its road, but cannot thereby avoid liability. Whether the road be run by agents, servants, or lessor, they will all be considered agents of the corporation owing the road.1 As corporations outside of the state have leased several Illinois railroads, and are likely to lease still more, this doctrine is of more than ordinary importance.

§ 67. The statute of 1872 contemplates that a railroad company may desire to offer inducements to secure donations of land or private subscriptions to the stock from persons along the proposed route. It therefore provides that if the company shall wish to fix the rates for any period of time for the transportation of passengers or freight, "such corporation may adopt a resolution fixing such rates and the time for which the same is to be fixed, and have the same recorded in the office of the recorder of deeds in the several counties through which said road is proposed to be run. These rates shall be binding upon the company and its successors, forming a vested popular right. It is added, however, "Provided that said rates. shall not exceed the rates provided by law."3

$ 68. There has been considerable controversy at different times in regard to the personal property of a railroad corporation, and the corporate liabilities thereto attached. The constitution declares, and it is the common law doctrine as held by the courts, that

1 Ohio and Mississippi R. R. Co. v. Dunbar, 20 Ill. 623; Chicago and Rock Island R. R. Co. v. Whipple, 22 Ill. 106.

2 Gross, vol. ii, R. R. chap. sec. 193.

3 Diligent inquiry fails to bring to light a single instance in which this cheap transportation privilege has been exercised by any railroad corporation in Illinois.

1

"the rolling stock, and all other movable property belonging to any railroad company or corporation in this state, shall be considered personal property, and shall be liable to execution and sale in the same manner as the personal property of individuals, and the general assembly shall pass no law exempting any such property from execution and sale." This clause is substantially embodied in the twentieth section of the railway incorporation act. The court would interfere, however to prevent the diversion of railway property from its original use to satisfy a creditor, when such satisfaction would have been a hardship upon the public. The people have a certain right in railway property, and it is conceivable that a case might arise of such a nature that the court would be compelled by regard to the general welfare and the necessities of travel to prevent the execution and sale of the personal property of a railroad company. No such case has occurred since the adoption of the existing constitution.

§ 69. "In all elections for directors or managers of a corporation of Illinois, of whatever nature, and under whatever legislation created, special or general, every stockholder has the right to vote, in person or by proxy, for the number of shares owned by him. for as many persons as there are directors or managers to be elected, or to cumulate said shares, and give one candidate as many votes as the number of directors multiplied by the number of his shares of stock shall equal; or to distribute them, on the same principle, among as many candidates as he shall think fit; and

1 Gross, vol. ii. R. R. chap. sec. 187.

such directors or managers shall not be elected any other way."1

§ 70. Each stockholder is individually liable to the creditors of the company to an amount not exceeding the amount unpaid on the stock held by him, for any and all debts and liabilities of the company, until the whole amount of the capital stock so held by him shall have been paid. But if a person holds stock as an executor, administrator, guardian or trustee, or if he holds it as collateral security, he is subject to no personal liability as a stockholder. The person pledging the stock is considered as holding it, and is subject to the liability of a stockholder accordingly. This provision is statutory, rather than constitutional, and applies in some of its features only to railway companies. In corporations organized under the general incorporation act of the state, the stockholder incurs no liability except that whatever he has agreed to pay into the treasury of the company he must pay, or forfeit his stock.

$71. It is contemplated by common and statutory law that the main business of a corporation will be transacted at stated and regular meetings. It is further contemplated that special meetings will usually be called by the directors. But this is a rule with exceptions. The statute of 1872 provides (sec. 9), that a meeting may be called at any time by the stockholders owning not less than one-fourth of the stock, as well as by the directors. The method in both cases is the same.

'This bunglingly stated provision forms section 3 of article xi, of the constitution of Illinois, and is put into railway act, section 25.

§ 72. A two-thirds majority, in value, of all the stockholders, may at any special meeting remove any president, director, or other officer of the corporation, and elect others in their stead. A majority of those present may at any meeting require the officers to make a full statement of the affairs of the company. It is competent for the majority, in value, of the stockholders to fix the rate of interest to be paid by the company for the money borrowed to build or equip the road; also to fix the amount of the loan.

§ 73. Each stockholder shall at all reasonable hours have access to and may examine all the books, records, and papers of the company.1 |

§ 74. Corporations are held to a strict construction of their corporate rights. A contract is ultra vires when it reasonably appears that the legislature intended that such a contract should not be made.2 "Where a corporation exceeds its powers in making a contract the contract is absolutely void."3 Corporate limitations are well defined in the following authoritative utterances: "That contracts which do in reality contravene any principle of public policy are illegal and void, is not and cannot be denied. The doctrine is universal. There is no exception. Although the unauthorized act may be neither malum in se nor malum prohibitum, but, on the contrary, may be for some worthy or benevolent object, yet, if it is a vio

1 Gross, vol. ii, R. R. chap. sec. 169.

2S. Y. and C. Co. v. G. N. R. Co. 9 Exch. 55, 84; 30 Eng. Law and Eq. 120; 24 Law J. N. S. Q. B. 105

3 Rock River Bank v. Sherwood, 10 Wis. 230; Beach v. Fulton Bank, 3 Wend. 573; N. Y. F. Ins. Co. v. Ely, 2 Cow., 678; Bateman v. Ashton-under-Ly. - 3 H. and N. 323; 4 Ellis and B. 397; 2 Exch. 711; id. 718; Angell and Ames, Corp. 9th Ed. 240.

lation of public policy for corporations to exercise powers which have never been granted to them, such contracts, notwithstanding their praiseworthy nature, are illegal and void."1

'Bissell . The M. S.and N. I. R'y, 22; N. Y. Ct. Ap. Repts. 258; 13 Eng. Law and Eq. 506; 7 id. 505; 12 id. 224; 6 id. 106; 16 id. 180; 3 id. 144. The following summary of the law on this point is from the argument submitted by Hon. Robert G. Ingersoll in the case of the Peoria and Rock Island R. R. Co. v Coal Valley Mining Company, not yet officially reported: 1. That railroad corporations are the mere creatures of the statutesthat their powers are all derived from the legislature, and that they have no right to construct, operate and manage their property except for the accomplishment of the purposes for which they were created. 2. That they are created for the public benefit, and have no right to do any act inconsistent with their charters. 3. That a corporation itself cannot add to its powers in any manner whatever. 4. That the corporation cannot delegate some of its powers to another corporation, for the reason that corporations cannot get powers from each other, but must get them from the law making power. 5. That a corporation has no right or power to agree that it will not exercise all its powers and franchises for the purpose of carrying out the object of its creation, and that it cannot incapacitate itself. 6. That the corporation can cease to exist under certain circumstances, and render back to the state its powers and franchises; but it cannot confer some of its powers upon some other corporation. 7. All agreements to do certain acts unauthorized by the charter and inconsistent with it, and inconsistent with the obligations of the corporation to the public, and inconsistent with the accomplishment of the objects for which the same was created, are ultra vires, contrary to public policy, and void.