#### Tar River Navigation Company v. Neal.

T 5- From Franklin. J

Where an act of the legislature incorporating a navigation company, authorizes, but does not require, the company to strike off the names of subscribers, delinquent by the non-payment of their instalments, and to sell their shares; this mode of proceeding is merely given as a cumulative remedy to facilitate the operations of the company, and does not preclude it from bringing suit for the instalment due.

Whenever it appears that a charter has been granted to certain individuals to act as a corporation, who are in the actual possession and enjoyment of the corporate rights granted, they shall be considered as rightfully in such possession and enjoyment, against wrong doers, and all others who have treated or acted with them in their corporate character: and even if it be shown that the char-I ter was granted on a precedent condition, and persons are found in the quiet possession and enj'oyment of the corporate rights, as against all but the sovereign, the precedent condition shall be taken as performed.

Where by the charter, commissioners are directed to ascertain the performance of a condition precedent to incorporation, and they declare it to have been performed, though such declaration be not true, yet shall it be deemed true until the sovereign complains: the usurpation, if there be one, is upon his rights, and his acquiescence is evidence that all things have been rightfully performed.

This was a proceeding commenced by warrant before ariTusticc of the Peace, to recover from the defendant as a corporator, the first instalment declared by the president and directors of the company upon the shares standing in his name on the company books. By appeal, the case was carried, first to the County and then to the Superior Court, where it wras tried at the last spring term before Norwood, Judge.

By the statement made np for this court, the case appeared to be this: By an act of the General Assembly passed in the year 1818, certain commissioners were appointed «for opening books to receive snbscrijrtions to the amount of $75,000, tor improving the navigation of Tar River. The act directed that the. commissioners, or amar-*521jority of them, should preparo books for receiving the said subscriptions, and should open the same on or be-1 ’ , , , . fore the 1st day of April, 1819, at such places and under the direction of such persons as they should designate for that purpose; the books to remain open until the first Monday in June, at which time they were to be returned to the commissioners in the town of Louisburg. The act then proceeded in these words:

“ And on the said first Monday of June next, there shall be a meeting of the subscribers in the town of Louisburg, and such meeting may be continued from day to day until the business be finished. If it appear to the said commissioners, upon the return of the said books, that the sum of §30,000 has been subscribed, the said subscribers, their heirs and assigns, from the time of their said first meeting, shall be, and they are hereby declared to be, incorporated into a company by and under the name of “ Tar River Navigation Company,” and as such may sue and be sued, plead and be impleaded, defend and be defended, have perpetual succession and a common seal; and such of the said subscribers as shall be present at the said meeting, or a majority of them, are hereby impowered and required to elect a president and five directors for conducting the said undertaking and managing all the said company’s business and concerns, &c.”

The second section of this act revives and declares in, force the provisions of an act passed in the year 1816, entitled, an act concerning the navigation of Tar River.” Sy the fourth section of the act of 1816, it is enacted, that certain sections of an act passed in the year 1812, for improving the navigation of Roanoke River, and. among others the fourth section of the said act, shall constitute part of the charter of the Tar River Navigation Company.

The section referred to in the act of 1812, provides that each subscriber shall pay, at the first general meeting of the stock holders, ten dollars upon every share by him. subscribed, and on failure his name may be struck off the hooks, and his shares taken by others complying with this provision. The section then authorizes the president and directors, from time to time, to make and sign orders-for money, and to direct at what times and in what pro*522portions the subscribers shall pay the sums by them sub-cribed, provided that not more than thirty-three dollars and a third per share shall be required to be paid in any one year. The section then enacts, that “if any of the subscribers, their heirs or assigns, shall fail to pay their proportions required within one month after the same is advertised, the president and directors may sell at auction, and convey to the purchasers, the shares of the subscriber so failing, giving one month’s notice of the sale.” If such sale produce more than the sum due, with interest and charges of sale, the surplus is directed to be paid to the former owner of the shares sold; and if the sale should not produce the full sum due, with interest and charges, it is enacted that «the president and directors may, in the name of the company, sue for and recover the balance by motion in any court of competent jurisdiction, on ten days previous notice.”

In the month of May, 1618, (betore the passage of the act of 1818 above mentioned,) a number of persons, and among them the present defendant, signed a paper writing in these words:

*' We whose names are hereunto subscribed, promise and oblige ourselves, our heirs, &c. to pay to John D. Hawkins the sum of one hundred dollars for each share subscribed against our names severally, to the use of such persons as may be hereafter appointed president, directors and company of the Tar River navigation, subject to such rules and payable by such instalments as the charter for rendering navigable the said river may provide.”

On this paper were subscribed shares to the amount of $32,000, and there was thereon an assignment by John D. Hawkins in the following words:

“I hereby endorse and assign 'his subscription list over to the commissioners appointed by the assembly of 1818, for the purpose of receiving shares of stock for making Tar River navigable.

“ 1st of March, 1819. “ Jno. D. Hawkins”

On the first day of April, 1819, the commissioners opened books for subscriptions pursuant to the act, and in one of the hooks so opened, JoJm D. Hawkins subscribed *523the names of those who had signed the paper made paya-hie to him, and the amount of shares subscribed by each, and annexed thereto the following memorandum, viz. “the foregoing were transferred from an old list made payable to John T). Hawkins lor the use of the Tar River Navigation Company.” And there appeared also subscribed in this book, in the hand writing of the parties themselves, shares to the amount of §24,300, and among these subscribers ivas one of those who had signed the paper made payable to John D. Haiokins. To this subscription book was annexed the following certificate, viz:

We the undersigned commissioners under the act of 1818 concerning the Tar River Navigation Company, in pursuance of the authority vested in us, opened the foregoing subscription, and met in the town of Louisburg tbe first Monday of June, 1819, and from day to day adjourned until the 16th June, when the said commissioners met. On makingan estimate of the subscription made as aforesaid, and on other subscriptions, the sum of §56,300, appeared to have been subscribed on the said 1st Monday in June instant. Whereupon, according to the provisions of said act, the said company is declared to be incorporated accordingly.

W. Moore, J

Jno.D. Haiokins, f . .

. . T _ , > Commissioners,

T Jno. J» JLiijy6} L

JV. Patterson, _}

On the trial of the cause in the Superior Court, the defendant objected, that there was no such corporation as the Tar River Navigation Company, and moved for a nonsuit.

The plaintiffs then offered to prove, that at the meeting of subscribers which took place on the first Monday of June, 1819, which was adjourned from day to day until the 16th day of that month, the defendant, together with many others who had signed the paper writing above mentioned payable to John D. Hawkins, were personally present on the 16th, when the report of the commisioners above stated was read, and the question being put to the subscribers present whether they assented to the report, the defendant and all the other subscribers voted in the *524affirmative; and farther, that the shares of the subscri-hers then present amounted to more than $30,000, and that they at that time proceeded, pursuant to the act, to e]ec£ a president and directors, and that the defendant voted in said election. The presiding Judge refused to admit this evidence. The plaintiffs then offered to prove, that at the adjourned meeting on the 16th of June, the shares of the subscribers who had signed the commissioners’ books with their own hands, together with those who had signed Hawkins’ paper and wiio were represented by proxies then present duly authorized, amounted to more than $30,000. This evidence also the Judge rejected, and ordered a nonsuit to be entered; and thereupon tbe-plaintiffs appealed to this Court.

Badger, for the appellants.

The objection taken in the Court below was, that the company had not a legal existence, and on this objection the plaintiffs were nonsuited. If, therefore, it can be shown, that the plaintiffs possessed, as a corporation, a legal capacity of maintaining a suit against the defendant, it will follow, that the judgment below was erroneous, and therefore the nonsuit must be set aside, without entering into the inquiry whether a debt has, in this case, been sufficiently established to enable the plaintiff to recover.

We affirm that this objection cannot prevail, even if founded in truth; but if such an objection, when true, is Sufficient, we allege, that here it is untrue, because the corporation is legally constituted.

1st. A corporation may exist either defacto or dejure: if it exist de fado, though without right or pretence of right, such existence is sufficient to maintain an action. Though the corporators may in truth be mere usurpers,, yet being in the actual enjoyment of the franchise of being d corporation, their right to tins'franchise can be sailed in question, and they dispossessed, only by a process in the name of the sovereign: no private individual can *525treat the corporation as a nullity, but a judgment in some public proceeding directed to the investigation of this particular fact is alone sufficient to establish the truth that they are usurpers. This position is fully supported by the case of Rex v. Jlmery, (2 Term R. 515.) and also stated in a note to Gwillim,s Bacon, “ Corporation,” G. In that case it appeared that an information in nature of a quo warranto had been instituted, in the reign oí Charles 2. against a corporation: and though the information proceeded upon the ground that the corporators were without any authority by charter, ami therefore usurpers, yet the proceedings were against the members by the corporate name. The corporation having made default, a judgment of rcseizurc quousque curia alterius ordmaverit was pronounced; and these proceedings being under consideration in Rex v. Jlmery, one objection was, that as the information did not seek to reseize corporate rights once vested, for an abuse of those rights, but upon the ground that there was no legal corporation, the members, being mere usui’pcrs, should have been proceeded against as individuals, and the judgment was therefore wrong. This objection was overruled by the Court, the process deemed regular and the judgment valid. “ A scire facias is proper,” says Mr. Justice Jlshhurst, “wherethere is a legal existing body capable of acting, who have been guilty of an abuse of the power entrusted to them; but that does not apply to the case of a non-existing body: a quo war-ranto is necessary where there is a body corporate defac-to, who take upon themselves to act as a body corporate, but who, from some defect in their constitution, cannot legally exercise the powers they affect to use.” The same doctrine is .to be inferred from the language of Sir FF. Blackstone, in 3 Comm. 260. From this it is obvious, that a body who are mere usurpers of a franchise without any foundation of right, are still, to some purposes, a corporation, and shall be styled by their corporate name. Again, how can a quo warranto he “ necessary,” if a corporation *526 defacto may have the legality of its existence questioned ^7 a private individual, and be treated as a nullity?

But if this proposition, in its full extent, cannot be sustain^ it may safely be affirmed, that where the possession of the franchise is supported by a colourable right, as where there is a charter or an act of the legislature professing to establish a corporation, and persons are found in the enjoyment of such franchise, claiming the enjoyment by virtue of such charter or act, they shall be taken to be rightfully in such possession and enjoyment against all the world except the sovereign himself; no private person shall dispute their right at any time or in any manner. For if there be an usurpation, it is of the sovereign’s rights; the franchise belongs not to any individual, but to the public: the sovereign alone can construe his grant and determine whether those in possession are intruders or rightful occupants; and while he acquiesces, it cannot be permitted to any other to contest their right; nor can the sovereign himself treat them as usurpers until their right has been investigated at his instance, and adjudged against them in a competent forum.

All rights vest in the sovereign, and pass from him by matter of record only; therefore, though letters patent be void, (as where there is a grant of a fair at a place at which another by grant was held before,) yet they are in full force till repealed by judgment upon scire facias; they cannot be questioned collaterally in any suit. (3 Lev. 220. Dyer 197", 8.) There must ha judgment to repeal the King’s grant. (Keilw. 134.)

So in the case of forfeiture and alienage, until conviction or office found, nothing vests in the sovereign, though after conviction or office found, the King is in by relation; yet no man can possess himself of the land or goods of the alien or felon, and afterwards upon ejectment or trover brought, defend himself by showing the alienage or the felony Committed; for by neither does any right vest in him, but in the sovereign only, the purchase by *527the alien being in contravention of his policy, and thefe-lony a violation of his law.

2d. The act of incorporation has been here well pursued, and the corporation is legally as well as actually constituted. The statute appoints certain commissioners, and enacts that “if it shall appear to them” that the sum of §30.000 has been subscribed, then the subscribers shall be a corporation, &c. The commissioners, in the time and manner appointed by the act, have determined that this fact does appear to them, and their determination is final: they were the appointees of the sovereign to ascertain that upon which the existence of the company was suspended, and their decision is that of the sovereign himself. In this view it is not material to inquire whether §30,000 was in truth subscribed, for the existence of the company depends not on that fact, but on what appeared to the commissioners to be the fact, whether rightly or otherwise. Upon the determination of the commissioners, thus representing the sovereign, the corporators were in unde** the statute, as if this determination had been incorporated in the statute, and claimed nothing from the commissioners. As in England, the Chancellor of one of the Universities has, by charter, the power of erecting corporations; yet when he grants to A, B and C to be a corporation, it is a mere designation of the persons who hold under the original charter immediately from the King, and not under the Chancellor who is but the King’s appointee. (Jacobs Verbo Corporation, and the authorities there cited,) When it is said that the determination of the commissioners is final, it is not meant that it is final to establish a debt, but to establish the existence of the corporation.

The principle on which the plaintiffs were nonsuited below, if applicable to them may be applied to every other corporation. The effect of such an application will be seen by referring to the acts incorporating the banks of this state. Each of these enactments appoints commissioners, *528directs books to be open ’d subscriptions to be received, and upon a certain amount being subscribed, ami on that x ^ event alone, incorporates the subscribers. All these acts, essej¡tial to the existence of the corporations, are. to be done subsequent to the passage of the statutes* and consequently the corporations are not immediately established by the law, hut suspended upon a subsequent event to be ascertained by others. The banks are in the actual possession of the granted franchise, claiming to hold under these statutes: Could it he pretended for a moment, that in an action brought by one of the banks, the defendant, a debtor to the institution, could require of the plaintiffs proof that the books had been opened and the subscriptions made in the manner and to the amount required by the act of incorporation, and for want of such proof move for a nonsuit? If this could not be done in the case of the bank, upon what principle can it be done here, where plaintiffs have a similar actual possession, claiming to hold under similar statutes?

But if it be necessary to go into tlie question, wc affirm that the subscriptions were made properly, and the determination of the commissioners is right. The act au-thorises the commissioners to receive subscriptions; these subscriptions were not promises to pay to the president and directors, for as yet there was no company; nor to the commissioners, for they could have no interest; but were merely declarations in writing to ascertain the consent of the subscribers to become corporators and to what amount. These subscriptions were to be received by the commissioners; and there is nothing in the phraseology of the act to prevent them from receiving those made before, as well as after its passage. The effect of the subscriptions being made, before was simply to give to the subscriber a locus penitenties, of which, if he did not avail himself to dissent, the subscription when received was binding; where fore the paper signed by the defendant to John 1). Hawkins is itself a sufficient subscription within *529the act. If not itself a subscription, it was a sufficient authority to Hawkins to subscribe for those who signed it, J ^ which he did. But at all events, by the proceedings at the first general meeting, the act of Hawkins is approved and adopted, and, therefore, is binding upon the parties, as their own act.

3d. If the act has not been properly pursued, and the right of the corporation can be investigated in an action brought by them when the defendant has done no act to recognize, their existence; yet it is clear that the defendant here, having appeared at the first general meeting, approved the report of the commissioners, and acted as a corporator by voting in the election of officers, is concluded to deny the existence of the corporation.

4th. This objection should have been specially pleaded, and cannot be made the ground of nonsuit on the trial. Bank of Newbernr. Pugh, (1 Hawks 198.)

Gaston, for the appellee.

In all cases where a corporation brings suit, and the general issue is pleaded, it must prove itself a corporation. (8 Johns. R. 678. 14 Ibid. Hob. 211. 2 Ld. Ray. 1535. Kyd. on Corp. 293.)

The powers and privileges claimed by the plaintiffs are important and extensive. They are legal immortality, perpetual dominion over the river and its tributary streams, the right to tax navigation, exemption from taxes: and to give effect to the acts of the commissioners preparatory to the creation of such a corporation, their power must be strictly pursued. (1 Caines Cas. in Error 94.)

Even when created, it can exert its powers only in the manner pointed out by the charter, (2 Cranch 166, 7.) a fortiori, its creation must be clearly conformable to the provisions of the law.

In the requirements of the law, there is no ambiguity. Books are to be opened to receive subscriptions, and a certain amount is required to be subscribed; and by the second section of the act of 1816, incorporated into this *530act, the subscription must be made in person or by proxy. The word proxy is an abbreviation of procuracy, a term well known in ecclesiastical law: “ procuracy, the writing or instrument whereby one is authorized.” (Jacobs, Verbo Procurator.) Proxies are also known in the common law as deputies formally constituted by peers to vote for them. (4 Inst. 13.) The requirements, therefore, of the second section of the act of 1816, have not been complied with: so it appeared from the books themselves, and so it is declared in the case; the names were transferred from a list prior in date to the law.

M'hen formalities are prescribed by him or them who have a right to require them, other formalities which may be thought equivalent will not. be sulhcient. This is the rule in the constitution of powers delegated by individuals; (17 Ves. Jun, 454. 4 Taunt. 214.) the rule is stricter in formalities required by the legislature. (1 Ves. Jun. 17.) The legislature required an actual subscription on the books, a precise and definite form of engagement, parol evidence of a subsequent engagement is not binding.

These subscriptions were to precede the creation of the body politic; a subsequent assent to the act done by Hawkins, whether express or implied, can give it no more validity than the individual can give, and he cannot verbally authorize a transfer.

If an estoppel is pretended; estoppels only preclude proof of facts not appearing: here the facts are actually stated. (Co. Lit. 352 b.)

Estoppels must be mutual or they bind neither, nor can they bind against a public law. (Cro. Eliz>. 37. Bac. M. “Estoppel.” 1 Wood on Conv. 235. 2 Term R. 171.)

The corporation under the act has no right to sue a Subscriber for his first instalment; the remedy is to strike off his name, sell, his share, and sue for deficiency.

Badger, in reply.'

The cases referred to from 8 and 14 Johns, and from, Zord Rmjmmd and Hobart, prove on*531ly tliat the existence of the corporation must be shown, not that a rightful existence must; if. therefore, the argument heretofore submitted, has shown that a corporation may exist de facto, and though without colour of right cannot be treated as a nullity, these cases do not oppose the doctrine which has been advanced for the appellant. It is said that the powers and privileges claimed by the plaintiffs are extensive and important; and it should have been added that they are conferred for purposes of great public utility. This furnishes a reason for fair and liberal exposition, suited to the enlarged and extensive views of the legislature, and certainly not for literal nicety and hypercritical minuteness of construction. The learning respecting the derivation and meaning of the term proxy, and the instrument of appointment as understood in the canon law and in the practice of the house of peers, it is not necessary to examine, for of these the legislature were probably ignorant, and certainly did not mean to refer to them: they used the word in its ordinary sense, to signify simply an agent or attorney. The form prescribed for the appointment of a proxy in the second section of the act of 1816, is confined to proceedings subsequent to the existence of the corporation, and has no relation to the subscriptions preparatory to its existence. It is a mistake to suppose that a precise and definite form of engagement is prescribed; a subscription only is directed, and that imports no form. The verbal and captious manner of expounding the statute, contended for, will justify the sarcasm upon judicial proceedings, “in nostra lege, unvm comma, evertit totumpla-cet mn.”

As to the doctrine of estoppel, it may be remarked, that the meaning of Co. Lit. 352, appears to have been misconceived by the counsel for the appellee. The meaning is, that if the record or deed alleged as an estoppel do itself show upon its face the truth, the estoppel is gone; not that the truth appearing in a case stated, or in a spe*532cial verdict, with the matter of estoppel also, shall de-s^t 0-f ^ie estoppel and set the matter at large. The party can lose the benefit of his estoppel only by his own miSpica(jing? an([ if he has w;ell pleaded, cannot be deprived of it by any finding of the jury; and the reason is, that by failing to plead the estoppel when he may, he is understood to waive it, and no waiver can be implied from that which is the act of the jury and not of the party. Thus, where there is a demise by indenture by one who has nothing in the, land, if the lessor bring debt for rent, and declare quod demisil, generally, and the lessee plead nil hob. in ten. and the plain ¡ iff reply quod habuit, he has lost the benefit of the estoppel; for having oncean opportunity to rely upon the indenture as an estoppel, he has by his mispleading waived it; for “estoppols, because they are concluding to speak the truth, are odious in law.” But if in the case put, the plaintiff reply that the lease was by indenture, unde petit judicium it the defendant shall plead this plea against his own acceptance of the lease by indenture, there the defendant shall he estopped. Treviban v. Lawrence, (2 Ld. Ray. 1051.) Bavenant v. Rafter, (Ibid 1054.) Com. Big. “Estoppel,” C.

But if the defendant in the case of the lease plead nil debet, to which the matter of the estoppel could not be replied, the plaintiff may take advantage of the estoppel upon evidence, “ because (says Lord Holt) the pleadings are not brought to such a point in the case as to give the plaintiff an opportunity of replying the estoppel.” (2 Ld. Ray. 1051.) If in the case as last put, the statement had been made with the view of obtaining the opinion of the Court whether the defendant w'as estopped to investigate the title, surely the plaintiff could not have been told, as seems to be supposed on the other side, the very statement which shows your indenture, supposes that you have nothing in the land, and therefore the question of your right to the estoppel cannot arise. Howrever the truth may he made to appear, whether by a case stated, or by *533 f> special verdict, if the plaintiff has not in pleading waived the benefit of the estoppel, the defendant shall be . , concluded by it. 1 hus m the case of Trevivan v. Law-rente, as reported in 1 Salk, where the jury, íh a special verdict; found a record of a judgment by which the party was estopped to show' another matter appearing also of record in the court where the judgment was, but found also at large in the special verdict, the matter as in truth it was; the Court held not only the party, but also the court and jury bound by the estoppel, and that the jury could not find against it, and therefore disregarded the facts thus appearing, and gave judgment on the estoppel.

The doctrine of estoppels has by modern decisions been greatly extended; and hence, though a lease be by deed poll or even by parol, the Court will not permit the lessee to dispute the title of him from whom he derives the benefit of possession. This rule has been applied to a case"1 analogous to the one now' before the Court. When a former parson had made a lease of the church lands, and in an action brought by his successor for rent the tenant alleged that the plaintiff had been simonaically' presented, it was strongly insisted by his counsel, that as the statute of Miz. had declared every such presentation with tiie induction and all subsequent acts absolutely void, the rule which estopped the defendant ought to yield to public policy, and that the statute would be inoperative if the plaintiff might securely enjoy the fruits of its violation: but the Court would not hear this defence from the lessee, who, having paid rent to the incumbent on the lease, had thereby recognised him as parson. Cook, clerk, v. Lox-ley, (5 Term R. 4») These cases are strikingly similar; the parson could only claim upon the lease as parson, which is an artificial character as entirely as that of a corporation aggregate: but being defacto parson, though not rightfully so, his capacity to lease and to sue could not be disputed by the party to the lease. But it is farther said, that everv estoppel must be mutual: true, and *534so it is here; for as the defendant by acting as a corpo-rator is estopped to deny that the company was rightful-1 f . ly a corporation, so by accepting him as such the company jg estopped tovdeny that he was then rightfully a corporator.

But it is objected that the corporation cannot recover in an action for the first instalment, because that is required to be paid at the first meeting, and if not paid, the remedy is to strike the subscriber off and sell his share. The answer to this objection is, that the action is brought not for this preliminary payment, but for the “first in-stalment declared by tiie president and directors.”

It is farther objected, that even as to subsequent in-stalments, the act directs that the share shall be sold and an action is given for the deficiency: but a reference to the statute will show, that the directors are authorized, not required, to sell; for the expression is may, not shall. And as they have a capacity to sue, and by declaring the instalment a debt arises, they may sue for it without any special provision in the act for that purpose.

. There is one other view of this subject to which the attention of the Court ought to be called. This is a public corporation; the state is a corporator, the Legislature and the Board of Internal Improvement, by various acts since the proceedings now called in question, have recognized the legal existence of the company. Surely, whatever may be as to private corporations, it cannot be permitted to a citizen to dispute the rightful existence of that body politic of which the sovereign is a member, the proceedings of which he aids by his cooperation, and whose title to the franchises enjoyed, he recognises by public, solemn, and official acts.

Taylor, Chief Justice

The authorities concur in establishing the position, that when a corporation sues for a debt, its existence must be proved on the general issue; and the question arising here is, whether the evi*535dence offered was sufficient for that purpose. The act of incorporation and the declaration of the commissioners that the necessary sum had been subscribed, and the subsequent proceedings of electing a president and directors, gave existence to the corporation; and although the commissioners should have been mistaken in their report as to the amount of the sum subscribed, yet having been entrusted by the legislature with the power of deciding on that fact, their acts can only be examined in a proceeding directly against the corporation to inquire into the validity of the charter. It might be sufficient for the purposes of the case to set aside the nonsuit on account of the rejection of this evidence; but as other topics have been discussed, upon which it may he desirable to the parties to have the opinion of the Court, as the means of preventing expense and litigation, I shall proceed to notice them.

It is said that no action or warrant can be brought ior^ the payments declared by the company, because the law of 1812 has provided for striking off the names of the delinquent subscribers and the sale of their shares. But the terms of this act leaves -it discretionary with the company whether they will do it or not. It is merely á cumulative remedy given by the act to facilitate the operations of the company; for it might happen that the shares should become wholly unsaleable and unproductive when the exigencies of the company demanded ail immediate supply of funds, which yet might la raised by suing the stockholders on the original contract. A similar provision has been inserted in the cbartera of other incorporated companies; and the general course of judicial exposition is, that it gave the company an election either to sue, or exact the forfeiture prescribed by the statute.

The only other question I shall notice is, whether it is competent for the defendant to deny the existence of the corporation; and considering the contract made by him, promising to pay for the shares to the use of the *536persons who might thereafter be appointed president, direc^ors ai,d company, his presence at the meeting when the commissioners made their report, his assent thereto, an¿ afterwards voting for the president and directors; these are acts which, taken in connexion with each other, do, in my opinion, estop him from disputing the regularity of the inceptive steps tending to the formation of the company. By entering into a contract with the plaintiffs in their corporate name, he thereby admits them to be duly constituted a body politic and corporate under such name; a rule which appears to be recognized in 2 Ld. Ray. 1532. and one certainly consistent with j ustice and the analogies of the law. I think there ought to be a new trial.

Hall, Judge.

To the act of 1818, oh. 9T9. the Tar m Navigation Company owes its existence. That act Mjpve it its incipient form, and enabled it, by a transfer to it of certain powers, to become a corporation. It declares, among other things, “that if it shall appear to the commissioners upon the return of the books that the sum of g 30,000 has been subscribed, the said subscribers, their heirs and assigns, from the time of their first meeting, shall be, and they are hereby declared to be, incorporated into a company, &c. and as such shall sue and be sued, and are empowered to elect a president and di- • rectors.” The case further states, that at a regular meeting of the commissioners they reported that g 56,000 were subscribed. That suck report was received by the stockholders (one of whom the defendant was,) and by them approved; that they proceeded to elect and did elect a president and directors. The company being thus established in the manner pointed out by the act, the defendant ought not to be permitted to dispute its existence; and the less so as he in part, by his vote, had confirmed it. If the commissioners improperly exercised the powers conferred upon them by the act, they cannot.be called to an account by the defendant in the present action; some *537other remedy must he resorted to. I, therefore, think that the company is authorized to sue; and, as the judgment of nonsuit was pronounced under a different impression, that a new trial should he granted.

Henderson. Judge.

I do not go the whole length of the plaintiff’s counsel in saying, that persons in possession of corporate rights or franchises shall be considered as rightfully corporators against all persons but the sovereign; but agree with them with this qualification, that where it is shown that such corporation may by law exist, that is, where it is shown that a charter has been granted, those in possession and actually in the exercise of those corporate rights, shall be considered as rightfully there, against wTrong-doers, and all those who have treated or acted with them in their corporate character; and even where it is shown that such charter lif® been granted upon a precedent condition, and persons are found in the quiet possession and exercise of those corporate rights, as against all hut the sovereign the precedent condition shall he taken as performed. And much, more will I consider the condition rightfully performed, where it is by the charter left to others to declare the fact of performance, and such persons make such declaration. j.The, sovereign alone has the right to complain, lor if it is an usurpation it is upon the rights of the sovereign, and his acquiescence is evidence that all things have been rightfully perform ed7~^t think, therefore, that the presiding judge erred in holding the plaintiff to strict proof of the performance of the condition, and more so by not considering the declarations of the commissioners as evidence of that fact. Let the rule for a new trial he made absolute.

So, per toiam curiam, Judgment reversed.

[Vide Turner and another v. Baines, (2 H, Bl- 559.) in which it was held, that church-wardens de facto might maintain an action against former church-wardens, for money received by them for the use of the *538parish, though the validity of the election of the plaintiffs to the office -mas doubtful, and though they were not the immediate successors of the defendant. The Court held, that as against the defendant, it was sufficient that the plaintiffs had been “ admitted, and sworn into the office, and acted as church-wardens.” As this seems to be a direct authmity on one part of the foregoing case, and was not adverted to in the argument or the opinions or the Judges, fh - Reporter takes the liberty of adding it to the case by way of note.]