
    NOVEMBER TERM, 1844.
    The President, Directors & Company of the Planters Bank of the State of Mississippi vs. Thomas L. Sharp, et al.
    Where, since the act of 1840, prohibiting assignments by the banks of their bills receivable and evidence of debt, a bank sued upon a note in its own name, and the defendant pleaded puis darrein continuance, that the bank had, since the institution of the suit, transferred the note; held, that such a plea is a good plea in abatement of the action. Chief Justice Sharkey, dissenting.
    
    In error, from the Lawrence circuit court.
    The president, directors and company of the Planters Bank of the state of Mississippi, on the 11th day of October, Anno Domini, 1841, filed their declaration in ,the circuit court oí Lawrence county, against Thomas L. Sharp, Edward Engelhard, and Henry Hampton Bridges, to recover the amount of a note made by the defendants to the plaintiffs for one thousand dollars.
    At the October term, 1841, of the court, the defendants appeared and plead non assumpsit. The cause was continued until the December term, 1842, of the court, when a jury-being empaneled to try the issue joined, the defendants offered another plea in the following words.:
    “ The Planters Bank ) “ In the Circuit Court of Lawrence vs. > County,
    “ Thomas L. Sharp, et al. ) ' December Term, 1842.
    “And now at this term, that is to say, on the second day of the term aforesaid, until which day this cause was last continued come the said plaintiffs by attorney and the said defendants’ by attorney, and. the said defendants say that since the last continuance of this cause, that is to say since the sixth day of the May term, 1842, of this court, from which day this cause was last continued ; and before this day, that is to say on the tenth day of June, in the year 1842,- at the county aforesaid, the said plaintiffs then and there being the owners of the said note sued on in this cause, and then and there being a bank within the state of Mississippi and within the intent and meaning of the statute of this state entitled ‘ An act requiring the several banks in this state to pay specie and for other purposes,’ transferred the aforesaid note to the United States Bank of Pennsylvania, contrary to the statute in such cases made and provided, and this the said defendants are ready to verify; wherefore they pray judgment if the said plaintiffs ought further to be answered in this said action and that the same may abate.
    “Personally appeared in open court Thomas L. Sharp, one of the defendants in the above stated case, who, being duly sworn upon his oath, says that the matters and things set forth in the above plea are true in substance and fact.
    “Sworn to and subscribed in open court, "6th December, 1842.}Thomas L. Sharp."
    “ Edward L. Bowen, Cleric.”
    The plaintiffs demurred to this plea and assigned twelve special causes, which it is not deemed requisite to set out. This demurrer was overruled and judgment of respondeat ouster awarded. The following entry then appears in the record: “Whereupon- issue is joined in short by consent of counsel on both sides. E. G. Peyton for defendant.”
    
      A trial was had and the jury found for the defendant; the plaintiffs moved for a new trial, which was overruled.
    A bill of exceptions was taken and signed to the reception of the plea, “puis darrein continuanced This bill of exceptions stated that the defendants proved by a witness that the note had been transferred as alleged.
    The errors assigned are,
    1. The permission to file the plea puis darrein continuance during the progress of the trial of the cause.
    2. In overruling the demurrer to that plea.
    3. In receiving the evidence of defendants.
    4. In not granting a new trial.
    
      Quitman and McMurran, for plaintiffs in error.
    An action was brought by the plaintiffs in error against the defendants in error, upon a promissory note, in the circuit court of Lawrence county; the general issue was pleaded, and the parties proceeded to trial. During the trial, a plea of puis darrein continuance was pleaded, alleging that since the last continuance the plaintiffs had transferred the note sued on to the Bank of the United States, contrary to the provisions of the statute of this state, prohibiting the banks of this state from transferring any of their bills receivable. The counsel for the plaintiffs objected to the plea, but the court overruled the objection. They then demurred to it, by filing a general demurrer, with an assignment of special causes ; there was a joinder, and upon argument the demurrer was overruled ; a replication was then filed, a trial upon this issue, and a verdict for the defendants followed.
    A motion for a new trial was made by plaintiffs, but it was overruled, and exceptions taken.
    This short reference to the facts will show the points upon which the plaintiffs rely for a reversal of the judgment of the court below.
    ■ And in the remarks we shall make, we shall confine ourselves to the law of the case, as it arises upon the plea of puis darrein continuance. There might be some minor questions arising upon the record in this case; but we think the demurrer to the plea of puis darrein continuance raises fairly and fully the question, whether the provision of the act of the legislature of 1840, recited in the plea, be constitutional and binding on the Planters Bank, or the assignees of any of her assets; or whether that provision is void when brought to bear on the assignment of a note by the Planters Bank of this state. It is upon this question our clients are most desirous for the decision of this court, and this question we will now proceed briefly to discuss.
    The provision of the law of 1840, being the 7th section of the laws of Mississippi of that year, will be found on page 1 to 14 of the pamphlet laws of the session of the legislature of that year. It in substance makes it unlawful, and prohibits the banks of this state from transferring, by indorsement or otherwise, any note, bill of exchange, or other evidence of debt, and if it shall appear in evidence, upon the trial of any action upon such note, bill receivable, or other evidence of debt, that the same was transferred, the same shall abate on the plea of the defendant.
    The Planters Bank, then plaintiffs, were incorporated by an act of the legislature, passed on the 10th February, 1830. Rev. Statutes 1824 — 1838, p. 237. The 6th section, p. 240, gives them most extensive rights, powers, and privileges — as extensive as we recollect ever to have been conferred on a bank by its charter. The plaintiffs are “ capable and able in law to have, possess, receive, and enjoy to themselves and successors, lands, rents, tenements, hereditaments, goods, chattels, and effects, of what kind soever, nature, and quality, not exceeding $6,000,000, including the capital stock; and the same to grant, demise, aliene, or dispose of for the good of the bank.” The 17th section authorizes them “to receive money on deposit, discount bills of exchange, and notes, with two or more good and sufficient names thereon,” &c., “ to make loans to citizens,” on mortgages, &c.
    In December, 1830, the legislature passed a supplemental act. Rev. Statutes 1824 —1838, p. 297. So another amendatory act, in December, 1831. Same volume, 359. Again, 362. So on the 5th February, 1833, another amendatory act was passed. Rev. Statutes, 1824 — 1838, p. 433.
    These additional acts do not vary in any way the powers granted by the original act; and it is to be observed, that they are to take effect token accepted by the bank, showing the sense of the legislature upon this subject.
    Taking, then, the charter of the plaintiffs, their power to discount notes, to possess, receive, and dispose of any kind of effects to the amount of $6,000,000, would seem to be most unquestionable. Here is an unqualified and express grant to this bank, to dispose of her assets, in any manner, for the good of the bank.
    But independently of this express grant of powers and privileges to this corporation, it is incident to it, at common law, to purchase and aliene lands and chattels, unless restrained by the charter or laws in force at the time of the grant of the charter. 2 Kent’s Com. 277, 281. Ang. & Ames on Corp. 58,59, 78. 1 Yes. & Bea. 226, 237, 244.
    So a corporation may take a mortgage to secure a debt, though not specially authorized by its charter. 2 Kent’s Com. 283. 4 John. Ch. R. 370. 11 S. & R. 411. And as incident to the corporation, it may enter into contracts, and sue and be sued, just as individuals may, and nothing but a restriction in the charter will limit it.
    Opinion of High Court in the case of Commercial Bank of Manchester v. Nolan, recognizing fully the doctrine laid down by Kent, Angel] & Ames, and all other writers upon this subject. These remarks apply directly and unqualifiedly to the acquisition and disposition of property. In other respects, corporate powers are construed more strictly.
    Same opinion of 'High Court, and authorities there cited. And how much stronger is the case there presented against the validity of the act of the bank than in the present instance 7 If a bank, by no greater powers conferred on it by its charter, can take in pledge, to secure a debt, cotton, and dispose of the same, surely she could dispose of a debt to pay a debt, or for any such purpose.
    
      Again. Independent of positive law, all corporations have the jus disponendi absolutely. Ang. & Ames 104, sec. 9.
    "What does the right of a bank to receive and discount notes, &c. amount to, if she has not the right to dispose of them 7 The right to acquire is idle and useless, without the right to dispose of the acquisition. The right of disposition impliedly exists, coextensively with the right of acquisition, whether derived from a grant to an individual, or a grant of a charter to a corporation.
    But besides, “ Every corporation, unless expressjy forbidden, has by implication the power to do such acts as are essential to its existence, or necessary to enable it to perform its functions.” Same opinion of High Court, citing 2 Al. Rep. 472. 14 Peters 129. Ang. & Ames, 132. And how essential it should pay its debts? how urgent the duty? 6 Gill •&. John. 219, 220, 230. 6 Con. Rep. 233. Chancellor Buckner’s opinion, in case of Robins, et al. v. -Embry, et al., 1 S. & M. Ch. R. 207.
    But the very section of the act of 1840, which we are discussing, sustains our views, so far as the views of the legislature can have any weight. For if the banks of this state had not the right to transfer their paper at the time of the passage of this act, why pass the act 7 If they have not the right under the charter, then counsel have wholly misconceived this-case; I may add, too, on both sides of it.
    We submit, then, that we have shown that the bank, not only as incident to it as a corporation, but by the express language of the grant itself, has by that grant the right to transfer her bills receivable. This right or power is prohibited by the 7th section of the law referred to, -and the remaining question for our consideration is, whether that section be constitutional or not. As this 'is -the only section bearing on the case, we will confine ourselves to it. Whether the residue of the statute be constitutional or not cannot affect the decision of the court upon this provision.
    We insist, then, that this section violates that provision of the constitution of the United States, which prohibits “ a state from passing a law impairing the obligation of a contract,” and violates a similar provision contained in the latter clause of the 18th section of 1st article in the constitution of this state. '
    The charter of the plaintiffs is a contract between the people of the state and the bank. The acts of incorporation constitute an executed grant of whatever rights, powers, and privileges are contained in it, and usually incident to such grant. 2 Kent’s Com. 305. 6 Cranch’s Rep. 88, 89. Ib. 43. 1 Paige, 102. Dartmouth College v. Woodward, 4 Wheat. Rep. 518, 697, 700. Besides, it is a private corporation. “ A bank, whose stock is owned by private individuals, is a private corporation, although its objects and operations partake of a public nature, and although government may have become a part owner, by sharing in the stock.” 2 Kent’s Com. 274. United States Bank v. Planters Bank, Ang. & Ames, 21. 9 Wheat. Rep. 907.
    The question then resolvés itself into this — “ to this complexion it must come at last ” —Whether this court will maintain the doctrine, that the legislature may repeal or modify, or in any way impair charters granted to associations of individuals, forming private corporations, by subseqent legislation. But indeed it is no question at all; such a doctrine will not be entertained for a moment by this court. When the constitution, which the judges are sworn to support, and an act of the legislature come in conflict, the latter will be pronounced void. 2 Kent’s Com. 305. 6 Cranch R. 88. 7 Ib. 154. 9 Ib. 43, 292. Dartmouth College Case, 4 Wheat. 518, 697, 700.
    This last case, we believe, has settled the law upon this subject ; and our state convention, in 1832, with this knowledge, inserted the provision we have referred to, knowing that the prohibition would extend to any legislation touching private corporations and their franchises, as effectually, as to legislative interference with the grant or vested rights of an individual.
    Again ; if the law impairs or alters, in the slightest degree, any of the rights or powers of the corporation, secured to it by its charter, it is equally void, as if it attempted a repeal of the whole charter. 2 Kent’s Com. 305. Green v. Riddle, 8 Wheat. Rep. 1, 84.
    And whether the power or right attempted to be altered or destroyed be an express one contained in the grant or charter, or an implied one, as incident to the corporation, the principle is the same. The attempt is equally a violation of the constitution. People v. Manhattan Company, 9 Wend. Rep. 351, 383, 392, 393.
    We have then shown, we trust, that the plaintiffs have, under their charter, the right to transfer the note sued on to the Bank of the United States. That the 7th section of the law of 1840, prohibiting them from doing so, interferes with this vested right, and is in direct violation of the provisions of the constitution of the United States and this state, and consequently that that section is absolutely void and of no effect.
    And it might be further urged that this 7th section, while it strikes at the rights of the bank, strikes equally at the rights of the creditor; prevents him from taking the assets of the bank in payment of a debt, or for any other purpose, and on this ground is equally unconstitutional.
    But it may be contended, by the opposite counsel, that the latter part of the 7th section redeems the first part from all objections on the score of unconstitutionality. The latter clause provides merely for the abatement of the suit on the plea of the defendant. But we insist that this provision is as obnoxious to the constitutional objection, as the other provision in the section. Admitting, for argument sake, that the bank might still sue on the return of the evidence of debt to her, after an abatement of the suit in the name, or for the use of the assignee, it takes away all remedy upon the transferred paper from the assignee, and is therefore, we insist, unconstitutional and void.
    How far the legislature may vary the remedy, or protract or delay it, without infringing on the right, presents, in many cases, a delicate and difficult question to decide. But when the remedy is altogether taken away, we believe there can be no difference of opinion as to the unconstitutionality of such legislation. A right, without a legal remedy to enforce it, or to protect it, is no legal right at all. No legal obligation of a contract can exist, where there is no legal remedy; and the law which impairs or destroys the remedy, impairs or destroys the obligation. And if in legislation the effect of impairing the obligation of • the contract is produced, “ it is immaterial whether it is done by acting on the remedy, or directly on the contract itself. In either case it is prohibited by the constitution ” of this state, as well as of the United States.
    How strong and how applicable the language of the supreme court of the United States, in the case of Green v. Riddle, 8 Wheat. R. 1, 75, 76.
    This doctrine is reiterated by the same court, in the case of Bronson v. Kinzie, et al, decided at January Term, 1843. 1 How. Sup. Court U. S. Rep.
    We have thus briefly discussed the leading questions we conceive to be involved, in this case. If we are correct in the grounds we have insisted upon for a reversal of the judgment of the court below, we think this court can have no difñculty as to the judgment to be pronounced. If the court shall sustain the demurrer to the plea of puis darrein continuance, the judgment in this court will be entered for the amount of the note sued on and interest. For the plea of puis darrein continuance is a waiver, on the part of the defendants, of all former pleas and issues in the case. It reposes the defence on this plea alone. Yeates v. Linn, 5 Pet. R. 224, 231. Wallace v. McConnell, 13 Pet. R. 136.
    
      Adams and Freeman, for defendants in error.
    The only question that can arise in this case is, that of the validity of the statute under which the plea was filed. The doctrine, that corporations are subject to subsequent legislation, has already been recognized by this court, in the case of The Commercial Bank of Manchester v. Nolan, et als. This statute is a general one, in reference to all banks in this state.
    
      “ Corporations, like individuals, are subject to legislative action ; and hence all contracts made by them, in contravention of the general laws of the land, are voidable, or may be void by force of statutory provision.” Ang. & Ames on Corp. 142.
    In England, the statute of 15th Geo. 2d, chap. 13, prohibited any body corporate, or any other persons in partnership exceeding six, from borrowing, owing, or taking up any money, on their bills or notes payable at demand,'or at any less-period than six months from the-borrowing; but did not expressly avoid securities ill contravention of the act.” A. & A. 144. This statute was certainly more objectionable than the one now before the court, as it postponed the execution of contracts already entered into. Yet this statute was held to be good. Our statute does not render the securities transferred - void, but simply declares the transfer unlawful, and abates the suit on proof of the transfer of the note or bill sued on. It does not prevent the bank from collecting the amount due on her notes or bills receivable, but simply prohibits the bank from conferring that power on other persons. Does this divest the bank of any vested rights specially granted by the charter 1 The bank had a right to sue and be sued, plead and be impleaded, but had no power to authorize other persons to sue on its own contracts. /
    The object of the creation of the bank was to loan money, and to take security for the repayment of the same, and the right to sue enabled it to collect money on such securities. The right of the bank, if any, to transfer her bills and notes, was an implied right, and by no means essential to attain the ends of the corporation; and therefore the prohibition of the legislature divests no positive grant, and is not ex post facto in its operation. But if the court shall be of a different opinion, and shall pronounce that part of the statute unconstitutional, which prohibits the transfer of its paper, they will certainly not deny that the legislature have the power to regulate the legal remedies on the contracts of banking corporations, and to declare what matters may be pleaded in abatement. Statutes of limitation as to time, have never been regarded as impairing the obligation of contracts ; this law limits the right of action to the banks,' on their own bills receivable. In this case the action is brought by the hank, but,the proof shows a transfer in fraud of the law. The bank has lost all interest in the note sued, and is not entitled to prosecute the suit for want of interest. The title in the note is in the United States Bank, (if the law be void,) and the suit must abate for want of interest in the plaintiff.
   Mr. Justice Clayton

delivered the opinion of the court.

The only point of difference between this case, and that of Payne, Green Wood v. Baldwin, Vail and Huffy, decided at this term of the court, is that in that case the assignment by the PlantersBank appeare d upon the face of the declaration; in this the transfer is set up and relied on by a flea, puis darrein continuance.

The object of the legislature, in passing the act of 1840, prohibiting the transfer of their bills receivable and evidences of debt by banks, would seem to have been, to enable the debtors of the banks under all circumstances to pay their debts in the notes of the banks. Hence when the suit is in the name of the bank, and ostensibly for its own use, as the judgment may be satisfied by the payment of its own bills, the case would appear not to'fall within the reason of the law. Yet the terms of the act forbid all transfers. Its words are, it shall not be lawful for any bank in this state to transfer by indorsement or otherwise, any note, bill receivable, or other evidence of debt; and if it shall appear in evidence, upon the trial of any action, upon any such note, or other evidence of debt, that the same was so transferred, the same shall abate, upon the plea of the defendant.” Acts of 1840, p. 15, sec. 7. This language is too plain to admit of more than one construction, and we cannot refuse to enforce it because the case may not seem to come fully within the mischief intended to be remedied. Upon the trial the plea was sustained by the evidence, and the jury found a verdict for the defendants. A judgment in bar was entered by the court, but according to the act it should have been in abatement.

It is now the settled doctrine, that an act prohibited by astatute, will not lay the foundation of a suit that can be sustained in a court of law. The penalty annexed to the transgression of this statute is an abatement of the action — what will be the consequence of such abatement, we are not now called on to decide.

It is possible that if another suit be brought, and the same matter be pleaded, that a replication that there had been a re-transfer of the instrument to the bank, would enable it to maintain the action. But it is not proper for us to volunteer an opinion in this respect. We have no intention to do so, but simply to mark the limits of this judgment.

The judgment of the court below must be reversed, because entered in bar, and one here entered in conformity with the statute in abatement.

Mr. Justice Thacher:

I concur in the above opinion and judgment.

Mr. Chief Justice Sharkey

delivered the following dissenting opinion.

Although it is with great reluctance that I dissent in any case, yet I cannot bring my mind to the conclusion that this action should be abated on the plea of the defendant. This suit is not brought in the name of an assignee or indorsee, nor is it for the use of a third person, but it is in the name of the Planters Bank, as plaintiff. The assignment of the note since the suit brought is pleaded. The language of the statute is very broad, it is true, but still we must look at its spirit and meaning. If the object of the legislature be apparent, it should be so construed as to accomplish that object, and there it should end. It declares “ That it shall not be lawful for any bank in this state to transfer by indorsement or otherwise any note, bill receivable or other evidence of debt; and if it shall appear in evidence, upon the trial of any action upon any such' note, bill receivable, or other evidence of debt, that the same was so transferred, the same shall abate upon the plea of the defendant,” I regard this provision not as a punishment on the bank, by compelling a forfeiture of its right of action, but as intended solely and exclusively for the benefit of bank debtors. Bank paper was then generally very much depreciated, and the country was full of this depreciated currency, and it was designed to secure to debtors the right to pay the banks in their own notes. By allowing them to transfer their notes, debtors would have been compelled to pay the indorsees in the constitutional currency. But when the suit is brought in the name of the bank, this difficulty cannot occur. An assignee can then have no control of the matter. The legal rights of parties are determined by the record. If the bank alone is plaintiff of record, all the legal consequences follow and no assignee can change the rights of parties by asserting a claim. The court would not, under such circumstances, recognize the right of any one who was not a party to the record, and when the reason of the law fails the law itself should cease. An assignment made after suit brought, is but a transfer of the proceeds of the suit. The indorsee cannot make himself plaintiff in the suit; nor can he vary the right of recovery, or the defendant’s right to offsets, or his right to make satisfaction in a particular way. I regard the statute as applying only to cases in which the suit is brought in the name of the assignee or for his use. In such cases it gives the defendant the right to have the suit abated or not, at his discretion.

In the case of Payne, Green & Wood v. Baldwin, Vail, and Hufty, (3 S. & M. 661,) we held that the legal right of the bank to sue was not impaired by this act. Any act impairing that right would be unconstitutional. In this action she only seeks to enforce that right, she does not seek to enforce the right of the indorsee. She may sue on her notes, and she must sue in her own name, and if we abate this action, the only remedy she has is to bring another in the same way. There is no defect in the form of the action, or in the legal rights of the parties to the record. The transfer is prohibited by law, and it is therefore either void, or it is voidable. If it be void, it did not change any right. The legal right is still in the bank, and the suit being in her name, how can it be abated by that which was a nullity ? But suppose it be voidable merely, then what does the defendant get rid of by his plea? He gets rid of the assignment only. He remains debtor to the bank instead of being debtor to a third person. Now I believe such assignments .to be voidable only, subject to be affirmed or avoided by the m'aker. When the action is brought in the name of the indorsee, by pleading the transfer in abatement, the maker gets rid of that action, because the plaintiff’s title fails. But when the suit is.in the name of the bank, she may answer such a plea by saying, admitting it to be true that the note has been transferred, your plea avoids nothing but the transfer; it does not affect our right of action, which does not depend on an indorsement. Such a plea strengthens our right to recover, because it admits a promise made to us,, and avoids the attempted change of that right. As an evidence that the act was only designed to prevent the banks from coercing payment in a sound currency, I may cite the supplemental act, passed.the day after the original act, which compels the banks to receive their notes at par in payment of debts due them. This act was no doubt intended to explain fully, and to .carry out.the original design. Thinking then that this plea was defective in substance, and regarding it as a waiver of all other pleas, my opinion is that the plaintiff was entitled to judgment on the demurrer.  