Court Opinion

ID: 6655612
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:57:32.77432+00
Date Added: 2024-06-11T15:59:53.689162
License: Public Domain

The following opinion on rehearing was filed January 5, 1905. Reversed:
Oldham, C.
An opinion by Commissioner Dtjefie was filed in this cause. Ante, p. 713. In this opinion there is a careful and accurate statement of all issues arising under the pleadings and proofs, consequently no additional statement is requisite to the conclusion about to be reached. We find, on a reexamination of the evidence contained in -the bill of exceptions, that the conclusion reached by the learned commissioner in support of the first paragraph of the syllabus of the original opinion is well founded and should be adhered to, and as this will necessitate a retrial of the cause in the court below, we deem it well to further examine the doctrine announced in paragraph 2 of the syllabus of the former opinion. In this latter paragraph it is held, in substance, that, where a collection of persons claim to have organized themselves into a corporation, the invalidity of their organization may be shown even when questioned collaterally, when no articles of incorporation have been filed with the secretary of state. In support of this conclusion the learned commissioner says:
“The articles themselves were introduced in evidence and, while they show a filing in the office of the county clerk, they do not bear a certificate of the secretary of state to the effect that they were filed in his office.”
The question then arises, does the failure of a domestic corporation, organized under the general laws of the state, to file its articles of incorporation with the secretary of state, when it has filed them in the office of the clerk of the county in which' its place of business is situated, render its proceedings a nullity for the purpose of transacting business other than its own organization? Section 126, chapter 16, Compiled Statutes (Annotated Statutes, 4119), which is quoted in the original opinion, provides in substance that every corporation, when the same is not formed by legislative enactment, shall adopt articles of incorporation and have them filed in the office of the secretary of state, and it also provides that domestic corpora*720tions must also file them with the county clerk in the county where their headquarters are located. This section of the statute was adopted in 1897 as an amendment to section 126, chapter 25, Revised Statutes, 1866, which bnly provided for the recording of the articles with the county clerk in the county in which the business of the corporation is to be transacted. Section 132, chapter 25 of the Revised Statutes of 1866, however, has never been amended or repealed by direct enactment and remains as section 132, chapter 16, Compiled Statutes (Annotated Statutes, 4124), and this section provides that any corporation formed without legislative enactment may commence business as soon as its articles of incorporation are filed with the county clerk of the county, as required by this subdivision, and shall be valid if a copy of its articles be filed in the office of the secretary of state, etc. This latter section of the statute is now in full force and effect, unless repealed by implication by the enactment of section 126, supra, and if repealed by implication it must be because of a clear and irreconcilable conflict between the two sections. If the question of the conflict of these sections of the statute and the consequent repeal of section 132 by the adoption of section 126 had been raised in a direct attack by a quo ■ warranto proceeding, instituted by the state to prevent the corporation from transacting business, other than its organization, without filing its articles with both the county clerk and the secretary of state, we would consider the question one worthy of grave consideration, for in such proceeding the corporation would be compelled to show its right de jure to transact business; but when collaterally attacked, as in the case at bar, it is only necessary to show1 a die facto existence.
Prior to the amendment of 1897 it was held by this court that the filing of articles with the county clerk is a condition precedent to the right to do business other than the organization of the company. Abbott v. Omaha Smelting & Refining Co., 4 Neb. 416; Capps & McCreary v. Hastings Prospecting Co., 40 Neb, 470, 477. These *721cases go to the question that the mere adoption of articles of incorporation, without filing the same as required by statute, gives no right as even a de facto corporation to transact business; but in the case of Haas v. Bank of Commerce, 41 Neb. 754, where the right of a corporation was collaterally attacked, Ibvinb, C., speaking for the court, said:
“Where the law authorizes a corporation, and there has been an attempt in good faith to organize, and corporate functions are thereafter exercised, there exists a corporation de facto, the legal existence of which can not ordinarily be called in question collaterally. It would be intolerable to permit in any civil action, to which such a body was. a party, an inquiry into the legal- right to exercise corporate functions — a right which it is for the state alone to question in appropriate proceedings for that purpose. On this there is a substantial unanimity in the authorities. Among other cases may he cited, Williamson v. Kokomo Building & Loan Fund Ass’n, 89 Ind. 389; Pape v. Capitol Bank, 20 Kan. 440; Lessee of Frost v. Frostburg Coal Co., 24 How. (U. S.) 278; Society Perun v. Cleveland, 43 Ohio St. 481. The evidence here shows that articles of incorporation were adopted, acknowledged and filed for record in the office of the county clerk, and that the hank acted under such articles and conducted business thereunder for some years. This was sufficient evidence of a corporate existence. Abbott v. Omaha Smelting & Refining Co., 4 Neb. 416; Merchants Nat. Bank v. Glendon Co., 120 Mass. 97.”
It seems to us, in view of the apparent existence of the two sections of the statute, it may be said that the Fair-field Grocery Company has colorably complied with the requirements of the law, and this is all that is necessary to show to constitute it a de facto corporation, and secure it against a collateral attack. 1 Clark. & Marshall, Private Corporations, sec. 80, p. 227, and authorities there cited.
We therefore conclude that the second paragraph of the syllabus of the original opinion should be overruled, and *722that the cause should be reversed and remanded because of the insufficiency of the testimony to sustain the judgment as set forth in the first paragraph of the original opinion.
Ames and Letton, CC., concur.
By the Court:
For the reasons stated in the foregoing opinion, the second paragraph of the syllabus of the original opinion is overruled, and the cause is reversed and remanded because of the insufficiency of the testimony to sustain the judgment as set forth in the first paragraph of the original opinion.
Reversed.