Court Opinion

ID: 6236088
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:32:51.569903+00
Date Added: 2024-06-11T08:58:00.165176
License: Public Domain

Mr. Justice Sterrbtt
delivered the opinion of the court, March 24th 1879.
The corporate existence of the plaintiffs in error has not been called in question, nor indeed could it be in this collateral proceeding : Rhoads v. The Hoernerstown Building and Savings Association, 1 Norris 180; but, the defendant denies that the association was incorporated under the Act of April 12th 1859, and therefore not clothed with certain rights and franchises conferred by that act. It cannot be doubted that the application for the charter in question, and the action of the court in granting the same, were intended to be under that act. The leading features of the charter correspond with the provisions of the act; and, so far as appears, the *431association was organized and its business conducted in accordance therewith. The act, however, provides that when ten or more persons may desire to form an association under its provisions, they shall make application to the Court of Common Pleas of the proper county, &c. In this case the petition was signed by nine only, and there is nothing in the body of the charter, or in the record of the proceedings, to clearly show that others united in the application or were in fact associated with the petitioners for the purposes specified in the articles of association presented to the court. It is claimed, however, that the fourth article of the charter, which provides that the officers shall be a president, vice-president, secretary and nine directors, implies that ten or more persons were associated and desired to be incorporated. This does not necessarily follow. The three officers named might be chosen from the nine directors. The application and proceedings to obtain the charter were evidently informal and defective in not clearly showing that the requisite number were before the court, on their own petition or otherwise, asking to be incorporated under the act; but, we think this defect was cured by the Act of May 11th 1874, Pamph. L. 133. The act is general, very comprehensive in its terms and is declared to be applicable to such corporations as were “ actually operating under and transacting business in pursuance and by virtue of” charters, “ defective in validity.” The language is certainly sufficient to include such charters as the one now under consideration. The association was actually in operation, transacting business in pursuance of its charter, which contains provisions corresponding with those of the Act of 1859, and to be found nowhere else.
The proviso to the act declares that rights acquired previous to its enactment shall not be affected thereby. If the defendant had any such rights they were thus protected, and there was nothing to prevent him from asserting them. He continued to recognise the contract which he had previously 'made with the association of which he was all the while a member. It was doubtless for the mutual benefit of all the members that any technical or other defect in the charter, under which they were transacting business, should be cured and thus any doubt as to their corporate power and authority removed; and if the defendant continued, after the passage of the curing act, to maintain his relations to the association, as a member thereof, enjoying, in common with other members, the benefits of the charter thus validated, he should be bound by its requirements.
This case differs from Rhoads v. The Hoernerstown Building and Savings Association, supra. In that case it was manifest that the association was not incorporated, nor intended to be, under the Act of 1859. An examination of the charter revealed the fact that many of its important provisions were inconsistent if not in direct conflict with that act. Several of these inconsistences are pointed *432out by our brother Paxson in his opinion in that case. In addition to this the Act of 1874 was not brought to the notice of the court, for the reason perhaps that it was deemed inappliable, or, it may be because the suit was commenced in the court below before the date of its passage.
We are of opinion that the learned judge erred in holding that the plaintiffs were not entitled to exercise the rights and franchises conferred by the Act of 1859, and consequently could not recover more than the sum actually loaned, with legal interest thereon.
Judgment reversed, and a venire de novo awarded.