Page:Harvard Law Review Volume 9.djvu/123

95 OWNERSHIP BY FOREIGN CORPORATIONS. 95 straint of trade, injurious to the public service, to prevent the course of justice, or contrary to good morals, — the public policy which the courts are justified in invoking is that only which is clearly manifested by the legislation or fundamental law of the State. The buying and selling or holding of real estate by a for- eign corporation does not fall within any of the classes of acts referred to. Accordingly, if it is forbidden by the public policy of a State, that policy must have been established by the law-making power of the State. It does not originate in the judicial tribunals. It is drawn solely from the constitution and statutes, and it is only by reference to their general scope that it is discovered and announced by the courts. It is the policy of the legislative, not of the judicial, department of the government. In the language of the New York Court of Appeals : ** The rules of comity are sub- ject to local modification only by the law-making power; until so modified, they have the controlling force of legal obligation. The franchises and immunities which they secure it is the duty of the courts to respect until the sovereign sees fit to deny them." ^ This proposition, of course, is subject to the condition that the business to be transacted is such as a natural non-resident person might lawfully transact in the State. In the absence, therefore, of a prohibitory law, or of legislative or constitutional provisions from which a settled policy to the con- trary may fairly be deduced, the courts should be bound by the law of comity, and recognize the right of a foreign corporation, author- ized thereto by the law of its creation, to acquire and hold lands within the State. The modern attitude of legislatures and courts toward foreign corporations is such that there is little occasion to consider the public policy of a State in the matter of lands acquired by corpo- rations of another State, to be held merely as incidental to the carrying on of a legitimate business, — as, for example, real estate devoted by the corporation to the purposes of a railroad or manu- facturing industry, or used as a warehouse or store in the carrying on of the corporate business. The subject assumes importance only in connection with corporate ownership of lands held purely as a direct source of pecuniary gain or income, as in the case of land companies, and religious, educational, and charitable institu- 1 Merrick v. Santvoord, 34 N. Y. 208. See also Hollis v. Drew Seminary, 95 N. Y. 166; Band v. Poole, 12 N. Y. 495; Lancaster v. A. I. Co., 140 N. Y. 576, 592.