17 How. Pr. 323 | N.Y. Sup. Ct. | 1859
After a careful consideration of the questions raised on the argument, I have come to the conclusion that the report of the referee should he confirmed. It would be alike impraclicable and unprofitable to refer in this opinion, at length, to the various minor questions raised by the different exceptors. Many of them relate to the practice under the. act in question, and I will merely remark that such of them as were not considered and decided by the court of appeals “ In the matter of the Empire City Bank,” I have had frequent occasion to examine, with care, in the progress of this proceeding, which has been conducted, I believe, entirely before me, upon a reconsideration of my previous conclusions. I am convinced that the proceedings have, in all respects, been conducted in substantial compliance with this act. I will, therefore, proceed to the examination of the objections in wbich all the exceptors unite on the argument, and which question directly the validity of any proceedings, in any form, under the statute, against this bank.
First, then, it is claimed that neither the provisions of the act of 1849, nor those of the constitution in aid of which that act was passed, extend, either in terms or by fair implication, to the Beciprocity Bank, for the reason that it was created and existed anterior to the constitution and the statute, and that both, if not so declared in terms, are by plain implication prospective in their character, and must be so limited in their operation. The safest, and indeed the only test of the soundness of this position, will be found by resorting to the primary, and, in the absence of any ambiguity or obscurity appearing there, the exclusive evidence as to the intention of the people in adopting the constitution, and of the legislature in passing the statute, namely, the language of those instruments. I think both the constitution and the statute apply in plain terms to this corporation. The language of the seventh section of the eighth article of the constitution is, “ the stockholders of every corporation, &c., for banking purposes, issuing bank notes, &c., to circulate as money after the 1st
But it is claimed by the several exceptors, that if the constitution and statute are applicable in terms to this corporation, their provisions are void, for the reason that they are in conflict with that provision of the tenth section of the first article of the constitution of the United States, which declares that no state shall pass any “ law impairing the obligation of
Indeed, the right of the- legislature to alter a charter previously granted, to the extent to which it has reserved the power to do so, was never questioned. But it was urged, and I confess with much plausibility, by the learned and venerable counsel who made the principal argument upon this question, that, as by the provisions of the constitution of this state, adopted in 1822, under which this charter was granted, {art. 7, § 11,) “ the assent of two-thirds of the members elected to each branch of the legislature shall be requisite to every bill, &c., &c., creating, continuing, altering or renewing any body politic or corporateand as this law of 1849 has the effect to alter the charter of this corporation, and it had not the assent of two-thirds of the legislature to its passage, the law is void.
The latter fact is undisputed, and it must be conceded that this act does in effect alter the charter; but in connection with these facts, it must be remembered that by the constitution of 1846, which was in force when the act in question was passed, the assent of two-thirds of the members of the legislature to the passage of such a bill was not required, and that this act had the assent of the requisite number of votes, according to the existing constitution. The question that is presented by this phase of the case is simply this : When the power to alter a corporate charter is reserved.by the legislature granting it, is the number of votes required for such alteration by the constitution in force when that charter is granted, requisite to the validity of an act altering it, without regard to the time when, or circumstances under which, such alteration is made ? The argument of the exceptors is, that the assent of two-thirds of the members of the legislature to the alteration of this charter, which was required when it was granted,
I have bestowed much reflection upon this view of the case, but I cannot assent to it. The error of the argument consists, in my judgment, in confounding the idea of a general power with the agency through which, and the form and manner in which, the form is exercised. The legislature is simply the representative and organ of the sovereignty of the state. The term is only another name for the same thing. The state, then, acting through this organ of the sovereignty, reserved to itself this acknowledged and essential attribute of its original power—-the right, at any time, to repeal or alter this charter, or any of its provisions. I cannot think that the existence of this power depends, in any degree, upon the mere form or manner in which it may be exercised. On the contrary, I think the people, who possess the power, may, from time to time, designate the agents or organs by which, and prescribe the manner in which, the power shall be exercised. This they have heretofore done by written constitutions, in which they have imposed specific restrictions upon their legislature, and to some extent prescribed to it forms and modes of proceeding. The powers of the legislature must, of course, be exercised in subordination to such restrictions, and in conformity to the prescribed forms of procedure. But, subject to these qualifications, the legislature, in my opinion, may exercise any power vested in it at its pleasure. In the exercise of such power, it is vested with a plenary discretion over all questions of expediency, time and forms of proceeding. If this were not so, a radical, or even material change, by the people, in the policy or form of their government, by their organic law, would result in an unintentional surrender by them of many, and some of the most essential, powers of sovereignty. If, for instance, the people should, in a subsequent revision of their constitution, vest the legislative power of the state in one general assembly instead of a senate and assembly, by which that
But I deem it unnecessary to pursue the argument. My conclusion in brief is, that as the power to make this alteration was reserved in express terms in this charter, and as it was exercised by an authority adequate for that purpose, and in accordance with the forms prescribed by the constitution in force when the alteration was made, theTaw is not obnoxious to the objection that it violates the contract with this corporation contained in its charter.
I think enough has been said to show that the act is not in • conflict with the 18th section of the first article of our constitution. That section, in general terms, provides that nothing in that constitution shall affect any corporate charters granted by this state since the 14th day of October, 1775, meaning
The next objection to the confirmation of the referee’s report, relied upon by all the exceptors, is that the report shows a large amount of assets in the receiver's hands not disposed of, and that, until the assets are exhausted, the court has no power, under the act, to order an apportionment of the debts of the corporation, among the stockholders. As I have before remarked, this question was carefully considered by me, when the order of reference Was granted; and after an attentive reconsideration of it, aided by the able arguments of counsel, and a re-examination of the statute, I am unable to come to a different conclusion from that which I reached when I granted the order. I will refer but briefly to a few of the provisions of the statute upon which I found my opinion. Section 12 provides that the receive!-, under the direction of the comptroller, shall convert all the securities deposited by the corporation with him, “ with the least possible delay,” and shall also convert into cash the effects and demands of the corporation, and for that purpose may sell any of such demands at auction, which any justice of this court may authorize to be sold. It further provides, that within ninety days from the time of his appointment, unless such time be extended by a justice of this court, not exceeding ninety days, the receiver
A question was made upon the argument by certain of the exceptors, as to the power of the corporation to receive its stock in payment of debts or otherwise, and to re-issue it. If this was a question between the corporation and such stockholders, it might present serious difficulties. But we are now dealing with a statute liability of the stockholders, real or apparent, to the creditors of the corporation, and I think the statute settles the question. Section two provides in express terms that the term “ stockholders” shall apply not only to such persons as appear by the boohs of the corporation, &c. to be such, hut also to every equitable owner of the stock. It is not necessary now to inquire whether both such apparent and equitable owners could not be made jointly liable in this proceeding, or how that liability could be enforced. It is enough that those who purchased the Merrick stock consented to do so, and were registered on the books of the bank as stockholders, and received dividends as such. This, in my opinion, makes them liable under this act. I think there is no force in the objection that certain shares of the stock were not assessed by the referee, since it distinctly appears, from his report, that those assessed are assessed for the precise amount that they -would have been had the other shares been assessed. Under such circumstances, I can see no rational ground of complaint on their part. The answer to the various objections of the married women who were stockholders at the time of the failure of the bank, is to be found in the plain terms of the act. The liability thereby created is imposed upon the “ stockholders.” Married women could own stock in banks in their own right, both at common law and under the act of 1848, and the acts amending it, and the legislature had the power to alter the common law so as to make them personally liable to the amount of their stock. It has thought proper to do so, and we are bound, in this as in all other cases,
Greene, Justice.]
I think the report of the referee should be confirmed, and an order accordingly must be entered in the office of the clerk of Erie county.