CORPORATIONS
1. A corporation is an artificial body created by statute law and vested with power to act in many respects as an individual—in particular to acquire, hold, and dispose of property, real or personal; to make contracts; to sue and be sued, and the like.
It is a legal entity apart from its members. It may sue without joining its members, and may be sued by others without the necessity of joining its members. It may transfer property and transact all business, not inconsistent with the rights granted by its charter, in its own name. In the transaction of business it is regarded as an individual.
CLASSIFICATION OF CORPORATIONS
2. Corporations may be divided into two general classes—public and private. A public corporation is a political entity organized for the purposes of government—as a city, county, or village. A private corporation is one organized to further the interests of its members. These may be divided into two classes—stock corporations and non-stock corporations.
A stock corporation is one organized for the pecuniary gain of its members.
A non-stock corporation is one organized to further a particular object—as clubs, charitable associations, societies for scientific research, etc.
Stock or business corporations are the ones with which we are chiefly concerned. Such corporations are organized to enable several persons to unite their capital to conduct a legitimate business enterprise and such organization accomplishes two important results; the rights of the members to transfer their interest without affecting the standing of the business, and exemption from personal liability for contracts or acts of the corporation.
In a partnership, each individual partner is liable for the debts of the partnership, and any partner can make contracts in the name of the partnership, such contracts becoming obligations of net only the partnership but of each individual partner.