the proceedings of corporations is settled." Maltby v. Northwestern Virginia R. Co., (1860) 16 Md. 422,

444.

1" When subscribers to the stock of a private corporation meet and elect a board of directors, and thereby effect a permanent organization, and engage in the corporate enterprise for several years, by which debts are incurred, voting and acting as bona fide subscribers, they will not be allowed to dispute the binding effect of their subscriptions, or the legality of the organization of the corporation, as against third persons who give credit to the company on the faith of its being legally organized, but will be required to pay their subscriptions as to creditors who are entitled in equity to be subrogated to the rights of the company." 15 Central L. J. 18, citing Hickling v. Wilson, (1882) 104 Ill. 54. It is not competent for any stockholder to make the objection to the existence of the corporation, inasmuch as they have chosen the president and managers, and have had all the benefits of the corporation. They can not now set up as a defense their own want of power. Rockville &c. Turnpike Road v. Van Ness, 2 Cranch, C. C. 449, 451.

2 As, for example, by acting as a director. Rice v. Rock Island &c. R. Co., 21 Ill. 93; Danbury & N. R. Co. v. Wilson, 22 Conn. 435; Meadow v. Gray, 30 Me. 547; Hunt v. Kansas &c. Co., 11 Kan. 412. "But we do not see how the defendant in this

case can raise this question. He is a stockholder in the defendant company. He has been, if he is not still, a director. He is not dealing with it as a stranger, but as a member who has participated in its organization, and claimed and exercised authority under and by virtue thereof. It will not do for him now to deny the rightful existence of this company as to himself and his own stock subscription, which he has affirmed as to all others. As to him, we must treat this corporation as having a legal organization and a right to call upon him to fulfill his engagement as a subscriber to its stock." Weinman v. Wilkinsburg & E. L. P. Ry. Co., (1888) 118 Pa. St. 192, 203. In another case it was held that where a member was an original subscriber to the company, and was one of the commissioners for receiving the subscriptions, and was elected one of the managers of the company, and acted as such, in virtue of his election, it was not competent for him to object that a sufficient number of shares had not been subscribed to justify the election. Rockville &c. Turnpike Road v. Van Ness, 2 Cranch, C. C. 449, 450.

3 Swartwout v. Michigan &c. R. Co., 24 Mich. 389, per Cooley, J.; Tar River &c. Co. v. Neal, (1825) 3 Hawks, (N. C.) 520, 534: Wilmington &c. R. Co. v. Thompson, 7 Jones, (N. C.) 387; Danbury & N. R. Co. v. Wilson, 22 Conn. 435; Hanover &c. R. Co. v. Haldeman, 82 Pa. St. 36. See also Garrett v. Dillsburg &c. R. Co., 78 Pa. St. 465, where the plea

was that the charter had been fraudulently obtained. "But it is not necessary for us to express a decided cpinion on that or any other of these objections, because we have no doubt that the conduct of the defendant, in regard to the organization by the choice of directors, and the preliminary steps which led to it, and his conduct since that organization, was such as ought to preclude him, as between himself and the plaintiffs, in an action like the present, which is brought to recover the amount due on the installments assessed on his stock, from disputing the regularity or validity of these steps taken in the organization of the plaintiffs as a corporation. He was a party to and co-operated very actively with the other subscribers and the commissioners in that organization, and participated in all the proceedings which led to it. He was one of the earliest and largest subscribers to the stock, and induced others also to subscribe to it. Attended, on the call of the commissioners, all the meetings of the stockholders as one of them, and acted with them in the choice of directors, accepted the office of director, to which he was chosen, and acted as such in the meetings of the directors and in the meetings at which the installments on the stock were laid, and until called upon long afterwards for his part of those installments, it does not appear that he ever questioned the regularity of the organization of the company or its corporate powers; and he continued to be, and acted as, a director, subsequently

during all the time while the arrangements were made by the directors for the building of the road and the operations connected with it. In consequence of this conduct on his part, and on the strength of what was thus done by him, in connection with the other stockholders and directors, the other subscribers, generally, were induced to pay for their stock; and the company have also been induced to incur the expense of building their railroad, and of carrying on all the branches of their business connected with it. The other stockholders have thus been led to invest their funds and assume responsibilities in a mode and to an extent which they would not have done but for this conduct of the defendant. The consequence of permitting him, now, to repudiate his acts, might be to devolve upon the other subscribers a personal liability for the engagements of the company, to make them even trespassers in regard to those whose property has been taken for the construction of their road, and to frustrate the whole object of their undertaking. It requires no argument to show that, under these circumstances, the case comes within the well established and most just and wholesome principle, that a person who, by his declarations, or a course of conduct, which is a species of declaration, has wilfully induced another injuriously to alter his condition, is, as against the latter, estopped from denying the truth of such declarations, or the rightfulness of such conduct." Danbury &

N. R. Co. v. Wilson, (1853) 22 Conn. 435, 450; citing Brown v. Wheeler, 17 Conn. 345; Kinney v. Farnsworth, 17 Conn. 361; Roe v. Jerome, 18 Conn. 138; Noyes v. Ward, 19 Conn. 250. "The company being thus established in the manner pointed out by the act, the defendant ought not to be permitted to dispute its existence; and the less so, as he in part, by his vote, had confirmed it. If the commissioners improperly exercised the powers conferred upon them by the act, they can not be called to an account by the defendant in the present action; some other remedy must be resorted to." Tar River Navigation Co. v. Mead, (1825) 3 Hawks, (N. C.) 520, 536.

1 Taggart v. Western Maryland R. Co., 24 Md. 563, 596, citing People v. Manhattan Co., 9 Wend. 351; Angell & Ames on Corporations, 3d ed. 747; Planters' Bank v. Bank of Alexandria, 10 G. & J. 346. "I do not go the whole length of the plaintiff's counsel in saying that persons in possession of corporate rights or franchises shall be considered as rightfully corporators against all persons but the sovereign; but agree with them with this qualification, that where it is shown that such corporation may by law exist, that is, where it is shown that a charter has been granted, those in possession and actually in the exercise of those corporate rights, shall be considered as

rightfully there, against wrong-doers, and all those who have treated or acted with them in their corporate character; and even when it is shown that such charter has been granted upon a precedent condition, and persons are found in the quiet possession and exercise of those corporate rights as against all but the sovereign, the precedent condition shall be taken as performed." Tar River Navigation Co. v. Neal, (1825) 3 Hawks, (N. C.) 520, 537. Schloss v. Montgomery Trade Co., (1889) 87 Ala. 411, was an action by an alleged corporation for the balance due on subscriptions to stock. The plaintiff demurred to a plea of nul tiel corporation on the ground that defendants were estopped from denying plaintiff's incorporation by having paid all of their subscription except the amount sued for, which was alleged to have been regularly called in by plaintiff, and demand made on defendants. The circumstances of the assessments were not shown, and it did not appear that they were made under color of corporate organization or capacity. It was held that, as from the facts shown it did not appear that the payments were not made as preliminary to corporate organization, the facts were not sufficient to create an estoppel.

1 Clearwater v. Meredith, 1 Wall. 25; Nugent v. Supervisors, 19 Wall. 241; Champion v. Memphis &c. R. Co., 35 Miss. 692; Marietta &c. R. Co. v. Elliott, (1859) 10 Ohio St. 57; Charlotte Bank v. Charlotte, (1882) 85 N. C. 433; Kennedy v. Panama &c. Mail Co., 17 L. T. Rep. (N. S.) 62. A contract of subscription to stock provided for the building of the A. railroad according to the survey made by the B. railroad, the original route running within 500 feet of M.'s mill. This route was changed so as to make it run 1,200 feet from the mill. In a suit against M. for the amount of his subscription, it was held that he might show that this alteration in the route was as to him and his interest a material variation. Moore v. Hanover Junction & L. R. Co., 34 Pa. St. 324. The effect upon subscriptions of a subsequent change of the charter of a corporation is considered in the note to Commonwealth v. Cullen, 53 Am. Dec. 461. See also notes to Franklin Glass Co. v. Alexander, 9 Am. Dec. 100; Connecticut &c. R. Co. v. Bailey, 58 Am. Dec. 181; Pacific R. Co. v. Hughes, 64 Am. Dec. 265; Martin v. Pensacola &c. R. Co., 73 Am. Dec. 713.

2 Vide supra, § 42. "In respect to the amendment of the charter, it appears from the record that the court left its materiality to the jury, and this is assigned for error. That amendment was to the effect that the capital stock may be as much as five hundred thousand dollars, but

Neither a mandatory statute

that the company may commence work when one hundred thousand dollars was subscribed. We think that the materiality of this alteration was a question for the court and that the judge should not have turned it over to the jury; but as they found it material, of course, if we agree with them, we ought not to interfere with what they did. We do think that the change is material in so far as it would force collections from those who have subscribed only on condition that five hundred thousand dollars should be subscribed. Besides, it legalized acts done by the directors and stockholders in releasing fictitious subscribers, and otherwise. Taking it altogether, it is such an alteration as materially affects the contract Sullivan made, and the principle ruled in Winter v. The Muscogee Railroad Company, (11 Ga. 438) will apply to this case." Memphis Branch R. Co. v. Sullivan, (1876) 57 Ga. 240, 243. But in an action by certain stockholders against the officers and other stockholders of a bridge corporation, to cancel all the stock held by defendants, it appeared that the cost of the bridge was estimated at three thousand dollars, and that the capital stock was limited to this amount, equal to sixty shares. The actual cost was seven thousand dollars, and to provide for the difference the stock was increased to the latter amount. No mala fides on defendants' part was shown, and the only