Gilfillan v. Union Canal Co. of Pa.

Citations

• 109 U.S. 401
• 3 S. Ct. 304
• 27 L. Ed. 977
• 1883 U.S. LEXIS 982

Syllabus

<p>Constitutional Law — Contract—Corporations.</p> <p>1. A provision in an act for the reorganization of an embarrassed corporation, which provides that all holders of its mortgage bonds who do not, within a given time named in the act, expressly dissent from the plan of reorganization, shall be deemed to have assented to it, and which provides for reasonable notice to all bondholders, does not impair the obligation of a contract, and is valid.</p> <p>2. When a corporation, being embarrassed, and owing money to its mortgage bondholders and to others, was authorized by the legislature from which it obtained its franchises to make settlement with its creditors-on a plan which provided that all holders of its mortgage bonds who did not, withT in a fixed period, dissent in writing from the proposed settlement, should be deemed to have assented ; and when a large majority of such bondholders assented to such plan, and some dissented, and the plan went into operation: Held, that a holder of such bonds who had due notice, and opportunity to act, and who neither assented to nor dissented from the plan within the time, was bound by its terms as fully as if he had expressly assented to it.</p>