State ex rel. Perkins v. Montgomery Light Co.

102 Ala. 594
CourtSupreme Court of Alabama
DecidedNovember 15, 1893
StatusPublished
Cited by8 cases

This text of 102 Ala. 594 (State ex rel. Perkins v. Montgomery Light Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State ex rel. Perkins v. Montgomery Light Co., 102 Ala. 594 (Ala. 1893).

Opinion

HEAD, J.

This is a proceeding in the nature of quo warranto, to vacate the charter of the respondent corporation, under sections 3167 et seq. of the Code of 1886. It has its basis mainly in subdivision 5 of section 3167, which authorizes judgment of forfeiture when a corporation “ exercises a franchise or privilege not conferred on it bylaw.” The statute prescribes two methods of procedure to enforce these forfeitures. One is that the j udge of the circuit, wherein the corporation is- located, whenever he has reason to believe any of the specified acts or omissions can be proved, and it is necessary for tlie public good, must direct the solicitor to bring the action. When so done the proceeding is alone in the behalf of the State for the public good. The other is, that the action may be brought on the information of any person giving security for the costs, to be approved by the clerk of the court; in which case the informant must be joined as plaintiff with the State. If the informant dies pending suit, another, giving security for costs, may be substituted in his place ; but if no person is so substituted the action abates. The present proceeding is of the latter class, except that the requirement [600]*600that the informant be joined as plaintiff with the State seems to have been overlooked and was not conformed to, the action being instituted in the ' name of the State alone, “on the relation of B. F. Perkins.” >

The respondent corporation was chartered by special act of the General Assembly, in the year 1853, by the name of The Montgomery Gas Light Company, with the city of Montgomery, Alabama, as its place of business, and was empowered to furnish that city and its inhabitants gas for illuminating purposes, which was the sole object and end of the incorporation. The business of the company was legitimately carried on, within corporate powers, until the year 1889, when the grievances complained of in the information began. On December 12th, 1888, the General Assembly of Alabama passed an act, “To authorize corporations organized under the general incorporation laws of the State, or which have been chartered by an act of the General Assembly prior to the enactment of the general incorporation laws of this State of 1867, to alter and amend their charter;” and, in this act, it is provided that not less than three-fourths in number of the stockholders of any such corporation, holding not less than two-thirds in value of the stock thereof, may, in specified cases, file in the office of the judge of probate of the county in which the corporation has its principal place of business, a verified declaration, in writing, signed by them, setting forth, 1st. When said corporation was organized, its name, what changes, if any, are desired to be made in such name, and the amount of its capital stock which has been subscribed for and taken. 2d. The names of the stockholders signing the same-, and the amount of stock held by each. 3d. The purposes of the corporation and the nature of its business, as the same is set forth in the original declaration, and the alterations or amendments thereof desired. 4th. The amount of the capital stock as shown by said original declaration, and the amount to which it is proposed to decrease such capital stock, if a decrease is proposed. There is a proviso limiting, to some extent, the powers to be derived by such alterations, not material to the present case. — Acts, 1888-89, p. 20. Proceeding strictly under and in accordance with this act, assuming its validity, the respondent, in 1889, in the probate court of Montgomery county, changed its name' from “The [601]*601Montgomery Gas Light Company” to “The Montgomery Light Company”; acquired the authority to manufacture electricity and furnished the same to the city and its inhabitants for purposes of illumination; had its capital stock increased to about $200,000, “from amount fixed by its first named charter,” and acquired authority to execute bonds to the amount of $250,000, and to mortgage all its property to secure the payment thereof ; since which, the company has exercised the franchise of producing and furnishing electricity, as aforesaid, having established the necessary plant and appliances for that purpose. It has increased its capital stock to $200,000, and issued certificates for the same; has issued its bonds in the sum of $250,000, and its mortgage on all its property to secure them. The relief the informant seeks is based alone upon the proposition that the act above noticed is violative of section 5, Art. XIV of the constitution, that “No corporation shall engage in any business other than that expressly authorized by its charter;” and in connection therewith section 3, Art. XIV, which forbids the General Assembly to alter or amend the charter of any corporation existing at the adoption of the constitution, or to pass any general or special law for the benefit of such corporation, except upon the condition that such corporation shall therafte? hold its charter subject to the provisions of the constitution ; and especially as violative of those provisions of the Federal and State constitutions which forbid the State to pass any law impairing the obligation of contracts. In argument of appellant’s counsel the attack is made solely from the last named position, but we will notice the others as well.

We observe first, that section 5 of Art. XIV can exert no influence upon this controversy, for, if we go to the verge of holding that, under that section, necessarily implied corporate power can not exist, and that every corporate act must find its authorization in express terms in the charter, the acts now complained of are expressly authorized in respondent’s charter, if the alterations and amendments above noticed can be otherwise upheld as valid.

Next, we find, in section 3 of Art. XIV, express recognition of the right of the General Assembly to alter or amend the charter of an existing corporation, or to pass [602]*602any general or special law for its benefit, upon condition only that such, corporation shall thereafter hold its charter subject to the provisions of the constitution. We take it that it would not be contended that the enactment, under these provisions, must express the condition above mentioned. A valid acceptance by the corporation of the benefits conferred by the enactment would imply acceptance upon the condition named in the constitution. Then, suppose all the stockholders of the respondent corporation had joined in the petition to the probate court for the enumerated powers, in pursuance of the act of 1888, could it be seriously questioned that the amendments of its charter and the enlargements of its powers were constitutionally accomplished, so far as the provision of the constitution under consideration is concerned? Certainly not; and if not, then we demonstrate that the act of 1888 is not per se violative of the constitutional provision in question. It is, in that regard, a valid enactment open to every existing corporation, in a lawful way, to avail itself of its provisions ; and the only show of argument appellant can now make is, that it does not affirmatively appear, on the face of the probate court proceeding, that all the stockholders applied for or consented to the grant of the enlarged powers. What may have been done by the stockholder, by positive act, at the time, he may do by subsequent express ratification or silent acquiescence, and, in. respect of acts which may be made lawful and efficacious by ratification, either express or by acquiescence, of another, it is the legal right of such other so to ratify, which right no outsider can deprive him of.

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Bluebook (online)
102 Ala. 594, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-perkins-v-montgomery-light-co-ala-1893.