appearance to be entered to the action, on a day to be specified in § 91-92 the order, a copy of which order shall be inserted in one of the newspapers published in this state, for at least three weeks, once in each week, and a copy thereof shall also be posted in three public places in this state, as shall be ordered by the court, for at least three weeks, and if the defendant shall not appear within the time limited by the order, or within such further time as the court shall limit, then, on proof of the publication and posting of the order, the court shall order the clerk to enter appearance for the defendant, and thereupon the action shall proceed as if the defendant had entered its appearance to the action.

Act of 1875, § 90.

91. No corporation against which an order for publication shall be made, as aforesaid, shall grant, bargain, sell, alien or convey any lands, tenements or real estate in this state (in case the said summons issued out of the supreme court), or in the county in which the said summons shall have been issued (in case the said summons issued out of the circuit court or the court of common pleas), of which it shall be seized or entitled to at the time of making such order, until the plaintiff in the action shall be satisfied his legal demand, or until judgment shall be entered for the defendants; and the said action shall be and remain a lien on such lands, tenements and real estate, from the time of entering the said order for publication in the minutes of the court, and the said lands, tenements and real estate shall and may be sold on execution, as if no conveyance had been made by the said corporation.

Act of 1875, § 91.

IX.-Remedies against Officers and Stockholders.

92. Action for liability imposed by act; remedy in chancery. When the officers, directors or stockholders of any corporation shall be liable to pay the debts of the corporation, or any part thereof, any person to whom they are liable may have an action against any one or more of them; and the declaration shall state the claim against the corporation, and the ground on which the plaintiff expects to charge the defendants personally;

93-95 or the person to whom they are liable may have his remedy by bill in chancery.

P. L. 1846, pp. 70-71; P. L. 1849, p. 307; Act of 1875, §§ 93-94.

Sections 92 and 94 relate to cases where officers, directors or stockholders are made specifically liable by the provisions of the act for the payment of the debts of the company, and provide in such cases for actions by the creditor. (See Section 52, ante.) They do not relate to actions against stockholders to enforce payment of subscriptions for stock. Such proceedings must be by general creditors' bill for the benefit of all. (Wetherbee v. Baker, 35 N. J. Eq., 501, 505.)

Waters v. Quimby is an action under these sections. (27 N. J. Law, 296; 28 Id., 533.)

93. Stockholders, etc., who pay company's debts may re

cover.

Any officer, director or stockholder who shall pay any debt of a corporation for which he is made liable by the provisions of this act, may recover the amount so paid, in an action against the corporation for money paid for its use, in which action only, the property of the corporation shall be liable to be taken, and not the property of any stockholder.

P. L. 1846, p. 71; P. L. 1849, p. 307; Act of 1875, § 95.

94. Property of director, etc., not to be sold for company's debt until remedy against the company has been exhausted.

No sale or other satisfaction shall be had of the property of any director or stockholder for any debt of the corporation of which he is such director or stockholder till judgment be obtained therefor against such corporation and execution thereon returned unsatisfied, but any suit brought against any director or stockholder for such debts shall stay after execution levied, or other proceedings to acquire a lien, until such return shall have been made.

P. L. 1846, p. 71; Act of 1875, § 96.

X.-Foreign Corporations.

95. Foreign corporation may hold and convey lands, etc. Any corporation created by any other state or by any foreign state, kingdom or government may acquire by devise or otherwise and hold, mortgage, lease and convey real estate in this

state for the purpose of prosecuting its business or objects, or § 95a-97 such real estate as it may acquire by way of mortgage or otherwise, in the payment of debts due such corporation; provided,. such foreign state, kingdom or government, under whose laws such corporation was created, shall not be at the time of such purchase at war with the United States.

P. L. 1873, p. 76; Act of 1875, § 99; P. L. 1882, p. 137; P. L. 1883, p. 220; P. L. 1887, p. 157.

See Section 95a, post.

95a.* Foreign corporations may acquire, own and dispose of real estate in New Jersey.

It shall be lawful for any foreign corporation whatsoever to purchase and convey, to lease, hold, occupy and use for the purposes of such corporation such real estate in this state as may be devised or conveyed to it.

(Chap. 38, Laws of 1902; P. L. 1902, p. 170.)

96. Foreign corporations subject to this act.

Foreign corporations doing business in this state shall be subject to the provisions of this act, so far as the same can be applied to foreign corporations.

P. L. 1873, p. 76; Act of 1875, § 103.

The question whether an aggregation of individuals is a corporation, or not, is to be determined rather by the faculties and powers conferred upon the body than by the name or subscription given to it. Thus a joint stock association formed under the New York statute was held to be a corporation in New Jersey, and, as such, empowered to sue and be sued. not, as is usual, however, in a corporate name, but in the name of designated officers, as prescribed by the law of its creation. (Edgeworth v. Wood, 58 N. J. Law, 463.)

As to what constitutes doing business, see notes to § 98.

97. Foreign corporations to file copy of charter, statement, etc., before commencing business.

Every foreign corporation, except banking, insurance, ferry and railroad corporations, before transacting any business in this state, shall file in the office of the secretary of state a copy of its charter or certificate of incorporation, attested by its presi* Arbitrary number; section inserted here merely for convenience of reference.

§ 97 dent and secretary, under its corporate seal, and a statement attested in like manner of the amount of its capital stock authorized and in the amount actually issued, the character of the business which it is to transact in this state, and designating its principal office in this state and an agent who shall be a domestic corporation or a natural person of full age actually resident in this state, together with his place of abode, upon which agent process against such corporation may be served, and the agency so constituted shall continue until the substitution, by writing, of another agent; upon the filing of such copy and statement the secretary of state shall issue to such corporation a certificate that it is authorized to transact business in this state, and that the business is such as may be lawfully transacted by corporations of this state, and he shall keep a record of all such certificates issued.

P. L. 1894, p. 346; P. L. 1895, p. 293.

The validity of laws imposing the terms on which foreign corporations are permitted to do business in a State has been upheld by the Supreme Court of the United States in several important cases. The first case was Paul v. Virginia, 8 Wall., 168. It was held that a corporation is not a citizen within the meaning of that provision of the Constitution which declares that the citizens of each State shall be entitled to all the privileges and immunities of citizens of the several States. And Mr. Justice Field in delivering the opinion of the court said: “The corporation being the mere creation of local law can have no legal existence beyond the limits of the sovereignty where created. As said by this court in Bank of Augusta v. Earle, 'It must dwell in the place of its creation and cannot migrate to another sovereignty. The recognition of its existence even by other States, and the enforcement of its contracts made therein, depend purely upon the comity of those Statesa comity which is never extended where the existence of the corporation or the exercise of its powers are prejudicial to their interests or repugnant to their policy. Having no absolute right of recognition in other States, but depending for such recognition and the enforcement of its contracts upon their assent, it follows, as a matter of course, that such assent may be granted upon such terms and conditions as those States may think proper to impose.'"

This doctrine was reaffirmed in the case of Horn Silver Mining Co. v. New York, 143 U. S., 305, in which Mr. Justice Field, after quoting from the opinion of the former case, adds: "This doctrine has been so frequently declared by this court that it must be deemed no longer a matter of discussion, if any question can ever be considered at rest."

He further declared: "Having the absolute power of excluding the § 98 foreign corporation the State may, of course, impose such conditions upon permitting the corporation to do business within its limits as it may judge expedient; and it may make the grant or privilege dependent upon the payment of a specific license tax, or a sum proportioned to the amount of its capital." (See also Liverpool Ins. Co. v. Oliver, 10 Wall., 566; Ducat v. Chicago, 10 Wall., 410; Pembina, &c., Mining Co. v. Pennsylvania, 125 U. S., 181; Norfolk, &c., R. R. Co., v. Pennsylvania, 136 U. S., 114; Hooper v. California, 155 U. S., 648; Parke, Davis & Co. v. Roberts, 171 U. S., 658; Blake v. McClung, 172 U. S., 239; Orient Ins. Co. v. Daggs, 172 U. S., 557.)

For a full discussion of the status of foreign corporations, see 6 Thompson on Corporations, Section 7875 et seq.

See also notes to Section 7, ante.

98.

Cannot maintain action until certificate of secretary of state is obtained.

Until such corporation so transacting business in this state shall have obtained said certificate of the secretary of state, it shall not maintain any action in this state, upon any contract made by it in this state; provided, that nothing herein shall prevent the enforcement of any contract made prior to the fourteenth day of March, one thousand eight hundred and ninety-five.

P. L. 1894, p. 346; P. L. 1895, p. 293.

In Faron Co. v. Lovett, 60 N. J. Law, 128, it was held that this section did not apply where the contract was made without the State.

A corporation which makes a single sale of its product from its office outside of New Jersey to a person in New Jersey, and takes a guarantee of payment in New Jersey, does not transact business in the State within the meaning of the statute. (Delaware & H. Canal Co. v. Mahlenbrock, 63 N. J. Law, 281.)

A mortgage is an executed contract, and proceeding to foreclose it is not an action upon a contract such as is contemplated by the statute forbidding unqualified foreign corporations from bringing actions on contracts made within the State. The taking of a mortgage to secure a debt, by a foreign corporation not in the business of loaning money, is a mere incident of its business, and is not such an exercise of its corporate functions within the State as is forbidden by the statute. (American Net & Twine Co. v. Ginthens et al., 21 N. J. L. J., 190.)

"Our statutes allow a foreign corporation to hold mortgages on lands in this State, and complainant is entitled to recover the amount due, even though it has not filed the certificate required by Section 97 of the Corporation Act." (Manhattan, &c., Loan Ass'n v. Massareli, 42 Atl. Rep., 284, 285.)