A hand-book of corporation law as applied to private business corporations

Front matter

H^ij^ t

Class Book

Copyright ]^^.

Preface

The subject of the following pages is one which, it is believed, must appeal to the modern lawyer.

The tide of transition from individual and partnership effort to incorporated forms has its source in good and sufficient reasons.

This process of evolution being a beneficial one, will continue its course, at least in the realm of larger concerns ; and it requires of the progressive and ambitious practitioner an effort to not only keep abreast, but to be in advance of the movement.

At the present day lawyers have not the time, even though they have the disposition, to deal with abstract questions of law. They need to know what has stood the test of challenge and dispute; namely, the utterances of Lords Hardwicke and Eldon, and their American counterparts, Marshall, Kent, Selden, Black, Davis, Waite and others of recognized standing.

Herbert Spencer, in his autobiography, says : 'T could have filled a bookcase with masterpieces which I have not read." There are in every law-library of lair magnitude thousands of practically unused decisions which are the ripened products of experienced legal minds. They are gems of legal thought, not only pleasing to read, but capable of enlightening both bench and bar if time were available for their perusal. In the prevailing method of legal examination, the

PREFACE examiner usually goes to the digests, or to the encyclopedias of law, and from them to the reports; but it is to be regretted that in many instances he stops at the digests, and filling his brief with ''cases," leaves it to the judge to go to the reports,— often to discover irrelevancy or unprofitable reiteration and redundancy.

Those painstaking lawyers who go to the reports themselves in most instances review but a portion of the cases cited; in fact, the vast number of th'e references serves to repel and embarrass the briefing examiner, and often by the irony of fate the best authorities are passed by. Few go beyond the reports of their own and neighboring States, so that the greater part of that which is recorded is in effect lost and unknown. This is the more unfortunate because some of the smallest and even youngest of the States have possessed, and still produce, jurists who, judged by their work, are entitled to take rank with those who have conferred honor on the older and larger States.

This work will not have been written in vain if some cases have been rescued from undeserved neglect, and if attention has been called to quarters where similar treasures will reward future research.

It is perhaps only just to reader and author to say that there has been in the inception of this book a motive outside of and beyond the realm of pecuniary reward.

Coupled with the growth of corporations in number

PREFACE iii

and importance has appeared a system for the despoiling of the small investor, — a system so adroit and audacious, and oftentimes so successful, as to constitute one of the plagues of the business-world.

To combat and to destroy this up-to-date piracy will be the aim of every honorable practitioner. it is hoped and believed that ammunition for that warfare will be found in the following pages, to the end that the modern corporation may go forth fully equipped either for its ordinary course of employment, or for defense; as in the China seas the merchant-vessel carries ordnance sufficient, on occasion, to defend itself against the attacks of predatory rovers.

It is too often assumed that the fight is hopeless, and a faint-hearted resistance is offered to those schemes for self-aggrandizement, — cherished and promoted by covetous associates in the common venture.

This, however, is not good Anglo-Saxon doctrine, nor is such a sentiment to be found anywhere in the opinions of the jurists of Great Britain or America. Courage of the kind which prevailed upon the fields of Poitiers, Crecy and Waterloo is not extinct, and never will be; and when like pluck and resistance are carried into the fight against greedy combinations of corporate managers, the "thin red line" of opposing shareholders will gain the day.

While the practical question, viz., whether the property-interests at stake and the evidence at command warrant appealing to the courts, must be decided in accordance with the facts of each individual case, the

IV

PREFACE readiness of those tribunals to protect the weak from spoliation by the strong, is abundantly illustrated in the text.

In preparing this work, the author has gone with confidence to the great source of equity jurisprudence, and his search among the decisions of the Lords High Chancellors and their associates has not disappointed him in the quantity and the quality of the material there found ready to hand. "Without fear or favor," — the enunciations of law therein set forth are lofty, strong and distinctly judicial in their tone, and will remain an inspiration for generations yet unborn.

It is to be regretted that in too many modern tribunals nice distinctions, saving clauses and particular cases have been permitted to befog the vision and to obscure, in whole or in part, the eternal rules which are, and must abide, the bright and God-given source of equity jurisprudence.

It behooves the student, accordingly, to get back to first principles and to study those ancient decisions which, like the Ten Tables of old, remain a repository of high ideals and sound law.

In the presence of these standard decisions and declarations by master-minds, the element of variance from true alignment can be at once detected, and the measure of confidence to be reposed in modern cases in American, English and Colonial courts can be correctly estimated and assigned.

The cases cited are in line, it is believed, with the catholic spirit with which the author has approached

PREFACE V

the work at bar. Wherever the rules of equity prevail his search for useful precedents has extended. The ability of a given decision or text-book has been deemed sufficient ground for citing it, or for quoting from its pages, without regard to the size or importance of the State in which it was rendered or produced; merit alone has been the touch-stone.

In fact, there are throughout this book numerous instances supporting the statement hereinbefore made, viz : that there is a large amount of excellent material 'locked up" in the least-cited reports.

Should these labors encourage a closer study of those cases worthy to be denominated "leading" and here for the first time joined in communal relations, it will be a source of great satisfaction to the author, independently of other rewards for the effort involved in this "search after wisdom."

The principle enunciated in the text regarding the right of the shareholder to an inspection of the books and records has been affirmed in recent decisions by the United States Supreme Court.

This confirmation of views, deliberately adopted after careful study of conflicting authorities, it is gratifying to record.

Among the text-books which have been invaluable are the following:

Spelling on Private Corporations.

Angel and Ames on Corporations.

Potter on Law of Corporations.

vi PREFACE

Beach on Private Corporations.

Kyd on Corporations.

Clark and Marshall on Corporations.

Cook — I, on Corporations;

2, on Stock and Stockholders.

Morawetz on Private Corporations.

Thompson on Corporations.

Waterman on Corporations.

Brice's Ultra Vires.

The author dcFires to express his appreciation of the uniform courtesy of Mr. Alfred J. Hook, Librarian, and especially of the aid of Mr. Daniel E. Cubberly. Assistant Librarian of the Law Library in Brooklyn, who has corrected the citations and authorities, and prepared the table of cases, and to whose trained assistance he has been greatly obligated in the progress of his labors.

Richard Selden Harvey.

New York, April, 1906.

Chapter I

THE PRIVATE BUSINESS CORPORATION — DFFINITION AND RELATION TO COMPONENT MEMBERS.

A much-discussed topic. — The basic distinction considered. — Limitations of this treatise. — Definitions from various authoi itative sources. — A leading decision. — Other leading cases. — The civil law. — The corporation is a distinct entity. — Authorities generally. — Origin of business-corporation idea. — Substantial harmony of definitions. — Substance of definitions.. . . . page 7

CHAPTER H.

SITUS .

The corporate home. — Recapitulation. — Further authorities. — Situs as it affects foreign corporations page 39

[vii]

viii , CONTENTS

Chapter VI. Bonds And Mortgages

Use and convenience of such securities. — Underlying idea. — Limitation of rule, when applied to quasi-public corporations. — General principle asserted

CONTENTS ix

in a leading case. — Other controlling authorities page 92

CHAPTER VIL

THE DUTIES, OBLIGATIONS AND LIABILITIES OF CORPORATIONS.

Differing types of corporations imply different duties, etc. — Beginning and scope of these incidents to corporate existence. — Enumeration. — Principles applied p(^g^ 102

CHAPTER Vni.

THE CHARTER.

AA'liat the charter really is. — Some reference to original mode of creating corporations. — Evolution of modern mode of incorporation. — The charter a contract. — This basic principle important. — Authorities confirmatory of the foregoing doctrines p<^g^ 113

CHAPTER IX.

THE CHARTER — ( Continued) .

Extent and effect of contractual relation. — Legislative power to amend is limited by Constitution page 140

X CONTENTS

CHAPTER X.

BY-LAWS.

Not necessary, but useful. — By-laws defined. — Power to create, and general purpose. — Must be reasonable. — By-laws must conform to charter, Constitution and statutes. — Right to make by-laws an inherent power. — Reference to decisions discussing subject broadly. — Rule as to judicial interference stated. — Effect of by-laws. — Additional authorities as to validity and judicial interference. — Distinction between by-laws and regulations. — By-laws bind corporate members. — Principle of estoppel applies. — Rights of third parties not prejudiced page 156

CHAPTER XI.

STOCK AND STOCK-CERTIFICATES.

Varied uses of term. — Legal signification. — Distinction between certificate of incorporation and stock certificate. — Nature of stock certificate considered. — Principle governing right to transfer. — Stock certificate is only quasi-negotiable. — Limited negotiability affects lost or stolen certificates. — General remarks page 183

CONTENTS xi

CHAPTER XII.

ON CHANGE OF CAPITAL STOCK.

Importance of subject. — No inherent power to make change. — Authority from legislative act must appear. — Reasons for rule stated page 203

CHAPTER Xni.

stockholders' meetings.

Stockholders' Meeting is corporate legislature. — Distinctive features of this chapter. — Plan includes epitome of treatment by distinguished authors. — Nature and requirements of meetings. — Clark and Marshall. — Angel and Ames. ■ — Potter. — Cook. — Morawetz. — Thompson. — Spelling. — Bouvier. — Waterman. — Blackstone. — Kent. — Price page 209

CHAPTER XIV.

stockholders' meetings — (Continued). Will of majority controls. — Binding effect dependent upon proper notice. — Individual assent not equivalent to meeting. — Real owner, as opposed to record owner, entitled to vote. — Stock- vote as binding as sealed instrument. — Supervision by court of equity. — Illegal votes not neces-

^xii CONTENTS

sarily fatal to whole meeting. — Perpetual voting trust invalid. — Inequitable or fraudulent acts restrained. — ■ Limits of corporate power.

CHAPTER XV.

DIRECTORS, OFFICERS AND AGENTS.

Importance of delegated authority. — Infrequency of litigation of subject. — Corporation has inherent right to appoint. — When appointed, are quasi-trustees. — Authority governing directors and officers. — Close resemblance of corporate to other agents. — Ultra vires principle applied. — Usual responsibility coupled with such agency. — Directors not insurers of fidelity of others.

CHAPTER XVL

STOCKHOLDERS INTER-SESE.

A semi-fiduciary relationship sometimes exists. — Courts of Equity require fair-dealing. — Discrimination is ultra vires. — Mutual responsibility flows from implied contract. — One cestui-quetrust must not injure another. — Result of distinction between disfranchisement and removal. — Equity is surest recourse. — Guilty stockholders equally liable with directors. — Differ-

CONTENTS xiii

ence between joint-stock companies and corporations. — Legislative intent opposed to oppression page 280

CHAPTER XVIL

THE FIDUCIARY RELATION.

A much-debated question. — The principle at last established. — Director occupies a fiduciary position. — Elements of doctrine stated. — Lord Hardwicke quoted. — A leading modern case to same effect. — Rule in Federal Courts. — Other leading cases. — Courts protect weaker from stronger. — Canadian authority. — Recent English case. — Rule as modified in application.

CHAPTER XVHL

INSPECTION OF BOOKS AND PAPERS.

Discussion of principles on which right is based.. - — Inspection an incidental and common-law right. — Includes right to make copies. — Receivership not ground for refusal. — Promotion of ulterior purpose through inspection not favored. — Mandamus proper remedy for refusal of right. — Recent decisions confirmatory of the text.

xiv CONTENTS

CHAPTER XIX.

stockholders' rights and wrongs enumerated.

Difficulty of task imposed. — Rights as enumerated by text-writers. — General classification of wrongs. — Instances of wrongs. — Source of the majority of wrongs. — Distinction noted. — Enumeration of wrongs. — Wrong usually involves infraction of trust relation. — A leading case quoted. — Reference to further treatment elsewhere pci'gs ^^^

CHAPTER XX.

RATIFICATION, ACQUIESCENCE, LACHES, ESTOPPEL.

Distinguishment of these corelative terms. — When courts will refuse relief. — Estoppel defined. — Principle of estoppel, as applied to corporative acts. — Periods of deferred action amounting to acquiescence, etc. — Presumption of ratification arises when benefits are received. — Presumptions same as with natural persons. — Knowledge must precede ratification, etc. — Equity follows the law. — Rule as to illegal acts. — New York rule as to subsequent purchaser. — Stockholder may confide in management, without laches.

CONTENTS XV

CHAPTER XXI.

THE REMEDIES FOR STOCKHOLDERS' WRONGS; WHAT THEY ARE, AND WHEN APPLIED.

Consideration of remedies is necessary as well as pertinent. — This subject belongs to equity. — Lord ■ Hardwicke's decision in a leading case. — Remarks suggested by same. — Oppression by directors most common source of complaint. — Difference between general and local text-books considered. — Remedies classified. — Distinction between stockholders suing individually and as a class. — Broadness of relief, in equity. — General consideration of remedy for oppression resumed. — Notice to corporation as a condition precedent to suit. — Stock newly bought and for ulterior object carries right to sue. — Equity protects small holder. — Reaches abuse of joint control. — Principles and authorities generally.

CHAPTER XXn.

AMALGAMATION COMBINATION CONSOLIDATION

MERGER; AND HEREIN ALSO OF CONSPIRACY.

Definitions of these terms. — Question of conspiracy is involved. — Absorption of going concern rexvi ■ CONTENTS

quires unanimous consent. — Railroad cases are most numerous decisions in point. — Combinations known as trusts not treated of herein. — Leading authorities considered and cited. — - Essentials of amalgamation stated. — Further authorities in support of text page 395

CHAPTER XXIII.

HOLDING COMPANIES.

Object sought to be accomplished by these companies.

— Old and new methods contrasted. — How Holding Company is formed. — Such method not equivalent to individual holding. — Main asset consists of voting power of companies controlled.

— Exclusive control invades property rights. — Principle involved within rule of Dartmouth College Case. — Authorities on right to permanently absorb voting power. — Rule as to fiduciary relation repeated. — It is ultra vires to surrender corporate functions. — Such surrender is also against public policy. — It amounts only to revocable proxy. — Trusts not treated of herein. — Stockholders entitled to benefit of individual judgment. — Reasonable latitude allowed. — Some reflections on the general theme of this chapter pd'g^ 421

CONTENTS xvii

CHAPTER XXIV.

CORPORATIONS AS AFFECTED BY CONSTITUTIONAL PROVISIONS.

Certain constitutional provisions particularly concern corporations. — Same enumerated. — Impairment of obligation of contracts. — Contractual relation is settled law. — Reservation of right to amend. — Exercise of reserved power must con- , form to Federal Constitution. — Every such amendment is necessarily fundamental. — Vested rights as affected by amendment of charter. — Subject of Holding Companies is likewise concerned herein. — Modern situation akin to ancient problem of mortmain. — Deprivation of property without due process of law. — Termination of corporate independence should require dissolution and division of assets. — Constitutional amendment as construed by courts. — Constitutional provisions and foregoing divisions are contravened by scheme of Holding Company. — Administrative reform which the situation demands . . . page 453

CHAPTER XXV.

TERMINATION OF CORPORATE EXISTENCE.

Corporative existence ceases by limitation or by judicial dissolution. — Grounds for termination. — xviii CONTENTS

Death of all its members no longer valid ground.

— Authorities on subject generally. — Local rules and procedure prevail. — Remarks on subject of chapter page 470

CHAPTER XXVI.

IN CONCLUSION.

Underlying principle of Anglo-Saxon jurisprudence.

— Oppression by directors, etc., violates that principle. — Application not remote. — Right to participate is concerned therein. — A solid and firm right. — This right permeates the corporation, extending to every share. — It pertains to and follows the stock. — Reason for this right. — Majority-control no answer to claim of right to participate. — Limitations of powers of directors as representatives of majority-interest. — Allusion to constitutional prohibition against the taking of private property, etc. — This constitutional provision applied to oppressive acts of directors.

— Occasion for these remarks. — National well-being requires that the foregoing principle shall be firmly enforced. — Means of redress exists.

HAND-BOOK

OF

CORPORATION LAW

Chapter I

The Private Business Corporation — Definition and Relation to Component Members.

A much-discussed topic. — The basic distinction considered. — Limitations of this treatise. — Definitions from various authoritative sources. — A leading decision. — Other leading cases. — The civil law. — The corporation is a distinct entity. — Authorities generally. — Origin of business-corporation idea. — Substantial harmony of definitions. — Substance of definitions.

A much-discussed topic. — The definition of the private business corporation has been the subject of almost boundless discussion, not only by the text-writers, but by the courts.

In a general way, it may be said that a corporation is an association of persons who, with their successors, have been by the Sovereign or the People acting through its representative the legislature, formed into an artificial body constituting a legal entity, for the purpose of carrying on some designated business or enterprise, with the power of acting as a unit and possessing the right to be treated to a certain extent as a natural person.

The basic distinction considered. — Perhaps the reader cannot be put in touch with the subject more readily than by the following article from the ''American Law Review." The learned writer says :

"In the recent work of Messrs. Lowell on Transfers of Stock, the legal idea of a corporation is thus expressed: — 'The corporation is something distinct from its members, its life is independent of theirs. Its will may at times be different from that of its members; and it may be bound by conduct which binds no one of its members as an individual; of course there is in reality no rights or duties but those of natural persons : but the rights and duties of natural persons who deal with a corporation arise from a mere fiction and their nature and extent are determined by that fiction. A person therefore who confounds a corporation with its stockholders, who say they are the corporation, or that it consists of its members, not only mistakes the legal view of the matter, but is in danger of falling into endless confusion and error. A corporation is distinct from its members in the same sense that a State is distinct from its citizens. The parallel indeed between a corporation and a State is very close.' "

Professor Pomeroy, in his review of Taylor on Corporations, is then quoted as follows :

'The author has here touched upon, although he has not fully developed, a fact which in our opinion must ere long be recognized and acted upon by the courts in dealing with the law of corporations.

'The common-law conception of the 'legal personality' — of the metaphysical entity constituting the corporation, entirely distinct from its individual members, arose at a time when corporations were all created by special charters generally granted by the Crown. When very few of them were 'stock' corporations : when they were mostly perpetual in existence; when absolutely no personal liability was imposed upon the individual corporators, but the legal status of the corporators was wholly swallowed up in the 'legal person' of the corporation, and when corporations were in reality, as a necessary result from this creation and legal position, monopolies.

"In the United States at the present day almost all corporations, whether business or otherwise, are formed under general laws. * * *

"The English courts have never treated the 'Joint Stock Companies' with limited liability, formed under these special statutes, as being identical with common-law corporations, but have always carefully distinguished between them. In our opinion, the American courts must, in time, recognize and enforce the same distinction."

The editor of the review then continues : "It ought, perhaps, to be added, that both views of the question are measurably correct. A corporation, in most of its relations, acts as a unit, and it is, for the most part, convenient to view it as an unit and to regard it as a 'person in law' ; but in many relations the proper idea of a corporation is not that of a person, but that of an aggregation of persons, or a kind of limited partnership. The effort of practical jurisprudence should be to regard it as an unit, or as a collection of persons, according to the relation in which it acts in a given instance. The shield will be either red or white, accordingly as it is viewed from the one side or the other." — Am. Law Reviezv, Vol. XI X., p. 1 14, et seq.

Limitations of this treatise. — It is not the purpose nor within the scope of this work to enunciate the correct rule, as we conceive it to be, excepting in disputed points; it is rather to afford to the reader, whether professional or lay, the ''Key-note" of the subject and the source from which he can obtain more light, if desired. With this end in view, we have drawn quite extensively upon the foregoing able review of the subject in hand.

Definitions from various authoritative sources. — The

definition of Messrs. Clark and Marshall in their elaborate work is as follows:

"A corporation is a body or artificial person, consisting of one or more individuals and sometimes of individuals and other corporations, created by law, and invested by the law with certain legal capacities, as the capacity of succession, and the capacity to sue and be sued, to make contracts, to take, hold and convey property, to commit torts and crimes and do other acts,

however numerous its members may be, Hke a single

individual."

2 Clark & Marshall on Private Corporations, sec.

Annexed to the foregoing is an extensive enumeration of the phases which a corporation may assume :

"A corporation, therefore, when it consists of more than one member, which is almost universally the case, may be regarded, according as the one view or the other may be necessary, either

"i. As a legal body or entity in which the existence of the natural persons who compose it is merged, or,

*'2. As a collection or association of natural persons vested with the capacity of existing and acting as a body.

"i. As a body or legal entity, it is distinct from the members who compose it and as such has,

''a. The capacity of succession, which is the capacity to exist as the same body for any length of time, notwithstanding the death, withdrawal or change of members.

'*&. The capacity to enter into contracts in its corporate name like an individual.

'V. The capacity to take, hold and convey property in its corporate name like an individual.

'^d. The capacity to commit torts and crime with some exceptions like an individual.

"e. The capacity to sue and be sued in its corporate name like an individual.

"3. It is merely by a fiction of law that a corporation is thus a legal entity distinct from its members. In reality it is a collection or association of natural persons who are created into a body for the purposes above enumerated, and it will be treated as such both in equity and law, whenever the fiction is urged to an intent and purpose which is not within its reason and policy."

Clark and Marshall on Private Corporations, Vol. I., sec. I, p. 2. See long line of sustaining cases; also note.

The definition given by Cook is : ''An artificial person like the State. It is a distinct existence, an existence separate from its stockholders and directors.'^

Cook on Corporations, Vol. I., sec. i, p. 2. (Chicago, 1903, 5th Ed.), citing Chief Justice Marshall's opinion in the celebrated Dartsmouth College Case, 4th Wharton 636, and the language of Lord Coke :

"An artificial being, invisible, intangible and existing only in contemplation of law."

The reference to the words of the learned and distinguished Lord Coke calls for more than passing attention by the reader.

The following extracts from Mr. Brice's excellent work are given at considerable length, because they illuminate the subject :

" 'A corporation is a person which exists in contemplation of law only and not physically. It is a collection of many individuals united in one body under a special denomination, having perpetual succession, under an artificial form, and vested by the policy of the law with the capacity of acting in several respects as an individual, particularly of taking and granting property, of contracting obligations and of suing and being sued, of enjoying privileges and immunities in common and of exercising a variety of political rights, more or less extensive, according to the design of its institution, or the powers conferred upon it at the time of its existence.' This is the description set forth by K3^d (i Kyd 13) and it is a fairly accurate description of the general nature of a corporation aggregate, but sufficient stress is not laid upon that which is its real characteristic in the eye of the law, viz., its existence separate and distinct from the individual or individuals composing it."

Green's Brice's Ultra Vires (Stevens & Haynes' Ed., London, 1893), Part L, Chap, i, sec. i.

'Tt is a fiction, a shade, a nonentity, but a reality for legal purposes. A corporation is only in abstracto — it is 'invisible, immortal and rests only in the intendment and consideration of law.' This is the description given by Coke in the case of Suttons Hospital (10 Coke's Rep., i, 23), and though exception has sometimes been taken to it, and more especially that a corporation is immortal, probably no better definition at once brief and accurate, can be given. The essential part of the notion Involved in the term corporation is its abstraction, the intangibihty of its existence, its being composed of a physical being, or beings, through which it manifests its capacities and powers, but from which It Is totally distinct. This Is the one important ' fact- The members of a corporation aggregate (note 'and the individual who is constituted a sole corporate') may form their connection with such, have rights and privileges, and be under obligations and duties over and above those affecting them In their private capacity, but they get them by reflection, as It were, from the corporation. They Individually are not the corporation — cannot exercise the corporate powers, enforce the corporate rights, or be responsible for the corporate acts; while even at common law they can mutually sue or be sued by the corporation or each other." Ibid, page 2.

Name, and common seal, and perpetual Identity are essentials. Corporations enjoy, to some extent, attributes of immortality; but to say "They never die" is Incorrect, they do terminate.

In the United States perpetual corporations are the exception.

Dillon on Municipal Corporations, 91, says:

"Continuous legal Identity and perpetual or Indefinite succession under the corporate name exist notwithstanding successive changes by death or otherwise in the corporators or members of the corporation."

*'It conveys perhaps as tangible an idea as can be given by a brief definition, to say that a corporation is a legal person with a special name, and composed of such memibers, and endowed with such powers, and such only as the law prescribes. This simply denotes that, notwithstanding the lapse of time or alteration in the constitution of a corporation or the renewal, many times repeated, of all its members, or its reconstruction on a new basis and even with different objects, the corporation itself remains the same — it does not import that it must or will continue forever."

The case of Hospital vs. Sutton, Cooke's Reports (Fraser), Vol. V. pp. 253-307 inclusive, remains one of the leading cases on the subject of English corporations, and like English corporation law generally, is much copied in this country.

In Viner's Abridgment of Law and Equity, Second Ed., Vol. 6, pp. 258-9 (1792), it is said:

"i. A corporation is a body politic consisting of material bodies, which joined together must have a name to do things that concern their corporations, or otherwise it is no corporation.

"2. All the natural persons of the corporation are not the corporation, but are persons of which the corporation consists, but not wholly, for the name is a part, without which the corporation cannot be; also, the King may give power to a common person to name the persons and the name of the corporation, and when he hath done so, this corporation is not said to be made by the common person, but by the King."

Ibid.

In Bacon's Abridgment, Vol. II., 437 (Philadelphia, i860), the definition is as follows, viz.: