| Ala. | Dec 15, 1875
In the case of the Pennsylvania Railroad Company v. Canal Commissioners, 21 Penn. State Rep. 22, Chief Justice Black, delivering the opinion of the court, said: “When the State means to clothe a corporate body with a portion of her own sovereignty, and to disarm herself to that extent of the powers that belong to her, it is so easy to say so that we will never believe it to be meant when it is not said.” Speaking further of the rule of construing powers of a corporation, he said: “In the construction of a charter, to be in doubt is to be resolved; and every resolution which springs Bom doubt is against the corporation.”
In the case of Grand Lodge of Alabama v. Waddill, 36 Ala. 318, we quoted this language approvingly. Substantially the same idea was expressed in the following cases: State v. Stebbins, 1 Stew. 308; State v. Mayor & Aldermen of Mobile, 5 Por. 279; Mayor & Aldermen v. Allaire, 14 Ala. 400" court="Ala." date_filed="1848-06-15" href="https://app.midpage.ai/document/mayor-v-allaire-6503729?utm_source=webapp" opinion_id="6503729">14 Ala. 400; Ex parte Burnett, 30 Ala. 461" court="Ala." date_filed="1857-01-15" href="https://app.midpage.ai/document/ex-parte-burnett-6506017?utm_source=webapp" opinion_id="6506017">30 Ala. 461. In the case of City Council of Montgomery v. M. & W. Plank-road Company, 31 Ala. 76" court="Ala." date_filed="1857-06-15" href="https://app.midpage.ai/document/city-council-of-montgomery-v-montgomery--wetumpka-plank-road-co-6506083?utm_source=webapp" opinion_id="6506083">31 Ala. 76, we affirmed the above principle, and went a step further, holdr ing that a party dealing with a corporation in a matter not within the purview of its dólegated powers, does not thereby estop himself from setting up in defense, the want of authority in the corporation to make the contract. The same doctrine was affirmed in the case of Grand Lodge v. Waddill, supra. In such case the doctrine of estoppel can not be held to apply, without clothing corporations with the ability to increase their powers indefinitely, by sheer usurpation. Such contracts, on the part of a corporation, are ultra vires and void; and no right of action can spring out of them.
When, however, the contract is within the delegated powers of the corporation, and the question is whether the corporation has been duly and completely organized according to the provisions of its charter, a very different rule is applied.
We are not prepared to say, however, that the present defendant is estopped by any thing appearing in this record, from setting up the defense of want of proper organization of the - Marion Savings Bank according to the requirements of the law, if such want really exists. He is not the party who made the contract, if one was made, with the Marion Savings Bank. The proof shows' that the acceptor of the bill applied to the bank for a loan of money, and tendered as security, or for discount, a paper in form of a bill of exchange, drawn by defendant on and accepted by him, the party tendering, and endorsed by another. This was enough to charge the bank with notice that the defendant was accommodation drawer. — Saltmarsh v. P. & M. Bank, 14 Ala. 668" court="Ala." date_filed="1848-06-15" href="https://app.midpage.ai/document/saltmarsh-v-p--m-bank-6503794?utm_source=webapp" opinion_id="6503794">14 Ala. 668. The present defendant, not being present at, nor participating in the negotiation, so far as we are informed, we can not know or affirm that he authorized the acceptor to borrow money upon it from the plaintiff, or that he knew such use was to be made of it. Hence, we can not say that the defendant, by any act of his, recognized the plaintiff as a corporation, or estopped himself from disputing it. We speak of the facts as the record tends to show they were made to appear in the court below.
The Revised Code, Part 2, Title 1, Chapter 1, § 1644 et seq., relates to free banking corporations, and provides for their incorporation under a general law. This general law was changed and amended by the act “ supplementary to the corporation laws of Alabama.”- — Pamph. Acts, 1868, p. 349. In the proceedings to incorporate the Marion Savings Bank, there seems to have been a strict compliance with the law, except that the associates did .not propose to become a bank of issue, or to issue or put in circulation any of their own notes. Hence, they made no deposit of money with the treasurer, under section 1644, and transferred to the comptroller [auditor] no United States stocks, or bonds issued or endorsed by the State of Alabama, under section 1646 of the Revised Code. The powers they sought to obtain, and the only banking powers they seem, to have exercised, are those enumerated in section 1655 of the Revised Code. The argument is made, that by failing to comply with sections 1644 and 1646 supra, the associates did not organize their corporation according to law, and that such pretended corporation had no authority to contract, and has no authority to sue.
The rulings of the circuit court were in direct conflict with these principles.
The judgment of the circuit court is reversed, the nonsuit set aside, and the cause remanded.