Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/393

 PART V.] CORPORATE ACTS WITHOUT THE STATE. [§ 391. corporation is composed of all the laws affecting the corpora- tion ; and embraces just as much statutes affecting corporations generally, as the particular statute — enabling act or special charter — immediately under which the corporation was organ- ized. 1 § 391. The correct distinction seems rather as follows : If the validity of an act, forbidden b} 7 the legislature of the state incorporating the foreign corporation on whose behalf or in regard to which the act was done, is to be passed on by the court of another state, by the true rule of comity the court should give effect to the prohibition according to the intent of the legislature enacting it. If the prohibition were apparently intended to inhere in the corporation, and to apply to all its acts wherever done, the court should give effect to it. 2 But if it was rather part of the local policy of the state enacting it, of local policy which there is no reason for extending beyond state limits, nor even any reason for supposing the legislature would have desired to see thus extended, then the prohibition should not be enforced by the courts of other states, at least in regard to acts and matters outside of the state enacting it. 3 The true rule was stated by Justice Christiancy in Thompson > Relfe v. Rundle, 103 U. S. 222. Compare Canada Southern R. R. Co. v. Gebhard, 109 U. S. 527, 537. The ordinary presumptions in favor of the legality of actions, how- ever, apply to foreign corporations. Thus, where a court has no judicial knowledge of the constitution of the foreign corporations, as, e. g., when it is chartered by a private law, the court will presume authority to do any reasonable act, until absence of authority be shown. Charleston, etc., Turnpike Co. v. Willey, 10 Ind. 34. See, also, Express Co. v. Rail- road Co., 99 U. S. 191, 199. 2 See Rue v. Missouri Pac. Ry. Co., 74 Tex. 474. 3 See Ohio Life Ins. Co. v. Mer- chants 1 Ins. Co., 11 Humph. (Tenn.) 1, 24. A statute forbidding corpora- tions to make assignments in con- templation of insolvency (said pro- vision not being contained in the statute under which the corporation in question was organized) is part of the local policy of the state (New York), and will not be enforced as to an assignment of property made in another state (Ohio), said prop- erty being in Illinois. Warren v. First Nat. Bk., 149 111. 9; ace. Pair- point Mfg. Co. v. Watch Co., 161 Pa. St. 17. The contract between a resi- dent shareholder and a foreign cor- poration is that embodied in the charter; and his rights are not af- fected by the general laws of the foreign state, incorporating the cor- poration, affecting remedies. Guil- ford v. West. Un. Tel. Co., 59 Minn. 332. 373