Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/42

 § 31.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. III. entered into in its prosecution, would have been the manifesta- tion, not of corporation, but of partnership law. § 30. Incorporation, however, far from changing the legal effect of any and all acts which may be done by the persons who are corporators, changes the legal effect 1 only of acts done in respect to the corporate enterprise. The constitution of a cor- poration is operative only in relation to the purposes of incor- poration and the means of their attainment. It is only as to these purposes that the corporators, through incorporation, are enabled to act as an incorporated body ; and it is only acts in relation to the corporate enterprise that occasion the rules of law embraced in the constitution" of the corporation to operate upon the actors. Phrasing the whole matter somewhat differ- ently, it may be said that the corporators by incorporation ac- quire the legal competency to employ certain funds or other property for the attainment of a certain object in a manner in which it would not have been legally competent for an unin- corporated company to act. § 31. By far the most important of the acts which on the part of the corporators brin^ about incorporation, is mental the agreement, contained in the charter or articles or between 11 association, whereby the parties thereto agree that the rators rp °" ie g a ^ relations constituting the corporation shall arise between them. This agreement is fulfilled through incorporation, which causes certain of the contemplated legal relations to arise, and provides for the coming into existence of further legal relations upon the doing of further acts in respect to the corporate enterprise. Upon incorporation this agree- ment receives the sanction of the rules of law in the constitu- tion of the corporation, its terms becoming a part of the legal rules which manifest themselves in legal relations in respect to the corporate enterprise. Whether, and in what sense, the state may be regarded as a party to this agreement will be discussed in another chapter. 2 Here, it suffices to say, that the agree- ment thus embodied in the constitution of the corporation can- not be changed by the state unless the state reserves the power to change it ; and this amounts to saying that the constitution 1 Legal effect, i. e., the legal rela- 1 2 Infra, chap, viii., §§438 et seq. tions which an act occasions. ' 22