Corporation

Corporation. A corporation is sometimes called an artificial person, that is, a person which exists by virtue of a legal fiction, for which purpose it must have a name. It is a body created by Act of Parliament, by charter, or by letters patent. It may be created either for trading or for general purposes. It must have a common seal, and all its contracts originally required to be under that seal. The living members of the corporation administer the property and do all the necessary acts for its acquisition and preservation, but the property does not belong to the individuals in definite shares nor to all of them; it belongs to the artificial person or to the name which the corporation has. In the case of joint stock companies and the like, no shareholder is the owner of a fractional part of the property. His share is an interest which he can transfer to others or which is transferable by will or intestacy, pursuant to the rules of the corporation. But it is not a share like that of a tenant in common or joint tenant. Numerous relaxations of the above-mentioned rule as to common seal have been latterly admitted, and the general state of the law now is that for contracts of an ordinary everyday occurrence a seal is not necessary, and that if such contracts have been executed and the corporation has had the benefit of them, then the corporation is liable to be sued for the price, but that upon executory contracts of that sort the corporation semble is not liable unless the contract is under seal. And the old law requiring the seal is still in force with regard to all contracts of an extraordinary kind, not within the usual business of the corporation, so that upon these latter kinds of contract, in the absence of the seal, the corporation cannot be sued, notwithstanding the contract is executed and the corporation has had the benefit of it and a fortiori if the contract in such case is executory. But the above rules do not apply to a corporation sole (i.e. a bishop or parson), but only to a corporation aggregate. Moreover, where a corporation aggregate is constituted by Act of Parliament, the Act commonly defines the mode by which and the purposes for which it may contract, and if such a corporation exceeds the purpose so defined, it cannot, even by affixing its common seal, make a valid contract, inasmuch as that would be ultra vires. A corporation is, of course, liable for torts. The largest class of corporations and those most varied in their object and character are lay and civil incorporations. Among these are the Universities of Oxford, Cambridge, Durham, and London, the municipal corporations of different cities and boroughs, the Bank of England, the Colleges of Physicians and Surgeons, the Royal Society, Royal Academy, and Society of Antiquaries, and numerous commercial and other companies erected by charter or by Act of Parliament.