persons instituting the proceedings are not supposed to have usually any special interest in the subject of the suit.

In most cases any citizen can bring a suit of this character, but the one who sues first is entitled to the penalty, and there can be but one recovery; and it is held that the first suit may be pleaded in bar of any subsequent suit.

In cases like the one now before us, as the object is to prevent the commission of a public offense and not to redress a private grievance, there could be no occasion for more than one injunction, and the court might properly decline to entertain a second application where there was already a subsisting injunction. The cases cited for the defendants hold that a private individual can not maintain suit for injuries caused by a public nuisance,' nor maintain a bill to enforce the construction of a railroad crossing, the statute having given that authority to the mayor and aldermen and selectmen and to no others.'

SECTION SIXTEEN.

State v. Atchison & N, R, Co., 24 Neb. 143; 38 N. W. 43.

Illegal lease enjoined; not cause, in first instance, for forfeiture of franchise.

A railway company leased its road for a long term to another company, together with all its rights, property and franchises. It is held, that it thereby abandoned the operation of its road and became subject to forfeiture upon quo warranto. The court says, however, that forfeiture will not be declared in the first instance, but the lease is to be declared void.

1 Canal v. Newcomb, 7 Met. 276; 2 Brainard v. Connecticut River R. Fall River Co. v. Old Colony Rail- R., 7 Cush. 506.

road, 5 Allen, 224.

CHAPTER III.

COMBINATIONS, BETWEEN CORPORATIONS OTHER THAN RAILWAY, WHICH ARE REGARDED FAVORABLY.

Business corporations, owing no duty to the public, are not as restricted in their conduct as are railway and other similar corporations. Their powers extend to the selling of property, collection of debts, and the taking of all kinds of property, even stock of other corporations, for the payment of debts,' though, ordinarily, a corporation can not purchase or deal in stocks, unless expressly authorized by law so to do.

Exercising no power of a public nature, so long as they attempt no combination prejudicial to the public, their acts, whereby they dispose of all their property and retire from business, will be deemed valid, certainly when all the stockholders consent. And such disposition of property may be by way of sale upon which the price is paid entirely in corporate stock of the purchasing company.

The cause of such disposition may be the inability of the corporation to carry the business on successfully; this would justify a reorganization, under which preferred stock issued, though without power, would become good eventually by acquiesence and laches, especially when the rights of later and innocent holders are involved.

The entire property may be sold when necessary to prevent loss, and may be bought by some of the trustees themselves; such purchase is not void, but only voidable at the election of those who may be affected thereby; and becomes good by the consent or acquiescence of those who have the right to object.

Agreements in restraint of trade are void if a general restraint, but valid if partial, reasonable, and on sufficient consideration; not larger than requisite to protect the party for whose benefit they are made, and not tending to create monopoly or unnatural prices, or to check fair and natural competition, or otherwise to injure the public.

1 Discussion of corporation holding stock in another, see Chap. XVII.

The test is in each case dependent upon the circumstances, with great allowance to the judgment and discretion of the parties themselves.

SECTION ONE.

Holmes & Greggs Manufacturing Co. v. Holmes & Wessell M. Co., 27 N. E. 831,-N. J.—

Distinction shown between corporations owing and those not owing duty to the public.

Plaintiff had sold out its whole plant to defendant, and took stock in defendant's corporation as payment; and later sold this stock to defendant and took notes as payment; then, when suing upon the notes, the defense was raised that plaintiff had no right to take the stock under the circumstances as stated. It is held, however, that while it is the general rule that a corporation can not, unless expressly authorized by law, purchase or deal in stocks of other corporations, yet it is equally true that it may do whatever may be necessary in the exercise of its corporate franchises. The selling of property and the collection of debts is among the powers given, and, hence, it may take title to all kinds of property, even the stock of another company, in the payment of a debt.

Following is the opinion in full:

HAIGHT, J.: This action was brought to recover the amount of a promissory note, bearing date December 1, 1884, executed by the defendant The Holmes & Wessell Metal Company, and indorsed by the defendants Morse and Shonnard. The defenses were ultra vires, no consideration, and a non-tender of certain stock for the purchase price of which the note was given. The plaintiff is a manufacturing corporation, organized under the general act of 1848, for the purpose of manufacturing sheet and rolled brass wire, tubing and other articles composed wholly or in part of metal, in the city of New York. Its president was Charles E. L. Holmes, and its secretary and treasurer was George C. Edwards. On the 12th day of July, 1881 Holmes and Edwards entered into an agreement with the defendants, Shonnard, Morse, and one Charles Wessell, to organize a new company for the manufacture of brass, nickeline al

loys and other composite metals, under the corporate name of the Holmes & Wessell Metal Company. The capital stock of such company to be $100,000, the whole amount to be issued and paid up in cash; three-fourths of which to be subscribed and paid by Holmes and Edwards, and the remaining one-fourth by the other parties to the agreement. The agreement, in its preamble, recites that Holmes and Edwards propose to transfer the rolling mill belonging to the plaintiff, including all the machinery, tools and appliances connected therewith, together with the lease of the premises occupied by the plaintiff, for the sum of $50,000. Subsequently, and at an annual meeting of the plaintiff's stockholders, held on the 20th day of July, 1881, the president and secretary were instructed to sell to the Holmes & Wessell Metal Company the entire machinery and plant owned by the plaintiff, for the sum of $50,000; and also authorized them to sell to the same company all the material manufactured, unmanufactured and in process of manufacture owned by the plaintiff; and to also subscribe for 3,000 shares of the capital stock of the company, and to pay for the same out of the proceeds of the sale of the mill and materials.

It also appears that the Holmes & Wessell Metal Company was incorporated on the 15th day of July, 1881, and that Charles E. L. Holmes subscribed for 2,000 shares, and George C. Edwards 1,000 shares of the capital stock. Thereafter, and on the 23d day of July, 1881, the new company, at a meeting of its stockholders, authorized the purchase from the plaintiff of its plant and machinery, and to pay therefor the sum of $50,000, and for the entire stock of materials, manufactured and unmanufactured, owned by the plaintiff, the sum of $31,333.96; and, on the first day of September, thereafter, such sale was completed by the transfer of the plaintiff company to the defendant company of its entire plant, machinery, etc., and, in payment therefor, the defendant company issued to George C. Edwards, trustee, the stock subscribed for by Holmes and Edwards, amounting to $75,000, and the balance, $6,333.96, was paid in cash. After such transfer the plaintiff discontinued its business.

On the first day of December, 1884, the plaintiff entered into a contract with the defendants, Morse, Shonnard and said

Charles Wessell, in which the plaintiff agreed to sell to the other parties thereto 1,440 shares of stock of the defendant company standing in the name of Edwards, as trustee, for the sum of $30,000, payable, $5,000 in cash and the balance by certain promissory notes, of which the note in suit is one. The agreement further provided that the stock should remain in the name of Edwards, or some other officer of the plaintiff as trustee; that it might be voted upon by him until delivered as specifically provided in the contract.

It is doubtless true that a corporation can not purchase or deal in stocks of other corporations unless expressly authorized by the law so to do. Talmage v. Pell, 7 N. Y. 328; Berry v. Yates, 24 Barb. 200; Milbank v. N. Y., L. E. & W. R. R. Co., 64 How. Pr. 20; Mechanics Mut. Savings Bank v. Meriden Agency Co., 24 Conn. 156; Central R. R. Co. v. Pennsylvania R. R. Co., 31 N. J. Eq. 475; Hazlehurst v. Savannah R. R. Co., 43 Ga. 57; Valley R. Co. v. Lake Erie Iron Co., 18 Northeastern Rep. 486; People ex rel. v. Chicago Gas Trust Co., 130 Ill. 268-284; Franklin Co. v. Lewiston Institute for Savings, 68 Me. 43; Hill v. Nisbet, 100 Ind. 341–349.

It is equally true, however, that it may do whatever may be necessary in the exercise of its corporate franchises. The selling of property and collection of debts is among the powers given; and hence, it may take title to all kinds of property, even the stock of another company, in the payment of a debt. Talmage v. Pell, supra, and cases above cited.

The statute under which the plaintiff was incorporated provides that "it shall not be lawful for such company to use any of their funds in the purchase of any stock in any other corporation." (Laws 1840, Chap. 40, § 8.) The funds here spoken of evidently mean the money of the company, and the statute was not intended to limit the powers of the corporation beyond that already indicated.

It

The plaintiff was a private manufacturing corporation. exercises no power of a public nature, and has attempted no combination by which the public may in any manner be prejudiced. There are, consequently, no questions affecting public policy to be considered. The purpose of the company is expressed in a preamble to the resolutions adopted, authorizing the sale of its plant and stock of materials on hand to the de