Southern Coal Co. v. Yazoo Ice & Coal Co. , 118 Miss. 860 ( 1918 )

Smith, C. J.,-

delivered the opinion of the court.

This is an action in assumpsit begun in the court below by appellant against several defendants alleged to be doing business as partners under the name and style of the Yazoo Ice & Coal Company. The declaration alleged that the Yazoo Ice & Coal Company was incorporated in February, 1908, hut that its organization was not reported to the Secretary of State within thirty days, as provided by section 930, Code of 1906, section 4104. Hemingway’s Code which provides that: “Should such report be not made within the time required, the charter granted shall be null and void, and all persons doing business thereunder shall he deemed and held to be partners in the business and liable as such.”

Appellees filed a special plea setting forth that the corporation was duly organized under its charter and was engaged in business as such, and that, on April 8, 1912, before the debt here sought to be recovered was incurred, “a complete report of the organization of said company was filed in the office of the secretary of state of Mississippi, as shown by the certified copy thereof under the hand of Joseph W. Power, Secretary of State, and which is filed .herewith, as Exhibit B hereto, the same as if fully set out herein, pursuant to authority given under an act of the state of Mississippi, being chapter 140 of the Acts of 1912. . . . ”

This plea was demurred to by appellant, and upon its demurrer being overruled it declined to plead further, whereupon judgment final was entered against it.

The requirement that a corporation file its report with the secretary of state within thirty days after the organization thereof, having been prescribed solely by the legislature, may he dispensed with hy it, within the limitations of the Constitution, by a law passed after a corporation has failed to meet the requirement. In other words, a formality to be observed either in the organization of a corporation or by it after its organization, which the legislature could have dispensed with in advance, may be dispensed with by the legislature after the time for the observance of it has passed.

No vested rights are disturbed by this statute, for the rights of creditors are expressly preserved by it, and the rights of stockholders' cannot be disturbed by it for the reason that acting upon its provision is optional with them.

The sections of our Constitution which the statute is said to violate are Nos. 87, 88, and 180.

In order to violate either section 87 or section 88, the statute must be either special or local, and it is neither. Vicksburg v. Insurance Co., 72 Miss. 76, 16 So. 257.

The provision of section 180 which it is said to violate is that: “Every charter or grant of corporate franchise hereafter made shall have no validity, unless an organization shall take place thereunder and business be commenced within two years from the date of such charter or grant.”

The argument is that the report required to be made by the statute to the secretary of state is a.step necessary to be taken in order to perfect its organization, and therefore, if the time within which this report can be made is extended for a period of more than two years from the' date of its charter, a corporation will thereby be permitted to organize and commence business more than two years after such date.

The defect in this argument is the assumption that the report to be made by a corporation to the secretary of state is a step necessary to be taken in order to perfect its organization, for the report cannot be made until after the organization has been completed and the penalty provided by the statute is imposed for the omission by the corporation to make the report after it has been organized.

Affirmed.