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Secretary of State, in the office of the county clerk of the county in which such property is situated, within sixty days after such purchase or location is made. Every corporation now in existence, whether formed under the provisions of this code or not, must, within ninety days after the passage of this section, file such certified copy of the copy of its articles of incorporation in the office of the county clerk of every county in this state in which it holds any property (except the county where the original articles of incorporation are filed); and if any corporation hereafter acquire any property in any county other than that in which it now holds property, it must, within ninety days thereafter, file with the clerk of such county such certified copy of the copy of its articles of incorporation. The copies so filed with the several county clerks and certified copies thereof shall have the same force and effect in evidence as rould the originals. Any corporation failing to comply with the provisions of this section shall not maintain or defend any action or proceeding in relation to such property, its rents, issues, or profits, until such articles of incorporation, and such certified copy of its articles of incorporation, and such certified copy of the copy of its articles of incorporation shall be filed at the places directed by the general law and this section; prorided, that all corporations shall be liable in damages for any and all loss that may arise by the failure of such corporation to perform any of the foregoing duties within the time mentioned in this section; and provided further, that the said damages may be recovered in an action brought in any court of this state of competent jurisdiction, by any party or parties suffering the same. En. March 21, 1872. Rep. 1873-74, 200. En. Stats. 1875-76, 71. Amd. 1877-78, 76; 1880, 13. Right to purchase estate: See post, sec. 354, C. C.

Legislative History.

There was originally a section 299 as follows: “If a member of a corporation dies, resigns, or is removed, a majority of the remaining members may elect another in his place." This section was repealed in 1873-74, and a new section enacted in 1875-76, which read as follows:

"299. No corporation hereafter formed under the provisions of this chapter shall purchase, locate, or hold property in any county of this state, without filing a certified copy of the certificate of its articles of incorporation in the office of the county clerk of the county in which such property is situated, within sixty days after such purchase or location is made, and every corporation now in existence must, within ninety days after the passage of this act, file a certified copy of the certificate of its articles of incorporation as provided in this section and a certified copy of such copy shall, as evidence, have the same force and effect as a certified copy of the orig. inal. Any corporation failing to comply with the provisions of this section shall not maintain or defend any action or proceeding in relation to such property.”

This section, as amended in 1875-76, read as at present through the words “rents, issues and profits,' except that it did not contain the words inclosed in parentheses above. The last part of the section as amended in 1875 from the words “rents, issues and profits" was as follows: “Any corporation which has not heretofore filed a certified copy of the certificate of its articles of incorporation may avail itself of the provisions of this act, with the same effect as if it had filed such certified copy of such certificate; provided, that this act shall not affect any pending litigation, or any suit now pending in court."

Section Cited.

Boston Tunnel Co. v. McKenzie, 67 Cal. 487, 8 Pac. 22; Weeks v. Gold Mining Co., 73 Cal. 601, 602, 15 Pac. 302; S. P. R. R. Co. v. Purcell, 77 Cal. 72, 18 Pac. 886; Ontario State Bank v. Tibbits, 80 Cal. 69, 71, 22 Pac. 66; South Yuba Water etc. Co. v. Rosa, 80 Cal. 335, 336, 22 Pac. 222; Mora v. Murphy, 83 Cal. 17, 23 Pac. 63; Labory v. Orphan Asylum, 97 Cal. 274, 32 Pac. 231; Emigrant Ditch Co. v. Webber, 108 Cal. 90, 91, 40 Pac. 1061; Calif. 8. & L. Society v. Harris, 111 Cal. 135, 137, 138, 43 Pac. 525; Savings and Loan Society v. McKoon, 120 Cal. 178-181, 52 Pac. 305.

Annotation.

Construction.—This is a penal statute. Penalties are never favored by the courts of law or equity, and statutes imposing penalties or creating forfeitures must be strictly construed. (Askew v. Ebberts, 22 Cal. 263; Schallert-Ganahl L. Co. v. Neal, 91 Cal. 362, 27 Pac. 743; Eyre v. Harmon, 92 Cal. 580, 28 Pac. 779.) Every intendment and presumption is against the person seeking to enforce the penalty or forfeiture. (Savings and Loan Soc. v. McKoon, 120 Cal. 179, 52 Pac. 305.)

Application of Section. This section applies only to corporations a copy of whose articles were required by statute to be filed with Secretary of State, and does not apply to a religious corporation established before the code, under a statute requiring only the filing of its articles with the county clerk. (Mora v. Murphy, 83 Cal. 12, 23 Pac. 63.)

Held, accordingly, this section does not apply to foreign corpora. tions, but applies only to domestic corporations who have filed a copy of their act of incorporation in office of Secretary of State of California. There is no provision or authority in the statute by which foreign corporations are to file a copy of their act of incorporation with the Secretary of State of this state. (South Yuba etc. Co. F. Rosa, 80 Cal. 333, 22 Pac. 222; Ontario State Bank v. Tibbits, 80 Cal. 68, 22 Pac. 66.)

This section does not forbid corporations failing to comply with its provisions from acquiring property, either by condemnation or otherwise, but it does inhibit the maintenance or defense by them of any action in relation to property acquired. (Emigrant Ditch Co. v. Webber, 108 Cal. 88, 40 Pac. 1061. To same effect: Savings etc. Society v. McKoon, 120 Cal. 180, 52 Pac. 305.)

Nor does the failure of corporation to file copy of its articles of incorporation in office of clerk of county in which it owns property prevent the corporation fronr defending an action brought against it to recover for work and labor alleged to have been performed on such property. (Weeks v. Garibaldi etc. Co., 73 Cal. 599, 15 Pac. 302. To same effect: Savings etc. Society v. Moon, 120 Cal. 180, 52 Pac, 305.)

So, also, the section does not apply to an action by a corporation to foreclose a mortgage in another county, which is simply and only an action for the collection of a debt, and to enforce a lien for its payment. The corporation does not “hold” the mortgaged property, within the meaning of that section. (Savings & L. Soc. v. MeKoon, 120 Cal. 177, 52 Pac. 305.)

Pleading Under the Section.-Noncompliance with section 299, Civil Code, does not impose upon corporation a loss or forfeiture of its property; nor is such compliance essential to a cause of action, or a jurisdictional element in the suit; but a failure to comply is merely ground for plea in abatement, which may be and is waived unless it is affirmatively pleaded. (Cal. S. & L. Society v. Harris, 111 Cal. 133, 43 Pac. 525. To same effect: Savings etc. Society v. McKoon, 120 Cal. 180, 52 Pac. 305.)

But a certified copy of a copy of articles of incorporation may be filed at any time before the filing of a plea in abatement, and such plea thereafter interposed is unavailing to prevent a further maintenance of the action. (California S. & L. Society v. Harris, 111 Cal. 133, 43 Pac. 525.)

An averment denying plaintiff's existence as a corporation and alleging that it has no legal capacity to sue does not set up the defense that a copy of the copy of the act of incorporation has not been filed with county clerk of county where property is situated. (Ontario State Bank v. Tibbits, 80 Cal. 68, 22 Pac. 66. Distinguished: S. & L. Soc. v. McKoon, 120 Cal. 180, 52 Pac. 305. To same effect: S. P. R. R. v. Purcell, 77 Cal. 69, 18 Pac. 886; Bank v. Tibbits, 80

Cal. 70, 22 Pac. 66; South Yuba Co. v. Rosa, 80 Cal. 336, 22 Pac. 222.)

Failure of corporation to file copy of copy of act of incorporation is not ground of general demurrer when complaint is silent upon the subject, nor is it ground of motion for nonsuit that plaintiff has failed to prove such filing; such failure can be availed of only by specially pleading it in answer as matter of abatement. (South Yuba Water Co. v. Rosa, 80 Cal. 333, 22 Pac. 222. To same effect: California ete. Society v. Harris, 111 Cal. 136, 43 Pac. 525.)

A failure to raise the issue by plea in abatement is a waiver of the defense. (Ontario State Bank v. Tibbits, 80 Cal. 68, 22 Pac. 66. To same effect: Calif. etc. Soc. v. Harris, 111 Cal. 136, 43 Pac. 525.)

An objection that a corporation has not filed its articles of incor. poration as required must be taken at the trial or conclusion thereof, and cannot be first made on appeal. (Labory v. Los Angeles etc. Asylum, 97 Cal. 270, 32 Pac. 231. To same effect: Cal. etc. Society v. Harris, 111 Cal. 136, 43 Pac. 525. Distinguished: S. & L. Soc. v. McKoon, 120 Cal. 180, 52 Pac. 305.)

Prohibition against corporation suing in county where articles of incorporation have not been filed applies to such actions or proceedrugs as are brought "in relation to such property, its rents, issues or profits." (Weeks v. Gold Mining Co., 73 Cal. 599, 15 Pac. 302. To same effect: Savings etc. Soc. v. McKoon, 120 Cal. 180, 52 Pac. 305.)

Evidence.- A certified copy of a certified copy of articles, filed in accordance with this section, in order to enable a corporation to maintain certain actions is not in any sense secondary evidence, but is by law made equal in all respects with the original, as evidence. (Boston Tunnel Co. v. McKenzie, 67 Cal. 487, 8 Pac. 22.)

BANKING CORPORATIONS MAY ELECT TO HAVE CAPITAL

STOCK Sec. 300, C. C. Every corporation that has been or may

be created under the general laws of this state, doing a banking business therein, and which has no capital stock, may elect to have a capital stock, and may issue certificates of stock therefor in the same manner as corporations formed under the provisions of chapter I, article I, of the Civil Code, relating to the formation of corporations : provided, that no such corporation shall use or convert any moneys or funds theretofore belonging to it or under its control into capital stock; but such funds or moneys must be held and managed only for the purposes and in the manner for which they were created. Before such change is made, a majority of the members of such corporation present at a meeting called for the purpose of considering the proposition whether it is best to have a capital stock, its amount, and the number of shares into which it shall be divided, must vote in favor of having a capital stock, fix the amount thereof, and the number of shares into which it shall be divided. Notice of the time and place of holding such meeting and its object must be given by the president of such corporation by publication in some newspaper printed and published in the county, or city and county, in which the principal place of business of the corporation is situated, at least once a week for three successive weeks prior to the holding of the meeting. A copy of the proceedings of this meeting, giving the number of persons present, the votes taken, the notice calling the meeting, the proof of its publication, the amount of capital actually subscribed, and by whom, all duly certified by the president and secretary of the corporation, must be filed in the offices of the Secretary of State and clerk of the county where the articles of incorporation are filed. Thereafter such corporation is possessed of all the rights and powers, and is subject to all the obligations, restrictions, and limitations, as if it had been originally created with a capital stock; and provided, further, that no bank in this state shall ever pay any dividend, upon so-called guaranty notes nor upon any stock except upon the amount actually paid in money into said capital upon such stock, and any payment made in violation of this provision shall render all officers and directors consenting to the same jointly and severally liable to the depositors, to the extent thereof. En. Stats. 1877-78, 77.

See section 287, Civil Code, ante, for provisions for change to code corporation.

Section Cited.

People v. Perrin, 56 Cal. 349; Dallemand v. 0. F. Savings Bank, 74 Cal. 600, 602, 16 Pac. 497.

Annotation.

A corporation organized to do a savings bank business without a capital stock, whether a de facto or a de jure corporation, and whether organized before or after the code, may avail itself of the provisions

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