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pointment of an agent should be made under the corporate seal. Mendham v. Losey, 2 N. J. Law, 327.

The manner of appointing agents is usually prescribed by the by-laws.

A trading or manufacturing corporation, until its charter is annulled by a proper proceeding at law, has the same authority as an individual trader or manufacturer to sell or consign goods, to select selling agents, and to impose conditions as to whom and the terms upon which they shall sell. Stockton v. American Tobacco Company, 55 N. J. Eq., 352; aff'd 56 Id., 847.

The fact that an incorporator of a company has received stock in payment for his services in promoting the company does not preclude a recovery for services rendered later as an employé. Wiltbank v. Automatic Amusement Co., 69 N. J. Law, 236.

As to the issuing of bonus stock by directors for services, and influence of one or more of their number in promoting a corporation, see Central Consumers' Wine & Liquor Co. v. Madden, 68 Atl. Rep., 777. When the duties of an officer decrease, it is expected that directors will reduce future salary. The question of reasonable value may be submitted to a jury. Metropolitan Rubber Co. v. Place, 147 Fed.

Rep., 90.

One of two persons engaged in the organization of a business for the common welfare is not entitled to compensation. Bailey v. Burgess, 48 N. J. Eq., 411.

Salaries.

A court of equity has power to review the question of reasonableness of salaries for personal service of directors, although fixed by the stockholders. Lillard v. Oil, Paint & Drug Co., 70 N. J. Eq., 197.

Where the salary of a director is fixed by the directors themselves, its reasonableness is reviewable in equity at the instance of a dissenting stockholder. Gardner v. Butler, 30 N. J. Eq., 712; Laurel Springs Co. v. Fougeray, 50 N. J. Eq., 756, 759.

Officers receiving excessive salaries are liable to the receiver of the corporation for the amount of the excess. Mills v. Hendershot, 70 N. J. Eq., 258.

See further as to officers, agents and de facto officers, notes to §13. VI. By-laws.

As to where the power to make and alter by-laws lies, see Section 11.

By-laws are binding and confer rights upon members of the cororation but not upon third persons without notice. State v. Overton, 24 N. J. Law, 435, 440.

Where a by-law is adopted as a part of the original organization of the company, and the subscriptions for stock are made and money

paid thereon upon the strength thereof, it becomes a fundamental contract between the stockholders, and cannot afterwards be altered, even though a general power be reserved in the by-laws to make alterations therein. Rights under such a by-law are vested in the stockholders and pass to each new holder of stock by transfer. Loewenthal v. Rubber Reclaiming Co., 52 N. J. Eq., 440.

For early cases declaratory of general principles relating to by-laws, see Paxson v. Sweet, 13 N. J. Law, 196; Taylor v. Griswold, 14 Id., 222; State v. Overton, supra.

VII. To wind up and dissolve.

See also Section 69. Generally speaking, aside from the inherent power of the state to forfeit a charter for misuser or nonuser, the statutes alone provide the means by which a private corporation may be dissolved, and any other method may be enjoined. Hunt v. American Grocery Co., 81 Fed. Rep., 532. In Hoboken Building Association v. Martin, 13 N. J. Eq., 427, it was contended that a failure to elect officers according to the requirements of the constitution worked a dissolution. But the court held contra. This matter is now settled by statute. Section 41, post.

The charter of a company is not extinguished by a transfer of all its property. Zinc Co. v. Franklinite Co., 13 N. J. Eq., 322; Sewell v. East Cape May Beach Co., 50 N. J. Eq., 717.

The methods by which a corporation may be wound up and dissoived, provided by statute, are:

1. Limitation in the certificate of incorporation. The corporate existence is continued, however, for the purpose of settling up and closing the affairs of the company. Sec. 53.

2. Surrender of the corporate franchises. Sec. 32.

3. Voluntary dissolution by the directors and stockholders, or by unanimous consent of the stockholders. Sec. 31.

4. Legislation. Sec. 4.

5. Decree of the Court of Chancery in insolvency proceedings. Sec. 69.

6. The Court of Chancery or Supreme Court may declare charter of company forfeited for failure to obey order to bring books into the state. Sec. 44.

7. Proclamation of the Governor for failure to pay taxes. Sec.

156..

2. Powers additional.

In addition to the powers enumerated in the first section of this act and the powers specified in its charter or in the act or certificate under which it was in

corporated, every corporation, its officers, directors and stockholders, shall possess and exercise all the powers and privileges contained in this act, so far as the same are necessary or convenient to the attainment of the objects set forth in such charter or certificate of incorporation; and shall be governed by the provisions and be subject to the restrictions and liabilities in this act contained, so far as the same are appropriate to and not inconsistent with such charter or the act under which such corporation was formed; and no corporation shall possess or exercise any other corporate powers, except such incidental powers as shall be necessary to the exercise of the powers so given.

P. L. 1846, p. 16; Act of 1875, §§2, 3, 9. See P. L. 1899, p. 334.

This section is an important provision of the corporation law, involving the question as to what corporate powers are granted by the statutes of New Jersey.

In 1846 the act entitled "An Act concerning corporations," approved February 14, 1846 (P. L. 1846, p. 16), was passed, giving all corporations substantially the same general powers as are contained in paragraphs 1 to 5 of this act.

In the same year "An Act to authorize the establishment and prescribe the duties of manufacturing companies," approved February 25, 1846 (P. L. 1846, p. 64), was passed.

This was the first general enabling act of New Jersey. During the next three years recourse was had to the Legislature by way of special charters for specific powers and objects, until it became apparent from the multiplicity of special charters that an extension of the general enabling act (P. L. 1846, p. 64) was necessary so as to include corporations other than manufacturing. Accordingly in 1849 the general enabling act was broadened to include companies for manufacturing and other purposes by the passage of an act entitled "An Act to authorize the establishment, and to prescribe the duties of companies for manufacturing and other purposes," approved March 2, 1849 (P. L. 1849, p. 300).

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The "Act concerning corporations, approved February 14, 1846 (P. L. 1846, p. 16), which prescribed the powers of corporations in general, remained practically unchanged down to the Revision of 1875.

Meanwhile the general enabling act of 1849 (P. L. 1849, p. 300) was supplemented by various acts of the Legislature from time to time,

In 1875 the Constitution of New Jersey, as then amended, provided that the "Legislature shall pass no special act conferring corporate powers, but shall pass general laws under which corporations may be organized and corporate powers of every nature obtained.''

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In obedience to the provision of the Constitution the Corporation Act of 1875 was passed, and in that act the fundamental powers of corporations as defined under "An Act concerning corporations, approved February 14, 1846 (P. L. 1846, p. 16), were substantially reiterated.

The Revision of 1896 consolidated Sections 2 and 3 of the Act of 1875 into Section 2 of the Act of 1896.

Before proceeding to analyze this section it should be borne in mind that the act is applicable to domestic corporations generally, including (1) corporations under special charters granted by the Legislature, or under the general corporation act prior to 1875; (2) corporations created under general acts of the Legislature applicable to different classes of corporations, such as banking, insurance, etc., as well as (3) to corporations organized under the Act of 1875. Therefore, when the statute reads "in addition to the powers enumerated in the first section of this act and the powers specified in its "charter" it includes companies created by special charters granted by the Legislature prior to 1875.

At common law a corporation created by charter could do any act that an individual could do, whether expressly empowered by its charter to do such act or not. For an abuse of its powers it was amenable to the sovereign alone. Riche v. Ashbury Co., L. R., 9 Exch., 224, 262. A corporation created by statute, however, is precisely what the organic act makes it. For every function it claims to exercise and for every power it assumes to possess it must find authority in legislative grant. Watson v. Acquackanonck Water Co., 36 N. J. Law, 195; Stockton v. Central R. R. Co., 50 N. J. Eq., 52.

When we seek to ascertain the powers of a corporation under this act we find that there are two sources from which its express powers are derived. These are:

(1) The "Act Concerning Corporations.

(2) The certificate of incorporation.

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I. The Act Concerning Corporations. It should be borne in mind that this act has a twofold scope. It contains:

(a) A code of general rules of law applicable to all corpora

tions.

(b) An enabling act under which certain kinds of corporations

may be formed. See Section 6.

In its first aspect it declares the fundamental powers which shall be possessed by every corporation. These are set forth in Section 1, and are, with some slight modifications, declaratory of the common law attributes of corporate existence, as stated by Coke and Blackstone.

They are basic and inherent powers, pertaining to a corporation as such without regard to the object of its creation.

It confers certain additional general powers and privileges on all corporations, however organized, but only "so far as the same are necessary or convenient to the objects set forth in such charter or certificate of incorporation." Ellerman v. Chicago Junction Rys., &c., Co., 49 N. J. Eq., 217; Rabe v. Dunlap, 51 N. J. Eq., 40; Dittman v. Distilling Co., 64 N. J. Eq., 541.

It confers also certain express powers on condition that they are inserted in the certificate of incorporation. Such, for instance, as the power to issue preferred stock (Sec. 18); to transact business outside of New Jersey (Sec. 7).

It also prescribes that every corporation "shall be governed by the provisions and be subject to the restrictions and liabilities in this act contained, so far as the same are appropriate to and not inconsistent with such charter or the act under which such corporation was formed."

This clause is applicable to corporations organized otherwise than under this act. As to corporations organized under this act, it is provided that the certificate of incorporation must be consistent with the act (Sec. 8), and Section 5 provides "this act and all amendments thereof shall be a part of the charter of every corporation heretofore or hereafter formed hereunder, except so far as the same are inapplicable and inappropriate to the objects of such corporation.”

In its second aspect the act enumerates the kinds of corporations that may be organized under it, prescribes the procedure for their organization, confers upon them certain powers and privileges, and imposes certain regulations as to their conduct and management.

II. The certificate of incorporation. The second source from which a corporation derives its express powers is its certificate of incorporation, and in the discussion which follows reference is had only to corporations formed under the "Act concerning corporations.''

"The general act gives to all corporations general corporate powers and all others necessary to their exercise.

"If these were not sufficient to effect the objects of the corporation recourse was formerly had to the Legislature for a specific grant of power. The Constitution providing that 'the Legislature shall pass no special act conferring corporate powers, but shall pass general laws under which corporations may be organized and corporate powers of every nature obtained,' and the general corporation act being as it now stands passed in obedience to the mandate of the Constitution, the certificate required by that act becomes the charter of the company, and the equivalent of the former special act of the Legislature." Ellerman v. Chicago Junction Rys., &c., Co., 49 N. J. Eq., 217, 240, 241.

As though to carry this idea to its logical conclusion, by an amendment to Section 8 passed in 1898 (Chap. 172), corporations are now

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