Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/529

 CHAP. VIII.] CORPORATION AND STATE. [§ 500. tion, " is one over the act itself, not over anything that may have lawfully been done under the act before its repeal or alteration. It is only by great confusion of things essentially distinct, that this power can be construed as applicable to a contract made after the corporation came into existence." 1 The following passage from the opinion of Chief Justice Waite in the same case, may also be quoted : " Whatever rules Con- gress might have prescribed in the original charter for the government of the corporation in the administration of its affairs, it retained the power to establish by amendment. 2 In so doing, it cannot undo what has already been done, and it cannot unmake contracts that have already been made ; but it may provide for what shall be done in the future, and may direct what preparation shall be made for the due performance of contracts already entered into. It might originally have prevented the borrowing of money, or it might have said that no bonded debt should be created without ample provision by sinking fund to meet it at maturity. Not having done so at first, it cannot now by direct legislation vacate mortgages al- ready made under the powers originally granted, nor release debts already contracted. A prohibition now against contract- ing debts will not avoid debts already incurred. . . . All such legislation will be confined in its operation to the future." 3 § 500. For further illustration of the application of these principles let us suppose a corporation formed under a general enabling act (or with a special charter, this tion. Reia- is immaterial); the state reserving the right to tween 6 " amend or appeal the enabling act. Let us suppose errand 015 * that the shareholders under this enabling act are creditors. 1 See Oldtown, etc., R. R. Co. v. Veazie, 39 Me. 571. The reservation of the right to alter and repeal does not authorize the legislature to do a judicial act, such as foreclosing a mortgage by legislation cutting off the mort- gagor's right to redeem (the mort- gagor being a corporation with a charter subject to alteration and repeal). Asbuelot R. R. Co. v. Elliot, 58 N. H. 451. 2 Quoted in Spring Valley Water Works v. Schottler, 110 U. S. 347, 353. See St. Louis, I. M. R., etc., R'y Co. v. Paul, 173 U. S. 404; Johnson v. Goodyear M'g Co., 127 Cal. 4; Lin- coln St. R. Co. v. Lincoln, 61 Neb. 109. 8 Sinking Fund Cases, 99 U. S. 700, 721. See, also, Close v. Glenwood Cemetery, 107 U. S. 466. 509