Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/289

 PART III.] ACTS BEYOND THE CORPORATE POWERS. [§ 3056. § 3055. Such are the decisions. Nevertheless in the United States it would be difficult to find a railroad company that has not mortgaged its road and franchises, and in most instances under express legislative authority. And perhaps the majority of railroad companies either lease their own roads or hold leases of the roads of other companies. The words of Chief Justice Ruger, giving the opinion of the New York Court of Appeals in Woodruff v. Erie Railway Co., seem more in accord with present railroad customs and the tendency of legislation : " Whatever may be the rule in other states or in England, the public policy of this state, as manifested by numerous acts of the legislature, has always been, not only to afford the fullest scope for the consolidation and reorganization of non-coin peting railroads and railroad corporations, but also for the transfer of the use of such roads and their franchises by one corporation to another." x In regard to corporations with public duties to perform, ques- tions of ultra vires and illegality are apt to run into each other. In chartering a corporation of this character, the legislature may be presumed to have in view mainly the interests of the public ; and may further be presumed to express in the charter or enabling act the legislative conception of what is and what is not conducive to the public interests. Accordingly, an act done by such a corporation which is plainly unauthorized by its constitution may readily be held by the courts to be illegal and void as against public policy." Nevertheless, corporations with 24. See Jacksonville, etc., Ry. ». Hooper, 160 U. S. 514; and ante §283. 1 93 N. Y. 609, 618. Accord with this remark, Vermont & C. R. R. Co. v. Vermont Central R. R. Co., 34 Vt. 2, 49; Shepley v. Atlantic, etc., R. R. Co., 55 Me. 395, 407. The point de- cided in Woodruff v. Erie Railway Co. was that the lessee of a railroad could not plead that the lease was ultra vires the lessor company. It was held in Camden & A. R. R. Co. v. May's Landing, etc., R. R. Co., 48 N. J. L. 530, that the lessee could not plead to an action for rent due under a lease that the lease was beyond its powers. 2 It is not, however, against public policy for a railroad corporation to agree to do what it possesses no power to do, provided the agreement be conditioned on its receiving the requisite authority from the legisla- ture. Thus, it has been held that a corporation may agree to extend its road provided certain outsiders, rep- resenting business interests along the line of such proposed extension, will secure the requisite authority from the legislature. " It was in sub- stance an agreement to do something 269