People v. Phœnix Bank

By the Court, Bronson, J. Ho question has been made upon the sufficiency of the [replications. The case, then, comes to this: the attorney general alleges that the defendants have forfeited their corporate privileges by taking usury. The defendants answer, that a state director has since been appointed by the governor and senate; and this act, they insist, amounts to a waiver or pardon of the forfeiture. The conclusion does not follow from the premises. Ho one could take advantage of the forfeiture in a collateral manner. It could only be asserted by a direct legal proceeding op the part of the government to dissolve the corporation, notwithstanding the existing cause of forfeiture, the defendants were a corporation de faeto, and might continue to exercise their franchise until judgment of ouster should be pronounced against them. In the mean time, it was the duty of the governor and senate, as well as all others, to treat the defendants as a legally existing corporation. The appointment of a state director was, therefore, perfectly consistent with the intention to continue this prosecution, and insist on the forfeiture. [432] Should it be conceded that the governor and senate had a dispensing power, it does not appear that the power has been exercised. We are not authorized to follow the suggestion of the defendants’ counsel, and assume that the appointment was made for the purpose of waiving the forfeit- [ *433 ] ure. *There is no such allegation in the rejoinder ; and besides, we cannot shut our eyes to the fact that there was another and a sufficient ground for the exercise of the appointing power. Indeed, if the public officers believed that the defendants had violated their charter, they had a cogent reason for making the appointment, to the end that there might be one director in the board to watch over the public interests until the forfeiture could be asserted, and the corporation dissolved in the forms prescribed by law. Enough has been said to dispose of this case. But I must not be understood as admitting that the governor and senate, without the concurrence also of the assembly, had any dispensing power. They had no more authority to waive or pardon the forfeiture than any other public officer or body of men. Indeed, the attorney general had more power over this matter than the governor and senate united ; for if he refused to prosecute, the wrong charged upon the defendants -would go unpunished, and the corporation would continue to exist and enjoy its privileges in the same manner as though there had been no violation of the charter. Still, the neglect to prosecute would not amount to a pardon ; it could only operate as a waiver so long as the omission continued, and would be no answer to a quo warranto whenever he, or his successor in office, might choose to insist on the penalty. In England, where corporations may be created by royal charter, the king can pardon a forfeiture, by granting restitution ; but he has, I think, no such power in relation to corporations created by act of parliament. The King v. Amery, 2 T. R. 568, 9. Newling v. Francis, 3 id. 189. The King v. Miller, 6 id. 277. So, here, where corporations are created by the legislature, that body can waive the forfeiture, by ratifying and confirming the original grant. The People v. The Manhattan Company, 9 Wendell, 351. But no other body of men has any such dispensing power. The franchise is granted upon condition that it shall become void in case of misuser ; and although the corporation will continue to exist until the forfeiture is asserted in the forms prescribed by law, the condition [ *434 ] can *on!y be changed, or the penalty released, by the power which made the original grant. The legislature may, perhaps, delegate its authority to pardon the offence; but that has not been done. The rejoinder does not show that any act has been done which is inconsistent with the assertion of the forfeiture; and if it were otherwise, the governor and senate, without the concurrence of the assembly, had no dispensing power. Judgment for the people.