Hargrave v. Bank of Illinois, 1 Ill. 122, 1 Breese 122 (1825)

Dec. 1825 · Illinois Supreme Court

1 Ill. 122, 1 Breese 122

Willis Hargrave, Plaintiff in Error, v. The Bank of Illinois, Defendant in Error.

ERROR TO GALLATIN.

Where a private corporation sues to recover real property, or upon a contract, it must, under the general issue, produce the act of incorporation.

The act of indorsing a bill to a bank, does not admit that the bank is a corporation.

Opinion of the Court by

Justice Smith.

This case comes before the court on a re-hearing. It is not intended to review the opinion which has heretofore been given by this court under its former organization, nor is it deemed necessary to enter into an examination of all the points which were there presented. Indeed, it will be sufficient to a correct determination, to ascertain whether any one of the points made on the argument by the counsel for the plaintiff in error, contains within itself sufficient cause for reversing the judgment of the court below. That which seems to be most important, and to me conclusive is, whether the plaintiffs on the trial were bound to have produced legal evidence of the act of their incorporation ? This point has been for a long time well settled by a series of adjudications, both in England and the United States, and so generally acquiesced in that on the argument it was thought the counsel for the defendant in error sought to avoid the force of those decisions, by attempting a distinction more ingenious and specious than solid. He assumed as a position, which is certainly very true, that what is admitted, need not be proved. That by the act of indorsing the bill given to the bank, the plainiff in error has admitted the existence of the corporation, therefore it was unnecessary to prove what was thus conceded.

This reasoning is calculated to mislead, rather than to enlighten the judgment.

It would not, however, certainly follow, to give the greatest latitude to the position assumed, that the act of indorsement admitted any thing more than that the person to whom the bill was indorsed, assumed the corporate name. It could not establish the fact of their legal corporate existence; because, if such an act amounted to such an admission, a fortiori, it would, for all judicial purposes, in this case, make them a corporation—although they should have no existence in fact. However we might admire the ingenuity which presented the syllogism of the defendant’s counsel, I can not admit the correctness of the minor part of it. The premises assumed are incorrect, and consequently, the conclusion is unsound. The rule, as is well settled, is this, that where a corporation sues either to recover real property, or on a contract, it must at the trial, under the general issue, prove that it is a corporation. 2 Ld. Raymond, 1535. 1 Kyd on Corporations, 292, 293. Buller’s Nisi Prius, 107. 8 Johns., 378.

Eddy, for plaintiff in error.

Starr, for defendant in error.

The instruction of the court below, prayed for by the defendant’s counsel on the trial, that this was necessary, was, as the bank is a private corporation, incorrectly withheld, and I am therefore of the opinion that the judgment ought to be reversed, and that the cause be remanded to the circuit court for further proceedings, ^(a) , ⁽¹⁾

Judgment reversed.

(a) Where a corporation sues either on a contract, or to recover real property, they must, at the trial, under the general issue, show that they are a corporation, or he nonsuited. 8 Johns., 378, Jackson v. Plumbe.

Before any corporate act can be given in evidence, the charter of incorporation must be produced. United States v. Johns, 4 Dallas, 412.

Public corporations are such as exist for public political purposes only, such as counties, cities, towns and villages. They are founded by the government, for public purposes, and the whole interest in them belongs to the public. But if the foundation be private., the corporation is private, however extensive the uses may be to which it is devoted by the founder, or by the nature of the institution.

A bank created by the government, for its own uses, and where the stock is exclusively owned by the government, is a public corporation.

But a bank whose stock is owned by private persons, is a private corporation, though its objects and operations partake of a public nature. 2 Kent’s Com., 222.

(1) In suits brought by corporations, the defendants,iby pleading the general issue, admit the capacity of the plaintiff to sue. If he would deny the existence of the corporation, he must put in a plea for that purpose. McIntire v. Preston, 5 Gilm., 48; Spangler v. Ind. & Ill. Central R. R. Co., 21 Ill., 277. The authorities on this question seem considerably conflicting; but the court in the first case cited (and where most of the authorities are collected,) said: “ Such has been held to be the law by the Supreme Court of the United States, and the courts of several of the states, and the decisions of those states are the best supported by reason and authority.”