the ends of justice. They have in such cases, seized upon the results of what has occurred without undertaking the unprofitable task of determining the real nature of the acts or the motives which actuated the body of corporators in doing them. They have seldom gone further in such cases, than to say, that whether the corporation was dissolved or not, its condition was for practical purposes equivalent to a state of dissolution.1

Courts of equity frequently presume dissolution when, in a legal sense, no dissolution has occurred. It is well settled that a dissolution does not result from a failure to elect officers; nor by a sale and assignment of all the corporate property; nor from the fact that the entire property has been leased to another corporation;4 nor because one person owns all the stock; nor by a

1 In Bradt v. Benedict, 17 N. Y. 73, SELDON, J., after a review of the decisions in that state said: It appears from these cases that in order to justify the inference that a corporation has surrendered its franchises, it is not sufficient that it has become utterly insolvent, nor even that every vestige of its property has been sold by the sheriff, but it must also have lost all power to continue or to resume business." See also, Swan, L., etc., Co. v. Frank, 39 Fed. Rep. 456.

2 Kelsey v. Pfaudler, etc., Co., 45 Hun, 10; Rose v. Turnp. Co., 3 Watts, 46; Com. v. Cullen, 13 Pa. St. 133; Hoboken Bldg., etc., Ass'n v. Martin, 13 N. J. Eq. 427; Evarts v. Killingworth Mfg. Co., 20 Conn. 447; Nashville B'k v. Petway, 3 Humph. 522; Boston Glass Mfg. Co. v. Langdon, 24 Pick. 49; Cahill v. Kalamazoo, etc., Ins. Co., 2 Doug. (Mich.) 124, 140; Harris v. Miss. Val., etc., R. R. Co., 51 Mich. 602; Phillips v. Wickham, 1 Paige, 590; Slee v. Bloom, 5 Johns. Ch. 366; 19 Johns. Ch. 456; St. Louis, etc., Loan Ass'n v. Augustin, 2 Mo. App. 123; People v. Wren, 5 Ill, 269; Muscatine Turn-Verein v. Finch, 18 Ia. 469.

3 Barclay v. Talman, 4 Edw. Ch. 123; Decamp v. Aylword, 52 Ind. 468; Reichwauld v. Com. Hotel Co., 106 Ill. 439; Rollins v. Clay, 33 Me. 132; Kansas City Hotel v. Same, 65 Mo. 279; Troy, etc.. R. R. Co. v. Kerr, 17 Barb. 581. 4 State v. Merchants, 37 O. St. 251; Smith v. Gower, 2 Dur. 17; State v. Rives, 5 Ind. L. 297; Bruffett v. Gt. West. R. R. Co., 25 Ill. 353.

5 Newton Mfg. Co. v. White, 42 Ga. 148; Sharp v. Dawes, 46 L. J. (Q. B.) 104; Button v. Hoffman, 61 Wis. 20; Swift v. Smith (Md.), 6 East. Rep. 574; England v. Dearborn, 141 Mass. 509; Hopkins v. Roseclare Leal Co..72 Ill. 373; Bellona Co.'s Case, 3 Bland. (Md.) 442, 446; Russell v. McLellan, 14 Pick. 63 where two persons had acquired all the stock.

cessation of all corporate business; nor by the death of its stockholders; nor by insolvency.3

But where necessary to prevent loss to stockholders or creditors the existence of one or more of these circumstances will be sufficient to warrant the court in winding up the corporation and distributing the assets as in case of dissolution. And where a corporation has long ceased to do business and is entirely destitute of assets, a decree dissolving it will not be reversed upon appeal by some of the stockholders; such decree not being calculated to injure them.5

§ 1008. Statutory dissolution. We may now safely advance from all inquiry into past theories and definitions of corporate dissolution, to the broad proposition that where the methods by which a corporation may be dissolved are prescribed by statute these must be substantially pursued."

Under statutory provisions which generally prevail an end can be put to the existence of a corporation. before the period of corporate existence limited by law or fixed in its charter in but two ways:

Attorney-General v. B'k, Hopkins' Ch. (N. Y.), 403; Baptist Meeting House v. Webb, 66 Me. 398; Harris v. Nesbit, 24 Ala. 398; Kansas City, etc., Co. v. Sauer, 65 Mo. 279, 288; Nimmons v. Tappan, 2 Sweeney N. Y. 652; State v. Brown, 58 N. H. 370; Re Jackson, etc., Co., 4 Sandf. Ch. 559; West v. Caro. lina, etc., Co., 31 Ark. 476; Bache v. Horticultural Soc. 10 Lea, 436 Brandon Iron Co. v. Gleason, 24 Vt. 228; Atlanta v. Gate, etc., Co., 71 Ga. 106.

2 Russell v. McLellan, 14 Pick. 63, 69; Boston Glass Mfg. Co. v. Langdon, 24 Id. 49, 52.

3 Moseby v. Burrows, 52 Tex. 396; Valley B'k, etc., Sav. Inst. v. Sewing Soc. 28 Kan. 423; State v. Merchant, 37 O. St. 251; Nat. B'k v. Ins. Co., 104 U. S. 54; Kinkaid v. Dwinnelle, 59 N. Y. 548.

✦ Slee v. Bloom, 5 Johns. Ch. 366; Bradt v. Benedict, 17 N. Y. 93; Losee v. Bullard, 79 N. Y. 404.

6 Alling v. Ward (Ill.), 24 N. E. 551.

In Ala. a corporation is dissolved ipso facto within the meaning of the statute imposing a liability upon stockholders, upon dissolution, when it makes an assignment for the benefit of creditors and ceases to do business. McDonnell v. Ala., etc., Ins. Co., 85 Ala. 401; See In re Livingston, etc., Ass'n, 15 C. P. R. (N. Y.)215; People v. Obrien, 111 N. Y. 1.

1. By voluntary dissolution corresponding to surrender at common law.

2. By involuntary dissolution or judgment of forfeiture which has the same meaning and effect as at common law. The first may be likened to the suicide of a natural person; the second to the forfeiture of an individual's life to the state for violation of law; and the case of a corporation continuing until the period fixed in its charter may be compared to that of a person who lives out his allotted days and dies a natural death.

§ 1009. Voluntary dissolution.In the absence of statutory provision for the surrender of a corporate franchise the question of what amounts to a surrender is largely one of fact. Proof of facts clearly indicating such an intention will be sufficient.1

A thorough consideration of the question of whether the members of a corporation possess the power to dissolve it and distribute its capital otherwise than accord

1 In the case of People v. College of Cal., 38 Cal. 166, the corporation was formed under general law providing for the incorporation of colleges. The trustees in whom all the powers of the corporation were vested by law, had acquired for from time to time, general donations of money from individuals for the benefit of the college and also acquired certain real estate by purchase. The president and board of trustees of the college, desiring to transfer its property and business generally, to and become incorporated as part of another institution, passed a resolution that upon certain conditions being performed, by the latter, and the procurement of the necessary legislation for the purpose "then the college of California will dis-incorporate, and after discharging all its debts pay over its net assets to such university."

The propositions and conditions embodied in the resolutions were accepted and performed, and all the real estate which it had purchased was deeded by the president and board of directors to the corporation referred to in the resolution, which was the State University. The action was brought to quiet the title of the State of California to the land, and it was decided that the acts done by the corporation known as the College of California amounted to a surrender of its franchise to the State, and after such surrender had been made, and the conveyance executed, all its personal estate remaining after the payment of its debts and all its real property acquired by purchase for value, would have vested by operation of law in the state.

ing to the provisions of the statute, may be found in Kohl v. Lillienthal where the law on the subject was ably expounded and the statutes carefully construed. The conclusion reached was contrary to the right to do so notwithstanding the benefit which might thereby accrue to the corporation and its members,1

This view is borne out in cases where other means than the judgment of a court were prescribed by law for carrying into effect the dissolution. Thus, where it was provided that notice of the dissolution must be given to the governor, the judgment of a court of law was held ineffectual.2 Leave of court need not be had before an action can be maintained to dissolve a corporation.3

1010. Practice-Parties.-Under such statutes the court cannot grant the relief without some sufficient cause being shown even where a majority in interest join in asking it. If the schedule presented has been

1 81 Cal. 378; 22 P. 689, Fox, J., delivering the opinion of the majority of the court, said: "When a method of procedure is prescribed by which a corporation may be dissolved, that method must be followed. When it is provided that the application must be made to the superior court, and must be in writing, verified, and must show that at a meeting of the stockholders called for that purpose, the dissolution was resolved upon by a twothirds vote of all the stockholders, and that all claims and demands against the corporation have been satisfied and discharged, there will be none so bold as to contend that a voluntary dissolution of a corporation can be effected without compliance with the requirements; and it is equally certain that when the legislature has said in the same section of the Code, in which it has forbidden the directors to divide the capital stock of a corporation among the stockholders, that the remaining capital may be distributed after the payment of all its debts upon its dissolution, or the expiration of its term of existence, the intention was that there should not be a distribution under any other circumstances."

2 Chesapeake, etc., Co. v. Balt., etc., R. R. Co., 4 Gill. & J. 1, 107. See Lime v. Wagoner, 71 Ala. 581. See Tutwiler v. Tuscaloosa, etc., Co., 89 Ala. 391; 7 So. 98. Under the N. Y. Statute C. C. P. sec. 1798.

People v. Lowe, 47 Hun, 577.

4 Ib. It was held to constitute good cause for dissolving a corporation organized as a stock exchange, the members having no community of in

made in good faith, the mere fact that it is defective in details, is no reason for refusing the relief prayed.1

Upon such petition being presented, the court may make an order requiring all persons interested in the corporation to show cause why it should not be dissolved. Such order is in the nature of process for bringing persons interested before the court, and unless its provisions are in strict compliance with the statute it is void. Under the New York statute, the motion, application and other papers and orders thereon must be served upon the attorney-general. But such service is not required where the appointment of a trustee of the corporation is sought, the execution of a trust being independent of the court except in the sense of its general supervision of trusts and trustees. The corporation is a necessary party in a proceeding instituted by stockholders under the West Virginia statute." An injunction will not be granted by a state court to restrain parties from proceeding in the federal court for winding up the affairs of an insolvent corporation or of one which has abandoned its business."

terest where it appeared that dissolution was favored by a large majority of its stockholders, and directors who owned the capital stock and controlled its operations, that only the small minority would be benefited by its continuance, and that its operations had long previously ceased. In re Imp. & Groc. Ex., 28 N. Y. S. Rep. 416; 8 N. Y. S. 319. See also, Kelsey v. Fermentation Co., 19 Abb. N. C. 427; Edison E. L. Co., 21 Ib. 119. A claim that the corporation was indebted to plaintiff was insolvent, was held insufficient to warrant its dissolution under the Kentucky statute. A judgment execution and return nulla bona should be shown. McMurty v. Montgomery Mas. T. Co., 86 Ky. 206; 5 S. W. 570.

1 In re Santa Eulalia S. M. Co., 51 Hun, 640; 2 N. Y. S. 221. The pendency of proceedings for voluntary dissolution is no bar to a proceeding by the attorney-general in quo warranto to dissolve the corporation. People v. Seneca L. G. & W. Co., 52 Hun, 174.

2 People v. Seneca L. G. & W. Co., 52 Hun, 174.

a Ib.

4 In re Gay, 21 N. Y. S. Rep. 346; 4 N. Y. S. 602.

5 C. 53 Code W. Va. 1868. See Hurst v. Coe, 30 W. Va. 158; 3 S. E. 564. 6 Kessler v. Continental C. & I. Co., 42 F. 258.