" 100

acter.' What may be meant by the suggestion at the end of this quotation is not clear. All that can safely be said at present was said by Judge Pardee in Continental Insurance Company v. Continental Fire Association: 101 "We have found no case in which a foreign corporation has been heard to complain of the corporate name given by the sovereign to a domestic corporation." In all cases of this sort which have been found, the plaintiff was refused relief on another ground.10

$232. Exercising a franchise.

Comity is never extended so far as to allow a foreign corporation to exercise what is strictly a corporate franchise. The Supreme Court of Maine said that a bridge corporation of Maine could not, merely by comity, collect tolls at the Canadian end of its bridge. 103 But where the right to exact tolls for crossing a bridge was appurtenant to land, and a foreign corporation bought the land, the Supreme Court of Alabama held that it might collect the tolls.104 This decision is certainly questionable.

The mere holding of land is not a franchise. 105 In Thompson v. Waters,106 the court said: "The mere right of a corporation to purchase and sell property, not being in its nature strictly a franchise, but a right existing equally in individuals without special grant, is very generally recognized in States other than those of its creation."

100 Bailey, J., in Hazleton Boiler Co. v. Hazleton Tripod Boiler Co., 142 Ill. 494, 30 N. E. 339.

101 101 Fed. 255, 256.

102 Continental Ins. Co. v. Continental Fire Assoc., 101 Fed. 255 (name a mere geographical one); Hazleton Boiler Co. v. Hazleton T. B. Co., 142 Ill. 494, 30 N. E. 339 (prior use of name by plaintiff illegal); American Tartar Co. v. American Tartar Co., 68 N. Y. Supp. 236, 57 App. Div. 411 (plaintiff not entitled to do business in the State).

103 Middle Bridge Co. v. Marks, 26 Me. 326.

104 Columbus v. Rodgers, 10 Ala. 37.

105 State v. Boston, C. & M. R. R., 25 Vt. 433.

106 25 Mich. 214, 12 A. R. 243.

§ 233. Taking in trust.

A corporation may hold as trustee; 107 but only when it is allowed to hold for its own purposes 108 or has complied with the law.109 So a foreign corporation, empowered to do so by its charter, may take property as executor.110 A fortiori if it obtained title outside the State it may enforce its title within the State by appropriate proceedings.111

But though a foreign corporation will not be allowed to take active charge of a trust until it has complied with the State law, the trust deed to it is good.112

And where land was devised to a foreign corporation as trustee, such corporation not being allowed by the law of the situs to hold the land, a similar domestic corporation was substituted as trustee.113

§ 234. Conveying property.

As has been seen a foreign corporation may not only take property, it may also convey it. Like an individual's, its conveyance must be made according to the law of the place where the property is situated; 114 and it may in some cases be impossible for a foreign corporation to make a valid conveyance. This is not because it is a foreign corporation, but because it is not able to comply with the general requirements of the law. Thus where it is provided by statute that a chattel mortgage

107 Farmers' Loan & Tr. Co. v. Chicago & A. Ry., 27 Fed. 146. 108 United States Trust Co. v. Lee, 73 Ill. 142, 24 A. R. 236.

109 Farmers' Loan & Trust Co. v. Chic. & N. P. R. R., 68 Fed. 412; Farmers' Loan & Trust Co. v. Lake St. El. R. R., 173 Ill. 439, 51 N. E. 55. See, however, Eskridge v. Louisville Trust Co., 29 Tex. Civ. App. 571, 69 S. W. 987, holding that a foreign corporation as trustee may maintain suit in ejectment.

110 Deringer v. Deringer, 5 Houst. (Del.) 416, 1 A. S. R. 150.

111 Toronto G. T. Co. v. Chicago, B. & Q. R. R., 123 N. Y. 37, 25 N. E. 198. 112 Farmers' Loan & Trust Co. v. Chicago & N. P. R. R., 68 Fed. 412; Morse v. Holland Trust Co., 184 Ill. 255, 56 N. E. 369.

113 In re Macdonald's Will, (1902) Queensland W. N. 22.

114 Fowler v. Bell, 90 Tex. 150, 37 S. W. 1058, 59 A. S. R. 787, 39 L. R. A. 254.

shall not be valid unless it is acknowledged or recorded where the mortgagor resides, a foreign corporation cannot make a chattel mortgage, since it has no place of residence.115

These are general provisions, applying to every conveyance; but a statute requiring certain exceptional formalities in the case of conveyances by corporations is to be interpreted as applying only to domestic corporations. For such a statute is adopted, either as a measure for the governance of its corporations, or as a protection to its stockholders; in neither case is it concerned with the governance of the corporation of another State, or with the interests of its members. Though it is of course within the power of the State to legislate in this way for foreign corporations which attempt to convey property within its limits, it is so unlikely a thing for the State to do that clear evidence of such an intention must appear in a statute if such an interpretation is to be adopted. Thus in Saltmarsh v. Spaulding 116 the validity of a mortgage of land by a foreign corporation, authorized by a directors' vote, was in question. A statute of Massachusetts required a stockholders' vote to authorize a mortgage of land by a corporation; but it was held that this provision applied only to domestic corporations, and the mortgage was sustained. So where a New York statute forbade assignments for the benefit of creditors by corporations, this was held not to apply to a foreign corporation which by the law of its own State had a right to make such an assignment.117

On the other hand, such provisions of law in the State of charter will not necessarily be carried into effect in a foreign State. Thus where a New York corporation, being insolvent, had mortgaged land in New Jersey to a stockholder, such a mortgage being valid in New Jersey but forbidden in New

115 Watson v. Thompson Lumber Co., 49 Ark. 83; Cook v. Hager, 3 Colo. 386.

116 147 Mass. 224, 17 N. E. 316.

117 Vanderpoel v. Gorman, 140 N. Y. 563, 35 N. E. 932, 37 A. S. R. 601, 24 L. R. A. 548. Contra (semble), Lamb v. Russell, 81 Miss. 382, 32 So. 916.

York, the mortgage was upheld.118 And a general assignment for benefit of creditors made by a foreign corporation, and valid where made, will be sustained, though forbidden to a corporation by the State of charter.119 Where the State in which property is situated forbids certain dealing with property, the corporation of course cannot do the act, and if it attempts to do so the transaction is void. Thus where a foreign corporation is empowered to hold real estate, but forbidden to mortgage it, an attempted mortgage is void.120 And where a foreign corporation was forbidden to accept an appointment as executor without making a certain deposit, such a corporation before making the deposit could not convey land as executor. 121 Nor will a foreign corporation be allowed to act as trustee before complying with the law. 122 And so if a foreign corporation may not mortgage, a chattel mortgage of property in a foreign State though executed in the State of charter where such mortgage is valid, is without effect to convey.'

123

A corporation having power to sell may lease property although it could not retain the property for use.124

118 Boehme v. Rall, 51 N. J. Eq. 541, 26 Atl. 832; to same effect Nathan v. Lee, 152 Ind. 232, 52 N. E. 987, 43 L. R. A. 820.

119 Warren v. First Nat. Bank, 149 Ill. 9, 38 N. E. 122, 25 L. R. A. 746; Pairpoint Mfg. Co. v. Phila. Optical & Watch Co., 161 Pa. 17, 28 Atl. 1003; East Side Bank v. Columbus Tannery Co., 170 Pa. 1,.32 Atl. 539; Borton v. Brines-Chase Co., 175 Pa. 209, 34 Atl. 597. Contra Pierce v. Crompton, 13 R. I. 312.

120 Talmadge v. North Amer. Coal Co., 3 Head (Tenn.), 337.

121 Pennsylvania Co. v. Bauerle, 143 Ill. 459, 33 N. E. 166.

122 Farmers' Loan & Trust Co. v. Chicago & N. P. R. R., 68 Fed. 412; Morse v. Holland Trust Co., 184 Ill. 255, 56 N. E. 369.

123 Fowler v. Bell, 90 Tex. 150, 37 S. W. 1058.

124 State v. N. O. Warehouse Co., 109 La. 64, 33 So. 81.

$241. Foreign corporation has power to sue.

It was once thought that according to the common law a foreign corporation could not sue; for a foreign incorporation, being a foreign fact, could not be found by a jury taken from the county. But as juries came to be instructed by witnesses they could deal with foreign facts; and it was finally held that a foreign corporation might sue in a common-law court, producing its charter to prove its incorporation.1 It is now, therefore, everywhere agreed that a foreign corporation may sue if permitted access to the courts.

1 See Introduction.