« PreviousContinue »
Under the broad definition of this section, a levee district has the attributes of a corporation. It is “a creature of the law, and has certain powers and duties of a natural person.” (Dean v. Davis, 51 Cal. 410.)
Under the act of May 20, 1861, railroad corporations possessed all the powers and privileges for the purpose of carrying on the business of the corporation that private individuals and natural persons had. (Pixley v. R. R. Co., 33 Cal. 183, 91 Am. Dec. 623.)
Corporation is a "Person.”—The word “person” in its legal signification is a generic term, and was intended to include artificial, as well as natural, persons. (Douglass v. Steamship Company, 4 Cal. 304.)
The word “corporation” in the act of 1897 (Stats. 1897, p. 231), means an artificial person created and existing under the laws of the place of its creation; but, as applied to its rights as a defendant, is to be treated as including all the persons who are members thereof. It is to be deemed a “person” within the meaning of the fourteenth amendment, which forbids a state to "deny to any person within its jurisdiction the equal protection of the law." (Johnson v. Mining Co., 127 Cal. 4, 78 Am. St. Rep. 17, 59 Pac. 304.)
By section 14 of the Civil Code, section 17 of the Code of Civil Procedure, section 7 of the Penal Code, and section 17 of the Political Code, the word “person” is defined to include a corporation as well as a natural person.
A Corporation De Jure is an artificial body created by operation of law upon the execution, filing, and certification of certain written instruments by persons desirous of incorporating, and certain public officers, in accordance with the provisions of the general laws. (Martin v. Deetz, 102 Cal. 55, 41 Am. St. Rep. 151, 36 Pac. 368.)
A Corporation De Facto is one acting as a corporation in good faith. (Lakeside Ditch Co. v. Crane, 80 Cal. 181, 22 Pac. 76.) A corporation de facto exists where a number of persons have organized and acted as a corporation. (Martin v. Deetz, 102 Cal. 55, 41 Am. St. Rep. 151, 36 Pac. 368. See section 358, C. C., post.
Corporate Franchise.-The right to be a corporation is a franchise, and to acquire a franchise under a general law, the required statutory conditions must be complied with. (People v. Selfridge, 52 Cal. 331. To same effect: S. V. W. W. v. Schottler, 62 Cal. 110; People v. Montecito etc. Co., 97 Cal. 278, 33 Am. St. Rep. 172, 32 Pac. 236; McCallion v. Hibernia S. & L. Soc., 70 Cal. 168, 12 Pac. 114.)
The charter is the statute or statutes granting and defining the powers of the corporation, under which it is constituted and exists, together with the instruments required to be executed by the provisions of such statute or statutes. These are sometimes called the constating instruments. Such franchises are legal estates, not mere naked powers, and are powers coupled with an interest, which vest
in the corporation by virtue of its charter or constating instrument. (S. V. W. W. v. Schottler, 62 Cal. 73.)
A franchise granted to certain parties vests by operation of law in a corporation which they form, and no assignment is necessary. (S. V. W. W. v. S. F., 22 Cal. 434. See S. F. v. S. V. W. W.,
48 Cal. 520.)
The right to be a corporation is a franchise, to acquire which the prescribed statutory conditions for the formation of corporations must be substantially complied with. (People v. Montecito Water Co., 97 Cal. 276, 33 Am. St. Rep. 172-176, 36 Pac. 236. Note citation: Jones v. Hardware Co., 52 Am. St. Rep. 227.)
Sec. 284, C. C. Corporations are either public or private. Public corporations are formed or organized for the government of a portion of the state; all other corporations are private. [En. March 21, 1872; Amd. 1873-74, p. 197.]
The original section, instead of "all other corporations are private," had the words “private corporations are formed for the purpose of religion, benevolence, education, art, literature, or profit." The original definition of private corporations restricted private to those formed for the purposes mentioned, and had the effect to exclude any corporation not expressly mentioned; as, for instance, à cemetery corporation, or a mutual benefit society, or a society for the prevention of cruelty to animals. The present definition is sufficiently comprehensive to include all purposes for which private corporations may be formed.
Davis, 51 Cal. 406; People v. Reclamation District, 117 Cal. 121, 48 Pac. 1016; Reclamation District v. Sacramento, 134 Cal. 478, 66 Pac. 668.)
Classification of Corporations.—There are several classes of corporations, such as public, municipal corporations, the leading object of which is to promote the public interest; corporations technically private, but yet of a quasi public character, having in view some great public enterprise, in which the public interests are directly involved to such an extent as to justify conferring upon them important governmental powers, such as the exercise of the power of eminent domain; and corporations strictly private, the direct object of which is to promote private interests, and in which the
public has no concern, except the indirect benefits resulting from the promotion of trade, and the development of the general resources of the country. (Miners' Ditch Co. v. Zellerbach, 37 Cal. 577.)
Corporations cannot be made the basis of classification for pur. poses of legislation, unless such classification is founded upon some constitutional or natural distinction, which suggests a reason to justify the diversity of legislation respecting them. No such basis exists for the classification of the act of 1897. (Johnson v. Mining Co., 127 Cal. 4, 78 Am. St. Rep. 17, 59 Pac. 304.)
Public Corporations. Public corporations are instrumentalities of the state, incorporated by the state, and invested with a corporate character, the better to perform within and for a certain locality governmental functions. (Dean v. Davis, 51 Cal. 411.)
School districts, road districts, levee districts, irrigation districts, and sanitary districts are public corporations. (Dean v. Davis, 51 Cal. 411; People v. Reclamation District, 53 Cal. 348; People v. Williams, 56 Cal. 647; Swamp Land District v. Haggin, 64 Cal. 204, 30 Pac. 631; People v. La Rue, 67 Cal. 528, 8 Pac. 84; Turlock Irrigation District v. Williams, 76 Cal. 368, 18 Pac. 379; Central Irr. District v. De Lappe, 79 Cal. 353, 21 Pac. 825; Quint v. Hoffman, 103 Cal. 506, 37 Pac. 514; People v. Irrigation Dist., 98 Cal. 206, 32 Pac. 1047; Reclamation Dist. v. Gray, 95 Cal. 601.)
But reclamation districts formed under the provisions of section 3446 et seq. of the Political Code do not come within the class of corporations defined by section 284 of the Civil Code. They are special organizations, formed to perform certain work, which the policy of the state requires or permits to be done, and to which the state has given a certain degree of discretion in making the improvements contemplated. (Reclamation District v. Sacramento, 134 Cal. 477, 66 Pac. 668.)
The conditions under which it can be said the legislature intended the creation of a corporation for the performance of some local governmental function considered, and held that question whether 2 corporation is such or not must come to depend upon the character of the powers enumerated in the creative statute. (Reclamation District v. Sacramento County, 134 Cal. 477, 66 Pac. 668; Hensley v. Reclamation District, 121 Cal. 96, 53 Pac. 401; Dean v. Davis, 51 Cal. 410.)
Corporations which fail of sufficient corporate powers to constitute them perfect corporations are sometimres termed quasi corporations, because many of the presumptions and rules which apply to corporations have been made applicable to them. (People v. Reclamation District, 117 Cal. 121, 48 Pac. 1016; Reclamation Dist. v. Sacramento, 134 Cal. 477, 66 Pac. 668.) Municipal corporations are designed to regulate the internal affairs of the places in which they are locatedpolice, health, streets, lawns, alleys, and the like, are the appropriate subjects of municipal administration. (Low v. Mayor of Marysville, 5 Cal. 217.)
Irrigation districts are public corporations to the same extent as reclamation districts, and the rule that proceedings to devest a person of his property in invitum are to be strictly construed does not apply to proceedings for the formation of such districts. Such proceedings are to be liberally construed to carry out the purposes of the law. (Central Irr. Dist. v. De Lappe, 79 Cal. 351, 21 Pac. 825. Note citation: Gulf etc. Co. v. James, 15 Am. St. Rep. 753.)
Irrigation districts provided for in act of March 7, 1887, are quasi public corporations in the sense that the purpose for which they are to be organized is for the general public benefit, and legislative recognition is sufficient to establish such district. (Turlock Irr. Dist. v. Williams, 76 Cal. 360, 18 Pac. 379. Same effect: People v. Selma etc. Dist., 98 Cal. 208, 32 Pac, 1047.)
A swamp land district, organized by the board of supervisors under act of March 25, 1868 (Stats. 1867-68, p. 316), is a public corporation, and validity of its corporate existence cannot be collatcrally attacked or questioned. (Hoke v. Perdue, 62 Cal. 545.)
An irrigation district is a public corporation, and its officers are public officers. (Perry v. Otay Irr. Dist., 127 Cal. 565, 60 Pae. 40.)
It is not a presumption of law that a corporation organized for irrigation purposes was organized for profit. (Applegarth v. McQuiddy, 77 Cal. 408, 19 Pac. 692.)
Quasi Public Corporations.– Defined. (Miners’ Ditch Co. v. Zellerbach, 37 Cal. 543, 99 Am. Dec. 300, and note.) Of this class are railroad, turnpike, canal, water, and light companies. (Miners' Diteh Co. v. Zellerbach, 37 Cal. 543, 99 Am. Dec. 300, and note; Turlock Irr. Dist. v. Williams, 76 Cal. 360, 18 Pac, 379.)
A reclamation district organized under the provisions of the Political Code (section 3446 et seq.) is a quasi public corporation whose organization cannot be collaterally attacked. (Reclamation District v. Turner, 104 Cal. 334, 37 Pac. 1038. To same effect: Hamilton v. San Diego Co., 108 Cal. 273, 41 Pac. 365.)
Private Corporations.-Under the classification of this section, all corporations are either public or private. The purposes for which a corporation is formed must be stated in its articles of incorporation, and it is by reference to the articles, as well as to the statute under which the incorporation is had, that the character of the corporation is determined. (C. C., sec. 290; Vercoutere v. Golden Gate Lumber Co., 116 Cal. 410, 48 Pac. 375; Perkins v. Fish, 121 Cal. 317, 53 Pac. 901.)
.PRIVATE, HOW FORMED.
Sec. 285, C. C. Private corporations may be formed by the voluntary association of any five or more persons in the manner prescribed in this article. A majority of such persons must be residents of this state. En. March 21, 1872. Amd. 1873-74, 197.
Formation of corporation to be under general laws: Const. Cal. 1879, art. XII, sec. 1; 1849, art. IV, sec. 31.
For corporations defectively organized and de facto corporations, see section 358, Civil Code, post.
This section is not based upon any general provision of law exist. ing prior to the adoption of the Civil Code. Many of the statutes relating to particular corporations provided minimum limitations vpon the number of individuals who could incorporate, but there was no uniformity in the limitation. Under the incorporation act of 1850 (Stats. 1850, p. 347), seven or more incorporators were required for insurance companies; twenty-five for railroad companies; five for turnpike, road, or plank road companies; three for manufacturing, mining, mechanical or chemical companies, five för bridge companies. For steam navigation companies, and telegraph companies there was no limitation upon the number of incorporators under that act. The mutual insurance companies act of April 16, 1851 (Stats. 1851, p. 523), required at least seven incorporators. The incorporation act of April 14, 1853 (Stats. 1853, p. 87), required three or more incorporators for the incorporation of the corporations therein provided. The plank and turnpike road act of May 12, 1853 (Stats. 1853, p. 169), required nine or more incorporators. By act of March 13, 1857 (Stats. 1857, p. 75), nine incorporators were required for the incorporation of the charitable institutions therein provided for. The rural cemetery act (Stats. 1859, p. 281) required at least seven incorporators, and imposed the further requirement of residence in the state. The homestead association act of 1861 (Stats. 1861) required seven incorporators. The railroad incorporation act of 1861 (Stats. 1861 p. 607) required ten incorporators. The act of April 11, 1862 (Stats. 1862, p. 199), providing for the formation of corporations for the accumulation of funds and savings, required five incorporators. The library association act of 1863 (Stats. 1863, p. 624) required twenty members. The fire insurance and marine in. surance act of 1866, and the mutual life insurance act of 1866 (Stats. 1866, pp. 743, 752, respectively), each required thirteen corporators.