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EDGEWORTH V. WOOD, TREASURER OF THE UNITED STATES EXPRESS

COMPANY.

58 New Jersey Law (29 Vroom) Reports 463 (1896).

On rule to show cause.

Argued at November term, 1895, before BEASLEY, chief justice, and Justices MAGIE and LUDLOW.

The opinion of the court was delivered by MAGIE, J. This is an action in tort in which plaintiff seeks to recover damages for injuries suffered by him by reason of his being run over, in a public street in Jersey City, by a wagon of the United States Express Company, negligently driven by a driver in the employ of that company. The jury having rendered a verdict for plaintiff, this rule to show cause why the verdict should not be set aside was allowed. Several reasons were filed in support of the rule, but only three have been urged in the argument. These only will be considered.

It is first contended that neither plaintiff's declaration nor the evidence produced by him discloses any liability on the part of Theodore F. Wood, treasurer of the United States Express Company, to answer for plaintiff's injuries if inflicted as he claimed.

Plaintiff claims to have made out his case in this respect, in the following manner: He produced proof that the United States Express Company was an association organized April 22, 1854, under the laws of New York, and having a principal place of business in the city of New York, and that Thomas C. Platt was its president and Theodore F. Wood its treasurer. He put in evidence chapter 238 of the laws of New York for the year 1849, and sections 1919, 1924 of the New York code of civil procedure, whereby it appeared that any association thus organized was expressly authorized to sue and to be sued in the name either of its president or its treasurer for the time being. Upon this he contends that he is entitled to an action against Wood, as treasurer, and as Wood is a resident of New Jersey, and was served with process here, that our courts, by comity, will recognize the liability to suit imposed by the laws of New York.

In opposition to this, it is contended on the part of defendant that if it be conceded that our courts will, by comity, adopt and enforce remedies against such associations, in the mode prescribed by the law of the state under which they came into existence, yet if the law of this state has furnished a mode of procedure by which remedies against such associations may be enforced, the rule of comity ceases and the mode of procedure provided by our laws must be pursued. The supplement to the Practice act, approved May 23, 1890

(Pamph. L., p. 353; Gen. Stat., p. 2592, § 342), is conceived by counsel to have furnished a mode of procedure under which this action could have been maintained against the United States Express Company.

By that act it is enacted that any "unincorporated company, stock company or association," consisting of two or more persons united for business purposes and having a recognized name, may be sued by that name in any action affecting the common property or the joint rights and liabilities of such company or association. Provision is made for the service of process and for the issue of an execution upon judgment in the same manner as upon judgments against corporations. If the United States Express Company is an unincorporated association, within the meaning of the act, it would seem that plaintiff could have brought his action under that act.

Questions concerning the nature of associations formed under the laws of New York, such as the United States Express Company, have been frequently considered in the courts of that state. The act of 1849 speaks of them as joint-stock companies or associations. By its certificate, this company calls itself a joint-stock company.

In the earliest case to which my attention has been directed the question requiring solution was as to the relation between a shareholder and such a company. After an exhaustive review of the New York statutes on the subject Judge Barnard declared that such companies had all the qualities of corporations, except that of having a common seal. His conclusion was that in a controversy between a shareholder and the company, he was not to be considered as a partner in a partnership, but the courts must deal with his relation following the analogy of the law of corporations. Waterbury v. Merchants' Union Express Co., 50 Barb. 157.

In a later case an action was brought by a shareholder in the same company against Fargo, its president, to recover for the loss of articles entrusted to it for transportation. The defense was that the owner of an interest in the company could not maintain such an action against it, which it was claimed was like an action by a partner against the partnership. The action was sustained by the court below. Westcott v. Fargo, President, 6 Lans. 319. Upon appeal, the opinion was delivered by Dwight, one of the commissioners of appeal. Upon a review of the statutes, he declared that the president or treasurer of one of these joint-stock companies or associations was to be regarded, for the purposes of an action against the company, substantially as a corporation sole; that such companies possessed some powers and privileges of corporations not possessed by individuals or partnerships, and that an action upon a

liability of the company might be maintained by one of its members. Westcott v. Fargo, 61 N. Y. 542.

Later the United States Express Company, the very company whose officer is here sued, objected to the imposition of a tax upon its corporate franchises and business computable upon its capital stock, under an act taxing corporations, joint-stock companies and associations incorporated or organized under any law of the state. Its contention was that it was neither so incorporated nor organized. The right to impose the tax was sustained, Judge Danforth saying: "The agreement which brought many persons into one artificial body was so framed as to accomplish that end, and in proposing to conduct its affairs by the power given to it in the mode prescribed by the legislature, they must be deemed, for the purposes of the act in question, to be incorporated - that is, formed or united under the law of the state, whether the artificial body be termed a corporation, a joint-stock company or association." People, ex rel. Platt, v. Wemple, 117 N. Y. 136.

Questions have also arisen respecting the right to remove to the federal courts actions between the president or treasurer of such companies and other persons.

In New York, it was held, in a suit by Fargo as president of such a company organized in New York, that the company was to be considered like a corporation, a citizen of New York, and the action was removable to the United States court, if the other party was a citizen of another state. Fargo v. McVicker, 55 Barb. 437.

In the United States Circuit Court for the District of Michigan, Judge Brown (now justice of the supreme court) held that such a company formed in New York was to be deemed a citizen of New York without regard to the citizenship of its members. Maltz v. American Express Co., 1 Flip. 611.

In another case in the federal courts, the action was brought by Fargo as president of such company against a citizen of a western state, and Judge Gresham held that such company was a citizen of New York and could maintain an action in those courts, notwithstanding the fact that some of its shareholders were residents of the state in which the defendant resided. Fargo v. L., N. A. & C. Ry. Co., 6 Fed. Rep. 787.

In the case last cited and in some of the other cases, the conclusion reached has not been deemed invalidated by the fact that some of the New York statutes speak of such companies and associations as unincorporated.

In Liverpool Ins. Co. v. Massachusetts, 10 Wall. 566 the Supreme Court of the United States held that an English joint-stock associa

tion, which was endowed with certain corporate powers, must be considered by our courts to be a corporation, notwithstanding the acts of parliament declared that such associations should not be held to be corporations.

Whether an aggregation of individuals united in an artificial body is a corporation or not is to be determined rather by the faculties and powers conferred upon the body than by the name or description given to it.

Upon this review, I have reached the conclusion that the United States Express Company is a corporate entity, empowered to sue and be sued, not, as is usual, in a corporate name, but in the name of designated officers. To such a corporation the act of 1890 does not apply, and this action was therefore properly brought against Wood as treasurer, whose status in the suit is not that of an individual, but of a representative of the company.

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This reason can not, therefore, prevail.
The rule to show cause should be discharged.

(e) The Corporation and its Shareholders.
WILLIAMSON et al. v. SMOOT et al.

7 Martin (La.) 31 (1819).

Appeal from the court of the first district.

MATTHEWS, J., delivered the opinion of the court. The plaintiffs having caused an attachment to be levied on the steamboat Alabama, the St. Stephens Steamboat Company intervened in their corporate capacity, and claimed her as their property. The intervening party are a body politic, created by an act of the legislature of the territory of Alabama, the capital stock of which is divided into shares of a certain amount, and Smoot, the defendant, owns ten of them, subscribed for by him.

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2. Can the shares or stock of any individual stockholder be legally attached?

II. The existence of the claimants being recognized as a body corporate, and it being admitted that the boat attached belongs to them as a part of their common stock, it is clear that Smoot does not possess such certain and distinct individual property in it as to make his interest attachable. The estate and rights of a corporation belong so completely to the body that none of the individuals who compose it has any right of ownership in them, nor can dispose of any part of them. Civ. Code, 88, Art. II.

The court is of opinion that the district court erred in disallowing the claim of the company.

It is, therefore, ordered, adjudged and decreed that the judgment be annulled, avoided and reversed, and that the attachment of the plaintiff and appellant be quashed, so far as it relates to the said steamboat, the Alabama, and that she be released therefrom.

THE QUEEN V. ELIAS ARNAUD et al.

[In the Queen's Bench (1846).]
16 Law Journal N. S. 50.

The facts appear in the opinion.

The judgment of the court was delivered by

LORD DENMAN, C. J. The object of the present mandamus is to compel the custom-house officers to register a vessel, the property of the Pacific Steam Navigation Co. The company is a corporation by charter of her present Majesty, for the purpose of providing vessels, and employing them in the Pacific Ocean. is admitted by the defendants that the company, as a British corporation, might be owners of British-built vessels, and prima facie would be, as such corporation, entitled to register them, under the provisions of the 8 & 9 Vict. c. 89, applicable to the registry of vessels by corporations. But is said that some of the members of the corporation are not British subjects, but foreigners; and, consequently, that the vessel does not wholly belong to Her Majesty's subjects, as required by the 5th section of the act, and is within the prohibition contained in the 12th section of the act, against foreigners being entitled to be owners, in whole or in part, directly or indirectly, of any vessel requiring to be registered. Now, it appears to us that the British corporation is, as such, the sole owner of the ship, and a British subject within the meaning of the 5th section, as far as such a term can be applicable to a corporation, notwithstanding some foreigners may individually have shares in the company, and that such individual members of the corporation are not entitled, in whole or in part, directly or indirectly, to be owners of the vessel. The individual members of the corporation, no doubt, are interested in one sense in the property of the corporation, as they may derive individual benefit from its increase, or loss from its destruction; but in no legal sense are the individual members the owners. If all the individuals of the corporation were duly qualified British subjects,

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