11 Colo. 113 | Colo. | 1887
A corporation de facto presupposes a charter, or a law authorizing the creation of such a corporation, that there has been an attempt in good faith to comply with its provisions, and that there has been, user or the exercise of corporate powers under it. Against such a corporation, as a general rule, a collateral attack by third persons will not avail. The reason is that if rights and franchises have been usurped they are the rights and franchises of a sovereign, and he alone can interpose. Until such interposition the public may treat those possessing and exercising corporate powers under color of law as doing so rightfully. The rule is in the interest of the public, and is essential to the safety of business transactions with corporations. Ang. & A. Corp. §§ 635, 636; Abb. Tr. Ev. 18, 26; Navigation Co. v. Neal, 3 Hawks, 520; Hudson v. Cemetery Corp. 113 Ill. 618; Tarbell v. Page, 24 Ill. 46; Turnpike Co. v. Cutler, 6 Vt. 315; Stout v. Zulick, 48 N. J. Law, 600; 7 Atl. Rep. 362. In the case of Railroad Co. v. Cary, 26 N. Y. 77, it said: “Under this and similar general acts for the formation of corporations, if the papers filed, by which the corporation is sought to be created, are colorable, but
A point is made respecting certain admissions of counsel of the defendant in error upon the trial of the cause. We think the general admission of “ all that is set up in the answer ” must be taken as qualified by the specific statement made in the same connection, namely: “We simply admit that the defendant in this case claimed to
The judgment of the court below is affirmed.