corporation required its officers annually, between the first and twentieth of January, to make and publish a certain report: held, that a company incorporated in May, 1867, was bound to make and publish such report in the following January.

Union Iron Co. v. Pierce, 4 Biss. 327.*

Annual Report-Explanatory Statute Void. And an act of the legislature declaring the meaning of the section under which such annual report was required and personal liability thereunder attached is utterly void.

Union Iron Co. v. Pierce, 4 Biss. 327.

Duty to Sell Assets and Pay Debts.-Where the lands of a coal company, its shafts, railroad tracks, rails, and mining rights were sold under a deed of trust given to secure the payment of its bonds, and brought a sum sufficient to pay the bonds, and the company owed other debts, it was held that it was not only the right but the duty of the directors to sell the remaining property to meet the other liabilities of the company, and that they might authorize its sale at auction by the party selling under the trust deed.

Harts v. Brown, 77 Ill. 226.

Issuing Currency Notes- Proof of Office.-In a suit for a penalty against a mining corporation for illegally issuing notes, the official character of the officer signing such notes may be sufficiently proved by showing that he acted as such officer de facto.

McGargell v. Hazelton Coal Co., 4 Watts & S. 424.

Issuing Corporate Paper to Circulate as Money. --An act to prevent mining and other corporations from issuing bills or notes, "upon loans," or to circulate as money, construed to not prevent a corporation issuing its notes in the usual course of business for money borrowed by it, holding that the word "loans" in the statute prohibited issuing of notes only where the corporation was the lender.

Magee v. Mokelumne M. Co., 5 Cal. 258.

Proceedings Outside of State.-Although a corporation, as such, can do no corporate act out of the limits of the state granting its charter, yet its agents and officers may bind it by contracts and engagements made in other states, and the minutes of its board of directors may be used as evidence of the acts of the board, even though the meetings of the board appear to have been held out of the state chartering the corporation. Wood Hydraulic H. M. Co. v. King, 45 Ga. 34.

§ 677. Organization-Taking Grant before Organization.-A corporation may take real estate by grant before it has such an organization, by the election of officers, etc., as to enable it to enter upon the transaction of general business.

Vermont M. & Q. Co. v. Windham Bank, 44 Vt. 489.

Cause of Action Arising before Incorporation.-Thompson contracted to buy an interest in two oil wells; afterward an oil company was incorporated, to which Thompson transferred his interest; the vendors in the mean time receiving and selling the oil. By agreement the vendors made the deed to the corporation, and dated it back to the date of the contract, agreeing to deliver Thompson's share of the oil to the company: held, that these facts constituted an original contract between the vendors and the company; and that assumpsit could be maintained by the company in its own name for oil received between the time of the contract and the incorporation.

Snow v. Thompson Oil Co., 59 Pa. St. 209.

Agreement between Organizers.-Where two brothers, contemplating the formation of a private corporation, purchased certain coal lands and mining rights, and agreed, when the purchase was made, that they were to have an equal interest in the stock of the company, and to make equal payments on account of the purchase and for carrying on the business; and after the incorporation one of them advanced various sums of money in payment of drafts of the corporation, and in taking up its indebtedness, for which he was credited upon the books of the company: held, in a suit against the corporation to recover such advances, that the agreement was intended only to bind each brother to advance equal amounts as loans, and not as donations, and even if this were not so, that the corporation could not set up the agreement as a defense, as it was no party thereto; the court could only look to the legal liabilities of the company.

Merrick v. Peru Coal Co., 61 Ill. 472; S. C., 79 Id. 113.

Contract as to Organization-Equities between Corporators Disregarded.—In a suit by an individual against a corporation for money alleged to be due from the defendant to the plaintiff, the defendant sought to prove, that before the organization of the corporation defendant, a contract was entered into between the plaintiff and his brother, that they would advance equal amounts for the purchase of property and carrying on the business of the corporation; that they would purchase and hold

stock in the corporation in equal amounts; that if one advanced more than the other, the one dvancing the lesser sum should pay the other such sum as would make their advances equal; and that the money sued for was advances made by the plaintiff in pursuance of this agreement: held, that the corporation was not a party to this agreement, and had no concern with it; that the court could look alone to the legal liabilities of the corporation, without regard to the equities between the plaintiff and his brother, and that the evidence was properly excluded.

Peru Coal Co. v. Merrick, 79 Ill. 112; see Merrick v. Peru Coal Co., 61 Id. 472.

Organizer Conveying Mine-Resulting Trust.-When one conveys all his interest, say one hundred and thirty-seven and one half feet, in a mining company's claim, to trustees to form a corporation, in trust that he is to receive shares in the corporation equivalent to his number of feet in the claim, and afterward conveys the same feet to another party with warranty of title, the last grantee takes an equity, and is entitled to the shares to be issued in lieu of these feet. When, in such case, the company had issued the stock to the last grantee, or the party equitably entitled thereto, the court should not compel them to issue to another, especially when that other can only show his claim by proving his own fraud.

O'Mera v. North American M. Co., 2 Nev. 113.

Legal Existence.- Corporations in California have a legal existence from the date of filing their certificate of incorporation in the office of the county clerk.

Mokelumne Hill Co. v. Woodbury, 14 Cal. 424.

Commencement-First Meeting.-A corporation exists under the general statutes, chapter 61, section 1, so as to be able to contract debts as soon as its first meeting has been held and its officers have been chosen, if not immediately upon the signing of the articles of association.

Haws v. Anglo-Saxon Petroleum Co., 101 Mass. 385.

Proof of Organization or Charter.-To establish the existence of a corporation de facto, a charter or some law under which the assumed powers are claimed to be conferred, and user of the franchise thereby obtained, must be shown.

Abbot v. Omaha Smelting Co., 4 Neb. 416.

The existence of a corporation (mining), founded under a general statute requiring certain acts to be done before the cor

poration can be considered in esse, when denied, must be proved by showing at least a substantial compliance with the requirements of the statute.

Mokelumne Hill Co. v. Woodbury, 14 Cal. 424.

But as to such acts as are not made prerequisite to the assumption of corporate powers, the corporation is responsible only to the government in a direct proceeding for forfeiture; and of this class is the fact that a duplicate certificate has not been filed in the office of the secretary of state.

Mokelumne Hill Co. v. Woodbury, 14 Cal. 424.

Filing Certificates, Statutory Organization.—The signing of articles of association by parties proposing to form a manufacturing corporation does not create such corporation; the subscribers must also make, sign, and acknowledge the certificate of incorporation prescribed in section 1 of the act for the incorporation of manufacturing corporations, and must file the same in the recorder's office of the proper county, and a duplicate thereof in the office of the secretary of state. Unless these steps have been taken, the corporation has no legal existence.

Indianapolis Furnace M. Co. v. Herkimer, 46 Ind. 142.

The statute of Nevada requiring certificates of incorporation of mining companies to state the names of trustees who shall act for the first six months, implies necessarily that a new election must be held at the expiration of such period, or within a reasonable time thereafter, notwithstanding the section allowing the time of annual election to be fixed by the by-laws.

Flagg v. Lady Bryan M. Co., 4 Nev. 401.

Certificate, not Acknowledged.-The certificate of incorporation of a company claiming in good faith to be a corporation under the laws of this state, and doing business as such corporation, is admissible in evidence in a private suit to which the company is a party, as evidence of its right to act as a corporation, although it is not acknowledged by all the corporators.

Dannebroge G. Q. M. Co. v. Allment, 26 Cal. 286.

Organization- Nul Tiel Corporations.—As to the plea of nul tiel corporation where a corporation has not complied with the statutory requirements as to organization, and the burden of proof in such case, see Indianapolis F. & M. Co. v. Herkimer, 46 Ind. 142.

Collateral Attack.-The right of a company doing business as a corporation de facto, and claiming in good faith to be a corporation under the laws of this state, to act as a corporation, can

not be inquired into collaterally in a private action to which the corporation de facto may be a party.

Dannebroge G. Q. M. Co. v. Allment, 26 Cal. 286.

If there is any defect in the proceedings for the organization of a corporation, or any abuse of its powers, or of the statute authorizing the formation of corporations under general or specific laws, the question is one of law, and it is for the state alone to take steps to dissolve such corporation, or forbid the exercise by it of corporate rights and franchises.

Doyle v. Peerless Petroleum Co., 44 Barb. 239.

Nul Tiel Corporation.—It can not be shown in a collateral proceeding that a corporation (mining) has forfeited its charter. Crump v. U. S. M. Co., 7 Gratt. 352.

§ 678. Defective Charter-Legislative Recognition.-Defects in the proceedings to incorporate a company are cured by the subsequent recognition of the existence of the corporation by the legislature of the state under whose authority it claims to have been incorporated.

Kanawha C. Co. v. Kanawha & O. C. Co., 7 Black, 391.

When a company had attempted an organization for both mining and manufacturing purposes, and their charter had been subsequently recognized by the legislature by the passage of an act amendatory thereto: held, that such act of the legislature cured the defect, if any existed, and rendered the incorporation valid ab initio.

Basshor v. Dressel, 34 Md. 503.

Regularity of Proceedings.-It is not incumbent on a person lending money to a joint-stock company to ascertain that all the proceedings of the company and its shareholders inter se have been strictly regular.

Bank of Australasia v. Willan, L. R., 5 P. C., 418.

Estoppel of Trustees as to Organization.-The trustees of a corporation who signed the certificate of incorporation and accepted the office of trustee are estopped from denying the validity of the act of incorporation.

Parrott v. Byers, 40 Cal. 614.

Void Charter.-The certificate of a ditch and mining company, which does not set forth the name of the city or town and county in which its principal place of business is to be located, does not establish the existence of a corporation.

Harris v. McGregor, 29 Cal. 124.