Court Opinion

ID: 6415576
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:55:55.050253+00
Date Added: 2024-06-11T15:51:19.387902
License: Public Domain

Hoak, J.
If the defendants are a foreign corporation, then the case of Attorney General v. Bay State Mining Co. 99 Mass. 148, is conclusive in favor of the plaintiff. It was there held that the right to exercise a corporate franchise within this Commonwealth was the proper subject of an excise; and that “ a corporation which seeks, by its agents, to establish a domicil of business in a state, other than that of its creation, must take that domicil subject tu the responsibilities and burdens which it finds in force there. The state may deny to foreign corporations the right to transact their business, hold property, or exercise any corporate function whatever within its limits. Or it may permit them to exercise such privileges upon terms prescribed by law, as has long been done in relation to insurance companies.”
We have, then, first to consider whether the defendants are a corporation, or an association so far clothed with the functions and attributes of a corporation as to come within the just application of the principles relating to corporations above stated. There can be no doubt that they are “ an insurance company, associated under the laws of a government other than one of the United States; ” and therefore that they come literally within the terms used in the St. of 1862, c. 224, § 2, which provides for the assessment of a tax upon such bodies. But the defendants object that they are not a corporation ; and that such *539a tax as the statute imposes cannot lawfully be assessed upon them, because they are to be regarded as a mere partnership, consisting in part of British subjects and in part of citizens of the state of New York, so that under the Constitution of the United States and the subsisting treaties with Great Britain they are entitled to transact any lawful business within this Commonwealth without being subject to any burdens which are not imposed upon our own citizens engaged in like avocations.
It appears from the exhibits annexed to the bill and answer, and from the agreed facts which are reported, that the defendants are an English joint-stock company, organized in 1836 under a deed of settlement, and since transacting business under that and two supplemental deeds of settlement, with powers and privileges conferred upon the company by three acts of parliament, of 1836,1847, and 1864. By one of the supplemental' deeds of settlement, provision is made for the transaction of business in foreign countries, with local shareholders and officers ; and it is under this that certain citizens of New York have become members of the company.
It is carefully and expressly stipulated in each of the acts of parliament, that it shall not have the effect to incorporate the company; and the personal liability of the members for the obligations of the association is carefully preserved. But while the creation of a corporation in the full sense of the term, as defined by the common law, is thus excluded, and, as we are inclined to believe, mainly with a view to keep this personal liability unimpaired, it is obvious that many powers of a corporate nature are expressly granted. The company has a name as an association, maintaining the identity of the body through all changes of its members; its property is divided into transferable shares ; and it has conferred upon it the legal capacity to sue and be sued in the name of one of its officers, and such a suit does not abate by reason of the death or resignation of the officer, or by reason of any change in the members, and may be brought by or against a member, as well as a third person.
To describe such a creature of law as this, we think the language of a recent English text writer is substantially accurate, *540which says that “joint stock companies are not pure partner* ships, for their members are recognized as an aggregate body, nor are they pure corporations, for their members are more or less liable to contribute to the debts of the collective whole. They are associations of persons intermediate between corporations known to the common law and ordinary partnerships, and partake of the nature of both.” Lindley on Part. (2d ed.) 6. And we are all of opinion that when, by legislative authority or sanction, an association is formed capable of acting independently of the rules and principles that govern a simple partnership, it is so far clothed with corporate powers that it may be treated, for the purposes of taxation, as an artificial body; and becomes subject as such to the jurisdiction of the government under which it undertakes to act and contract in its associated capacity.
We think the defendants are an association of the kind to which the statute of 1862 was expressly intended to apply, as well as to bodies wholly corporate in their character; and that, being permitted by the comity óf our laws to exercise their functions within this Commonwealth, they can claim no exemption from regulations appropriate to their collective action on account of the citizenship or nationality of their individual members.

Decree for the plaintiff.