Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/392

 § 390.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. VU. on the powers of foreign corporations contained in the general laws of the state incorporating them ; but only that persons dealing with the corporation would not be affected with notice of such provisions. The court continue, as follows : " Our citi- zens acting here in dealing with or in relying upon the acts of such a corporation, are bound to notice and regard the provisions of such charter, but are not affected by or bound to notice the general laws of the foreign state, although they may restrain the powers of such corporations under the charter." ' An ex- amination of the same case on appeal 2 will show that if the citizen of JS'ew York, in this instance, had had notice of the foreign law, the New York court would have given full effect to it, and would have recognized the disabilities imposed by it on the foreign corporation. 3 § 390. Admitting it to be proper for the courts of a state to protect its own citizens from the hardships they might suffer were they bound to know the laws of a foreign state, 4 it is sub- mitted that the distinction indicated above is neither conven- ient nor correct on principle. It is not convenient, for now- adays the vast majority of corporations are incorporated under general statutes, and have no " charters " properly speaking ; so the distinction is fast losing its applicability. And the dis- tinction seems incorrect on principle ; it being a curious comity which will recognize in corporations powers which, under their own constitutions, they do not possess. The constitution of a 1 lb. See, also, Pairpoint Mfg. Co. v. Watch Co., 161 Pa. St. 17. A court will not take judicial notice of the powers of a foreign corporation. Chapman v. Colby, 47 Mich. 46. The corporation must prove its powers. Diamond Match Co. v. Powers, 51 Mich. 145. 2 10 N. Y. 207, 222, sub nom. Hoyt v. Thompson's Executor. Compare Hoyt u. Thompson, 5 N. Y. 320, 353. 3 The New York Court of Appeals seems not to have adhered to the above distinction in the case of Ells- worth v. St. Louis, etc., R. R. Co., 08 N. Y. 553. There it was decided that wlien a railroad company incor- porated by another state enters into 372 a contract in New York, which, by its terms, is to be performed in New York, and is legal under New York laws, prohibitions in the charter which would render the contract il- legal in the state incorporating the company, do not render it illegal in New York; but operate only as re- strictions on the power of the cor- poration and its officers. 4 See § 389. But compare Relfe v. Rundle, 103 U. S. 222, 224; and Bockover v. Life Association, 77 Va. 85, which holds that every one deal- ing with a corporation, even in a foreign state, must take notice of its powers. See, also, Republican, etc., Mines v. Brown, 19 U. S. App. 203.