Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/52

 §51.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. HI. however, a third meaning of the term corporation which, though not entirely fortunate, is so much in the minds of courts and business men that it cannot be overlooked. In business and in the courts the term corporation is often used as if it were synonymous with the name by which action is usu- ally taken in regard to corporate matters. A name is employed for purposes of suit in the courts, and a name is employed for ordinary business dealings. The corporate name and the term corporation have thus become synonymous in practical usage. This is not always for the best. The corporate name in one lawsuit, or appended to one contract, may stand for very dif- ferent interests from what it stands for in another lawsuit or another contract. In treating the name of the corporation as synonymous with the term corporation the results have been at times as misleading as the continuance of the fiction of the legal person. This last method of employing the term must, however, be borne in mind in any consideration of corporation law. the impalpable and intangible crea- tion of human thought is itself a fic- tion, and has been appropriately de- scribed as a figure of speech. It serves very well to designate in our minds the collective action and agency of many individuals as per- mitted by the law; and the substan- tial inquiry always is what in a given case has been that collective action and agency? " People v. North River Sugar Refining Co., 121 N. Y. 582, 621, Opin. of Ct. per Finch, J. " The general proposition that a corpora- tion is to be regarded as a legal entity, existing separate and apart from the natural persons composing it, is not disputed; but that the state- ment is a mere fiction .... is well 32 understood. ... It has been intro- duced for the convenience of the com- pany in making contracts, in acquir- ing property for corporate purposes, in suing and being sued, and to pre- serve the limited liability of the stockholders, by distinguishing be- tween the corporate debts and prop- erty of the company, and of the stockholders in their capacity as in- dividuals." State v. Standard Oil Co., 49 O. St. 137, 177, Opin. of Ct. per Minshall, J. For the matters decided in these two cases see § 309 b. As to the popular business way of regarding a partnership as an entity, see Bank of Buffalo v. Thompson, 121 N. Y. 280.