Farther along the decision recites the facts, that in addition to the above, the directors of this Salem company issued $2,000,000 unassessable preferred stock, bearing interest at seven per cent per annum, and delivered the same to A. J. Cook & Company under a private understanding that Cook & Company was to give back to these directors $1,000,000 of this preferred stock, to be used by them in procuring legislation in Oregon. On page 91 of the decision the court says:
The attempt to subscribe seventy thousand shares to the stock of the Oregon Central Railroad Company, by the corporation itself through a person styling himself chairman, was done simply to evade the liability which the law imposes on all persons who subscribe to the capital stock of corporations. This action was a mere nullity, and added nothing to the amount of stock subscribed, which then was only six shares of one hundred dollars each. Those who subscribed the six shares then proceeded to elect directors and other officers of the corporation. The corporation was not organized according to law, but in direct violation of the statute, which provides that "it shall be lawful in the organization of any corporation to elect a board of directors as soon as one half the capital stock has been subscribed." In this case the attempted organization of the Oregon Central Railroad Company amounted to nothing. It was absolutely void. Nor did the joint organization of the legislative assembly, adopted October 20, 1868, recognize this corporation as the one entitled to receive the land granted by act of Congress, to aid in the construction of a railroad, cure the inherent defects of its organization. It had no power to legally transact any business nor to accept or hold the lands so granted.
Farther along, on page 93 of the decision, in speaking of the value of the bonds issued by this company, the court says:
