railway, telegraph and other continuous or connecting lines of work. As consolidations sometimes take the form of an absorption of one company by another, the former company purchasing from the shareholders of the latter their shares and issuing its own shares in payment, the legislature may authorize a domestic corporation thus to surrender its existence to a foreign one. But a domestic company can not sell out to a foreign one and take the latter's stock in place of its own without legislative authorization.1

$336. Status of inter-State consolidated companies.In general, it may be said that a company created by the consolidation of foreign corporations remains a domestic corporation of each of the concurring States, the peculiar legislation of neither State becoming operative within the limits of the other. Its property within the particular State is subject to taxation or vested with immunity from it, according to its laws or to the provisions of the original charter of the constituent company, these privileges not being destroyed by the consolidation, unless otherwise provided by the constitution or by the statute. For although the consolidation of corporations organized and existing under the laws of the same State creates an entirely new and distinct corporation, this is not the result where the corporations owe their existence to different sovereignties. Although in fact they may be so united as to have a physical connection and be practically one body, yet they remain "separate corporations in each State," the only effect of the consolidation being the creation of a community of interest. Their powers, rights and duties remain distinct as before. There is a union of interest and property, but no merger of personal or legal identity. When,

1 Farnham v. Blackstone Canal Co., 1 Sumner, 46; Racine &c. R. Co. v. Farmers' &c. Co., 49 Ill. 331, but each case allowed that there were separate legal entities in each State.

N. J. Eq. 456; Taylor v. Earle, 8
Hun, 1.

Ohio &c. R. Co. v. Weber, 96 Ill.
443; Bridge Co. v. Adams Co., 88
Ill. 615; In re St. Paul &c. R. Co., 36
Minn. 85; Clark v. Barnard, 108 U. S.

Lauman v. Lebanon Val. R. Co., 436; Railroad Co. v. Vance, 96 U. S. 30 Pa. St. 46. 436; Memphis &c. R. Co. v. Ala

3 Racine &c. R. Co. v. Farmers' &c. bama, 107 U. S. 581; Colorado Const.

Co., 49 Ill. 331.

art. xv, § 14.

Black v. Delaware &c. R. Co., 24

6 Muller v. Dows, 94 U. S. 444;

however, consolidation is effected by permission of law of the several States, the united corporations are practically placed under the same management and control; and contracts made by the controlling power, which assume a unity of action, are held to be made by each of the corporations.1 When two or more corporations are consolidated under the laws of different States, they each become domesticated in each State, and neither is subject to attachment as a foreign corporation.2 A company is none the less a domestic corporation by reason of having been created by the consolidation of domestic and foreign corporations. Thus in a recent case, an Arkansas corporation, owning a line of railroad in Arkansas, consolidated with a Missouri corporation, owning a line of railroad in Missouri. By the consolidation, the consolidated company became the owner of the road in both States, but in Arkansas it is to be regarded as an Arkansas corporation, and in Missouri as a Missouri corporation. A railroad corporation, however, which, though made up by consolidation of distinct corporations chartered by the legislatures of different States, has a capital stock which is a unit, and only one set of shareholders who have an interest, by virtue of their ownership of shares

Farnum v. Blackstone Canal Co., 1 Sum. 47; Racine &c. R. Co. v. Farmers' &c. Co., 49 Ill. 331; Bissell v. Michigan &c. R. Co., 22 N. Y. 258; Graham v. Boston &c. R. Co., 118 U. S. 161; s. c. 14 Fed. Rep. 753; Stone v. Farmers' Loan & Trust Co., 116 U. S. 307; Stone v. Illinois Central R. Co., 116 U. S. 347; Eaton &c. R. Co. v. Hunt, 20 Ind. 457; Chicago &c. R. Co. v. Moffitt, 75 Ill. 524.

1 Bissell v. Michigan &c. R. Co., 22 N. Y. 526; Racine &c. R. Co. v. Farmers' &c. Co., 49 Ill. 331.

Sprague v. Hartford &c. R. Co., 5 R. I. 233; Phillipsburg Bank v. Lackawanna R. Co., 27 N. J. L. 206; State v. Delaware &c. R. Co., 30 N. J. 473.

Muller v. Dows, 94 U. S. 444; Peck v. Chicago &c. R. Co., 94 U. S. 164; Matter of Sage, 70 N. Y. 220; Sprague

v. Hartford &c. R. Co., 5 R. I. 233;
McElrath v. Pittsburg &c. R. Co., 61
N. Y. 353.

4 Central Trust Co. v. St. Louis, A.
& T. Ry. Co., (1890) 41 Fed. Rep. 551;
s. c. 7 Ry. & Corp. L. J. 456, where
the court said: "The amended and
supplemental bill filed in this district
alleges the defendant is a corpora-
tion created by and existing under
the laws of the State of Arkansas
. . and a resident and citizen
of said State of Arkansas. This is a
correct statement of the legal status
of the defendant in this State. The
consolidated company owns the road
in both States; but in Arkansas it is
an Arkansas corporation and in Mis-
souri it is a Missouri corporation.
Acts Ark. 1889, p. 43; Railway Co.
v. Whitton's Adm'r, 13 Wall. 270;
Muller v. Dows, 94 U. S. 444."

of the stock, in all of its property everywhere, has a domicile in each State, and the corporation or shareholders can, in the absence of any statutory provision to the contrary, hold meetings and transact business in any one State, so as to bind the corporation as to its property everywhere.1

§ 337. Powers and duties of inter-State companies.Where two companies are consolidated under the laws of different States, the new company stands in the same relation to each State, as the original company in that State. For a consolidated company succeeds to the powers possessed by both of the preceding companies. But it succeeds to the peculiar powers or privileges possessed by either only within the State of its creation. And none of the States can impair the rights vested in the companies composing the consolidated corporation. Accordingly, no one of the States can impose a tax on the whole property of the consolidated company when one of them was originally exempt from taxation, unless the removal of the exemption was a condition of allowing the consolidation. But a consolidated company may, under domestic legislation, avail itself of the permissive legislation of a concurring State. Each constituent part of a consolidated railway company remains subject to statutes regulating charges for transportation. And each of the original companies continues subject to the insolvency laws of the State of its creation. Specific liens follow the property into the hands of the new corporation, but are, it seems, enforcible only in the forum of the situs of the property. Each respective component part of the

1 Graham v. Boston &c. R. Co., (1885) 118 U. S. 161; Bridge Co. v. Mayer, 31 Ohio St. 317.

Branch v. Charleston, 92 U. S. 677; Delaware R. Co. v. Cox, 18 Wall. 206; State v. Commissioner of Rail

2 Delaware Railroad Tax Cases, 18 road Taxation, 37 N. J. 243; Wood's Wall. 206.

3 Meade v. New York &c. Co., 45 Conn. 199, 221.

4 Delaware Railroad Tax Cases, 18 Wall. 206; Pittsburg &c. R. Co. v. Reich, 101 Ill. 157, 174.

Chesapeake &c. R. Co. v. Virginia, 94 U. S. 718; Philadelphia &c. R. Co. v. Maryland, 10 How. 376;

Ry. Law, 1685.

6 Att'y-Gen. v. Boston &c. R. Co., 109 Mass. 39.

7 Stone v. Farmers' Loan & Trust Co., 116 U. S. 307.

8 Platt v. New York &c. R. Co., 26 Conn. 544, 571.

9 Eaton &c. R. Co. v. Hunt, 20 Ind. 457, 464.

consolidated company is subject also to the jurisdiction of the courts of its State with respect to the appointment of receivers. When, however, the two corporations have the same name the same stockholders, a unity of stock and of interest, an action against one of them will bring all the parties, necessary for the complete settlement of a controversy, before the court, and its decrees will be binding upon them. But a State is not to be deprived of its jurisdiction over a corporation created by it, in actions brought by its citizens against it under its new name, by a removal of the cause to a federal court upon the motion of one of the other consolidating companies created by another State."

§ 338. Dissolution of old companies.- Legislative consent to consolidation of existing corporations has the effect of dissolving the former corporations, and at the same instant of creating a new corporation, with property, liabilities and stockholders derived from the old, upon such terms and conditions as may be prescribed by the act of consolidation.* This is the converse of the proposition that a corporation may be dissolved by a surrender of its franchises and an acceptance of them by the legislature. So, generally, consolidation works a dissolution of the corporations previously existing, and at the same instant, the creation of a new corporation, with property liabilities and stockholders derived from those then passing out of existence. Although the effect of consolidation

1 In re United States Rolling Stock Co., 55 How. Pr. 286; Taylor v. Atlantic &c. R. Co., 55 How. Pr. 275; Ellis v. Boston &c. R. Co., 107 Mass. 1; Richardson v. Vermont &c. R. Co., 44 Vt. 613.

6 Pullman Palace Car Co. v. Missouri Pacific Ry. Co., 115 U. S. 187, 594; Louisville &c. R. Co. v. Palmes, 109 U. S. 244; Railroad Co. v. Georgia, 98 U. S. 359, 364; Railroad Co. v. Maine, 96 U. S. 499, 508; Shields v.

&c. R. Co. v. Maryland, 10 How.

Paine v. Lake Erie &c. R. Co., 31 Ohio, 95 U. S. 319, 320; Philadelphia Ind. 347. 'Chicago &c. R. Co. v. Lake Shore 376, 393; Ridgway Township v. Gris&c. Ry. Co., 5 Fed. Rep. 19. wold, 1 McCrary, 151; Clearwater v.

4 McMahon v. Morrison, (1861) 16 Meredith, 1 Wall. 25, 40, 42; LightInd. 172; s. c. 79 Am. Dec. 418.

5 McMahan v. Morrison, (1861) 16 Ind. 172; s. c. 79 Am. Dec. 418; Lauman v. Lebanon &c. R. Co., 30 Pa. St. 42; s. c. 72 Am. Dec. 685.

ner v. Boston &c. R. Co., 1 Low. 338; Indianola R. Co. v. Fryer, 56 Tex. 609, 616; Cheraw &c. R. Co. v. Commissioners, 88 N. C. 519; Meyer v. Johnston, 53 Ala. 237; s. c.

generally is to dissolve the constituent companies, yet no such effect is produced as to the purchasing or absorbing company, where the consolidation takes place under the scheme of one company absorbing another by purchasing its stock and properties. The existence of one company is thus merged into