CORPORATIONS-POWER OF LEGISLATURE TO REVIVE CORPORATE CHARTER

Defendant, a New York corporation, was engaged in operating steamboats for sightseeing purposes below Niagara Falls. Defendant was incorporated in 1892 for a term of fifty years, the maximum then permitted by statute. Through inadvertence the charter was not renewed in 1942. The corporation continued in its regular course of business, and in 1947 when the oversight was discovered, the board of directors, with the approval of three-fourths of the shareholders, immediately revived the corporation under a statutory provision enacted in 1944.

Plaintiffs, shareholders of the corporation, claimed that application of the provision was an unconstitutional deprivation of their rights as shareholders and brought this action for dissolution of the corporation or for an appraisal of their stock. The trial court dismissed the complaint and the Supreme Court, Appellate Division, affirmed on grounds that the reserved power of the legislature authorized the 1944 enactment. On appeal, held, affirmed. The power to revive a corporation whose term has expired is within the legislature's reserve power to alter or repeal corporate charters and can be made retroactive to apply to a corporation whose charter expired prior to the enactment of the revival legislation.

Garzo v. Maid of the Mist Steamboat Co., 303 N.Y. 516, 104 N.E. (2d) 882 (1952).