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(191 Wis. 840, 210 N. W. 942.)

consolidation or merger of existing corporations as it is to the creation of a corporation in the first instance. It follows that an agreement between two or more corporations to consolidate, in the absence of legislative authority, is ultra vires, and will not be enforced even though it may have been partly performed." Fletcher, Cyc. Corp. § 4670. This applies to religious as well as other corporations. Thompson on Corporations, § 6071, and cases there cited.

Prior to the enactment of chapter 258, Laws 1919, which now appears in the statutes as § 187.14, there was no legislative authority in this state for the consolidation or merger of religious corporations, and this court has most emphatically held that under our statutes providing for the organization of church corporations, two or more separate and distinct congregations cannot lawfully be organized into one corporation. Evenson v. Ellingson, 67 Wis. 634, 31 N. W. 342. In that case it was said (page 645): "There is not a single clause or word of our statutes that can possibly be tortured into any reference to the formation of a corporation over more than one single church, and corporations can exist only by the authority and sanction of the law. It is most remarkable that any one should have ever conceived the idea that more than one church or religious society could be embraced in one corporation. What is the policy of our statutes in this respect is the policy of all statutes and laws in this country, and always has been since the formation of our government. . . I do not think that another case can be found in this country where it is even claimed that one corporation embraced more than one church or religious society."

In that case it was held that one religious corporation could not be organized under our statutes to include two churches or two congregations of the same religious sect,

creed, or denomination that were 9 miles distant from each other.

As already stated, there was no attempt or pretended attempt to comply with the provisions of § 187.14, Stat., relating to the consolidation of church corporations, and if there had been it would have resulted in the formation of a new corporation. That statutory provision does not authorize one existing religious corporation to acquire the property and swallow up the congregation of another existing religious corporation. So it appears that there is no vestige of authority under the statutes of this state for the merger of these corporations in the manner attempted. No merger, therefore, has resulted. The existing corporations retain their identity. They have have not been wound up or dissolved. The members of each corporation retain all attempted rights and privileges in such corporations as such members. The communicants of the plaintiff church have not become communicants of the defendant church by virtue of these proceedings. If some members of the plain

merger-effect.

tiff church have transferred their membership to the defendant church, it was through their own voluntary acts. Such change of membership was not brought about by virtue of the negotiations and agreements having for their objects a union of the two church societies.

The legal result is that the plaintiff corporation has conveyed to the defendant corporation its church property without any consideration whatever. The plaintiff corporation still exists. still exists. The greater portion of its congregation still remains, but it has no church in which to hold its meetings, conduct its religious services, and pursue the objects and purposes of its organization.

The right of the plaintiff to maintain this action is assailed on various grounds. It is said that, even though the contract be ultra vires,

it is an executed contract, and the plaintiff cannot maintain this action for its annulment. Such principles do not apply.

ance.

-right to rescind convey- This is not a mere ultra vires contract. It is not a contract merely outside the scope of the powers of this particular corporation because not authorized by its charter. It is no contract at all. It was an effort to accomplish that which the law does not permit. It is more analogous to an attempt to organize a corporation

in the absence of any statutory authorization. It was a mere nullity so far as the accomplishment of the dominant purpose of the transaction is concerned. Under such circumstances, there can be no doubt of the right of the plaintiff corporation to rescind the conveyance and to procure a cancellation of the deed. It follows that the judgment appealed from should be affirmed. So ordered.

Eschweiler, J., dissenting.

ANNOTATION.

Necessity and sufficiency of legislative authority for consolidation or merger of religious bodies. [Religious Societies, § 1.]

It is now so well settled as to be axiomatic that corporations have the right and the power to consolidate only by the consent and authority of the legislature. 7 R. C. L. 159.

And the general rule that corporations cannot consolidate without legislative authority seems to be applicable to religious corporations, although comparatively few cases have been found in which the decisions have turned upon this precise ground. Davis v. Congregation Beth Tephila Israel (1899) 40 App. Div. 424, 57 N. Y. Supp. 1015; Chevra Medrash Auschei Makaver v. Makower Chevra Aucchei Poland (1899) 66 N. Y. Supp. 355, and Erste Sokolower Congregation v. First United Royatiner Sokolower Verein (1900) 32 Misc. 269, 66 N. Y. Supp. 356, were decided upon the ground that in the proposed merger of two Hebrew religious corporations no attempt of any sort whatever was made to comply with certain statutes under which the merger of such corporations could have been effected.

In Chevra Bnai Israel v. Chevra Bikur Cholim (1898) 24 Misc. 189, 52 N. Y. Supp. 712, it was held that, since only one of the corporations involved was organized under the Religious Corporation Law, a consolidation could not be effected, the statutes permitting consolidation of two or more corporations applying exclusive

ly to those of a similar nature; and that, at any rate, the failure to obtain the assent of the supreme court, as well as the approval of the trustees of one of such corporations, would preclude their consolidation, since both of these steps were required by the statute.

The necessity of complying with the statutory requirement, in the case of consolidation of incorporated Episcopal Churches, that the agreement be approved by the bishop and standing committee, and also by the supreme court, was the ground for the dissolution of a temporary injunction restraining certain statutory proceedings in connection with the proposed consolidation of two such churches, in MacLaury v. Hart (1890) 121 N. Y. 636, 24 N. E. 1013. The court observed that to enjoin any proceeding under the agreement simply would forbid the statutory remedy and draw the whole inquiry and the ultimate determination of the controversy away from the appointed tribunal; that the injunction would avert no danger to the plaintiff, unless it were the danger of a hearing and a decision before the statutory tribunal; and that its sole office was to effect that result.

In Madison Ave. Baptist Church v. Baptist Church (1878) 73 N. Y. 82, the court, although holding that no jurisdiction existed, under the statute

in that regard, to authorize a conveyance by one Baptist church to another, as an incident of a scheme to effect a union, which contemplated the extinction of the former church, and that plaintiff was consequently entitled to recover the property so conveyed, observed that the two "ecclesiastical bodies" could unite and be merged in one.

The rule that there can be no consolidation or merger of independent corporations without legislative sanction is held in the reported case (EVANGELISCHE LUTHERISCHE ST. THOMAS GEMEINDE V. GERMAN EVANGELICAL LUTHERISCHE ST. MATTHEWS CHURCH, ante, 113) to be applicable to religious corporations. The court further observes that there had been no attempt to comply with the statute in regard to the consolidation of religious corporations, and that in any event that statute contemplates the formation of a new corporation, and does not authorize one existing religious corporation to acquire the property and swallow up the congregation of another existing religious corporation.

The decision that the Wisconsin statutes then in force did not permit the organization into a single corporation of two distinct churches, congregations, or religious societies, in Evenson v. Ellingson (1887) 67 Wis. 634, 31 N. W. 342, was adhered to upon a subsequent appeal in (1888) 72 Wis. 242, 39 N. W. 330.

In holding that the proposed union of three incorporated Presbyterian churches into a single new corporation, under a name entirely distinct from that of any of the old churches, did not comply with the agreement, which had been approved by the congregation of one of such churches, to unite with only one of the other churches, the court in First Presby. Soc. v. Markley (1910) 10 Ohio N. P. N. S. 529, pointed out that the positive requirements of the statute relative to the consolidation of religious corporations had to be, and had not been, complied with, since that statute required a two-thirds vote of the corporation of such church, which corporation in

fact voted against the proposed union. In Re German Lutheran & Reformed Wyomissing Church (1890) 9 Pa. Co. Ct. 12, where two congregations sought, by a single charter, to combine for certain purposes, while retaining their separate existence as to other purposes, the court observed that the corporate character could not attach in such a way that each congregation separately, as well as both combined, could act under the corporate name-stating further that the proposed articles presented other features which were equally incompatible with the notion of corporate existence, and that the court had no power to sanction such a corporation. It was held in Stokes v. Phelps Mission (1888) 47 Hun (N. Y.) 570, that the Mission, which was maintained as a free church, but was under no ecclesiastical or denominational control, having been organized as a charitable or benevolent society, could not consolidate with a denominational church corporation (Presbyterian), since the statute permitting the consolidation of two religious corporations under certain conditions had no application whatever to benevolent societies, whether religious in character or not, but only to such societies as belonged to some church or denomination. And see in this connection, Chevra Bnai Israel v. Chevra Bikur Cholim (1898) 24 Misc. 189, 52 N. Y. Supp. 712.

In refusing to authorize a proposed consolidation (so-called) which the members of an old church sought to effect by forming a new church, the supreme court said, in Methodist Episcopal Soc. v. Perry (1889) 51 Hun, 104, 4 N. Y. Supp. 723, that it knew of no statute authorizing the formation of a religious corporation for the sole purpose of consolidating it with another.

That, where a consolidation of local churches has been authorized by the supreme court, the consolidated church becomes subject to all the provisions of the general statute authorizing such consolidation, see Westminster Presby. Church V. Presbytery of New York (1911) 142

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The incorporation of two congregations as one church was authorized by statute in New York as early as 1784, a merger effected in that year having afforded the historical background upon which the controversy in Cammeyer v. United German Lutheran Churches (1844) 2 Sandf. Ch. (N. Y.) 186, was based.

And see Sutter v. First Reformed Dutch Church (1862) 42 Pa. 503, as to the union in 1813 of two local churches of different denominations, for which there was apparently legislative authority.

Two congregations of different denominations were held to be entitled to unite into a single corporation, in accordance with the provisions of a statute, where they apparently both used the same church or meetinghouse, in Neale v. St. Paul's Church (1849) 8 Gill (Md.) 116.

And a general statute authorizing any religious corporation to unite with another, where the majority of the members of each should assent, was held to have been complied with, in Bennett v. St. Paul's Evangelical Lutheran Church (1921) 137 Md. 341, 112 Atl. 619.

As recognizing the validity of the consolidation of two New York church corporations under the statute of that state, see Gladding v. St. Matthew's Church (1904) 25 R. I. 628, 65 L.R.A. 225, 105 Am. St. Rep. 904, 57 Atl. 860, 1 Ann. Cas. 537.

A special act of the legislature, changing the name of a meetinghouse association and enlarging its powers, was regarded as legalizing the actual merger which had been for years practically effected between that association and a parsonage society, and as having been accepted by interested parties as so doing, in Wheaton v. Cutler (1911) 84 Vt. 476, 79 Atl. 1091. And it appeared as a fact that steps to unite local congregations of

churches or synods which had consolidated were taken pursuant to statute, although the decision turned upon other grounds, in Spenningsby v. Norwegian Evangelical Lutheran Trinity Congregation (1922) 152 Minn. 164, 188 N. W. 217.

In holding that the consolidation, by act of the bishop, of three local Methodist churches (one of which was incorporated) into a single church of a new name, was purely a matter of ecclesiastical law and practice, the court in Trinity M. E. Church v. Harris (1900) 73 Conn. 216, 50 L.R.A. 636, said that it became unnecessary to consider a certain statute which had been relied upon.

As to whether unincorporated religious bodies may unite or merge without legislative permission, little direct authority has been found. It would seem that the rule as to the necessity of legislative sanction should apply to unincorporated religious societies, as well as to corporations.

So far as the validity of a general denominational merger is concerned, however, the courts seem to have been disposed to recognize it, in case the constitutional powers of the general denominational bodies themselves have not been violated; and the effect of this policy apparently has been, to some extent at least, to legalize the merger of various local congregations or societies which were joined together by reason of the general union. The decisions in this class of cases, however, have turned upon other grounds than authority from the state legislatures. And whether the local bodies in these cases were incorporated or not does not appear to have been material to the decisions.

There has been a great deal of litigation, in many jurisdictions, as to property rights depending upon the validity of the union or "reunion," with the parent Presbyterian Church as a whole, of the Cumberland Presbyterian Church, which was originally formed about a century before by seceders from the parent organization, and spread to various parts of the country. The decisions of these cases have turned, however, on

grounds with which the present annotation is not concerned; for example, the power of the general assembly of one of these churches to effect the merger. See in this connection, Barkley v. Hayes (1913; D. C.) 208 Fed. 319, reviewing many of these cases and upholding the inherent power of these churches to unite. This case was affirmed in Duvall v. Kansas Synod (1915) 138 C. C. A. 217, 222 Fed. 669, which in turn was affirmed by a memorandum decision in Shepard v. Barkley (1918) 247 U. S. 1, 62 L. ed. 939, 38 Sup. Ct. Rep. 422, overruling numerous objections, one of which was that the enforced merger of the Cumberland membership in and with the other church was a violation of the law of the land. And see Hayes v. Manning (1914) 263 Mo. 1, 172 S. W. 897.

As further recognizing an inherent or implied power of one of these churches to unite with the other, see also Sanders v. Baggerly (1910) 96 Ark. 117, 131 S. W. 49, and Ramsey v. Hicks (1910) 174 Ind. 428, 30 L.R.A. (N.S.) 665, 91 N. E. 344, 92 N. E. 164. The contention that the power to form a union with another religious denomination was inherently vested

in the presbyteries and general assembly of the Cumberland organization was overruled in Clark v. Brown (1908) - Tex. Civ. App., 108 S. W. 421; but the supreme court, in reversing the above decision in (1909) 102 Tex. 323, 24 L.R.A. (N.S.) 670, 116 S. W. 360, took the view that there was, at least, an implied power to effect the merger.

Even in the exhaustive opinion in the case of Landrith v. Hudgins (1908) 121 Tenn. 556, 120 S. W. 783, which holds that the proceedings taken to unite these two churches were ineffective, upon the ground that the constitution of the Cumberland Church did not confer the power so to unite, no suggestion has been found as to the requirement of legislative authority, and the implied power of religious bodies to unite is recognized.

But, as apparently recognizing the necessity of legislative authority, see the dictum in First Presby. Church v. First Cumberland Presby. Church (1910) 245 Ill. 115, 91 N. E. 774, 19 Ann. Cas. 287, that "if the merger has been effected in accordance with the law and usage of both churches, and in a legal manner, we think no one can complain." E. W. H.

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1. A city operating a legalized monopoly in the nature of water supply cannot give undue or unreasonable preference or advantage, or make unfair discrimination among customers.

[See annotation on this question beginning on page 125.]

Municipal corporations, § 30 - extent of powers.

2. A municipal corporation can function only through the powers granted by its charter, or those powers incident or related thereto as essential and necessary to carry out the de

clared objects contained in such express power.

[See 19 R. C. L. 768; 3 R. C. L. Supp. 971; 4 R. C. L. Supp. 1288; 5 R. C. L. Supp. 1045; 6 R. C. L. Supp. 1136].

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