pose; (a) and unless an officer be elected and declared to hold during pleasure, the power of amotion as well as of disfranchisement ought to be exercised in a just and reasonable manner, and upon due notice and opportunity to be heard. (b)

(10.) Corporate powers strictly construed.

The modern doctrine is to consider corporations as having such powers as are specifically granted by the act of incorpora

tion, or as are necessary for the purpose of carrying into * 299 effect the powers expressly granted, and as not having any other. The Supreme Court of the United States declared this obvious doctrine, (c) and it has been repeated in the decisions of the state courts. (d) No rule of law comes with

(a) Angell & Ames on Corporations, 405. Bagg's case, 11 Co. 99.

(b) The Commonwealth v. Penn. Beneficial Institution, 2 Serg. & Rawlc, 141. But the power of disfranchisement and amotion is to be exercised by the corporation at large, unless it be by charter expressly confided to a particular person or select body. Angell & Ames on Corporations, 423, 3d edit. In this last edition of Messrs. Angell & Ames, the cases in which the power of amotion or disfranchisement may be or be not exercised, are collected and reviewed; pp. 408, 424, ch. 12. The acceptance of another incompatible office does not operate as an absolute avoidance of the former, in any case where the party could not divest himself of that office by his own act, without the concurrence of another. King v. Patteson, 4 Barnew. & Adol. 1.

(c) Head & Amory v. The Providence Insurance Company, 2 Cranch, 167. Marshall, Ch. J., 4 Wheaton, 636. Beaty v. Lessee of Knowler, 4 Peters's U. S. Rep. 163. Taney, Ch. J., in the case of the Bank of Augusta v. Earle, 13 Peters, 587. Runyon v. Coster, 14 ib. 122. Story, J., in the case of the Bank of the U. S. v. Dandridge, 12 Wheaton, 68.

(d) The People v. Utica Insurance Company, 15 Johns. Rep. 358, 383. 19 id. 1.

1 Plank Road Co. v. Douglass, 5 Seld. 444. Commonwealth v. E. & N. E. R. R. 27 Penn. 339. Russell v. Topping, 5 McL. 194. Perrine v. C. & D. Canal Co. 9 How. U. S. 172. And the powers of a corporation are strictly confined to the jurisdiction creating it; and therefore, if one state authorize the erection of a bridge, one end of which extends into another state, the corporation cannot collect toll of those who pass only the part of the bridge situated in the other state. Middle Bridge Corporation v. Marks, 26 Maine R. 326; see, also, Miller v. Ewer, 27 Maine R. 509. Freeman v. Machias W. P. & M. Co. 38 Me. 343. In these cases it was held, that all the proceedings of a meeting of the corporators held out of the state were void. An agreement by a Plank Road Co. in N. Y. to purchase its own stock was held against public policy and void. Barton v. Pl. Rd. Co. 17 Barb. 397. The right of a corporation to subscribe to stock in another corporation, organized for a different purpose, was denied in Savings Bank v. Meriden Agency Co. 24 Conn. 159. See also Hodges v. N. E. Screw Co. 1 R. I. 312, 3 R. I. 9. Sumner v. Marcy, 3 W. & M. 105. But a corporation may enter into a partnership with an individual for purposes connected with its legitimate business. Catskill Bank v. Gray, 14 Barb. 471.

a more reasonable application, considering how lavishly charter privileges have been granted. As corporations are the mere creatures of law, established for special purposes, and derive all their powers from the acts creating them, it is perfectly just and proper that they should be obliged strictly to show their authority for the business they assume, and be confined in their operations to the mode, and manner, and subject-matter prescribed. (a) The modern language of the English courts is to the same effect; (b) and in a recent case (c) it was observed, that

S. P. The N. Y. Firemen Insurance Company v. Ely, 5 Conn. Rep. 560. The N, Y. Firemen Insurance Company v. Sturges, 2 Cowen's Rep. 664, 675. The N. R. Ins. Co. v. Lawrence, 3 Wendell, 482. Savage, Ch. J., N. R. F. Ins. Co. v. Ely, 2 Cowen, 709. Life and Fire Ins. Co. v. Mechanic Fire Ins. Co. 7 Wendell, 31. First Parish in Sutton v. Cole, 3 Pick. Rep. 232. The State v. Stebbins, 1 Stewart's Ala. Rep. 299. Berlin v. New Britain, 9 Conn. Rep. 180. Angell & Ames on Corporations, 239, 2d edit. The New York Revised Statutes, vol. i. p. 600, sec. 3, have declared that no corporation shall possess or exercise any corporate powers not expressly given by statute, or by its charter, except such as shall be necessary to the exercise of the powers so enumerated and given. The case of Sharp v. Speir, and Sharp v. Johnson, 4 Hill's N. Y. Rep. 76, 92, are samples of the very strict and even stringent construction of the powers and proceedings of municipal corporations in respect to assessments, taxation, and sales of private property.2 By the New York Revised Statutes, 3d edit. vol. i. pp. 893, 894, all associations for banking purposes, and all banking operations unauthorized by law, are prohibited under a penalty. The prohibition extends equally to foreign corporations exercising business of banking in this state.8

(a) Corporate acts must not only be authorized by the charter, but those acts must be done by such officers or agents, and in such manner as the charter authorizes. Taney, Ch. J., in the Bank of Augusta v. Earle, 13 Peters, 587.

(b) Dublin Corporation v. Attorney-General, 9 Bligh, N. S. 395.

(c) Broughton v. The Manchester Water Works Company, 3 Barnew. & Ald. 1.

In the matter of Flatbush Avenue, &c. 1 Barb. S. C. Rep. 286. 3 id. 275. A power to erect a bridge, will authorize the purchase of one already erected. Thompson v. The N. Y. & H. R. R. Co. 3 Sandf. Ch. R. 625; see, also, Halstead v. Mayor of N. Y. 5 Barb. S. C. Rep. 218. In this case, a draft drawn by the Corporation of N. Y., was held void in the hands of a bona fide holder; the power to draw being conditional, and the charter a public act. S. C. 3 Comst. R. 430.

2 If the officers have unreasonably neglected to compel an assessment, the general funds of the corporation will be liable, otherwise not. Cumming v. The Mayor of Brooklyn, 11 Paige R. 596. Lake v. The Trustees of Williamsburgh, 4 Denio's R. 520.

* As to what will amount to keeping an office for banking purposes by a foreign corporation, see Taylor v. Bruen, 2 Barb. Ch. R. 301. It seems that the negotiable securities of foreign corporations, valid on their face, will be upheld in the hands of bona fide hoiders, without notice, though put in circulation in violation of the charter of the corporation, and of the laws of the state where issued. Stoney v. American L. Ins. Co. 11 Paige R. 635.

a corporation could not bind themselves for purposes foreign to those for which they were established. Where a corporation was created for purposes of trade, it resulted necessarily that they must have power to accept bills and issue notes. But if a company be formed, not for the purposes of trade, but for other purposes, as, for instance, to supply water, the nature of their business does not raise a necessary implication that they should have power to make notes and issue bills; and it seemed to be doubted whether there must not be an express authority to enable them to do it.3 The acts of corporation agents are construed with equal strictness; and it is the doctrine, that though a deed be signed by the president and cashier of a corporation, and be sealed with its corporate seal, yet the courts may look beyond the seal, and if it be affixed without the authority of the directors, and that fact be made affirmatively to appear, the instrument is null and void. (a) ⋆

*302

(a) The Mayor and Commonalty of Colchester v. Lowten, 1 Ves. & Beames's Rep. 245. Tilghman, Ch. J., in the case of St. Mary's Church, 7 Serg. & Rawle, 530. Leggett v. N. J. Man. and Banking Co. Saxton's R. 541. Every act of a public body acting under statute authority, which is to divest an owner of his property for any public purpose, without his consent, is to be strictly and rigidly pursued. Van Wickle v. Railroad Company, 2 Green's N. J. Rep. 162. The King v. Bagshaw, 7 Term Rep. 363. The King v. Mayor of Liverpool, 4 Burr. 2244. Rex v. Croke, Cowp. 26. Westervelt v. Corporation of New York, 2 Hoffman's Ch. Rep. See, also, supra, n. b, the cases of Sharp v. Spier, and of Sharp v. Johnson. There is a very valuable

1 But power to execute works incidental to main purpose will be presumed if exercised bona fide. Wright v. Scott, 34 E. L. & Eq. 1.

2 See Clarke v. School District, 3 R. I. 199. But a bank may not make an accommodation indorsement. Bank of Genesee v. Patchin Bank, 3 Kern. 309.

Hawtayne v. Bourne,

8 Mining companies have no implied authority to borrow money. 7 M. & W. 595. Ricketts v. Bennett, 4 Com. B. R. (56 Eng. C. L.) 686. Law J. R. (N. S.) C. P. 17. Aliter as to banking companies. Bank of Australasia v. Bank of Australia, 12 Jurist R. 189. Burmester v. Norris, 8 Eng. L. & Eq. 487. But the manager of a mine has authority to incur debts for wages and goods necessary to carry on the mine; and shareholders making bona fide advances of money, necessary to carry on the mine, will be allowed such advances. German Mining Company, in re, 19 Eng. L. & Eq. 591. Moss v. McCullough, 7 Barb. 279. Sacket's Harbor Bank v. Lewis County Bank, 11 Barb. 213. N. Y. L. I. & T. Co. v. Beebe, 3 Seld. 364.

4 It is held, in 1 Selden R. 320, Hoyt v. Thompson, (reversing the decision of the court below, 3 Sandf. S. C. R. 416,) that where the charter entrusts the management of a corporation to a board of directors, the president and cashier, unless specially authorized, have no power to assign the choses in action of the company as security for a precedent debt. Nor can the stockholders act, the power being by the charter placed in the directors. Conro v. Port Henry Iron Co. 12 Barb, R. 27.

IV. Of the visitations of corporations.

I proceed next to consider the power and discipline of visitations to which corporations are subject. It is a power applicable only to ecclesiastical and eleemosynary corporations; (a) and it is understood that no other corporations go under the name of eleemosynary but colleges, schools, and hospitals. (b) The visitation of civil corporations is by the government itself, through the medium of the courts of justice. And in the case of the failure or want of a visitor over a private eleemosynary foundation, the duties of a visitation devolve, in England, upon the crown, and is exercised at the present day not by the K. B., but by the lord chancellor in his visitorial capacity. (c) As it has been determined in New York, (d) that the chancellor cannot act in a visitorial character, the jurisdiction in such a case would revert to the courts of law, according to the ancient English practice, to be exercised under common-law process. (e)

To eleemosynary corporations, a visitatorial power is attached as a necessary incident. The nature and extent of this power were well explained by Lord Holt, in his celebrated judgment in the case of Philips v. Bury. (f) If the corporation be public, in the strict sense, the government *has the sole right, as trustee of the public interest, to *301 inspect, regulate, control, and direct the corporation, and its funds and franchises, because the whole interest and franchises are given for the public use and advantage. Such corporations are to be governed according to the laws of the land. The validity and justice of their private laws are examinable in the courts of justice; and if there be no provision in the char

discussion on the nature, power, and restriction of the transfer of corporate stock in ch. 16 of Angell & Ames on Corporations, 3d edit. p. 499, and the numerous American cases are there cited and examined. The subject is rather of too practical a nature to admit, in a work of this character, of a digest of the many and nice distinctions, and I must refer the student to the treatise itself.

(a) 1 Blacks. Com. 480. 2 Kyd on Corp. 174.

(b) 1 Woodd. Lec. 474.

(c) The Attorney-General v. Dixie, 13 Ves. 519. The Same v. Clarendon, 17 ibid.

491.

(d) Auburn Academy v. Strong, 1 Hopkins's Ch. Rep. 278.

(e) Rex v. Bishop of Chester, Str. Rep. 797.

(f) Skinner's Rep. 447. 1 Lord Raym. 5, S. C. 2 Term Rep. 346.

ter how the succession shall continue, the law supplies the omission, and says it shall be by election. But private and particular corporations, founded and endowed by individuals for charitable purposes, are subject to the private government of those who are the efficient patrons and founders. If there be no visitor appointed by the founder, the law appoints the founder himself, and his heirs, to be the visitors. This visitatorial power arises from the property which the founder assigned to support the charity; and as he is the author of the charity, the laws give him and his heirs a visitatorial power; that is, an authority to inspect the actions and regulate the behavior of the members that partake of the charity. This power is judicial and supreme, but not legislative. He is to judge according to the statutes and rules of the college or hospital; and it was settled, by the opinion of Lord Holt, in the case of Philips v. Bury, (and which opinion was sustained and affirmed in the house of lords,) that the decision of the visitor (whoever he might be) was final, and without appeal, because the doctrine is, that the founder reposes in him entire confidence that he will act justly. (a) In most cases of eleemosynary establishments, the founders do not retain this visitatorial power in themselves, but assign or vest it in favor of some certain specified trustees or governors of the institution. It may even be inferred, from the nature of the duties to be performed by the corporation or trustees for the persons interested in the bounty, that the founders or donors of the charity meant to vest the power of visitation in such trustees. This was the case with Dartmouth Col

lege, according to the opinion of the Supreme Court *302 * of the United States, in the case of Dartmouth College v. Woodward. (b) Where governors or trustees are appointed by a charter, according to the will of the founder, to manage a charity, (as is usually the case in colleges and hospi

(a) In Shipley's case, who was expelled from his college in Oxford University for publishing a libel and being guilty of general immorality, he appealed to the king as visitor, and the appeal was heard before Lord Chancellor Camden. The judgment of the chancellor was most masterly, and the decree of the dean and chapter was reversed, as most arbitrary and unjust, and contrary to the "first principles of common 'justice." Campbell's Lives of the Lord Chancellors, vol. v. 364.

(b) 4 Wheaton, 518.