Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/536

 § 504.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. VIII. statute. 1 The legal effect of the repeal by the legislature of a charter of a corporation is clearly stated in the following words of Justice Miller, giving the opinion of the court in Greenwood v. Freight Company: 2 "Whatever force the law may give to transactions into which the corporation entered, and which were authorized by its charter when in force, [after the repeal of its charter] it can originate no new transactions dependent on the power conferred by the charter. If the corporation be a bank, with power to lend money, and to issue circulating notes, it can make no new loan nor issue any new notes designed to circulate as money. If the essence of the grant of the charter be to operate a railroad, and to use the streets of a city for that purpose, it can no longer so use the streets of the city, and no longer exercise the franchise of running a railroad in the city. In short, whatever power is dependent solely upon the grant of the charter, and which could not be exercised by unincorporated private persons under the general laws of the state, is abrogated by repeal of the law, which granted these special rights. Personal and real property acquired by the corporation during its lawful existence, rights of contract, or choses in action so acquired, and which do not in their nature depend upon the general powers conferred by the charter, are not destroyed by such repeal ; and the courts may, if the legislature does not provide some special remedy, enforce such rights by the means within their power. The rights of the shareholders of such a corporation to their interest in its property are not annihilated by such a repeal, and there must remain in the courts the power to protect those rights." 3 1 Freehold Mutual Loan Associa- tion v. Brown, 29 N. J. Eq. 121 ; Wilson v. Tesson, 12 Ind. 285. a 105 U. S. 13, 18. See, also, Peo- ple o. O'Brien, 45 Hun (N. Y.) 519. 3 " Lawful dissolution of a cor- poration will destroy all its corpo- rate franchises or privileges vested by the act of incorporation ; but if it holds rights, privileges, or fran- chises having the nature of prop- erty, secured by contract based on valuable consideration, these will survive the dissolution of the cor- 516 poration for the benefit of those who may have right to or just claim upon its assets." Interna- tional & G. U. R'y Co. v. State, 75 Tex. 356, 378. Opinion of court, per Staytou, C. J. In the case of the Broadway Sur- face Railroad Co., which was dis- solved by act of the legislature, it was held that its rights derived from grant from New York City, e. g., its street rights and franchise to run a railroad in Broadway, sur- vived, as did also its mortgages and