Birmingham age-herald., 1895-02-19

heps., 166. Farmers' Loan ana lrusI 70. vs. Chicago Railway Co.,, 2 Fed. Rep. 146. And even where foreign corporation has an established business within state, as an insurance company, without regard to the amount invested in it's business or loss to it's stockholders, the state, h the exer-
 prohibit absolutely the further transaction Of it's business. Chicago Life Ins. Co. vs. Needles, 113 U. s., 674.
 "But it must be observed that the con- stitutionality of house bill o2l depends ID no respect upon the right to prohibit aliens. whether individuals or corpora tions, from voting stock in domestic cor porations. The act in question makes no attempt to do this. It merely assumes to re gulate and control the manner of the ex- ercise of this right.
 :rhe fundamental proposition upon which the correctness oi the veto Is att tempted 10 be justified Is thus stated: sWhen person becomes stockholder or a corporation under the general statutes or Ala bama, either by subscribt1on to stock or by the purchase of shares, he becomes
 under the law entitled to one vote for each
 share of stock owned or held by him. This law being in force al the time of the pur-
 chase enters into the contract and becomes
 part of the obligation of the contract and the measure of bis rights therein. Any change or i'm pairment of these rights by
 statute is forbidden by the constitutions of
 both the state and the United States
 bub LQsb lTue4 luiS Who tu0 PiiHSt-
 pie laid down in the Dartmouth college
 case (4 Wheat, 51S), which established the
 Legislative inviolability of the charters or
 private corporations; but the constitution
 of this state, and, indeed, Of all the states
 since this decision have done away
 with tue effect of this decison by ex-
 pressly providing that all computes in-
 corporated under the laws of this state &C.,
 cept their charters upon the express con
 dition of the right ol the legislature to re-. peal amend or. alter 1t.
 the supreme court of the United States coa-
 sidered at length the vested right of the stock holder, even in domestic corpora tion to maintenance Of the voting power of bis stock as fixed by the original cnarter of in ncorporation.
 "Under the original! charter of railroad com papy the city of Rochester was stock holder, aud had power, by reason Of the amount Of stock owned Oy 1t, to name four directors out of the thirteen, the remain ing stockholders being entitled to name nine directors. By an amendment to the charter the city was given the power to name seven out of the thirteen directors. This was resisted by the remaining stock holders upon the ground that 1t was anslm- pairment of the voting power of their
 stock. In the opinion the court says: At
 tempt is made In this case to show that the
 right to elect all the directors except four
 had become vested in the stockholders
 owning min norlty of the shares, and that
 the amendatory act giving to the city the
 power of elecling seven impars that vested
 right; but the court IS entirely of differ
 enu opinion, as the legislature, in conced-
 ing that right, made the concession subject
 to the reserved power to alter or repeal the
 charter, as ordained in the constitution of
 the state, which clearly gave to the legis- lature the power to augment or diminish the number, or to change the proportion as the ends of justice or the best interests of all concerned may require.
 .tIu the case of Muck vs. DeBardele b5n
 Coal and Iron company (9o Ala, s93, 403)
 our own court upheld a subsequent statute
 amend ng the charter of the Eureka Mining
 company, which provided that no stock
 holder should be entitled 10 cast more than
 one- fourth of all the votes at any election
 of directors. This manifestly was limi
 tation upon upon the voting power of the
 stock. It was coutended by the owners of
 the majority of the stock that they were
 of right entitled to vote the several shares
 standing ia their names, notwithstanding
 the statutory inhibition. h disposing of
 this contention Judge Stone says: We think the statutory restraint on the voting power of the stockholder was en- acted for very wise and conservative pur- pose, and that it should bs upheld in its integrity. It is perhaps to be iamented that our organic law does not contain provision applica be 10 all business cor
 porations aggregate, that no cue person,
 whether natural or artificial, can ever exer-
 else q controlling voice ID their organ1za-
 ton or govern ment.'
 .sThs recent case of Cross vs. West Vir-
 gin ia Railway company (12 s. B. Reporter,
 1071, 1072) is very instructive as to the
 power oi state with right similar to
 that provided in our constitution, to alter
 or amend the charters of corporations of its own creation in reference to the voting power Of stock. In that case the original charter of the company declared that each share of stock should be entitled to one vote. The charter was subsequently, ame uded so as to authorize the right of cumulative voting 80 as to increase the proportionate vatue of the voting power of the minority stock holders, which was strongly objected to by the majority stock holders. The court in disposing of the contention says: I quote these parts of the | act of incorporation of the original con- pany because defendants claim that the mode Of voting-one share one vote-is of | the nature of a contract binding the state not to impair it, and that the requiring and l aut h orizing cum ulative voting IS such inn l pairment and is obnoxious to section 10, l article of the constitution of the United | States, but the conclusion on this point, l reached after careful consideration, is that l the state constitution and laws authorizing | the stockholder to cumuiate his votes con- | stitutes no such impairment, for the reason, among others, that the leg | islature in the last section of | the incorporation reserved the right l to alter and amend, and in the latter part l of the first section requires that all rights, l requirements and regulations shall not be l repugnant to any law of the state then in l force or which might be passed under the powers reserved.
 1.-The provisions of house bill 821 do not | require the stock of alien corporations to be | voted after the manner specified therein. {. l The purpose of the act under consideration | (house bill S2l) is not to require foreign l alien corporations to accept it's provisions l and vote it's stock according to the terms of
 the act, but to provide that h case 1t does l wish to exercise the right of voting its stock, within this state, 1t may do so only
 upon the terms imposed by the act, that is l to say, through the agency of it's stock. l holders, and not directors or officers.