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CHAPTER V.

DEFINITIONS, CLASSIFICATION, NATURE OF CORPORATION AND

DISTINCTIONS.

49. Change in Nature and Relations of Corporations-Effect upon Early Definitions.

50. Definitions of a Corporation.

51. Summary of Expressions Used

in Defining a Corporation.

Civil or Political Institution-Distinctions Between Incorporation and Corporation-Distinction Between Public and Private Corporations.

52. To What Extent Definition of § 61. Public, Quasi-Public and Pri

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§ 49. Change in Nature and Relations of Corporations— Effect upon Early Definitions.-What is said by the court in a case in the United States Supreme Court, decided in 1870, is pertinent here; it is as follows: "The subject of the powers, duties, rights and liabilities of corporations, their essential

nature and character, and their relations to the business transactions of the community, have undergone a change in this country within the last half century, the importance of which can hardly be overestimated. They have entered so extensively into the business of the country, the most important part of which is carried on by them, as banking companies, telegraph companies, insurance companies, etc., and the demand for the use of corporate powers in combination with the capital and the energy required to conduct these operations is so imperative, that both by statute, and by the tendency of the courts to meet the requirements of these public necessities, the law of corporations has been so modified, liberalized and enlarged, as to constitute a branch of jurisprudence with a code of its own, due mainly to very recent times. To attempt, therefore, to define a corporation, or limit its powers by the rules which prevailed when they were rarely created for any other than municipal purposes, and generally by royal charter, is impossible in this country and at this time." 1

§ 50. Definitions of a Corporation.-Under a definition given in a comparatively recent case in the Federal Supreme Court a corporation is but an association of individuals with a distinct name and legal entity. The definition, however,

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1 Liverpool Ins. Co. v. Massachu- compose it, and is for certain pursetts, 10 Wall. (77 U. S.) 566, 574, poses, considered as a natural per575, 19 L. ed. 1029, per Miller, J. son. * It means an intelSee also Thomas v. Dakin, 22 Wend. lectual body, composed of individuals, (N. Y.) 1, 70. and created by law; a body which is 2 Hale v. Henkel, 201 U. S. 43, 50 united under a common name, and L. ed. 652, 26 Sup. Ct. 370. See also the members of which are capable Pembina Consolidated Silver Mining of succeeding each other, that the & Milling Co. v. Pennsylvania, 125 U. body (like a river), continues always S. 181, 189, 8 Sup. Ct. 737, 31 L. ed. the same, notwithstanding the change 650. See § 51, herein. in the parts which compose it." "A corporation is a body, created Angell & Ames on Corp. (9th ed.) by law, composed of individuals §§ 1, 30.

united under a common name, the "A body politic or corporate, members of which succeed each other, formed and authorized by law to act so that the body continues the same, as a single person, and endowed by notwithstanding the individuals who law with the capacity of perpetual

which has been the most extensively quoted, adopted and relied upon, is that given by Chief Justice Marshall, as follows: "A corporation is an artificial being, invisible, intangible and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of its creation confers upon it, either expressly, or as incidental to its very existence. These are such as are supposed best calculated to effect the object for which it was created. Among the most important are immortality, and if the expression may be allowed, individuality; properties by which a perpetual succession of many persons are considered as the same and may act as a single individual." It is said, however, that: 'It is not essential to the idea of a corporation that it shall have perpetual existence, for limited corporations are a matter of most common occurrence, whether organized under general or special laws. Neither is it essential that it shall have capacity to sue and be sued under its corporate name, for it may be authorized only to sue in the name of its officers, as was the case under the New York banking law. That it shall have capacity to sue and be sued under some name standing for the collective body is all that is necessary. In the last analysis, the only essential attribute of a corporation is the capacity to exist and act within the powers granted, as a legal entity, apart from the individual or individuals who constitute its members." 4

§ 51. Summary of Expressions Used in Defining a Corporation. The following summary of the expressions used by the courts in defining a corporation evidences a substantial agreement upon certain essential points irrespective of the form in which any particular court has given such definition.

succession; a society having the capacity of transacting business as a single individual." Webster's Dict.

Dartmouth College v. Woodward, 4 Wheat. (17 U. S.) 518, 636, 4 L. ed. 629. See note to § 51, herein.

Andrews Bros. v. Youngstown

Coke Co., 86 Fed. 585, 589, 30 C. C. A. 293, 58 U. S. App. 444, per Lurton, Cir. J. That this case is overruled, see Great Southern Fire Proof Hotel Co. v. Jones, 177 U. S. 449, 457, 44 L. ed. 842, 20 Sup. Ct. 690, per Harlan, J.

Thus a corporation is defined as: "An artificial being, invisible, intangible; an artificial body; an artificial legal person; an artificial person representing shareholders; an artificial person created to become the business representative, agent or trustee of those furnishing money for the business; an artificial person created by statute; an intelligent though artificial person; an intellectual body created by law; a legal person; a legal being, a legal institution; a fictitious person; an ideal body; in a certain sense legislative bodies; a creature of the law; a body created by the supreme power of the State; a creature existing by statute; created by the legislature; a franchise created by the king; an association of individuals; an association of persons; a collection or association of individuals united in one body; composed of persons made into one body; an aggregate body; an aggregation of individuals united by operation of law so as to form but one person; a collective unity; a body consisting of one or more persons; a body consisting of one or more natural persons; a collection of many individuals in one body; an assembly of many into one body; a body composed of persons which the law prescribes; a body united in its franchises and liberties; an artificial being existing only in contemplation of law; a body distinct in law from all its members, or existing independent of its members; a distinct entity; a legal entity; an entity distinct from its members; a body politic or corporate; a franchise for a number of persons to exist as a body politic; existing only in political capacity or in both a political and natural capacity; composed of individuals vested with a political character and personality distinct from their natural capacity; composed of individuals who subsist as a body politic; a body united for a lawful purpose; a mere creature of the law established for special purposes; a personification of certain legal rights; a body established by law with usually some specific purpose, or for certain specific purposes; a body with special privileges not possessed by individuals; a body composed for the purpose of obtaining franchises or privileges not allowed to corporators as individuals; composed of individuals united under a common name, or a special name;

having a distinctive artificial name; subsisting under a special denomination; having common stock and common business; a person or legal being capable of transacting some kind of business as a natural person; a person with capacity to transact business as an individual; having power or capacity to act as an individual; having capacity to act as a single individual; a body acting in many respects as individuals; having certain powers and duties of natural persons; having like powers and liabilities as natural persons; an artificial being with capacity of acting within the scope of its charter as a natural person; a body which acts and speaks through its officers or agents; a legal institution conferring on its members powers, privileges and immunities which they would not otherwise possess; a personification of certain legal rights; a body possessed with power to do corporate acts, but with prescribed powers, or with powers prescribed by law, or with powers only of the kind and degree conferred by law; a body constituted by policy with capacity to take or do; being in its corporate capacity a mere creature of the act to which it owes its existence; receiving all its powers from the act creating it; a body with its existence, powers and liabilities fixed by the act of incorporation; a body limited to one peculiar mode of action; a body whose existence is evidenced by the exercise of certain franchises and functions; a person vested with power and capacity to make contracts within the scope of its powers; a person with capacity to take and grant property as an individual; a body with right to sue and be sued like natural persons; composed of constantly changing members, or with a right to change of members without dissolution; a succession of individuals; in law a single continuous person; a body with such a grant of privileges as secures a succession of members without changing the identity of the body, a body continued by a succession of members, as its members succeed each other so that the body is always the same notwithstanding change of individuals; a body with capacity of succession irrespective of change in membership; or with a capacity of succession in perpetuity, by transfer of shares; a body with capacity of

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