It is found that “ the Utica, Chenango & Cortland Railroad Company * * * was a railroad corporation duly organized under the general railroad act of this state by the due filing of its articles of association April 9, 1870, and that it thereupon became incorporated for the purpose of constructing a railroad from the town of Cortlandville through the said town of Solon and the said town of Taylor, in the county of Cortland, and the town of Otselic, in the county of Chenango, in the state of Hew York.” It is also found “ its articles of association were filed in the office of the secretary of state April 9, 1870, and previous thereto one thousand dollars of stock for every mile of railroad .proposed to be made, to wit, 32 miles, had been subscribed thereto, and ten per cent, paid thereon in good faith; and there was indorsed thereon or annexed thereto an affidavit made by three of the directors named in said articles that the said amount of stock, as required by law,1 had been in good faith subscribed, and ten per cent, paid thereon in cash and in good faith.” Upon the trial some of the subscribers for the stock was called as witnesses, who gave evidence tending to show they paid nothing on their subscription, and some of them “that they had an agreement with the individuals soliciting or taking their subscriptions that they need not pay their ten per cent.;” and some of them testified that they had a like agreement that they need not pay anything; but they testified “they knew they were bound by the instrument,” and also “that they intended to make good articles, ” and they also admitted “that the agreement was a private affair between them and the persons soliciting their subscriptions, ” and that they subscribed, so far as the articles were concerned, in good faith and honestly. It appeared that the corporation, as such, was not connected with the alleged agreement, and that it had twice made calls for the payment upon the stock. There is no proof that 10 per cent, on the $32,000 subscription had not actually been paid. On the contrary, it appeared in the affidavit of the three directors attached to the articles in ac
1. If any such agreement was made prior to the subscription, or contemporaneous with the act of subscribing to the articles as mentioned by the witnesses to which reference has been made, the same was a fraud upon the law, and one that could have no effect and could receive no force. Tuckerman v. Brown, 33 N. Y. 297. We think the act of 1850, under which the railroad was organized, did not require that each subscriber should pay, before the articles could be deemed efficient, 10 per cent, upon their subscriptions. Plank Road Co. v. Vaughan, 14 N. Y. 546. In Railroad Co. v. Mason, 16 N. Y. 451, it was held, viz.: “It is not necessary to the incorporation of a railroad company under the general act that ten per cent, be paid upon the amount of each subscription at the time of making the same, or previous to the filing of the articles of association with the secretary of state. It is sufficient if the cash payment, by whomsoever made, amount in the aggregate to ten per cent, upon one thousand dollars for each mile of road proposed to be constructed.” In Farnham v. Benedict, 107 N. Y. 159, 13 N. E. Rep. 784, the subscriptions were less than the amounts required, and no part thereof was paid in cash, and there was not a compliance with the act of 1850. The case therefore differs from the one before us. Here the affidavit of three of the directors attached to the articles of association states “that at least $1,000 of stock for every mile of railroad proposed to be made by the terms of said articles of association lias been in good faith subscribed thereto; that ten per cent, in cash has been paid thereon in good faith; and that it is intended in good faith to construct, maintain, and operate the road mentioned in said articles of association.” In Plank Road Co. v. Thatcher, 11 N. Y. 111, it was held that a similar affidavit for a similar purpose was sufficient, and the objections thereto were overruled. In Railroad Co. v. Hatch, 20 N. Y. 161, it was held that such an affidavit “is sufficient evidence that at least $1,000 of stock for every mile of road proposed is subscribed and paid.” In considering a similar affidavit in that case, Grover, J., stated: “The affidavit in this case proves these facts. Whether the public interest requires further restrictions is a question for the legislature.” It appeared here that by chapter 351, Laws 1872, the legislature recognized the existence of the Utica, Chenango & Cortland Railroad Company. It is competent for the legislature to recognize the continued existence of the corporation. In re New York El. R. Co., 70 N. Y. 327, 336. In Railroad Co. v. Barnard, 31 Barb. 260, Pratt, J., observed: “But when the proceedings are regular upon their face, and the company, while in the actual exercise of all its corporate functions, is recognized by the lawmaking power of the state as a corporation, it becomes by such recognition ipso facto a legal corporation.” People v. Manhattan Co., 9 Wend. 380; Trust Co. v. Clowes, 3 N. Y. 470.
2. Upon the argument of the appeal before us it was insisted in behalf of the appellant “the petition presented to the county judge failed to state the jurisdictional fact that the subscribers were a majority of the taxpayers of the town whose names appeared upon its last preceding tax list or assessment roll as owning a majority of the taxable property in the corporate limits of the town;” also that “the bonds issued by the railroad commissioners exceeding twenty percent, of the entire taxable property within the bounds of the town, as shown by the last preceding tax list, was unauthorized and void;” also that “the bonds, having been issued without seals, did not conform to the requirements of the bonding act, and were therefore void;” also that “the $24,000 of
3. It was admitted upon the trial “that the plaintiff is the owner of the coupons set forth, * * * and that he purchased them in good faith, and paid the par value thereof in cash, without actual notice of any defect in the bonding of the town or the issue of the bonds.” The bonds from which the coupons were cut were put in evidence, and it was conceded that the bonds were made payable to the treasurer of the railroad company or bearer, and that the same had been indorsed by the treasurer in blank. The seventeenth finding of fact is as follows:
“That the following is a copy of the coupons or interest warrants annexed to the bonds of plaintiff, except as to number and time of payment, to wit:
“‘17.50. The town of Solon will pay to bearer, at the National Park Bank
of New York, seventeen fifty h undredths dollars on the 1st day of-, 187—,
being six months’ interest on said bond.
“‘No.--. Lyman Peck, Jr.
“ ‘ Oerin Randall.
“ ‘ John T. Butman.
“‘ Commissioners.’”
In the body of the bonds it was stated, viz.: "The interest and principal of this bond are payable to the-; the interest upon presentation at said bank of the coupons hereto annexed as they respectively become due, and the principal sum upon presentation at said bank of this bond at its maturity. This bond is one of the series of bonds, in all amounting to $44,800, issued by the said town of Sólon under and by virtue of a law of the state of New York entitled ‘An act to authorize the formation of railroad corporations, and to regulate the same, ’ passed April 2, 1850, so as to permit principal corporations to aid in the construction of railroads, passed May 18, 1869.” The several bonds were registered in the office of the clerk of Cortland county, and had indorsed thereon, viz.:
“ Utica, Chenango & Cortland Railroad Company pay to the order of-the within bond and coupon attached, as they severally become due.
“Cortlandville, --, 187—.
[Signed] “James S. Squires,
“Treasurer of the Utica, Chenango & Cortland Railroad Company.”
And the further indorsement, viz.:
“State of New York. Town of Solon. Bond No.-.
“$500.00. Interest payable March 1st and September 1st, at National Park Bank in the city of New York. Registered in Cortland county clerk’s office, book 1, page-. . Frank Place, Clerk. ”
In the twenty-first finding of fact it is stated that the sum of $2,681 was due upon the coupons held by the plaintiff upon a recovery as sought in this action; and it is found as a fact in the twenty-second finding “that the interest upon said coupons from their several dates of maturity to the 31st day of October, 1889,—the date of the trial of this action,—is $963.35, to which sum
1.
The statute referred to Is Laws 1850, c. 140, § 8, which reads as follows: “Such articles of association shall not he filed and recorded in the office of the secretary of state until at least one thousand dollars of stock for every mile of railroad proposed to be made is subscribed thereto, and ten per cent, paid thereon in good faith, and in cash, to the directors named in said articles of association; nor until there is indorsed thereon, or annexed thereto, an affidavit made by at least three of the directors named in said articles that the amount of stock required by this section has been in good faith subscribed, and ten per cent, paid in cash thereon as aforesaid, and that it is intended in good faith to construct or to maintain and .operate the road mentioned in such articles of association; which affidavit shall be recorded with the articles of association aforesaid. ”