[§ 2951 not specially provided for and assigned a different period.1 Like a natural person, a corporation may sue as a trustee regardless of the fact that in another capacity it might have been barred had it sued.2 The statute may be tolled or suspended as to corporations by disabilities or exemptions.3 Thus, a receivership or state of judicial control during insolvency may operate as a suspension of the statute.* Mere nonuser or dormancy is not a concealment 5 and with respect to foreign corporations, it has been held that they may plead the statute where they were within the state submitting to its laws and jurisdiction. A few states following the lead of New York established the judicial doctrine that a foreign corporation was a nonresident not capable of pleading limitations, though all the time present and doing business in the state. The overwhelming majority is against

1 An action for assault by a servant is the same action against both servant and master. Hence as to the corporation it is not "any other injury to the person

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not hereinafter enumerated" (Code Civ. Pr., § 91) for which a different period is fixed. Priest v. Hudson River Co., 32 N. Y. Super. Ct. 595, 40 How. Pr. 456, 10 Abb. Pr. (N. S.) 60.

2 A corporation suing for a fund as trustee is not barred because it might also have proceeded upon a claim filed with defendant as executor if it had done so in time. Proprietors of White School House v. Post, 31 Conn. 240.

3 A corporation, being exempt from the obligation to file a suitor's test oath on a cause of action accrued during the Civil War, could not claim that inability to take it tolled the statute. Bank of Virginia v. Handley, 14 W. Va. 823.

4 Effect of receivership to toll statute where receiver is substituted as defendant, see Lehigh Coal & Navigation Co. v. Central R. Co. of New Jersey, 42 N. J. Eq. 591, 8 Atl. 648.

Prescription does not run against claims while the corporation is in liquidation and not suable. Gas Light & Banking Co. v. Haynes, 7 La. Ann. 114.

5 Ft. Scott v. Schulenberg, 22 Kan. 648.

6 When foreign corporation has become a "resident" by coming into the state the statute applies. Pennsylvania Co. v. Sloan, 1 Ill. App. 364.

A foreign corporation is not a "person" out of the state and for that reason excepted from operation of the statute as to actions against him while so absent. Faulkner v. Delaware & R. Canal Co., 1 Den. (N. Y.) 441. But an act extending for a time the right to sue to "all persons who reside beyond the limits of the state' was held to include it. Clarke v. Bank of Mississippi, 10 Ark. 516, 52 Am. Dec. 248.

As to residence for the purpose of applying the statutes of limitation, see $ 398, p. 859, supra.

7 Blossburg & C. R. Co. v. Tioga R. Co., 5 Blatchf. 387, Fed. Cas. No. 1,563; North Missouri R. Co. v. Akers, 4 Kan. 453, 96 Am. Dec. 183; Boardman v. Lake Shore & M. S. Ry. Co., 84 N. Y. 185; Mallory v. Tioga R. Co., 42 N. Y. 354, 355, 3 Abb. Dec. (N. Y.) 139, 142, 1 Trans. App. 203, 5 Abb. Pr. N. S. (N. Y.) 420, 423, 36 How. Pr. (N. Y.) 202, 203; Olcott v. Tioga R. Co., 20 N. Y. 210, 75 Am. Dec. 393; Wehrenberg v. New York, N. H. & H.

this doctrine and in New York it was abrogated by statute. The directors undoubtedly have power to waive the statute or to extend its running by acknowledgment or new promise 10 and it would seem that any officer with authority to contract or extend time of payment of debts could by a promise toll the statute,11 but it has been held that neither officers nor members have authority to toll the statute and extend it against the corporation by mere admissions.12

The bar is prevented if the corporation be served in an action brought in time, though there is a mistake or it is misnamed in the pleadings which are not corrected until after the period has run; but it could not be brought in as a new party after the bar was complete.13 If by amendment the corporation is impleaded as a new party the bar having already become complete will defeat the action. as in ordinary cases.14

R. Co., 124 N. Y. App. Div. 205, 108 N. Y. Supp. 704; Robeson v. Central R. Co. of New Jersey, 76 Hun (N. Y.) 444, 447, 28 N. Y. Supp. 104, Thompson v. Tioga R. Co., 36 Barb. (N. Y.) 79, 80; Connecticut Mut. Life Ins. Co. v. Duerson's Ex'r, 28 Gratt. (Va.) 630.

8 See chapter on Foreign Corporations, infra.

9 See the New York Code of Civil Procedure.

10 Leavitt v. Oxford & G. Silver Min. Co., 3 Utah 265, 1 Pac. 356.

11 As to such authority, see Chapter 42, supra.

12 Neither admissions of members, nor of an officer of a college corporation can toll the statute on its debt. Lyman v. Norwich University, 28 Vt. 560.

13 Amendment to correct misnomer does not let in the bar of the statute. Southern Pac. Co. v. Graham, 12 Tex. Civ. App. 565, 34 S. W. 135.

A petition seasonably filed against the corporation and its receivers, but alleging the cause against it and impleading them under a mistaken belief that they were its representatives who could be served, will arrest the running of the statute, even

if the receivers are misjoined. International & G. N. R. Co. v. McCulloch (Tex. Civ. App.), 24 S. W. 1101.

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Where a judgment against a ceiver was ineffectual because of his previous discharge, a so-called "supplemental petition" to bring in the corporation, which was stricken out as a supplemental pleading but docketed as a new suit, was merely a continuation in substance of the original suit and was not barred. Texas & P. R. Co. v. Watson (Tex. Civ. App.), 24 S. W. 952.

Defendant was not impleaded until after the bar was complete, but it was in fact merely described under another name by an amendmen✩ but not as a new party. Pennsylvani a Co. v. Sloan, 125 Ill. 72, 8 Am. St. Rep. 337, 17 N. E. 37.

In a suit in equity to cancel land patents service on individuals within time saves the bar, and a corporation controlled by one of defendants so served cannot plead the bar though it was brought in afterwards. Linn & Lane Timber Co. v. United States, 196 Fed. 593, aff'g decree United States v. Smith, 181 Fed. 545. 14 See § 3080, infra.

15 the

When charged with notice through its officers and agents bar of laches may arise against the corporation, and this even though limitations is not yet complete.16 Even the New York cases seem to have recognized that a corporation could plead laches, though it was foreign, and could not plead limitations.17 Both laches and estoppel have been invoked in a great variety of ways in favor of, as well as against, corporations. They will be discussed in other parts of this work treating of the subject-matter to which the laches or estoppel relates.18

§ 2952. Defenses by or against corporation-In general. Another corollary to the proposition that the corporation may sue or defend like a natural person, is that it may have the same defenses as far as the facts allow. When the corporation has a defense to a pending action, and by reason of wrongful control or fraud will not make it, the stockholder may intervene on a proper showing and be admitted to make it for the corporation.19 One who deals with a corporation as

15 See Chap. 42, supra.

That such laches as would bar a stockholders' suit will also bar one by the corporation for their benefit, see Fox v. Robbins (Tex. Civ. App.), 62 S. W. 815.

There is no laches imputable to the corporation to sue for annulment of a decree for fraud, where it was in the hands of the wrongdoers who alone knew of it. Fox v. Robbins (Tex. Civ. App.), 62 S. W. 815.

A bank held not estopped by lapse of time and silence from claiming as its own stocks placed in a person's name as trustee for it. Hemphill v. Monongahela Nav. Co., 19 Pa. 351.

16 Laches may apply even if statute of limitations has not yet run; and the neglect of the president to see that defendant was operating the corporation's mines and to make objection charges it with laches. Loomis v. Missouri Pac. R. Co., 165 Mo. 469, 65 S. W. 962.

17 Kirby v. Lake Shore & M. S. R. Co., 14 Fed. 261.

In the foregoing case the court states that the bill does not disclose laches. It thus implies that laches

might be pleaded, the bill having been demurred to. Id.

18 As to corporate existence and powers, see Chapters 11 and 37, supra.

As affecting rights on subscriptions, see $$ 525, 599, 634, 667, 679, 687, 704-706, 715-720, supra.

As affecting rights of or defenses against creditors, see chapters on Insolvency; Bankruptcy; Receivers; Forfeiture, Dissolution and Winding Up, infra.

As affecting rights of stockholders other than on subscriptions, see chapter on Stock and Stockholders, infra.

Stockholders suing to prevent enforcement of a decree against the corporation may be defeated by their laches. Wilson v. Seymour, 76 Fed. 678.

Stockholder may be barred by laches from claiming rights in stock. Cunningham v. Independence Consol. Min. Co., 58 Wash. 371, 108 Pac. 956.

19 Defenses by stockholders in right of the corporation, see chapter on Stock and Stockholders, subd. Remedies of Stockholders for Injuries to the Corporation, infra.

a corporation is estopped to deny that character in an action by it 20 and since a de facto existence is all that is required, except in an action to try that very question brought by the state or in an action founded on a de jure existence as an element in the cause of action, no defense can be made by collateral attack on the corporate existence.21 Ultra vires is a defense only when the action rests on the asserted power and when the defendant is in a position to question it. The question therefore takes on the form of an inquiry as to the effect of ultra vires transactions, which is fully treated in another chapter.22 Misuser or nonuser of franchise,23 or any departure from the conditions thereof,24 or change of name,25 or want of legally elected officers 26 are not ordinarily defenses against its suit. It is no defense that the legislature has failed to prescribe modes of service or procedure in the charter or laws creating the corporation.27 A stockholder may have any defense against the corporation suing him which is special to him and not a general one affecting only the whole body of stockholders, as for instance, mismanagement by officers.28 The defense

20 Estoppel to deny corporate existence, see Chaps. 11 and 14, supra. 21 See 88 274-277, supra.

A landowner sued for an assessment for drainage may plead nul tiel corporation at the time of assessment since until full organization no assessment could be levied. New Eel River Draining Ass'n v. Durbin, 30 Ind. 173. This appears to have been a quasi public corporation exercising a power to make local drainage assessments.

22 See Chap. 37, supra.

A stranger to a contract cannot plead ultra vires unless it violates a duty owing to him. State Ins. Co. of Des Moines v. Farmers' Mut. Ins. Co., 65 Neb. 34, 90 N. W. 997.

Ultra vires held not material in action of forcible entry by corporation. Woodlawn Social Entertainment Ass'n v. Anderson, 187 Ill. App.

507.

In an action on a contract it is no defense that it failed to conform to the foreign charter of defendant if within the general franchise, and if plaintiff did not know and assent to

the charter terms. City Fire Ins. Co. v. Carrugi, 41 Ga. 660. See also Chap. 37, supra, and chapter on Foreign Corporations, infra.

23 Misuser or nonuser cannot be shown in defense (misuser by wrongly locating the line); the state only can complain of that. Hammett v. Little Rock & N. R. Co., 20 Ark. 204.

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24 Conditions in a franchise granted by charter are pleadable defensively by a private person only when imposed for his benefit, and not when for public benefit. Southwest Bend Bridge v. Hahn, 28 Me. 300.

25 Mere change of name without change of identity is no defense (answer held insufficient). Wilhite v. Convent of Good Shepherd, 117 Ky. 251, 25 Ky. L. Rep. 1375, 78 S. W. 138.

26 Illegal election of officers is no defense to liability on a contract. Carrothers v. Newton Mineral Spring Co., 61 Iowa 681, 17 N. W. 43.

27 Penobscot Boom Corporation v. Lamson, 16 Me. 224, 33 Am. Dec. 656. 28 When a stockholder is sued on a contract with the corporation he may

to a foreign corporation's action that it was not entitled to do business. in the state will be considered in its own connection.29

§ 2953. Statutory provisions; usury, etc. A restrictive statute is not a defense available to a person in whose favor the restriction does not operate and where the transaction sued on is not made wholly void or prohibited by it.30 In some of the earlier banking corporations special rates of interest were permitted to be taken, and nothing within that rate was usury.31 If a usurious rate has been taken by a corporation, it should be urged as a defense by appropriate pleading 32 and not anticipated by bill to enjoin suit on the contract.33 By statute in New York it has been provided that corporations shall not make the defense of usury on contracts made by them.34 This applies to a corporation formed for the specific purpose of carrying on a testator's business and to a loan made by it for the benefit of the estate only and not for the corporate account,35 also to foreign corporations,36.and to

make any defense of fraud, mistake or imposition which tends to show that its claim alleged is unlawful and that nothing is due, but he cannot urge mismanagement injurious to him as a stockholder. Whittington V. Farmers' Bank, 5 Harr. & I. (Md.) 489.

See generally chapter on Stock and Stockholders, infra.

Rutherford, 18 N. J. L. 158.

33 A bill will not lie to stay action on a note on the ground that usury has been taken beyond the charter limit or in violation of law, such being a defense in the action if brought. Minturn v. Farmers' Loan & Trust Co., 3 N. Y. 498.

34 Belmont Branch of State Bank v. Hoge, 35 N. Y. 65; Frazier v. Trow's

29 See chapter on Foreign Corpora- Printing & Bookbinding Co., 24 Hun tions, infra.

30 A statute providing for protection of insured persons that the insurer's investments shall not exceed 50 per cent. of the value of the security, does not invalidate mortgages for a greater margin of value so as to be a defense available to the mortgagor. Washington Life Ins. Co. v. Clason, 162 N. Y. 305, 56 N. E. 755.

31 Under statutes allowing corporations to charge a given rate of interest, usury within that rate is no defense. McKiel v. Real Estate Bank, 4 Ark. 592.

32 A New York corporation's want of power to take above a certain rate must be pleaded defensively in another state. Bennington Iron Co. v.

(N. Y.) 281, aff'd 90 N. Y. 678 (corporation's own check taken at discount).

The statute does not apply to usury in a note indorsed by it for accommodation or where its own contract is not avoided. Merchants' Exch. Nat. Bank v. Commercial Warehouse Co., 49 N. Y. 635; Strong v. New York Laundry Mfg. Co., 37 N. Y. Super. Ct. 279.

35 De Moltke-Huitfeldt v. Garner & Co., 145 N. Y. App. Div. 766, 130 N. Y. Supp. 558, holding an agreement to make good any loss incurred by lending credit was not usurious.

36 Southern Life Insurance & Trust Co. v. Packer, 17 N. Y. 51.