Case Name: Samuel Ferguson vs. The Miners' and Manufacturers' Bank
Court: Tennessee Supreme Court
Jurisdiction: Tennessee
Decision Date: 1856-09
Citations: 3 Sneed 609
Docket Number: 
Parties: Samuel Ferguson vs. The Miners’ and Manufacturers’ Bank.
Judges: 
Reporter: Tennessee Reports
Volume: 35
Pages: 609–634

Head Matter:
Samuel Ferguson vs. The Miners’ and Manufacturers’ Bank.
1. Constitutional Law. Fraudulent Legislation. The Judicial Department of the government would hesitate, even if its power were indisputable, to declare an act of the Legislature invalid on account of fraudulent and improper practices on the part of its members in procuring the passage of such act. The presumption of law is in favor of the probity of all legislative action, and it would require a strong ease to justify the Courts even in entertaining a question so derogatory to the Legislative Department.
2. Same. Const., Art 2, $ 21. Sills of a general character. Bank charters. The term, “bills of a general character,” used in the constitution to designate such bills as shall be passed upon a call of the “ayes and noes,” applies to such statutes as affect the rights of the people at large. A bill to incorporate a private banking company, is not a bill of a general character in tie sense of tie constitution.
3. Same. Const, Art 2, $ 18. Amendments upon the third reading of bills. Tie 18th section of tie 2d article of the Constitution of this State, which requires all bills to be read on three several days in both houses of the Legislature, was intended to prevent frauds, and to superinduce caution and circumspection in the passage of all laws. The practice which has obtained in the two houses of the Legislature of adopting upon the third and last reading of bills, amendments which are not homogeneous with the general objects of the bill, is not only unsafe in itself, but is not within the spirit of the Constitution, and should not be favored.
4. Same. Repealing power. Contract. An act of the Legislature granting to divers companies, charters of incorporation in severalty, like other contracts containing various provisions, must be taken as a whole. And if the reservation of the right to alter or repeal all charters granted by said actt appears distinctly in any part thereof, it applies with equal force to every charter created thereby, whether the section by which such charters be granted, precede or succeed that containing the reservation.
5. Same. Same. Act of 1856, ch. 113, § 16. Case in judgment. The act of 1856, ch. 113, § 16, which repeals so much of the act of 1854, ch. 294, as conferred banking powers upon the corporations created by said act, is a valid and constitutional enactment.
6. Same. Same. Act of 1854, ch. 294. The act of 1854, ch. 294, gives to all companies incorporated by said act, three years after a dissolution of said corporations by limitation, legislative repeal, or otherwise, to wind up and settle the affairs of said companies.- They may therefore sue and be sued as corporations at any time within three years after dissolution,
EEOH KNOX.
At the June Term, 1856, of the Circuit Court of Knox county, before Alexander, Judge, the Miners’ and Manufacturers’- Bank recovered a judgment against Samuel Ferguson upon a bill of exchange, of which he was the drawer, from which judgment he appealed in error to this Court. For the plaintiff in error, it was insisted that the judgment was erroneous, because there was at the time the same was rendered, no such corporation as the Miners’ and Manufacturers’ Bank. It seems that said Bank claimed its corporate existence under the act of 1854, ch. 294, entitled, “An act to incorporate the .¿Etna Mining and Manufacturing Company, and for other purposes.” By said act of 1854, ch. 294, which contains seventy-five sections, various corporations were created, for mining, manufacturing, educational and other purposes. Provision is also made in said act by some forty sections thereof, commencing at section 8 and ending at section 48, for a summary mode of creating corporations for manufacturing purposes, by a certificate to be made by the corporators, setting forth the place of business, beginning and termination of the corporate existence, names of stockholders, amount of capital stock, &c.; which certificate, after being recorded in the register’s office of the county where the business is proposed to be carried on, is to be deposited in the office of the Secretary of State. By the 72d section of said act, the Southern Mining Company is incorporated for mining 'and manufacturing purposes, and by § 73, it is provided, that whenever said company is organized, it shall have and exercise all the privileges conferred “upon the corporation and body politic created by an act passed December 27, 1843, ch. 60, and also the rights and privileges conferred upon the Cocheco Mining Company by the act of 1852, ch. 103.” By § 75, it is enacted, that said company may change its title whenever it may be deemed necessary, so as not to conflict with the- “ above privileges.” The act of 1843, ch. 60, referred; to in. § 73, is the charter of the Bank of East Tennessee. Under these several provisions, the defendant in error commenced the business of banking- under the title of the Miners’ and Manufacturers’ Bank. The 46th section of the act of 1854, ch. 294, under which the defendant in error claims its franchise as a banking corporation, reserves to the Legislature the right to repeal “ all charters granted by this act.” By the act of 1856, ch. 113, § 16, the Legislature repealed the act of 1854, ch. 294, so far as said act conferred banking powers upon any company embraced therein. In this Court it was argued on behalf of the defendant in error, that the reservation of the right of repeal contained in the 46th section of the act of 1854, ch. 294, referred alone to the “ certificate corporations ” provided for in said act, and that the repealing act of 1856 is unconstitutional and void. On the other hand, it was contended, that the words of said repealing clause were general and embraced all charters granted by said act; and that, independent of that position, the legislation under which the banking power is claimed, was void ah initio, it being á general law passed without a call of the ayes and noes, and also, on account of the alleged fraudulent manner in which it was obtained, and that the Court had the power so to declare it.
W. B. Reese, Jit., for the plaintiff in error:
The record in this. case presents two questions for the consideration of the Court:
First. Was there ever such a corporation legally created, as the Miners’ and Manufacturers’ Bank, capable of contracting, sueing and being sued?
The counsel for the appellant contends, that the act incorporating the Southern Mining Company, now called Miners’ and Manufacturers’ Bank, passed 2d March, 1854, did not confer upon that corporation banking privileges. — See acts of 1853-4, page 610.
A corporation is a contract between the government and the corporators. — See 2 Kent, 306.
The very essence of a contract is that the parties should mutually consent to the contract. — See Kent, 2 vol. 477.
There is no contract if there be an error or mistake of a fact, or in the circumstances going to the essence of the contract. — See 2 Kent, 477.
To make a contract binding, the parties must make a mutual disclosure of all the material facts in their knowledge. — See 2 Kent, 482.
A contract is binding only, in the sense in which one party understood and knew that the other party understood it. — See Parsons on Contracts, vol. 2, p. 9.
Now, it is contended for the appellant, that the Legislature of Tennessee never consented that there should be a Miners’ and Manufacturers’ Bank created, that the Legislature was acting under an error and mistake of facts in passing the bill of incorporation, that there was no disclosure to the Legislature, and that the corporators knew that the Legislature did not intend to create a banking institution.
All this is manifest upon a mere inspection of the act of incorporation. The Court by looking to the acts of 1853-4, page 610, can ■ see how delicately the morceau was cooked.
But again, all public laws are required by our constitution to be passed by the Legislature, upon a call of the ayes and noes — this Court has decided in 2 Humph, a bank charter is a public law — in passing this act there was no call of the ayes' and noes. See Journal.
2. But secondly, if there ever was such a corporation as the Miners’ and Manufacturers’ Bank, has it now any legal existence, and can this Court give judgment in favor of a defunct corporation ?
The Legislature, in the very bill which breathed the breath of life into the Southern Mining Company, expressly retained the power at any time to amend or repeal the charter. — See acts of 1853-4, p. 604.
This power of repeal has been exercised by the Legislature.— See acts of 1855-6, p. 125, § 16.
If in the act of incorporation, a power to repeal the charter granted, be retained, the exercise of this power cannot be complained of.— See Kent, p. 2.
It is usual for Legislatures, in acts of incorporation for private purposes, to reserve to themselves a power to alter, modify or repeal the charter at their pleasure, and as the power of modification and repeal is thus made a qualifying part of the grant of franchises, the exercise of that power cannot, of course, impair the obligation of the grant.' — See Angelí and Ames on Corporations, p. 504.
The words used by the Legislature in the repealing clause are “every company created under this act,”— “ the provisions contained in this act may be amended or repealed at the pleasure of the Legislature,” &c. — • See forty-sixth section of the act of incorporation.
Now whether the repealing power be retained in the first section of the act or the last section, can make no difference. It is just as operative, if it be the forty-sixth as if it were the seventy-fifth. The word “ act ” must necessarily and legally mean, all the act, the first section, and the 'second section, and the seventy-five sections of which the act consists. The ■whole included all its parts.
To illustrate: If a man rent his house to another and retain the power, to at any time and of his mere pleasure, pull the house down, does such a reservation empower the landlord to demolish only the front porch or the kitchen chimney, -or does not the word “house” include windows and doors, walls and roof, cellar and garret, in short, everything in and •about the house, from the basement to the copingstone ? The Miners’ and Manufacturers’ Bank is, therefore, defunct— its charter has been repealed and it no longer has a legal existence.
The doctrine is well settled, that upon the dissoli^ ■tion of a corporation, the debts due to and from the corporation are all extinguished.— See Kent, 2 vol. 307. This Court has so held in the case of White vs. Campbell, and others; 5 Humph. 38.
There is, therefore, no person now before the Court in whose • favor a judgment can be given.
T.- A. R. Nelson and W. C. Kain, for the defendant in error..
The latter said:
On behalf of the defendant in error, it is insisted, that the Miners’ and Manufacturers’ Bank was estab lished and incorporated by the Legislature of Tennessee, by an act passed 2d- of March, 1854, and that said corporation under and by virtue of that act, is invested with full banking privileges, and that said act is still in force and communicates vitality to said corporation, and neither has said act been, or can it be repealed by the Legislature.
It is admitted by the defendant in error,- that the 16th section of an act passed February 2, 1856, (see acts, p. 125,} was intended to deprive it on and after the 1st day of August, 1856, of “banking privileges” conferred upon- it by § 73 of the act of March 2, 1854, but it is insisted that this legislation is unconstitutional and void. The Constitution of the United States, art. 1-, §11, provides and declares that no State shall pass any law impairing the obligation of contracts; and by art. 5, of the Amendments to the ’ Constitution, it is declared that no person shall be deprived of “property” without due process ■ of law. Our own State constitution, art. 1, § 8, declares “that no freeman shall be disseized of his freehold, liberties or privileges¿ or in any manner deprived of his properly,, but by the judgment of his peers or the law of the land;” and it is provided in section 20 of the- same article, that “ no law impairing, the obligation of contracts shall be made.”
It is urged on behalf of the Bank, that the Legislature in passing the act of February 2, 1856, violated- and trampled upon each of these constitutional provisions.
It is clear that the act of incorporation, passed March 2, 1854, among other things, conferred banking privileges upon the body politic created by that act; nor, we presume, will it be questioned, that these “priv- lieges” are among the rights intended to be protected by the 8th section of the 1st article of our State constitution, and that the stockholders of the bank have a legal estate and “property” in the franchises conferred upon them by the act of March 2, 1854, and are therefore clearly protected by the Constitution, not only of the United States, but of Tennessee, even from legislative violation. Upon this point, that eminent jurist, Justice Story, in delivering his opinion in the familiar and celebrated case, of Dartmouth College vs. Woodward, (4 Wheaton, p. 699,) uses this language: “In respect to franchises, whether corporate or not, which include a pernancy of profits, such as a right of fishing, or to hold a ferry, a market, or a fair, or to erect a turnpike, bank, or bridge, there is no pretence to say, that grants of them are not within the constitution. All incorporeal hereditaments, whether they be immunities, dignities, offices, or franchises, or other rights, are deemed valuable in law — the owners have a legal estate and property in them, and legal remedies to support and recover them in case of any injury, obstruction or disseizure of them. Whenever they are the subjects of a contract or grant, they are just as much within the reach of the constitution as any other grant.” — (4 Wheaton, 699.) Again, the same high authority, in the same opinion, p. 688, instances the very case at bar, to show that a charter may be granted upon an executory consideration, or rather, in arguing that a present consideration was not a necessary requisite to- entitle a contract to this constitutional protection, holds this language: “ It will not be pretended, #that if a charter be granted for a bank, and the stock holders pay in their own funds, the charter is to be deemed a grant without consideration, and therefore revocable at the pleasure of the grantor.”
It is urged on behalf of the Bank, that the franchises granted by the act of March 2, 1854, are such “ privileges ” and such “ property,” as are protected from legislative interference by our State constitution, art. 1, § 8, and the attention of the Court is invited to the able and elaborate opinion of Chief Justice Marshall, and Judges Washington and Story in the case of Dartmouth College vs. Woodward, 4 Wheat., 624-715. The Bank relies on these same opinions as conclusively affirming, that the act of incorporation passed by the Tennessee Legislature, March 2, 1854, is a contract within the meaning of the Constitution of the United States, art. 1, § 10, and § 20, art. 1, of the amended constitution of Tennessee, both of which declare that no law impairing the obligation of contracts shall be passed; and therefore, that the act*of the Legislature passed February 2, 1856, repealing so much of the act of March 2, 1854, as “confers banking privileges” on the defendant in error, is unconstitutional, invalid and void.
It may be admitted by the other side, that these propositions are, from the weight and force of the decisions referred to, now beyond question or controversy; and yet it may be claimed, that the Legislature in granting the charter to the bank or company, reserved and retained the right to revoke and repeal the charter, and that the grantees accepted the charter tram-elled with this provision, and cannot now be heard to complain of the arbitrary action of the Legislature,— See acts of 1853-4, p. 593.
An examination of the act passed March 2d, 1854, (see acts 1853-4, p. 593,) shows, first, that the Legislature incorporated various Mining and Manufacturing Companies, and also provided, that “ any number of persons exceeding four, might associate themselves into manufacturing companies, and on compliance with certain rules and conditions, should enjoy most of the privileges usually granted to such companies by act of incorporation; this act is almost an exact counterpart of an act of the Legislature of New Jersey. The third section of this portion of the act, (page 595,) contains this proviso, “ The Legislature may at pleasure dissolve any company created by virtue of this act.” The act then proceeds to define the privileges conferred upon all companies that may hereafter be established within this State, “ under the provisions of this act,” and to point out the duties and liabilities of stockholders, agents and officers of said companies or associations. The fifth section contains a limitation and restriction upon these companies, in these words, “Provided always, that no part of the funds of such company shall be used or employed in banking operations,” and then follow various provisions respecting the business and management of the affairs of such companies as' may be in future organized under this act.
The forty-ninth section immediately succeeding that portion of the act referring to the. organization of manufacturing companies, incorporates the Mansker’s Creek Mining and Manufacturing Company; the fiftieth, the “ Calhoun and Charleston Mining Company,” and various other mining companies are chartered by the remaining sections. The four last sections, viz: the seventy-second, seventy-third, seventy-fourth and seventy-fifth, create the body politic now in this Court as a party to the suit. The seventy-third section confers upon the corporation all the “powers, franchises, rights, privileges and immunities conferred upon the corporation and body politic created by an act passed December 27, 1843, ch. 60. The privileges thus conferred on the plaintiff, are those enjoyed by the Bank of East Tennessee.— See acts 1843-4, p, 65. The 11th section of this act provides, “ That whenever the Legislature may be of opinion, that the charter of the corporation hereby granted shall have been violated, and that the same has been forfeited, it shall be lawful by joint resolution to direct a scire facias, to issue from the Supreme Court of the State, in the name of the State of Tennessee, calling upon said corporation to show cause why the charter hereby granted, shall not be declared forfeited,” and it is further provided, that the Supreme Court, upon the return of the scire facias being made known, shall have full power “ to inquire into the truth of said alleged violations, and if such violations be made to appear, then to adjudge and pronounce that said charter is forfeited and annulled; provided however, among other things, that “ every issue of fact which may be found between the State and said corporation shall be tried by a jury,” &c.
It is believed, that the above recited section eleven of the act of December 27, 1843, and the proviso contained in the third sub-section of section eight, (page 595, acts of 1853-4,) are the only clauses in the various acts of the Legislature which give vitality to the defendant in error, which can by possibility be relied on as authority for the repeal of those portions of the act of March 2d, 1854, which confer banking privileges, and the sole question then before the Court is, whether the Legislature was authorized by virtue of the proviso contained in the third sub-section of section eight of the act of March 2d, 1854, (page 595, acts 1853-4,) to pass the sixteenth section of the act of February 1856, (page 125, acts 1855-6.) It is argued on behalf of the Bank, that the Legislature possessed no such power by virtue of the proviso. First, because the proviso itself refers only and solely to the associations for manufacturing purposes, which might be established within the State of Tennessee, under and by virtue of the provisions, and in compliance with the forms and regulations prescribed by the act, and has no reference to the corporations for mining, educational and banking purposes, created and called into existence by the express tdrms of the various sections of the act creating these bodies politic.
The proviso in the fifth section, act of 1854, that none of the funds of the various companies thereby authorized to be formed, “should be used or employed at any time in banking operations,” and the subsequent incorporation in the concluding sections of the act show conclusively, that the proviso relating to the dissolution of the companies thereby authorized to be formed, referred solely to the manufacturing associations vested by the act with powers and privileges usually incident to corporations.
Again, the Legislature, by adopting as it did, the eleventh section of the act of December 27th, 1843, clearly marked out and defined the mode and manner, by which any and all questions that might arise, as to the forfeiture of the chartered rights, might be adjudged and determined; and this mode is at once in accordance with the genius of our institutions and in harmony with our constitution — preserving the great right of a trial by jury, and acknowledging the bhiding force of that constitutional provision, which declares that no man shall be deprived of his rights of property or privileges but by due course of law.

Opinion:
CaRuthers, J.,
delivered the opinion of the Court.
This suit was brought and a recovery had upon, a bill of exchange held by the plaintiff below as a corporation against the defendant. Several questions are made in defence: 1. That the charter was fraudulently obtained. 2. The act was passed without taking the ayes and noes on the last reading. 3. That it was repealed by the Legislature at its last session and before the trial of this suit, and therefore no recovery could be had, as the corporation was dissolved.
On the first point, it is urged that some one or more members of the . Legislature of 1853-4, whose names are not given, offered sections 68 to 75, as amendments to an act, entitled an act, "to incorporate the iEtna Mining and Manufacturing Company and for other purposes," incorporating this and another company for Mining and Manufacturing purposes, which sections after enumerating the ordinary powers of a corporation, has the following enlarging and amplifying clause, that whenever the said companies are "organized according to the provisions of the foregoing sections, in addition to the powers therein enumerated, they shall have all the powers, franchises, rights, privileges and immunities conferred upon the corporation and body politic created by an act passed December 27, 1843, ch. 60." By reference to the act of 1843, ch. 60, it' is found to be, " An act to charter the Bank of East Tennessee." The argument is, that these sections were designed and fraudulently offered in the hurry of legislation, and on the third reading of the bill, and that they were voted for by a majority, without reference to the act of 1843, and without knowing that they were creating two new banks. There are some insurmountable obstacles to arriving at this conclusion, although it must be admitted, it is' strongly favored by the surrounding circumstances. In the first place, it cannot be presumed that any one honored with a seat in the Legislature would be so corrupt as to knowingly and designedly attempt such a fraud and imposition; and secondly, that both the majority and minoi'ity were so ignorant, or careless, in the discharge of their duties, as not to know the powers they were conferring upon these new corporations by the adoption of the acts to which reference was made. The hypothesis assumed, that is, that a part of the lawmaking body were capable of an attempt to dupe and deceive their fellows, and that the latter could be thus imposed upon in .the discharge of the important trusts confided to them, by their constituents, would, if established, be calculated to destroy all confidence in that most vital and important branch of the government.
No judicial action then, can be based upon a ground so derogatory to a co-ordinate department, and so destructive of all confidence in the representative system. It may also here be remarked, that there is no proof adduced of any extraneous facts to sustain the assumption upon which the argument is based. We need not, nor do we say now, whether a case could, or could not, be made out, which would authorize the Courts to disregard an act of the Assembly upon the ground of fraud and imposition in procuring its passage. This case does not in its facts call for a discussion or any opinion, on that question.
2. It is insisted that the act chartering the plaintiff is invalid upon another ' ground, that Is, that the journals do not show that the ayes and noes were taken and recorded upon its final passage, as required by the Constitution, art. 2, sec. 21. The provision is that " The ayes and noes shall be taken in each house on the final passage of every bill of a general character, and bills making appropriations of public moneys." Whether this would be regarded as only directory upon the members who were acting under an oath to support the Constitution, of which it is a part, or that it would be presumed that they had complied, and the clerk had failed to enter it upon the journal, it is not necessary to decide in this case, because this was not " a bill of a general character." That description was evidently intended to apply to such statutes as would affect the rights of the people at large, or all that might be embraced in a certain category, as all banks, all sheriffs, &c. Mayor and Ald. of Alexandria vs. Dearmon, 2 Sneed, 118, This was an act to create a private corporation, to bring into existence a new artificial person, and cannot in any legal sense be regarded as of a "general character."
A more plausible constitutional objection, to say the least of it, might be made to this charter, if the fact be as assumed, that the section containing it was offered and adopted as an amendment on the third reading of the bill; grounded on the 18th sec.. of the 2d article of the Constitution. It is this:
" Every bill shall be read once on three different days, and be passed each time in the House where it originated, before transmission to the other. No bill shall become a law, until it shall be read and passed on three different days in each House, and signed by the respective Speakers."
The intention of this requirement is, to ensure full consideration and mature reflection upon every measure before them, and that no bill shall be hastily and inconsiderately passed. If this mode had been adopted in a case like the present, the time intervening •, between the different readings, and .the repeated readings of the bill, would probably have caused some one to think of turning to the act of 1843, and bringing its contents before the House, if indeed the fact were as stated, that this was not done, nor its contents known to the members, that is, that they were voting in the dark, and in utter ignorance of what kind of law they were making. We have already said that we are forbidden by our respect for that honorable body to arrive at a conclusion so disparaging to them. Yet it is certain that conformity to the Constitution, in this respect, would tend to prevent such an occurrence as that presented in the argument. It is said that it is not unfrequently the case, and that the fact was so, in this instance, that provisions entirely distinct from those in a bill will be thrown on under the name of amendments on the third and last reading in both houses, and sent to the House where the bill -originated for concurrence, when a favorable action will make it, as well as the original bill, the law of the land. Now, this has the appearance at least of an evasion of the Constitution. If the new matter is not germane to that of the original bill, it would seem to be a new bill, although it may be called an amendment, and if so, should be read three times instead of once in each House.
But the case before us does not call for an adjudication of this question, and it is only referred to now as one of sufficient importance to be maturely •considered of by the Legislature and the profession. It is certainly a very unsafe and improvident mode of legislation, and not to be favored. How this question should be brought up, and what would be the decision upon it, is left for a case in which it may arise.
3. If the repealing act of the last session, ch. 113 sec. 16 is valid and effectual the preceding questions are of but little importance in the disposition of this case. That then, is the main question, and we will now consider it.
In England corporations are created by royal charter, and 'by act of Parliament. They may also exist by prescription there, which presupposes a creation in a lawful mode, that is, in that country, by charter from the King, or act of Parliament. In this country they can only be created by the authority of the Legislature. Constitution of Term., art. 11, sec. 7; 2 Kent, 276. In the case of private corporations, they are regarded as contracts between the public and the corporators, and as such, cannot be changed or altered by either party without the consent of the other, —the "obligation- of the contract" eannot be "impaired," without an infraction of the Constitution. Their corporate franchises, as well as property, are vested with the security of other private rights,- and are placed beyond the power of the Legislature. These principles are well established, and have not been questioned since, if indeed they ever were before, the great leading case of Dartmouth College vs. Woodward, 4 Wheaton, 518; 2 Kent, 306; Angel and Ames on Corp., ch. 22, sec. 767.
But we consider it equally clear that the Legislature may reserve the power to modify, amend, or repeal a charter.—2 Kent 306; Angel and Ames, ch. 22, sec. 737. This reservation then, becomes a part of the contract, and the charter is accepted with that as one of its terms or provisions. This exercise, therefore, of this power, to amend or repeal, is no infraction of the contract in such a case, but is in exact conformity to it. The right of the Legislature to insert this term in charters is not debateable at this day. Vested rights must be strongly maintained by the Courts against the Legislatures and all other authorities. The safety of every man's rights, of all kinds depends upon a firm adherence to this principle, -and the least departure from it would be just cause of alarm. But what are the rights of men or corporations and the rules of construing their contracts, must also be regulated by the rules of law. A can-tract of any kind with various provisions, must be taken as a whole, and all its terms are to have -equal vigor according to the meaning and intent of the parties.
But in order to reserve to the Legislature this 'important power to repeal, impair, or alter, the rights and privileges conferred by a charter, which is considered a compact between the government and the individual corporators, such reservation must be made a part and parcel of the contract, that is, it must be contained in the act constituting the charter, or it is of no force; such reservation is efficacious, contained in the same act with the charter, and not otherwise.—2 Kent, 306-7.
In the unreported case of Hurt vs. Lebanon and Nashville Turnpike Company, decided by this Court several Terms since, perhaps in 1850 or 1851, this was settled. An amendment of the charter in that case had been passed, and at a subsequent session repealed.. The company resisted the iorce of the repealing act upon the ground that it was unconstitutional, on the principle established in the Dai'tmouth College case. The Court so held, although at the same session of the amended charter a general clause was inserted in another and distinct act, reserving to the Legislature the power to amend or repeal all charters granted at that session. But not being a part of the amended charter, it was held not to apply to it. If this were not so, no one could safely deal upon the faith of charters, without exploring and fully understanding the whole legislation of the session, at least. But upon the principle settled there is no danger, as the whole compact must be contained in the same act plainly open to the inspection of all persons concerned.
All these principles then being well settled, nothing remains but to ascertain the facts in the case before us, and determine the result.
As before stated,, the charter of the plaintiff is contained in chapter 294 of the acts of 1853-4, § 72,. 73, 74 and 75. The title of the act has been given, and this corporation is called the "Southern Mining Company." The act first incorporates the " J3tna Mining and Manufacturing Company," then makes an amendment of the " Memphis and Charleston Railroad Company" in the sixth and seventh sections. Then from the seventh to the forty-ninth section, provision is made for the creation of any number' of corporations, for manufacturing purposes, by the association of four or more persons, upon the condition of making out a certain description of certificate, and having the same recorded by the clerk of the County Court. Whether such a corporation would be valid or not, is not the question in this case, and should therefore be left open for a case that may properly present it. But in the third clause of section eight, there is a proviso, that "the Legislature may, at pleasure, dissolve any company created by virtue of this act." Again, in the forty-sixth section, it is enacted, "That the provisions of the act may be amended or repealed at the pleasure of the Legislature, and every company created under this act, shall be bound by such amendment:" The following sections create various other corporations by name, and then concludes with the one under consideration. This charter having been transferred by the first corporators after the organization of a regular bank, by virtue of the reference to, and adoption of, the charter of the Bank of East Tennessee, as before explained, is now, or was up to the repealing act of last session of the Legislature, exercising all the functions of a bank, under the name of the "Miners' and Manufacturers' Bank," in lieu of the " Southern Mining Company," the charter name of the corporation. It has no connection with the mining business, the apparent object of its creation. Another bank was established at Nashville, called the " Central Bank," under section sixty-eight of this act, incorporating "Eastern Division Mining Company." This change of the names was authorized by the a«t. Both these charters were expressly repealed so far as they confer banking privileges by an act of the last session, ch. 113, § 16.
And it will at once be seen that the only question remaining is, whether according to the principles we have stated, the power of repeal was effectually reserved.
It is argued that it was not, because the clauses cited have reference only to the corporations to be created by certificate, under the eighth and succeeding sections. But the language is too broad for that construction, and cannot be so restricted. "Any company created by virtue of this act," or, as in the forty-sixth section, "any company created under this act," must, by all rules of fair construction, be extended to all and every section of the act, and not limited to a part of it. The location of the provision of itself, in the beginning, middle, or end of the chapter, cannot impair its force and effect. But it might further be remarked, in answer to the objection, if it had only been intended to apply this provision to the countless certificate corporations provided for, as that had been fairly accomplished in the eighth section, why was it again repeated in the forty-sixth? We must take the Legislature to have meant what they plainly say, that the power to repeal was reserved as to all the companies charted under and by that act.
And. we further hold, that when one act contains charters for various companies, it is enough for the power of repeal to be reserved in any part of the-same act, without being repeated in each section which may contain a separate charter, provided the language of the clause is sufficient to embrace the whole act, and there is nothing to restrict it, as in this case.
So, we think, that the repealing power was properly and legally exercised, and puts an end to the banking powers of these corporations.
But the corporations, as well as the public, are saved from the general consequences of the dissolution of a corporation, by another provision in the same act. The forty-second section provides, " That all corporations created under the provisions of this act, which shall expire by their own limitation, or shall be annulled by the Legislature, or otherwise, shall be continued bodies corporate three' years after the time when they would have been so dissolved, for the purpose of prosecuting and defending suits," &c. This section, as well as those on the subject of repeal, extends to, and constitutes a part of the charter of each and every company created by the act.
It follows, that the recovery of the plaintiff as a corporation was properly had, although its charter was repealed, as the suit was brought within the three yeai's allowed to settle up the business of the concern.
The judgment is affirmed.
Note by Repobter.—This question was muck considered in the case of Fletcher vs. Peck, 6 Cranch. R., 87. That was an action of covenant upon a title deed, in the Circuit Court of the district of Massachusetts. Fletcher had purchased of Peck, on the 14th of May, 1803, a large body of land, paid the consideration money, and taken a deed from the latter. The land had been originally granted by the legislature of Georgia, and Peck claimed under a regular chain of conveyances from the original grantees. The act of Assembly authorizing the grant, was passed on the 7th of January, 1795, and the grant was issued by the Governor on the 13th of that month. On the 13til of February, 1796, the Legislature of Georgia on account of certain improper influences used in order to procure the grant aforesaid, declared said grant null and void.
Among the covenants of Feck's deed to Fletcher, was one "that all the title which the State of Georgia ever had in the premises, had been legally conveyed to John Peck, the grantor." The second count of the declaration assigns as a breach of this covenant, "That the original grantees from the State of Georgia, promised and assured divers members of the Legislature, then sitting in General Assembly, that if the said members would assent to,. and vote for, the passing of the act, and if the said bill should pass, such members should have a share of, and be interested in, all the lands purchased from said State by virtue of such lav. And that divers of the said members, to whom the said promises were made, were unduly influenced thereby, and, under such influence did vote for the passing of the said bill; by reason •whereof the said law was a nullity, &c., and so the title of the State of Georgia did not pass to said Peck," &c.
Chief Justice Marshal in animadverting upon this question as presented by the pleadings, holds the following language:
"That corruption should find its way into the governments of our infant republics, and contaminate the very source of legislation, or that impure motives should contribute to the passage of a law, or the formation of a legislative contract, are circumstances most deeply to be deplored. How far a Court of Justice would, in any case be competent, on proceedings instituted by the State itself, to vacate a contract thus formed, and to annul rights acquired under that contract by third persons, having no notice of the improper means, by -which it -was obtained, is a question -which the Court would approach with much circumspection. It may well be doubted how far the validity of a law depends upon the motives of its framers, and how far the particular inducements operating on members of the supreme sovereign power of a State, to the formation of a contract by that power, are examinable in a Court of Justice. If the principle he conceded thatan act of the supreme sovereign power might be declared null by a Court, in consequence of the means which procured it, still there would be much difficulty in-saying to what extent those means must be applied to produce this effect. Must it 'be direct corruption, or would interest or undue influence of any kind be sufficient? Must the vitiating cause operate on a majority, or on what number of members? would the act be 'null, whatever might be the wish of the nation, or would its obligation or nullity depend upon, the public-sentiment?
"If a majority of the Legislature be corrupt, it may well be doubted whether it be within the province of the judiciary to control their conduct - and if less than a majority act from impure motives, the principle by which, judicial-interference would be regulated is not clearly discerned.
"whatever difficulties this- subject might present, when viewed under aspects of which it may he susceptible, this Court can perceive none in the particular pleadings now under consideration. This is not a bill brought by the State of Georgia to annul the contract; nor does it appear to the Court, by this count, that the State of Georgia is dissatisfied with the sale that has been made. This case as made out in the pleadings is simply this: One individual, who holds lands in the State of Georgia under a deed covenanting that the title of Georgia was in the grantor, brings an action of covenant upon this deed, and assigns as a breach that some of the members of the Legislature were induced to vote in favor of the law -which constituted the contract, by being promised an interest in it, and that therefore the act is a mere nullity.
"This solemn question cannot be brought thus collaterally and incidentally before the Court. It would be indecent in the extreme, upon a private contract, between two individuals, to enter into an inquiry respecting the corruption of the sovereign power of a State. If the title be plainly deduced from a legislative act, which the Legislature might constitutionally pass; if the act be clothed with all the requisite forms of a law, a Court, sitting as a Court of Law, cannot sustain a suit brought by one individual against another, founded on the allegation that the act is a nullity, in consequence of the impure motives which influenced certain members of the Legislature which passed the law."