjoined.3 But relief cannot be given to a corporation against a decree in equity, on the ground that it had no existence at the time when the decree was rendered, where it is not shown that its existence had not been so prolonged or revived that it would have a standing in court. So, although a corporation may have been in the possession of its charter and franchises at the time of the rendition of a judgment against it, yet a scire facias cannot be maintained upon the judgment if, before the issue of the writ, its charter has been surrendered or forfeited.' Creditors may, however, enforce their claims against any property belonging to the corporation, which has not passed into the hands of bona fide purchasers, but is still held in trust for the company, or for its stockholders, at the time of its dissolution, in any mode permitted by the local laws.

R. Co., 123 Mass. 32; Read v. Frankfort Bank, 23 Me. 318; Whitman v. Cox, 26 Me. 335; Greeley v. Smith, 3 Story (U.S.), 657; Bonaffe v. Fowler, 7 Paige (N. Y.), 576; McCulloch v. Norwood, 58 N. Y. 562; Musson v. Richardson, 11 Rob. (La.) 37, 42; Life Asso. v. Goode, 71 Tex. 90; National Bank v. Colby, 21 Wall. (U.S.) 609, 614.

1 Ante, § 6734, et seq.; Lumber Co. v. Ward, 30 W. Va. 43. Some of these statutes continue the corporate existence for a stated period of time, during which its corporate name may be used for the purpose of suing to collect its debts, etc. Such was the act of Congress chartering the former Bank of the United States. It had the effect of preserving from abatement all suits pending at the date of its passage. Bank of United States v. Leathers, 8 B. Mon. (Ky.) 126. The question

Under

whether actions pending against a corporation at the date of its dissolution ought, under such statutes, to be revived against a receiver, has been already considered (ante, § 7135); but a decision may be noted here to the effect that under the statutes of Ohio this is not necessary in a court of the United States. Lake Superior Iron Co. v. Brown, 44 Fed. Rep. 539.

Musson v. Richardson, 11 Rob. (La.) 37, 42.

Merrill v. Suffolk Bank, 31 Me. 57; Rankin v. Sherwood, 33 Me. 509. But see Whitman v. Cox, 26 Me. 335, 340.

• Muscatine Turn Verein v. Funck, 18 Iowa, 469.

Mumma v. Potomac Co., 8 Pet. (U.S.) 281.

Mumma v. Potomac Co., 8 Pet. (U.S.) 281, 286, per Story, J.; City Ins. Co. v. Commercial Bank, 68 Ill.

statutory systems, stockholders also have a standing to sue in equity to wind up the affairs of the corporation. It must also be kept in mind that it is within the power of every business corporation to prevent the results which the rules of the common law attach to a dissolution, by making an assignment of all its property, prior to its dissolution, in trust, for the benefit of its creditors."

§ 7721. Insolvency of Corporation No Defense to Actions against It.—From the foregoing principles, it follows that, in an action by a corporation against an individual, evidence that the corporation has become insolvent is inadmissible; for although such insolvency might be a ground for adjudging the corporate rights forfeited in proceedings against the corporation for that express purpose, yet it cannot be inquired into collaterally in an action brought by the corporation.3 If, therefore, an action has been brought against a corporation to enforce an obligation entered into by it, the plaintiff has the right to have the corporation retained as defendant, notwithstanding it may have become insolvent or may have disposed of its property in such a manner as to render the recovery of its judgment futile, and a motion to substitute an assignee for the corporation will be properly denied unless assented to by the plaintiff."

§ 7722. Dissolution by Reason of Non-user not Pleadable. The dissolution which alone is pleadable under the foregoing principles is an absolute, unqualified dissolution, such as has been denounced by a competent judicial sentence, or such as needs no judicial sentence to announce the fact. The foregoing principles have no application to a dissolution by the

348; Lindell v. Benton, 6 Mo. 361; Thornton v. Marginal Freight R. Co., 123 Mass. 32, 34; Habich v. Folger, 20 Wall. (U. S.) 1; ante, § 6692, et seq.

1 Krutz v. Paola Town Co., 20 Kan. 397; ante, § 4550, et seq.; and § 6692,

et seq.

Ante, § 6466; Sturges v. Vanderbilt, 73 N. Y. 384; 8. c. sub nom. Sturgis v. Drew, 11 Hun (N. Y.), 136.

Cahill v. Kalamazoo Mut. Ins. Co., 2 Dougl. (Mich.) 124; s. c. 43 Am. Dec. 457, 464.

Hood v. California Wine Co., 4 Wash. 88; s. c. 29 Pac. Rep. 768.

mere non-user of the franchises of the plaintiff corporation; for although such non-user might be a ground upon which the State could vacate the franchises of the corporation, yet this result cannot be accomplished by private individuals in a collateral way, by way of defense to an action brought by the corporation. The very fact of bringing the action is a revival of the corporation if dormant, and a user of its franchises if they have fallen into a state of non-user. Accordingly, where trustees of a religious corporation bring an action, colore officii, an objection that they were not regularly elected as such trustees cannot be sustained, unless it be shown that proceedings have been instituted against them by the government and carried to judgment of ouster.2

§ 7723. What Actions Abate and What Survive. - Assuming, then, that statutes exist preventing the dissolution of a corporation from putting an end to rights of action against it, the question arises whether those rights of action which, under the principles of the common law, abate on the death of a natural person, will abate on the dissolution of a corporation. It seems that this question must be answered in the affirmative. For instance, it has been held that an action by a cor

1 Cahill v. Kalamazoo Mut. Ins. Co., 2 Dougl. (Mich.) 124; s. c. 43 Am. Dec. 457, 465. See also Silver Lake Bank v. North, 4 Johns. Ch. (N. Y.) 370, 373; Vernon Society v. Hills, 6 Cow. (N. Y.) 23; s. c. 16 Am. Dec.

429.

Vernon Society v. Hills, 6 Cow. (N. Y.) 23; 8. c. 16 Am. Dec. 429. See also the same principle, Penobscot Boom Co. v. Lamson, 16 Me. 224; s. c. 33 Am. Dec. 656; Banks v. Poitiaux, 3 Rand. (Va.) 136; s. c. 15 Am. Dec. 706. Upon the same principle, it is held that the failure of a railroad company to commence the construction of its road within the time limited by its charter, does not, per se, work a forfeiture of its fran

chises without judicial determination, unless it is apparent, from the language of the statute, that the legislature intended that the statute should be self-executing without the aid of any judicial sentence. Ante, § 6582; Re Brooklyn Elev. R. Co., 32 N. Y. St. Rep. 1065; 8. c. 11 N. Y. Supp. 161. And even where there has been an absolute dissolution, such franchises as exist in perpetuity and as have been assigned by mortgage with the assent, express or implied, of the legislature, if in the nature of real property, survive, according to one view, and exist in perpetuity. People v. O'Brien, 11 N. Y. 1; 8. c. 19 N. Y. St. Rep. 173; 2 L. R. A. 255; 7 Am. St. Rep. 684; 18 N. E. Rep. 692.