Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/436

 § 434.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. VII. Surrender of fran- chises. § 433. It is said very generally in older cases, that a corpo- ration cannot validly surrender its franchises unless the state accepts them. " Charters are in many re- spects compacts between the government and the corporators. As the former cannot deprive the latter of their franchises in violation of the compact, so the latter cannot put an end to the compact without the consent of the former. It is equally obligatory on both parties. The surrender of a charter can only be made by some formal act of the corporation, 1 and will be of no avail until accepted by the government. There must be the same agreement to dissolve that there was to form the compact. It is the acceptance which gives efficacy to the surrender. The dissolution of a corporation, it is said, extinguishes all its debts. The power of dissolving itself by its own act would be a dangerous power, and one which cannot be supposed to exist." 3 It is also said that " the modes in which a surrender is to be made, and as to what facts consti- tute a surrender, have been a fruitful subject of discussion in the courts of this country. In England, the surrender is by deed to the king, by whom corporations are usually created by charter. In this country, corporations are created by an act of the legislature, and it would seem to follow, in the absence of any statute prescribing the mode in which a surrender is to be made, that to become available, it must be accepted by the authority which created the corporation." 3 § 434. The present applicability of the preceding citations to stock corporations is somewhat doubtful. Formerly, corpora- tions usually received special charters ; but now stock corpora- tions at least are almost universally organized under general enabling acts. A mode of dissolution is ordinarily provided ; See Kimball v. Goodbum, 32 Mich. 10; New York Marbled Iron Works v. Smith, 4 Duer (N. Y. ), 362. 1 Not the officers, but only the shareholders of a corporation can surrender its franchise. Jones v. Bank of Leadville, 10 Col. 464. 2 Boston Glass M'f'y v. Langdon, 24 Pick. 49, 53. Accord, Town v. Bank of River Raisin, 2 Dougl. (Mich.) 530, 538; Lagrange, etc., R. 416 R. Co. v. Rainey, 7 Coldw. (Tenn.) 420, 438; Revere v. Boston Copper Co., 15 Pick. 351; Mechanics' Bank v. Heard, 37 Ga. 401; Wilson ». Propri- etors, etc., 9 R. I. 590; Norris v. Mayor of Smithville, 1 Swan. (Tenn.) 164; 2 Kent's Com., 311. Cf. Attor- ney-Gen. v. R. R. Co., 93 Wis. 604. 3 Town v. Bank of River Raisin, 2 Dougl. (Mich.) 530, 538.