The Green Bag
254
"In the former portion of this article, some of the leading foreign theories as to the nature of corporate personality, which in recent years have been promulgated by French, German, and Italian 'urists with indefatigable industry and notable learning and brilliance, were briefly outlined; a short statement was made of the traditional doctrine of Anglo-American law upon the subject, and some of the inconsistencies 0 that doctrine were mentioned; and afterwards
an examination of the subject on principle was begun. The result of this examination was the conclusion that a corporation, or indeed any group or succession of men — such as the Church,
or an army, or a political party-—is a real entity ——something other than the mere sum of the members for the time being; but that this
entity is actually impersonal, and is regarded as a person only by way of metaphor or bya fiction of law. We now proceed to test this theory that a corporation is a real but impersonal entity, which is personified by a legal fiction or meta phor, by applying it to various situations and questions which arise in cor oration law. We shall then consider the use, i any, of the fiction of corporate personality, and certain classes of errors in its application. Lastly, the article will conclude with a practical suggestion as to the best method of treating and studying the doc trine of corporate personality. . . . "The personification of the cor orate entity serves many a useful purpose. f a code of corporation law could foresee and rovide for every possible case to arise in the uture, then indeed, as contended by M. de Vareilles-Som mieres, it might dispense with personification of the corporate entity, and might legislate directly for every conceivable case. But, unfortunately, it is impossible thus to rovide
explicitly for every conceivable case. n spite of every precaution, the cams omissus will occur; and when it does, then the doctrine of corporate personality comes into play. For the law, recognizing its inability to provide specifically for every case that may arise, after laying down
certain rules which make the personification of the corporate entity natural and almost in evitable,—limited liability, continuous succes sion, unified management, power to sue and be
sued, and to take or convey property in the corporate name,—goes on to exact, in effect, that in all other cases, not expressly so rovided for, the company shall be treated as i it were a person, or in other words shall be conceived of as a person, or shall be an imaginary or fictitious person. . . . "Let us take an illustration of this use of the corporate fiction. The regulations of a certain company provide that the directors may exer cise all the powers of the corporation except
the bonds as issued by the directors as agents of the imaginary corporate personality in viola tion of restrictions upon their authority; and as third persons, dwling with the agents, could not justly be expected to see to compliance with such restrictions, therefore, applying the law of agency, we reach the conclusion that the bonds are valid in the hands of innocent third persons. We then drop the symbol of the corporate rsonality which has been useful to us in reac ing our conclusion, and we express the net result in terms of the rights of actual persons by adjud ing that the bondholders _take'the assets an the shareholders get noth ing. See Federal Incorporation, Interstate Com meree. Criminal Procedure. “The Illinois Juror in the Trial of Criminal Cases." By Oliver A. Harker. 5 Illinois Law Review 468 (Mar.). A singular provision of the Illinois criminal code, adopted in 1827, made juries in criminal cases judges of the law as well as of the facts. This extraordinary power, the exercise of which is fraught with great public danger, isbestaccounted for by certain historical reasons. It has made the judge in criminal trials in Illinois merely a presiding oflicer. See Administration of Justice, Juvenile Delinquency. Criminology. “The Need of New Crimino logical Classification." By A. Bullard. 1 Journal of Criminal Law and Criminology 907 (Mar.). "We need at least a binominal terminology. We must distinguish the ‘habitual thief‘ from the
‘habitual
counterfeiter,’
the
‘occasional
robber‘ from the ‘occasional murderer.‘ Even a tri-nominal nomenclature might be tried. The first term to indicate the motive —anger, lust, greed; the second term to give the nature of the crime—burglary, manslaughter, forgery; and the final term might describe the offender — born, habitual, occasional.
Even a more com
plicated system would be better than our present slipshod indefiniteness. "We must develo really distinct categories. Today we class ' uction' as a crime against public morality. When the codes were first written, it probably was a crime of lust.
In
that no bonds shall be issued or mortgage
our modern city courts it more often has ‘easy money’ for a motive. At least half the murders which we class as crimes against the person-— which are su posed to be crimes of anger—are in reality e orts to get money. Most of the assaults which take place about the polling booths at election times are on behalf of the party with the larger corruption fund. Until
executed without the prior approval of a share
we recognize the intricate variety of crime, we
holders’ meeting.
will make little progress. It is puerile to look for the same causes back of sexual perversion and bur lary We have worked from the wrong end. e should base our categories — as every other science has done—on observed facts. We need a large body of data-—a mass of recorded cases.’I
Nevertheless, without such
approval, the directors issue bonds, and execute a mortgage to secure them. Are the bonds valid secured obligations of the company? In order to solve this problem, it is convenient to conceive of the corporation as a personality giving commands to the directors as his or its agents.
We say, therefore, that we will regard
See Penology.
