In Re: Petition For Rehearing
| Decision Date | 28 July 1927 |
| Parties | On Petition For Rehearing. |
| Court | Idaho Supreme Court |
BRINCK,
Commissioner.-Counsel for respondents have presented a petition for rehearing accompanied by a brief urging that the opinion heretofore filed has failed to follow the precedents established by this court and by the supreme court of California.
They first state that the doctrine of Alaska Salmon Co. v Standard Box Co., 158 Cal. 567, 112 P. 454, cited in the original opinion herein to the point that the Governor's proclamation is a necessary condition precedent to the forfeiture of a corporation's charter for nonpayment of license fee, has been repudiated by later California decisions, such as that of California Nat. Supply Co. v Flack, 183 Cal. 124, 190 P. 634. In Alaska Salmon Co. v. Standard Box Co., supra, as in Kaiser Fruit & Land Co. v. Curry, 155 Cal. 638, 103 P. 341, 347, to the same effect, the court was considering a statute identical, so far as relating to this question, with our C. S., secs. 4781, 4786; while in the case of California Nat. Supply Co. v: Flack, supra, the court was considering a later statute which did not require a proclamation by the Governor. The later California cases, therefore, in no sense repudiate the doctrine of Alaska Salmon Co. v. Standard Box Co., as applying to statutes such as ours.
The principal contention of the petition for rehearing is in substance that any act done in the corporate name, after its charter has been forfeited, is not only entirely void, but that, being made criminal by C. S., sec. 4789, an estoppel to deny its validity cannot be set up. C. S., sec. 4789, provides that it shall be unlawful for any corporation delinquent under the license law to transact any business within the state after the time when the charter is forfeited, and makes it a misdemeanor for any person after such time to exercise any of the powers of the corporation or transact any business for or on behalf of the corporation. C. S., sec. 4790, constitutes the managers in office or directors of a corporation whose charter may be so forfeited trustees with full power to settle the affairs of the corporation. C. S., sec. 4787, provides for the reinstatement, upon payment of the delinquent fees and penalties, of "any corporation which failed to pay the license tax and penalty," and provides that such reinstatement relieves the corporation from the forfeiture and relieves all persons exercising the powers of such corporation from the provisions of C. S., sec. 4789.
It seems obvious that the intent of our statute is that after delinquency no acts shall be performed, even by the trustees, which are in the nature of continuing the business of the corporation, but it is clearly the intention of the statutes that the statutory trustees may do all acts properly embraced within the winding up or settling of the corporate affairs. Such an act, of course, is disposing of and conveying the corporate property. We think it may be presumed that an act of this nature is done for the purpose of winding up the corporate affairs. Where a corporation, after the expiration of its charter, is permitted by statute to sue to collect its assets, it has been held that a suit begun in the corporate name is presumed to be for the lawful purpose of winding up its business. (Stark Electric R. Co. v. McGinty Contracting Co., 238 F. 657, 151 C. C. A. 507.) If, in such a conveyance, the trustees, through ignorance or mistake, use the corporate name, it does not seem that our statutes would contemplate that they should be subjected to the penalties of C. S., sec. 4789. Their act, if done for carrying on the general purposes of a corporation, and transacting its business, except for the purpose of winding it up, would be unlawful under sec. 4789, but it seems to us that an act which is properly within the scope of winding up the corporate affairs, even though exercised in the corporate name, is merely defectively exercised and not void, if it be shown that the act so done was in fact done by the trustees. Thus, in the matter of a deed in the corporate name, the execution of the deed would be defective, but we think undoubtedly the deed should be given effect, if it were shown that the trustees authorized it, and unless it were shown that it was an act not for winding up the corporate affairs, but for carrying on its general business.
None of the California cases cited by respondents present the situation found in this case, or pass upon the particular questions here raised, nor do we think they necessarily sustain respondents' contention when applied to the facts of this case. Among the cases so cited are Rossi v. Caire, 174 California Nat. Supply Co. v. Flack,
183 Cal. 124, 190 P. 634; Ransome-Crummey Co v. Superior Court, 188 Cal. 393, 295 P. 446; Van Landingham v. United Tuna Packers, 189 Cal. 353, 208 P. 973; Sharp v. Eagle Lake Lumber Co., 60 Cal.App. 386, 212 P. 933; Newhall v. Western Zinc Min. Co., 164 Cal. 380, 128 P. 1040; Finch v. Finch, 68 Cal.App. 72, 228 P. 553. Those decisions do hold that the particular acts under consideration, done by or against a corporation in its corporate name, after its charter had been forfeited, were void, and use general language which might be considered as supporting respondents' contention. It is repeatedly said in those decisions that a corporation whose charter had been "forfeited" for nonpayment of license fee has no more existence than a natural person when life ceases, and that no act can be done even in its behalf. This view rests, we...
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