to perform their duties to the public, or to individuals. For example, where a railroad company, with the power of eminent domain, has constructed and operated its road, it will be compelled by mandamus to accept and transport freight, notwithstanding there is a strike of employees for higher wages, there being no violent interference by the employees (3). So, where a street railway company refused to transfer a passenger from one part of the road to another, without the payment of an extra fare, where the terms of the grant required such transfer, the passenger could compel the company by mandamus to transfer him (4). But where a corporation had merely the privilege and not the duty of the placing its car tracks in certain streets, it would not be compelled to place or keep them there (5). § 157. Control by courts of equity. These courts have no general jurisdiction to dissolve corporations, though it has been held that where dissolution was necessary to prevent the continuance of a fraud, in a suit of which the court has jurisdiction because of the fraud, it could go to the extent of decreeing dissolution; such power, under similar circumstances, is frequently conferred on such courts by statute. Neither do courts of equity usually have power to enjoin ultra vires corporate acts, without other grounds of jurisdiction. An injunction may be granted upon the application of the state, whenever a corporation is abusing the power given it for a public purpose, or acting adversely to the public, or creating a (3) People v. N. Y. Central Ry. Co., 28 Hun (N. Y.) 543. (4) Richmond Ry. Co. v. Brown, 97 Va. 25. (5) San Antonio St. Ry. Co. v. State, 90 Tex. 520. nuisance, or threatening to do these; or to prevent a dissipation of the funds of a public charitable trust, when the beneficiaries are so numerous and indefinite that the trust can be preserved only through the public authority. A shareholder may enjoin the acceptance of fundamental changes, the diversion of the funds, or the completion of executory ultra vires contracts. Where one member of a corporation obtains control of it, and fraudulently appropriates all its income by an excessive salary paid to himself as president, and by excessive rent paid to himself for property leased to the corporation, a court of equity may decree dissolution to prevent the continuance of the fraud (6). So, too, the state may have an injunction to prevent the giving of a prize fight exhibition by an incorporated athletic club (7). But the state cannot, by an injunction in a court of equity, prevent an ice company from manufacturing linseed oil. The remedy is quo warranto in a court of law (8). § 158. Indictment. This has been sufficiently considered above (§ 150), in discussing corporate liability for crimes. At common law corporations were subject to indictment for public nuisance, and are now generally for such, and for violation of anti-trust, safety appliance, and pure-food laws, giving rebates, and matters of a similar kind. § 159. Control by private visitor. In the case of charitable corporations, the person who endowed the charity (C) Miner v. Belle Isle Ice Co., 93 Mich. 118. (7) Columbian Athletic Club v. State, 143 Ind. 98. (8) Atty.-Gen. v. Tudor Ice Co., 104 Mass. 239. had, at common law, the right to appoint a visitor to see if the funds were applied according to the terms of the gift; if he did not appoint any, the right to do this resulted to himself and his heirs; but, since we have abolished the English primogeniture rules of descent, and all of a man's children become his heirs, such method of visitation is impracticable, though, if not waived, the legal right yet remains. Statutes, however, usually provide other methods, and such visitorial rights, unless otherwise provided, are presumed to be vested in the corporate trustees (10). § 160. Control by public visitor. In most of the states there are railroad, insurance, and other commissioners, whose duty it is to inquire into and report upon the condition of various kinds of corporations; these are provided for the protection of the public, and have been held to be valid methods of the state in supervising such corporations as are likely to become injurious if not looked after in some such way (11). § 161. Control by the legislature. This is either: (1) Ordinary, or (2) extraordinary. In the exercise of the ordinary legislative powers corporations are subject to the power of eminent domain, the police power, and the taxing power. In the exercise of extraordinary powers, under some circumstances, corporate charters may be (a) repealed, or (b) amended. § 162. Power of eminent domain. Corporations, like natural persons, are subject to the power of the state to (10) Trustees of Dartmouth College v. Woodward, 4 Wheat. 518. (11) Weld v. Gas Co., 197 Mass. 556. take any of their property or their franchises for public purposes upon making due compensation. The general rule, however, is that property already devoted to a public use cannot be taken for another public use without express authority; and it is sometimes said that the new use must be different from the old use-that is, one railroad company could not be authorized to take the whole line of another railroad company to be operated in the same way; horse street-railways however have been taken by electric companies, and toll-roads have been taken by the state and turned into free roads. And so, where a bridge company was incorporated with the exclusive right to build a toll bridge over a river and take the tolls for its use, such bridge and the right to take tolls may be taken under the power of eminent domain, and upon payment therefor may be converted into a free bridge (12). § 163. Police power. Corporations are subject to the police power of the state, the same as individuals; although they may be chartered for the express purpose of carrying on a lottery or manufacturing liquor, subsequent legislation may forbid such acts, without impairing the contract, for the reason that no one can obtain a vested right in any business that is dangerous to the public health, the public morals, or the public safety. The state cannot surrender or barter away its control over these subjects. Under this power, also, the rates to be charged by a public service company (within the limit that forbids depriving them of their property without due process of law) may be fixed or regulated; so reports from in (12) West River Bridge Co. v. Dix, 6 How. 507. surance, trust, building and loan, bank, and other like companies, may be required for the protection of the public. The general limits to this power are that, in case of lawful businesses, property cannot be confiscated by the state, vested rights divested, nor the performance of national functions interfered with, by the state legislation. For example, where a lottery company paid five thousand dollars to the state, and agreed to pay one thousand dollars as an annual tax for the privilege of carrying on a lottery, for twenty-five years, the state could revoke this privilege at any time, without specifically reserving the right to do so, and without repayment to the corporation of any money received (13). Or, a state can pass a law repealing an existing license law, and forbid the further manufacture of liquors and sale of liquors made prior to the prohibitory law, without "depriving any one of his property without due process of law" (14). § 164. Taxation. The state's power to tax corporations is the same as in the case of individuals. The corporate elements of taxation are (15): (1) the primary franchise; (2) the secondary franchises; (3) the property, real or personal, tangible or intangible; (4) the capital stock authorized, subscribed, or paid in; (5) earnings, gross or net, or profits; (6) the shares of stock owned by shareholders. It is possible that all of these might be taxed at one time without being illegal, though it would be what is in some sense double, or treble, or quadruple (13) Stone v. Mississippi, 101 U. S. 814. |