Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/451

 CHAP. VIII.] CORPORATION AND STATE. [§ 450. bring the actors under the operation of rules of law contained in the constitution of the corporation, shall continue to have that effect ; shall continue to bring the actors within the oper- ation of those same rules of law and occasion the same legal relations. Much confusion seems to have arisen from the omission of courts and law writers to specify more definitely what the contract between the corporation and the state really is. It is said that the charter of a corporation is a contract between the corporation and the state. But it is clear that the terms and provisions of the charter are not the terms and provisions of a contract between the state and the corporation in the sense in which the terms and provisions of a written agreement be- tween A. and B. are the terms and provisions of a contract between them. Ordinarily in a charter or enabling act the state does not purport to contract with the corporation nor the corporation with the state. The terms and provisions of the charter or enabling act are rather rules of law which will manifest themselves in legal relations among the corporators, and between them and other persons contracting in respect of the corporate enterprise. The agreement on the part of the state is that it will not alter or repeal these rules of law. Apply the ordinary definition of a (executory) contract — an agreement to do or not to do a particular thing — to a char- ter or enabling act, and it will appear that the state does not agree to do anything, except (impliedly) not to alter the char- ter or enabling act as a rule of law, and (impliedly) to enforce it as a rule of law. For instance, a statute authoriz- ing the building of a toll-bridge over a navigable river by a corporation " with two suitable draws, which shall be at least thirty feet wide," was held to constitute when accepted a con- tract between the state and the corporation, which the state could not constitutionally alter by a subsequent statute re- quiring the corporation to maintain larger draws. 1 It is ap- parent that the contract in this case between the corporation and the state was simply that the state would not repeal or modify the former statute. To be sure a state may make other and further contracts with a corporation ; e. g., it may agree 1 Commonwealth v. New Bedford Bridge, 2 Gray, 339. 431