delivered the opinion of the court:
Upon an examination of section 4 of the charter of the appellant corporation it will be found that the legislature authorized the corporation to engage in a general banking business, except that it could not issue bills, and in addition to banking the corporation was authorized to engage in a general real estate business, with full power to buy, sell and hold real estate, and lease and improve the same, in the same manner and with like power as an individual or natural person. Under the charter as originally enacted it is plain that appellant had the power to transact a general real estate business. But it will be observed that section 11 of the charter provides: “The said company shall be subject to the provisions of any general law hereafter passed on the subject of banking, trust and deposit companies.” Under this clause in the charter the State expressly reserved the right, by general law, to change the charter, and the charter was accepted by the loan and real estate association upon this condition, and the first question to be considered is whether the legislature, since the charter was granted, has by general law chang’ed the charter and taken away any of the powers which were granted under it. If it has, then the corporation has no right to exercise any power which has been taken away by the legislature.
It is set out in the information and admitted by the demurrer, that the legislature passed an act concerning corporations with banking powers, which was adopted by the people by a vote at an election held for that purpose, and became a law of the State on December 6,1888. Section 9 of the act provides that an association organized under the act may own such real estate as is necessary in which to do its banking business, and may take such other real estate to which it may obtain title in the collection of its debts, but shall not carry any real estate in its assets, except its banking house, for more than five years after acquiring title thereto. This prohibits banks organized under the State law from engaging in or carrying on a real estate business. They may own the real estate in which their business is transacted, and they may, in the collection of debts due the bank, acquire real estate in liquidation of indebtedness due, but this must be sold within five years after it is obtained. To this extent they may, under the Banking act, own and hold real estate, but they cannot go any further in that direction. The wisdom of the provision is obvious. The main object of establishing a bank is, or ought to be, to afford a safe place for the deposit of money and to accommodate the public by making loans and discounting commercial paper, but if the funds of a bank are invested and tied up in real estate these objects will, of necessity, be defeated.
Section 12 of the Banking act makes 'provision for any corporation organized under the act or organized under a special .charter to change its name, change its place of business, to increase or decrease its capital stock, to increase or decrease its number of directors, or to consolidate such corporation with any other corporation having banking powers. After providing the steps to be taken to make any of the changes specified, the section contains the following: “And provided further, that any corporation with banking powers availing itself of or accepting the benefits of or formed under this act, and all corporations with banking powers existing by virtue of any special charter or general law of this State, shall be subject to the provisions and requirements of this act in every particular, as if organized under this act.” This provision in plain terms makes every bank in the State organized under a special charter passed by the legislature of the State subject to the general Banking act, and in so far as a charter may conflict with the general act that charter is modified and changed by that act. In so far, therefore, as the Henderson Loan and Real Estate Association was authorized by its charter to purchase, hold and sell real estate, that power was taken away by the Banking act of 1887.
But it is said, the proviso should be construed as affecting the section or paragraph to which it is annexed, only. We do not concur in that view. A proviso is something engrafted upon a preceding enactment, and is legitimately used for the purpose of taking special cases out of the general enactment and providing specially for them. (Potter’s Dwarris on Stat. 118.) There are, no doubt, cases where a proviso might be confined as affecting the section only to which it is annexed, but we do not understand this to be the general rule. Here it is-manifest that the proviso was intended to apply to the act and not to a particular section, and when such is the case it should be given that construction.
But it is said that the language in section 12 of the act of 1887, “any corporation with banking powers” and “all corporations with banking powers existing by virtue of any special charter or general law of this State,” does not apply to the Henderson Loan and Real Estate Association, for the reason that under the constitution of 1848, which was in force when appellant received its charter, a corporation with banking powers was understood to be a bank of issue. In Reed v. People, 125 Ill. 592, we had occasion to consider somewhat the meaning of the words “banking powers,” as used in the organic act of 1870, and we there held that in a commercial sense banks were of three kinds, to-wit, of deposit, of discount and of circulation, and a corporation authorized to receive deposits, discount notes and invest the proceeds in public securities and declare dividends must be regarded as having banking powers. Here the Henderson Loan and Real Estate Association was not empowered to issue bills to circulate as money, but it was authorized to receive deposits, loan money, discount notes and bills, buy and sell negotiable paper and other securities, and there can be no doubt that it was a corporation with banking powers, within the meaning of the act of 1887.
The next question presented is, whether the facts set up in the second count of the information were sufficient to authorize the judgment. It appears from the averments of this count that the corporation was organized and commenced business on January 11, 1868, and continued business until April 30, 1878, when the corporation went out of business, and for a period of fifteen years, to-wit, from April 30, 1878, to April 10, 1893, transacted no business of any character whatever, but during said period neglected and failed to use or exercise any of the rights, powers or franchises granted by the act of incorporation; that while the charter required the stockholders to elect directors annually, from December, 1868, until January, 1875, no election of directors was had, and after January, 1875, no directors were elected until the year 1893. The grant of corporate rights and privileges by the State and their acceptance by the appellant corporation created a contract, under which the corporation was bound to exercise its corporate rights and powers, and its failure to do so for a period of fifteen years without any excuse whatever constituted a gross and deliberate violation of its duties as a corporation. By section 11 of the charter it is expressly provided that the charter shall be void unless said company shall organize and proceed to business within two years. From this provision it is plain that the legislature intended that the franchises granted should be used, and that continuously; and as was said by this court in People ex rel. v. Kankakee River Improvement Co. 103 Ill. 491, where a similar question was involved, “the non-compliance with the requirement was per se a misuser, and a cause of forfeiture of the purchase as for a condition broken.”
The powers and privileges conferred upon appellant by the charter were of a public nature. As a corporation with banking powers it was clothed with power to receive deposits from the people, to make loans to the people, to discount commercial paper, to receive trust funds on deposit, to issue letters of credit,-—all matters pertaining to the public. Having assumed these extraordinary powers and privileges from the State it owed a duty to the public which it grossly neglected to discharge. Here was a clear breach of trust which would authorize a forfeiture. (People v. Bristol, etc. Turnpike Road, 23 Wend. 221.) In Terrett v. Taylor, 9 Cranch, 43, Mr. Justice Story said: “A private corporation created by the legislature may lose its franchises by a misuser or nonuser of them, and they may be resumed by the government under a judicial judgment upon a quo warranto to ascertain and enforce the forfeiture. This is the common law of the land, and is a tacit condition annexed to the creation of every such corporation.” In Chesapeake and Ohio Canal Co. v. Baltimore and Ohio Railroad Co. 4 G. & J. 1, the court, in deciding the case, among other things said, the corporation “may be dissolved by a forfeiture of its charter, through abuse or neglect of its franchises, as for condition broken, there being a tacit condition in every such grant that the corporation shall act up to the end of its institution.”
We think the judgment of the court warranted by the facts, and it will be affirmed.
Judgment affirmed.