delivered by Mr. Justice Craig, it was said: "We understand it to be a well settled rule of law that an agreement in general restraint of trade is contrary to public policy, illegal and void. Whatever is injurious to the interest of the public is void on the ground of public policy."

In Central Ohio Salt Co. v. Guthrie, 35 Ohio St. 666, the Supreme Court of Ohio said: "Public policy unquestionably favors competition in trade, to the end that its commodities may be afforded to the consumer as cheaply as possible, and is opposed to monopolies, which tend to advance market prices to the injury of the general public."

It is the duty of the judiciary to refuse to sustain that which is against the public policy of the State, when such public policy is manifested by the legislation or fundamental law of the State.'

It is, in most states, provided that the common law of England, so far as the same is applicable and of a general nature, shall be the rule of decision, and shall be considered of full force until repealed by legislative authority. Public policy is that principle of law which holds that no subject or citizen can lawfully do that which has a tendency to be injurious to the public, or against the public good. This principle owes its existence to the very sources from which the common law is supplied.'

The common law will not permit individuals to oblige themselves by a contract either to do or not to do anything, when the thing to be done or omitted is in any degree clearly injurious to the public.'

In Stanton v. Allen, 5 Denio, 434, an agreement, whose tendency was to prevent competition, was held to be void by the principles of the common law, because it was against public policy, and injurious to the interests of the State. "Contracts creating monopolies are null and void as being contrary to public policy.” All grants creating monopolies are made void by the common law.'

1Santa Clara Female Academy v. Sullivan, 4 West. Rep. 114, 116 Ill. 375. Greenhood, Pub. Pol. 2, 3.

Chappel v. Brockway, 21 Wend. 159; West Virginia Transp. Co. v. Ohio
River P. L. Co. 22 W. Va. 600.

42 Addison, Cont. 743.

57 Bacon, Abr. 22.

In the Case of the Monopolies, 11 Coke, 84, it was decided, as long ago as the forty-fourth year of the reign of Queen Elizabeth, that a "grant to the plaintiff of the sole making of cards within the realm was utterly void, and that for two reasons: (1) that it is a monopoly, and against the common law; (2) that it is against divers acts of Parliament," etc.'

Corporations can only exercise such powers as may be conferred by the legislative body creating them, either in express terms or by necessary implication; and the implied powers are presumed to exist to enable such bodies to carry out the express powers granted, and to accomplish the purposes of their creation.'

An incidental power is one that is directly and immediately appropriate to the execution of the specific power granted, and not one that has a slight or remote relation to it."

Where a charter, in express terms, confers upon a corporation the power to maintain and operate works for the manufacture and sale of gas, it is not a necessary implication therefrom that the power to purchase stock in other gas companies should also exist. There is no necessary connection between manufacturing gas and buying stocks. If the purpose for which a gas company has been created is to make and sell gas and operate gas-works, the purchase of stock in other gas companies is not necessary to accomplish such purpose. "The right of a corporation to invest in shares of another company cannot be implied, because both companies are engaged in a similar kind of business."

It is true that a gas company might take the stock of another corporation in payment of a debt, or perhaps as security for a debt; but the actual purchase of such stock is not directly and. immediately appropriate to the execution of a specifically granted power to operate gas-works and manufacture gas. Some corporations, like insurance companies, may find it necessary to keep funds on hand for the payment of losses by death or fire, or to meet other necessary demands; but it is questionable whether 'Bell v. Leggett, 7 N. Y. 176; Burke v. Child, 88 U. S. 21 Wall. 441, 22 L. ed. 623.

Chicago, P. & S. W. R. Co. v. Marseilles, 84 Ill. 643; Chicago Gaslight & C. Co. v. People's Gaslight & C. Co. 11 West. Rep. 63, 121 Ill. 530.

Hood v. New York & N. H. R. Co. 22 Conn. 1; Franklin Co. v. LewistonSav. Inst. 68 Me. 48.

41 Morawetz, Priv. Corp. § 431.

even these can invest their surplus funds in the stocks of other corporations without special legislative authority. But there is nothing in the nature of a gas company which renders it proper for such a company to accumulate funds for outside investment.. Its surplus profits belong to the stockholders, and, when distributed among them, can be used by them as they see fit.

If, then, the power to purchase outside stocks cannot be implied from the power to operate gas-works, and make and sell gas, a company to whom the latter power has been expressly granted cannot exercise the former without legislative authority to do so. This is the law, as settled by the great weight of authority.. Boone, on the Law of Corporations, says: "Without a power specifically granted or necessarily implied, a corporation cannot become a stockholder in another corporation, and especially where the object is to obtain the control or affect the management of the latter." 107.

In Green's Brice's Ultra Vires (p. 91, note b) it is said: "In. the United States a corporation cannot become a stockholder in another corporation unless by power specifically granted by its. charter, or necessarily implied in it.”

So, also, 1 Morawetz on Private Corporations (§§ 431, 433) says: "A corporation has no implied right to purchase shares in another company for the purpose of controlling its management. A corporation cannot, in the absence of express statutory authority, become an incorporator by subscribing for shares in a new corporation, nor can it do this indirectly, through persons acting as its agents or tools."

The authorities referred to by these text-writers sustain the conclusions announced by them. It has been held in many cases, that "in the United States corporations cannot purchase or hold or deal in the stocks of other corporations, unless expressly authorized to do so by law;" and that "one corporation cannot become the owner of any portion of the capital stock of another corporation, unless authority to become such is clearly conferred by statute."

991

'Franklin Co. v. Lewiston Sav. Inst. 68 Me. 48; Franklin Bank v. Commercial Bank, 36 Ohio St. 350; Milbank v. New York, L. E. & W. R. Co. 64 How. Pr. 20; Sumner v. Marcy, 3 Woodb. & M. 105; New Haven, M. & W. M. Mut. Sav. Bank & Bldg. Asso. v. Meriden Agency Co. 24 Conn. 159; Central R. Co. v. Collins, 40 Ga. 582; Hazlehurst v. Savannah, G. & N. A. R. Co. 43 Ga. 13; Berry v. Yates, 24 Barb. 199.

Nor will the fact that a corporation is organized under a general act of incorporation authorize such purchase. The only powers granted by such acts are the ordinary corporate powers, such as the rights to be bodies corporate and politic, to sue and be sued, to have a common seal, etc.

The charter of a corporation formed under such a general law does not consist of the articles of association alone, but of such articles taken in connection with the law under which the organization takes place. The provisions of the law enter into and form a part of the charter. It certainly cannot be true that a corporation formed under a general incorporation act, for a purpose other than that of dealing in stocks, can exercise the power of purchasing and holding stock in other corporations, where such power cannot be necessarily implied from the nature of the power specifically granted, and is not necessary to carry the latter into effect. The power to purchase and hold stock in other companies must be the subject of legislative grant, if not in all cases, at least in cases where it cannot be implied from the powers expressly granted. General incorporation laws contain no grant of such power. Can a corporation organized under that law be clothed with such a power by merely naming it in the statement filed with the secretary of state? Clearly not. The action of the secretary of state in issuing the license and the certificate of organization is necessarily, to a large extent, merely ministerial."

Where the organization is for the purpose of erecting gas works and making and selling gas, that being the main purpose for which the corporation was formed, the incorporators could not tack on and connect with such main purpose the power to buy and hold stock in other gas companies, by merely describing such power in the statement. To hold that they could confer such power by writing it down in the statement would be to hold that the Legislature could clothe them with a part of its legislative functions. When a corporation is formed under a general incorporation act, for the purpose of carrying on a lawful business, the law, and not the statement or the license or the certificate, must

11 Morawetz, Priv. Corp. § 318.

Oregon R. & Nav. Co. v. Oregonian R. Co. 130 U. S. 1, 32 L. ed. 837, 4 Am. & Eng. Enc. Law, title Corporations, p. 192, note 1.

determine what powers can be exercised as incidents of such business.

It has been held that the powers obtained by the corporations organized under general laws are necessarily restricted to those mentioned in the Act;' that in such cases the charter is void as to all powers and privileges granted beyond the provisions of the statute;' that, if unauthorized provisions are added to the articles of incorporation, all acts done pursuant to such provisions will be void; that anything in such articles not warranted by the statutes authorizing the formation of corporate bodies is void for want of authority, and that such articles must be construed strictly and against the grantee, and in favor of the government or the general public.

A corporation formed to erect works and manufacture gas under a general statute has no power to purchase and hold shares in other gas companies as an incident to the purposes of its formation, even though such powers are specified in its articles of incorporation."

§ 61. Corporation Representing a Trust, cannot Act in Foreign Territory without Local Authority. As the charter of a foreign corporation cannot confer any power upon it to do any act in another jurisdiction independent of the consent of the authority there existing, certainly such corporation can do no act in such jurisdiction contrary to its laws, or its policy. Nor can it usually assume powers in another State not granted to it in the State of its incorporation." Nor can such powers be conferred by the State within which it does business, by comity."

A foreign and nonresident railroad corporation, being pro

'Philadelphia Medical College Case, 3 Whart. 445.

'Heck v. McEwen, 12 Lea, 97.

Eastern Pl. R. Co. v. Vaughan, 14 N. Y. 546.

4 Oregon R. & Nav. Co. v. Oregonian R. Co. 130 U. S. 1, 32 L. ed. 837. People v. Chicago Gas Trust Co. 8 L. R. A. 497, 130 Ill. 268.

6 Bank of Augusta v. Earle, 38 U. S. 13 Pet. 539, 10 L. ed. 284; Milnor v. New York & N. H. R. Co. 53 N. Y. 363; Lewis v. Bank of Kentucky, 12 Ohio, 132, 40 Am. Dec. 469; Stetson v. City Bank of New Orleans, 2 Ohio St. 174; Blair v. Perpetual Ins. Co. 10 Mo. 559, 47 Am. Dec. 129. 'Starkweather v. American Bible Soc. 72 Ill. 50, 22 Am. Rep. 133. Diamond Match Co. v. Powers, 51 Mich. 145; White v. Howard, 46 N. Y.

144.