vote is to deprive him of an essential attribute of his property. Therefore, ordinarily, the legislature has not the power so to amend a general corporation law as essentially to undermine the right of a stockholder to vote, and such a result cannot be accomplished indirectly by vesting the directors with authority, upon the consent of a majority of the stockholders, to amend the charter so as to produce that effect. Lord v. Equitable Life Assur. Soc., (1909) 194 N. Y. 212, 87 N. E. 443, 22 L. R. A. (N. S.) 420, reversing 126 App. Div. 937, 110 N. Y. S. 1135.

Withdrawal of exemption of road company from assessment.— The exemption from assessment for public improvement conferred upon a plank road company by chapter 87 of the Laws of 1854, and chapter 566 of the Laws of 1890, as amended by chapter 617 of the Laws of 1892, is withdrawn by subsequently enacted provisions of the city charter authorizing such assessment. People v. Cummings, (1901) 166 N. Y. 110, 59 N. E. 703, reversing 53 App. Div. 36, 65 N. Y. S. 581.

Exaction from street railway of per cent. of gross receipts instead of license fee. The Act of 1873 (ch. 647, Laws of 1873), requiring the B. S. & F. F. R. R. Co., a street railroad corporation organized under the General Railroad Act (ch. 140, Laws of 1850), to pay into the treasury of the city of New York one per cent. of the gross receipts instead of a license fee as before prescribed (ch. 199, Laws of 1873), is constitutional. It must be deemed an alteration and amendment of the charter of the company, and so is within the power reserved to the legislature by this section of the constitution. The court said: “Here, in the first instance, by the act chapter 199 of the laws of 1873, a license fee of $50 for each car was considered a sufficient compensation to the city for the valuable franchise enjoyed by the corporation. But, on further consideration, the legislature concluded that it would be more convenient and beneficial to the city, and a fairer measure of the compensation which it should receive, that a percentage on the gross receipts should be paid. And this change the legislature was competent to make within every authority that can be found in the books." New York v. Twenty-third St. R. Co., (1889) 113 N. Y. 311, affirming 48 Hun 552, 1 N. Y. S. 295.

Limitation on amount of business.— By virtue of this section the legislature may limit the amount of business which a corporation created by it may transact. Bush v. New York Life Ins. Co., (1909) 135 App. Div. 447, 119 N. Y. S. 796.

Merger of corporations. The legislature, under its power to repeal or amend a corporate charter, may authorize the merger of corporations, if there be no confiscation of their property. A merger which results in the extinction of the merged corporation, and the transfer of its assets to the other corporation, does not confiscate its property or deprive it of vested property rights, where, under the statute, a stockholder unwilling to assent to the terms of the merger agreement may obtain the value of his stock in cash. Colby v. Equitable Trust Co., (1908) 124 App. Div. 262, 108 N. Y. S. 978, affirmed (1908) 192 N. Y. 535, 84 N. E. 1111, mem.

Prohibition of contract not to join labor union. It has been suggested that the legislature, under its reserve power to alter, amend and repeal the charters of corporations and general laws under which they are formed, might declare it unlawful for corporations to enter into contracts binding their employees not to join a labor organization. People v. Marcus, (1905) 110 App. Div. 255, 97 N. Y. S. 322, affirmed (1906) 185 N. Y. 257, 77 N. E. 1073, 113 A. S. R. 902, 7 Ann. Cas. 118, 7 L. R. A. (N. S.) 282.

Authorization of corporation to issue preferred stock with consent of twothirds of common stockholders. The amendment by chapter 354, Laws of 1901, of section 47 of the Stock Corporation Law (Laws of 1892, ch. 688), in such wise as to allow a domestic stock corporation, whose certificate of incorporation did not provide for the issuing of preferred stock, to issue

such stock upon obtaining the consent of two-thirds of the stockholders, instead of upon obtaining the consent of all the stockholders, as provided in the section prior to the amendment, was a valid exercise of the power reserved to the legislature to alter or repeal the charter granted to any corporation. Hinckley v. Schwarzschild, etc., Co., (1905) 107 App. Div. 470, 95 N. Y. S. 357. In that case this was said: "It is evident that the present legislation does not defeat or impair the object of the grant; it cannot be said that it does not seek to carry into effect the purposes of the grant, and in the orderly course of administration of the affairs of the corporation, prosecuted in good faith, it cannot be said that the issue of preferred stock is not for its benefit. As the law is general and applies alike to all domestic stock corporations, it may be deemed to exhibit the public policy of the state with respect thereto, and, therefore, its adoption indicates a legislative intent to promote the public good in connection with the administration of the affairs of corporations to which its provisions are applicable. The case would, therefore, seem to be brought within the legislative power in every aspect, unless its enforcement upon corporations existing prior to its passage can be said to interfere with contract or vested rights. If it does, then it would not be authorized."

Alteration or abolition of school district.- Under this reserved power so far as the school district itself is concerned, it is competent for the legislature, not only to transfer a portion of territory of one school district to another district, but to merge it into such other district or to abolish it entirely. "A legislative grant to, a corporation of special privileges, if not forbidden by the constitution, may be a contract; but where one of the conditions of the grant is that the legislature may alter or revoke it, a law altering or revoking, or which has the effect of altering or revoking the exclusive character of such privileges cannot be regarded as one impairing the obligation of the contract, whatever may be the motive of the legislature or however harshly such legislation may operate in the particular case upon the corporation or parties affected by it. The corporation, by accepting the grant subject to the legislative power so reserved by the constitution, must be held to have assented to such reservation. Such an act

may be amended, that is, it may be changed by additions to its terms or by qualifications of the same. It may be altered by the same power and it may be repealed. What is it that may be repealed? It is the act of incorporation. It is this organic law on which the corporate existence of the school district depends which may be repealed, so that it shall cease to be a law, or the legislature may adopt the milder course of amending the law in matters which need amendment, or altering it when it needs substantial change. All this may be done at the pleasure of the legislature. That body need give no reason for its action in the matter." Board of Education v. Board of Education, (1902) 76 App. Div. 355, 78 N. Y. S. 522, affirmed (1904) 179 N. Y. 556, 71 N. E. 1128.

Conversion of mutual fire insurance company into stock corporation.-An act providing a method by which a mutual fire insurance company may be changed into a stock corporation is within the reserved power of the legis lature and not in violation of the constitutional rights of a member or policyholder of the mutual company. “Every person who became a member of the corporation did so with full knowledge that it might be at any time changed from a mutual to a stock corporation, upon certain terms and conditions, and that under this provision of the constitution those terms might at any time be changed by the legislature." Grobe v. Erie County Mut. Ins. Co., (1899) 39 App. Div. 183, 57 N. Y. S. 290, affirmed (1902) 169 N. Y. 613, 62 N. E. 1096.

Dissolution of village. By virtue of this section the legislature may authorize the dissolution of a village even though private rights are injuriously affected thereby. Blauvelt v. Nyack, (1876) 9 Hun 153.

Effect of amendment on pending transaction by corporation.—“When the legislature creates a corporation it does not guarantee to it that it may transact the business for which it is created except upon a compliance with the provisions of law in force at the time, and if the corporation does not act until the law is repealed or amended it is bound to conform to the law and to abide the constitutional will of the legislature." Thus, where a cemetery corporation has begun but has not perfected the proceedings prescribed by law for obtaining property for cemetery purposes, the legislature is competent to deprive the corporation of its right to secure the lands by enacting a statute (Laws of 1902, ch. 73), providing that the consent of the board of supervisors of a county, having a population of between 175,000 and 200,000, to the taking of lands therein for cemetery purposes, should not be granted where 500 acres of land therein had already been granted for such purposes. Palmer v. Hickory Grove Cemetery, (1903) 84 App. Div. 600, 82 N. Y. S. 973.

Public service corporations.-"In the case of corporations such as railroad companies which are clothed to some extent with a public trust and are under an obligation to discharge duties which affect the community at large the legislature may make amendments in furtherance of the public interest for the benefit of their employees even though such amendments operate as limitations upon the exercise of the right to contract.” New York Cent., etc., R. Co. v. Williams, (1910) 199 N. Y. 108, 92 N. E. 404, 139 A. S. R. 850, 35 L. R. A. (N. S.) 549, affirming 136 App. Div. 904, 120 N. Y. S. 1137. To the same effect, see People v. Boston, etc., R. Co., (1877) 70 N. Y. 569; People v. Public Service Commission, (1912) 153 App. Div. 129, 138 N. Y. S. 434; People v. Public Service Commission, (1911) 143 App. Div. 769, 128 N. Y. S. 384; People v. Public Service Commission, (1910) 140 App. Div. 839, 125 N. Y. S. 1000. Hence, legislation fixing the medium and time of payment of the wages of those who work for railroad corporations is a constitutional exercise of the reserved power. New York Cent., etc., R. Co. v. Williams, (1910) 199 N. Y. 108, 92 N. E. 404, 139 A. S. R. 850, 35 L. R. A. (N. S.) 549, affirming 136 App. Div. 904, 120 N. Y. S. 1137. Also, "it seems to be quite clear that the legislature retains such complete power over the fares to be charged by public service corporations (short of actual confiscation) that an act reducing the fares to be charged by a railroad corporation is valid, even though the original rate has been fixed by law before the road was built." People v. Public Service Commission, (1912) 153 App. Div. 129, 138 N. Y. S. 434. To the same effect, see People v. Public Service Commission, (1910) 140 App. Div. 839, 125 N. Y. S. 1000; People v. Public Service Commission, (1911) 143 App. Div. 769, 128 N. Y. S. 384. See also People v. Boston, etc., R. Co., (1877) 70 N. Y. 569.

Moneyed and banking corporations.-The power here conferred on the legislature to create corporations and to alter laws of incorporation, is of the broadest scope and extends to any and all corporations of every nature whatsoever. To that power moneyed or banking corporations are subject: nor are they exempted from legislative regulation by reason of the circumstance that special provisions are made for them in sections 4 and 7 of this article. Barnes v. Arnold, (1899) 45 App. Div. 314, 61 N. Y. S. 85, affirmed (1902) 169 N. Y. 611, 62 N. E. 1093. Thus assuming that section 52 of the Banking Law (Laws of 1892, ch. 689), imposed upon stockholders of all banking corporations a liability which had previously been limited to stockholders in banks of issue, that section is not unconstitutional as to stockholders in a bank not of issue incorporated under a law attaching no such liability to its stockholders, the legislature being competent by virtue of this section to amend laws of incorporation. Barnes v. Arnold, supra.

Indirect amendment.- A corporate charter may be act which does not specifically refer to such charter.

amended by a general New York Cent., etc.,

R. Co. v. Williams, (1910) 199 N. Y. 108, 92 N. E. 404, 139 A. S. R. 850, 35 L. R. A. (N. S.) 549, affirming 136 App. Div. 904, 120 N. Y. S. 1137; People v. Raymond, (1909) 194 N. Y. 189, 87 N. E. 90, reversing 126 App. Div. 720, 111 N. Y. S. 177; People v. Gass, (1907) 190 N. Y. 323, 83 N. E. 64, 123 A. S. R. 549, 13 Ann. Cas. 678, reversing 119 App. Div. 280, 104 N. Y. S. 643; Pratt Institute v. New York, (1905) 183 N. Y. 151, 75 N. E. 1119, 5 Ann. Cas. 198, affirming 99 App. Div. 525, 91 N. Y. S. 136; People v. Public Service Commission, (1911) 143 App. Div. 769, 128 N. Y. S. 384. So, "the legislature has the reserved power to so amend the law under which a charter has been taken out as to carry with it a corresponding amendment of the charter itself, either directly, or by authorizing the corporation to make the change." Lord v. Equitable Life Assur. Soc., (1909) 194 N. Y. 212, 87 N. E. 443, 22 L. R. A. (N. S.) 420, reversing 126 App. Div. 937, 110 N. Y. S. 1135.

2. Repeal of Tax Exemption.

Repeal generally. The legislative power to alter or repeal a corporate charter includes the right to repeal a provision exempting the property of a corporation from taxation. People v. Raymond, (1909) 194 N. Y. 189, 87 N. E. 90, reversing 126 App. Div. 720, 111 N. Y. S. 177; People v. Gass, (1907) 190 N. Y. 323, 83 N. E. 64, 123 A. S. R. 549, 13 Ann. Cas. 678, reversing 119 App. Div. 280, 104 N. Y. S. 643; Pratt Institute v. New York, (1905) 183 N. Y. 151, 75 N. E. 1119, 5 Ann. Cas. 198, affirming 99 App. Div. 525, 91 N. Y. S. 136. See also In re Huntington, (1909) 168 N. Y. 399, 61 N. E. 643, modifying 62 App. Div. 96, 70 N. Y. S. 853. Where, therefore, by an amendment to the Tax Law (Laws of 1906, ch. 532), a recording tax upon mortgages is thereafter imposed and it is provided that " no mortgage of real property situated within this state shall be exempt, and no person or corporation owning any debt or obligation secured by mortgage of real property situated within this state shall be exempt from the taxes imposed by this article by reason of any provision in any private act or charter which is subject to amendment or repeal by the legislature," an exemption from taxation provided for in the charter of a corporation, so far as mortgages belonging to it are concerned, must be deemed to have been repealed, and an application for a peremptory writ of mandamus to compel the register of a county to record such a mortgage without the payment of any tax thereon, should be denied. People v. Gass, (1907) 190 N. Y. 323, 83 N. E. 64, 123 A. S. R. 549, 13 Ann. Cas. 678, reversing 119 App. Div. 280, 104 N. Y. S. 643. Repeal by implication.- An exemption from taxation may be repealed by implication: that is, an enactment may be such a revision of or substitution for former statutes, general and special, on the subject of exemption from taxation, as to impliedly supersede and repeal them. People v. Raymond, (1909) 194 N. Y. 189, 87 N. E. 90, reversing 126 App. Div. 720, 111 N. Y. S. 177; Pratt Institute v. New York, (1905) 183 N. Y. 151, 75 N. E. 1119, 5 Ann. Cas. 198, affirming 99 App. Div. 525, 91 N. Y. S. 136. See also In re Huntington, (1901) 168 N. Y. 399, 61 N. E. 643, modifying 62 App. Div. 96, 70 N. Y. S. 853. Accordingly, the General Tax Law (Laws of 1896, ch. 908, § 4, subd. 7, as amended), exempting so much of the real estate of educational institutions as is used exclusively for carrying out thereupon one or more of the corporate purposes, impliedly repeals the provisions in the charter of an educational institution making exempt property from which the revenues are devoted exclusively to the purposes of the institution. Pratt Institute v. New York, (1905) 183 N. Y. 151, 75 N. E. 1119, 5 Ann. Cas. 198, affirming 99 App. Div. 525, 91 N. Y. S. 136. But this rule is applicable only to cases where the exemption has relation to property which

was donated or conveyed without any express or implied condition. Thus, where the transfer of property, in endowment of a charitable corporation, was indirectly induced by a promise of an exemption from taxation, which was acted upon, it will not be presumed that the legislature, in passing a general law, operative in repeal of prior exemptions, intended to repeal any exemptions awarded under such circumstances. People v. Raymond, (1909) 194 N. Y. 189, 87 N. E. 90, reversing 126 App. Div. 720, 111 N. Y. S. 177. In that case the court said: "It will not do to hold that the reserved power to alter, or to repeal, a charter has been exercised by implication in a case, where to do so will result in the violation of a promise by the state through which the conveyance of property was induced to a domestic benevolent corporation; which, except for the promise, might have been given outside of the state. In such a case, I do not think that we should presume that the legislature intended to commit so gross a breach of faith. The rule to be applied, in my opinion, is that where the transfer of property, in endowment of a charitable corporation, was directly induced by a promise of an exemption from taxation, which was acted upon, it will not be presumed that the legislature, in passing a general law, operative in repeal of prior exemptions, intended to repeal any exemption awarded under such circumstances."

§ 2. Dues from corporations.

Dues from corporations shall be secured by such individual liability of the corporators and other means as may be prescribed by law.

Const. 1846, Art. VIII, § 2.

Such was

Scope. This section would seem to be of the broadest scope. the ruling of Barnes v. Arnold, (1899) 45 App. Div. 314, 61 N. Y. S. 85, affirmed (1902) 169 N. Y. 611, 62 N. E. 1093, wherein it was held that banking corporations not of issue were not exempted from its operation by reason of the particular provision made in the constitution of 1846, article 8, section 7, for the individual liability of stockholders of banks of issue. Dues from corporation to directors.- Sums due from a corporation to its directors are not dues" within the meaning of this section. In 1846 private corporations for all kinds of ends were rapidly increasing in this state, and the statesmen of that day thought it wise and sound public policy that the creditors of such corporations should in some cases and to some extent have, besides the corporate responsibility, some security in the individual liability of the corporators. But that public policy plainly had reference to outside creditors of a corporation dealing with and trusting it, and generally ignorant of its precise financial condition. It could have no relation to the directors of a corporation who manage its affairs and can generally know its condition, who create the debts and can generally protect themselves, if creditors, before disaster overtakes them. The constitutional provision and the laws enacted to give effect to the policy embodied therein were not intended for the protection of the debt makers, directors who constitute themselves creditors of the corporation, and then attempt to unload their burden upon stockholders whose interests were committed to their hands." McDowall v. Sheehan, (1891) 129 N. Y. 200, 29 N. E. 299.

Liability imposable. The liability imposed by law on stockholders under this section, may be "absolute or conditional, immediate or secondary, as the legislature, in its discretion, may determine." Walton v. Coe, (1888) 110 N. Y. 109, 17 N. E. 676, affirming 47 Hun 160, 13 N. Y. St. Rep. 416.