The Kenosha telegraph. [volume] (Kenosha, Wis.) 1860-1888, 1860-06-28

ment Tor stock, and, that having done
so, they cannot refnse the party givi
it the privilege Of a corporation, In
r. r. Co. Us. Hickman, % Penn, ST.,
318, it is expressly decided that the
provisions Of the statue concerning the
powers of the Commissioners are not
applicable to the acts of the Company
after it is organized. And THAT under
the general power of prescribing the
manner ofpaying for stock, and to make
contracts &C., it may take payment in
labor, materials or anything necessary
for the building of the road. In Carr
Us. lie F6vre. 81 Penn. ST., AIS, it was
held that transfer of land to be used
for the purpose of the corporation, was
a good payment for stock: In Broaow
and Brother Us. illus, II Conn. "a, the
entire stock of a corporation had been
paid for in real and personal estate
necessary for the use of the Company.
The court below charged that it was
valid payment, and though the Sup
RENE Court did not find it necessary to
decide the point, they say they are
"Strongly inclined to think that there
was no error on this point" In the
case of Ire0dDeW and another vS.
Sails6ngp Nam. Co. and others, 7Gray,
405, it was held that where the circum-
stances ofan existing corporationjustifie
sale of its entire property, its taking
payment in the stock Of new corpor-
alton did not render the transaction il
legal. The Court said ''The new stock
is taken in lieu of money, to be distrib>
uted among those stockholders who
are willing to receive it, or to be con-
verified into money by those who do not
desire to retain it." In the Cincinnati
r.. :R. Go. vs. GARRISON, Z Ind, sos it
was held that the company had power
to take subscriptions for stock payable
in real estate, though the case does
uot show what were the provisions of
the charter.
We are satisfied, therefore, that the
authorities utterly fail to sustain the
position here contended for, that this
company had no power to dispose of
its stock for anything except money.
But that, on the contrary, they show
with entire unanimity, as we'll by 81
lent acquiescence; as by positive ad-
Indication, that it had the power to
dispose oft in such manner as would
accomplish the objects authorized by
the charter
1t was said that taking the mortgage
was an unWarrantable dealing in real
estate but this is not so. There is
nothilg in the transaction approaching
speculation in lands. The mortgage
is taken as mere security, and as such
is only an incident to the debt 1t is
simply obtaining by contract, what the
company could obtain by operation of
law on any ordinary stock subscription,
where there was default in payment.
Judgment could be recovered which
would be q lieu on rea. estate. 1t
the debt, and the mortgage was moth
ing more.-Suppose such suit brought;
could not the company settle it on the
party securing the debt by mortgage :?
could they not take from q willing par
ty by contract, what the law would
give them against him if unwilling, that
as a security for the debt on his real
estate ? We can see no reason to doubt
it. And if they could do it on the set
Element of suit, there is no more OBJ
lection to it in the first instance, with
out suit.-Ang. &c A, on Crop, s 159.
But it is further said that such con-
tract is fraud on the cash paying SUBJ
scribers. 1t is a sufficient answer to
say that those subscribers do not COM
plain. If the transaction is liable to no
other objection, party to it cannot set
up his own fraud to defeat his contract,
when the party defrauded chooses to &C
quiesce, Redfeld on Railways S7-8 &
note. But we are unable to perceive
that the objection is valid. The d irec-
tors are the agents of the stockholders,
and their acts within the powers con-
ferred are binding on the latter. This
mode of receiving payment for stock
was directed by them, and, it being
within the scope of their authority, it
was to be deemed assented to by all
1t is to be assumed that the company
could negotiate the securities for their
present worth, which would be equiva.
lent to the full amount paid on success
sive instruments.
We are, therefore, clearly of the opin-
ion that the company had power to
make this contract, and that the Securi-
ties are valid. It was not an attempt
to go outside Of it's charter and accom-
plish things unauthorized, but was al
means of executing the powers granted
as to which, except SO far as positively |
restricted, the company possessed the
powers Of an individul. Says Justice
Nelson in WilDo0rd Us. Crawford, 10
Wend., 342: Unless there is some ex-
press restriction, either in the charter,
or some other act Of the Legislature, as
to the nature of the evidence of the |
debts due to or from them, or securities
to be taken or given by them, they have
in this respect the same powers that
belong to individuals. Corporations,
while acting within the scope of their
authority under the act creating them,
that is in the execution of the powers
granted to to, or duties imposed upon
them by the charters, are to this extent
and one like natural persons" And
our whole conclusion is only an appli-
cation to corporations Of the rule famil-
lar as between individuals, that securi>
ties may, by contract, be received in
payment.
The Court below erred in holding
these securities invalid, and the judg-
ment must be reversed, with costs, and
the cases remanded for further proceed
ings.
az Southern Senators have fall en-
into an ugly habit of denouncing poor
men and those who s'labor in the swe at |
of their brow" Senator Hammond
them the "mudsills of hu.
man society," Senator Wigfa Il in his