Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/539

 CHAP. VIII.] CORPORATION AND STATE. [§ 507. of the corporate enterprise, would usually come up between creditors and the corporation ; j or between creditors and share- holders or directors; 2 or among creditors. 3 However, when a state, that has provided in the charter of a bank that its bills shall be receivable for state taxes, attempts to repeal this pro- vision, the question of the constitutionality of the repeal would arise directly between the state officers and the billholders. Such a provision is held to constitute a contract between the state and the holders of the bank bills in circulation, and a contract which the state cannot affect by subsequent legisla- tion. 4 1 E. g., where the legislature of a state authorized commissioners to borrow money to be used in making a canal, and, for the redemption of the loan, pledged the canal, with its tolls and lands, the lien of a lender under the act cannot be divested or postponed by subsequent legislation. Trustees of the Wabash and Erie Canal Co. v>. Beers, 2 Black, 448; compare Curran v. Arkansas, 15 How. 304; § 501. The legislature may constitution- ally enact a law providing that, un- less a creditor of an embarrassed corporation expresses his dissent within a specified time from meas- ures deemed essential to the com- mon welfare of the corporation and its creditors, he shall be held to have assented to them. Union Canal Co. v. Gilfillin, 93 Pa. St. 95; S. C, aff'd, 109 U. S. 401. 2 See §§ 500, 501. When the state is a shareholder, questions may arise between the creditors of the corpo- ration and the state as shareholder in the corporation or contributor of its capital. See Curran v. Arkansas, 15 How. 304. 8 See Barings v. Dabney, 19 Wall. 1. So questions as to the compe- tency of a court to authorize a re- ceiver to issue certificates making them liens prior to the lien of a mortgage, would arise among cred- itors. See, e. g., Fosdick v. Schall, 99 U. S. 235; Wallace v. Loomis, 97 U. S. 146. See §§ 821 et seq. 4 Woodruff v. Trapnall, 10 How. 190. In this case the state was the sole shareholder. See Paup v. Drew, 10 How. 218; Furman v. Nichol, 8 Wall. 44; Wagner v. Stall, 2 S. C. 538. Such bank bills are not " bills of credit" within the meaning of the Constitution. Darrington v. Bank of Alabama, 13 How. 12. In 1836 Maryland passed a law di- recting a subscription of $3,000,000 to the capital stock of the Baltimore and Ohio R. R. Co., with the follow- ing proviso: "That if the said com- pany shall not locate the said road in the manner provided for in this act, they shall forfeit $1,000,000 to the state of Maryland for the use of Washington County." In 1841 the state repealed so much of the prior act as made it the duty of the rail- road company to locate its road as prescribed, and released the penalty. Held, that the above proviso was a penalty, and measure of state pol- icy, which the state might change; and that neither the county nor any of its citizens acquired any separate or private interest in it. Maryland 519