
    RAISBECK v. OESTERRICHER.
    
      N. Y. Common Pleas; Special Term,
    August, 1878.
    Manufacturing Companies.—Filing Certificate oe Incorporation.
    Under the New York general act for the organization of manufacturing, &c., corporations (L. 1848, p. 54, c. 40. § 1; same provision, 2 B. B. 6th ed. p. 500, § 1),—which provides that the certificate of incorporation shall be filed in the office of the clerk of the county where the business is carried on, and a duplicate thereof in the office of the secretary of state,—a failure to file the duplicate in the office of the secretary of state, does not vitiate the incorporation so as to render the members partners as between themselves.
    
    Application for injunction and receiver pendente lite.
    
    The plaintiffs, Thomas A. Baisbeck and James Baisbeck, and the defendants, Ignatz Oesterricher, Thomas, Jacob and Edward Wimbridge, entered into an agreement under seal, dated July 7, 1877, by which they agreed to form a corporation to be called “The Photo-Plate Company” for the purpose of making relief plates for printing, and for other purposes. Pursuant to such agreement, they subscribed and acknowledged a certificate as provided in the first section of the act to authorize the formation of corporations for manufacturing and other purposes, passed February 17, 1848, and the acts amendatory thereof. The certificate was dated July 7,1877, and acknowledged on that day. It was filed in the office of the clerk of the city and county of New York (the proper county), pursuant to the act, on September 22, 1877. No duplicate of the certificate was filed in the office of the secretary of state as required by the act (Laws of 1848, ch. 40; Lams of 1866, ch. 799).
    The parties treated the corporation as regularly organized, and proceeded with its business pursuant to the certificate of incorporation, from the date of the, filing of the certificate up to the time of the commencement of this action ; when the plaintiffs, conceiving that the neglect to file a duplicate of their certificate in the office of the secretary of state resulted in a failure to effect a valid incorporation under their agreement, and having reason to complain, as they believed, óf the acts of defendants, brought this action to obtain the appointment of a receiver of the joint property, and to wind up the business. A preliminary injunction was obtained, which plaintiffs moved to have made permanent.
    
      Albert Roberts, for plaintiffs,
    cited: Wells v. Gates, 18 Barb. 554; Dennis v. Kennedy, 19 Id. 517.
    
      Simon Sultan, for defendants,
    cited as to omission to file duplicate certificate: 3 Rev. Stat. (Edm. Ed.) 733, §§ 2, 9 ; Mokelumne Hill Mining Co. v. Woodbury, 14 Cal. 424; Cross v. Pinckneyville Mill Co., 17 Ill. 
      54; Baker v. Backus, 32 Id. 79; Tarbell v. Page, 24 Id. 48; Stone v. Great Western Oil Co., 41 Id. 85; Thompson v. Candor, 60 Id. 248; Willard v. Trustees, &c., 66 Id. 55; Cochran v. Arnold, 58 Penn. 407; Swartwout v. Mich. Air Line R. R. Co., 24 Mich. 394. As to attacking corporate franchise collaterally: Angell & Ames on Corp. (9th ed.) ch. 21, §§ 731, 778; Rex v. Pasmore, 3 Term, 244, 245; Regents of the University of Md. v. William, 9 Gill & J. 365; Canal Co. v. R. R. Co., 4 Id. 1; Commonwealth v. U. S. Bank, 2 Ashm. 349; Nickles v. Rochester City Bank, 11 Paige, 118; Abb. Dig. of Corp. 339, 340; Rondell v. Fay, 32 Cal. 354; Matter of Reformed Presb. Church of N. Y., 7 How. Pr. 476; McFarlane v. Triton Ins. Co., 4 Den. 397; Caryl v. McElrath, 3 Sandf. 176; People v. President, &c. Manhattan Co., 9 Wend. 351 Matter of the N. Y. Elevated R. R. Co., 3 Abb. New Cas. 401; Methodist Epis. Union Church v. Pickett, 19 N. Y. 482; Jones v. Dana, 24 Barb. 395; Baker v. Backus, 32 Ill. 79 ; Tarbell v. Page, 24 Id. 48; Groesbeck v. Dunscomb, 41 How. Pr. 302; Sands v. Hill, 42 Barb. 651; Cooper v. Shaver, 41 Id. 151; Cole v. Dyer, 29 Geo. 434; Hinman v. Ellsworth, 27 Conn. 282; Howard Mutual Loan, &c. Assoc. v. McIntyre, 3 Allen, 571.
    
    
      
       To same effect as between the members and creditors, see Meriden Tool Co. v. Morgan, 1 Abb. New Cas. 125, note.
      
      The importance of this case is chiefly in its applying to the class of actions between the members, the principle applied usually in private actions by the body or against it, viz., that if there is a statute under which such a body might be a corporation for the purposes for which they exist, and if they have for a considerable length of time acted as a corporation under that statute, or if they have color of organization under it, such that the members might in good faith suppose themselves to be regularly incorporated, the court will not inquire into the regularity of the organization. For another illustration of defective organization, see Betts v. Betts, p. 317 of this vol. See also Trustees of St. Jacobs v. Bly, 18 Alb. L. J. 59, Ct. App. Apr. 1878, and the following cases.
      A joint stock company under an organization not sanctioned by statute is a partnership as to third persons (Clagett v. Cilbourne, 1 Black, 346).
      An illegally organized corporation has no valid existence, and can have no property in moneys which have been advanced for its use by private parties; and a State statute forfeiting the assets of such an organization does not affect moneys loaned to its officers for its use (Commonwealth v. France, 3 Brews. [Penn.] 148).
      Stockholders carrying on business after dissolution of corporation, deemed partners (Bausinger v. Guenthner, 66 Barb. 186).
      As to persons erroneously supposing themselves incorporated, see Fuller v. Rowe, 57 N. Y. 23; rev’g 59 Barb. 244.
      Partner liable, though he intended to form limited partnership, and was induced to join by fraud (Tournade v. Hagedorn, 5 Sup'm. Ct. (T. & C.) 288).
    
   J. F. Daly, J.

[After stating the facts.]—The plaintiffs argue that by reason of the failure to file the duplicate of the certificate of incorporation in the office of the secretary of state, the parties subscribing the certificate became merely copartners inter sese. Upon the correctness of the proposition depends the right to the relief asked upon this motion. What consequences result from the failure to file the duplicate of the certificate of incorporation as required by the act has not been the subject of judicial examination in this State. The statute requires “that the certificate shall be filed in the office of the clerk of the county in which the business of the company shall be carried on,” and “a duplicate thereof in the office of the secretary of state” (section 1). It is further provided that “when the certificate shall have been filed as aforesaid, the persons who shall have signed and acknowledged the same, and their successors shall be a body politic and corporate, &c.” (section 2). The section does not in terms make the filing of the “duplicate” essential to the incorporation, and the court will incline to an interpretation of the statute which will give validity to the acts and proceedings of the parties done and taken in good faith as a corporation. The general manufacturing corporations act of California contains provisions as to the mode of incorporation almost identical with our statute (Act of 1850, 365, “366). It was held by the supreme court of California that the natural and ordinary import of the language used in that statute does not justify the construction that proof of the filing of the “ duplicate” in the office of the secretary of state is necessary to establish the existence of the corporation ; that the intention of the statute clearly was, that so far as individuals are concerned, the corporation should acquire a valid legal existence upon the filing of the certificate in the office of the clerk of the county; that the rights conferred by the statute vest on filing the certificate, and can be divested only by a direct proceeding on the part of the State (Mokelumne Hill Mining Co. v. Woodbury, 14 Cal. 424).

The general manufacturing corporations act of Illinois also contains provisions as to the mode of incorporation similar to those of our statute (Act of 1849, 87, 88). The supreme court declared the provision requiring the “ duplicate” to be filed in the office of the secretary of state directory merely, and not mandatory, nor essential to the validity of the corporation, that it was apparent from the act to have been a secondary ■ object and intended to multiply proof, place of publicity and the chances of preservation of the evidence of incorporation, and that the filing of the certificate in the office of the county clerk was sufficient to effect the incorporation (Cross v. Pinckneyville Mill Co., 17 Ill. 54). This view of the statute is in effect taken in many subsequent cases in that State (Tarbell v. Page, 24 Ill. 48 ; Stone v. Great Western Oil Co., 41 Id. 85 ; Thompson v. Candor, 60 Id. 248 ; Willard v. Trustees, &c., 66 Id. 55).

The reasoning of these cases upon the language of the statute there in question may be applied in all its force to our statute, is sound, and should be adopted in construing its provisions. Since the statute distinguishes between the “certificate” and the “duplicate,” providing that the certificate is to be filed in the office of the county clerk and the duplicate in the office of the secretary of state, and in the next section declares the subscribers incorporated when the certificate shall have been filed, we may assume the omission of any reference to the duplicate in the latter connection to be intentional, and this assumption is justified if indulged in for the purpose of supporting the validity of a corporation and of rights and franchises honestly intended to be created and acquired. If the object of the statute is to multiply proofs of incorporation as has been said in one case, the duplicate may be filed now in the office of the secretary of state.

It may be added that the ninth section of our general manufacturing act declares that the copy of the certificate, certified by the county clerk, or his deputy, shall be received in all courts and places as presumptive legal evidence of the facts therein stated. No other method of proving the corporate existence is provided for by that statute, and only on failure to produce such copy and proof of loss of the original, does, the production of a copy of the duplicate certified by the secretary of state become competent or necessary (N. Y. Car Oil Co. v. Richmond, 6 Bosw. 213).

The production of a copy of the certificate filed with the county clerk, which copy is certified by him, being made evidence of the incorporation by the statute, is sufficient proof of corporate existence and sufficient answer to all allegations of non-incorporation except in a direct proceeding by the State to annul the franchise (Jones v. Dana, 24 Barb. 398).

The certificate having been duly filed in the office of the clerk, it is immaterial, in any action not brought by the State against the corporation to prohibit its exercise of corporate powers, to inquire whether the duplicate of such certificate has been filed in the office of the secretary of state.

The motion must be denied and injunction dissolved with ten dollars costs.  