Boisdere v. Citizens' Bank

Bullard, J., delivered the opinion of the court. The plaintiffs, f. p. c., allege that they were original subscribers and stockholders of the Citizens’ Bank of Louisiana ; that they executed their mortgages, which were duly accepted, in conformity with the charter, and they thereby became entitled to all the advantages, privileges and immunities conferred by the charter on stockholders; but they complain that the president and directors refuse to consider them as stockholders, or to allo'w them to act as such, or to dispose of their stock, or to accord to them the privileges to which they are entitled. The defendants admit all the facts and allegations set forth in the petition, but aver, that when the faith of the state was pledged for the security of the capital of said bank, it was expressly provided, that no person or persons, not being a free white citizen of the United States, and domi-ciliated in the state, should be directly or indirectly owner of any part of the capital stock of the company, and that no part, sentence or clause of the act granting the faith of the state, should go into operation, until the whole should be accepted. They therefore submit the question, whether they can extend to the plaintiffs, who are free persons of color, the rights, privileges and immunities of stockholders, without a violation of the express conditions under which the faith of the state was granted. it appears to us clear, that previously to the act of the legislature, amendatory of the charter, and pledging the faith of the state, the plaintiffs had fully complied with all the requirements of law, to constitute ■ them stockholders. They were thereby entitled to all the rights of stockholders; they might sell their stock or pledge it for a loan, according to the provisions of the charter. Their right was fully vested. But it has been argued that until the money was procured, in consequence of the pledge of the faith of the state, the right of the plaintiffs was nominal, and could not be enjoyed, and that the legislature had a right to impose such conditions as it thought proper, and that the condition contained in the last act, docs not violate a vested right. A right may [510] exist, although its free enjoyment may be suspended or impeded. If the plaintiffs have forfeited or lost their privi-leges ®s stockholders, it must be either by their own acts or consent, or by operation of law. The accept-anee of an a-memled charter and1*6 directors^ ■which excludes r class ox slock-holders, who are when^fteforigii nal charter gives the hoard to ob-difieation, does forfeiture^ of their stock, or divest them of their rights as stockholders. The acceptance of the amended charter by the president and directors, cannot be considered as producing that effect, ' .... , , , because by the charter, no authority is given to the board to obtain such a modification as to exclude a part of the original stockholders; and it does not appear that the charter, ^ * x a * as amended, has ever been submitted to the stockholders, We are, therefore, of opinion, that the plaintiffs have not by their consent, lost their privilege. It only remains to inquire, whether the act of the legislature amending the charter, and pledging the faith of the state, ougbt to be so construed as to operate the disfranchisement of the plaintiffs. That act first declares, that in order to . .. . . . facilitate the Citizens’ Bank in the negotiation of the loan of twelve millions, the faith of the state is pledged for the security of said sum, and it provides for issuing the bonds of the state. The third section declares, that “ for the guarantee of the bonds, to be emitted by the state, in favor of the Citizens’ Bank, and of the interest thereof, and for which the state pledges its faith, all the securities granted by the act of incorporation of said bank, and especially by the third and fourth sections of said act to the holders of its bonds, are hereby transferred to the state, and the holders of the bonds which may be issued in virtue of this act.” The securities here spoken of, as provided by the third and fourth sections of the original charter, are the mortgages given by the stockholders ; so that the mortgages given by the plaintiffs, among other stockholders, are declared to accrue to the benefit of the state, and of the holders of its bonds; and form in fact a part of the security upon which the loan is to be obtained from foreign capitalists. The eighth section of the amendatory act, provides for opening books of subscription to complete the capital stock, and a proviso to that section has created the present controversy. That proviso is in the following words, “that no [511] person or persons, who are not free while citizens of the United States, and domiciliated in (be state of Louisiana, shall be either directly or indirectly owners of any part of the capital stock of said company.” m^datoiyofthe charter voives the’ de-vested°rightf or impairs an obii-gation, it will he declared to' tionaVand'voIth" If this clause be susceptible of two interpretations, we consider ourselves bound to give it that which would, not involve the destruction of a vested right, the impairing of an obligation, because if such were its clear import, we should be compelled to say that it is unconstitutional, and void. That' the legislature did not intend to destroy any of the ... , ... ... mortgages previously given by subscribers, is quite clear, because they are declared t.o accrue to the benefit of the state, and to the holders of its bonds, as a security for the reimbursement of the loan. No exception is made of those mortgages given by persons not white, and not citizens of the United States. It would lead to great inconsistency to suppose, that the legislature intended at the same time to annul acts of mortgage, which they accept as a consideration upon which the bonds of the state are issued, and which by the same act, are held out as inducements to capitalists to loan the capital stock. The words of the proviso are prospective, and refer to the future.* The only doubt'arises from using the words, “shall be,” instead of shall become “ deviendra,” as is employed in the French text. But according to the best lexicographers, the words to be, is some times used as synonimous with, to become, “ to be made to be,” and the example given is, “ and they twain shall be one flesh,” in the old English translation of the bible. Taken in this sense, we may fairly conclude, that the legislature only intended to provide, that hereafter none but free white citizens shall . become stockholders, either by subscription, under that section of rthe act, or by a transfer of existing stock, leaving the rights of all who were at that time stockholders unimpaired. It follows as a necessary consequence, that the president arid directors, by a negotiation of the rights of the plaintiffs, would not violate any condition upon which the faith of the state has been pledged; for we cannot consider the legislature as having required or imposed a condi512 lion constitutionally and legally impossible, that of annihilating the acquired and vested rights of. the plaintiffs, without their consent. v 11 is, therefore, ordered, adjudged and decreed, that the judgment of the District Court be affirmed, with costs.