This section is from the book "Popular Law Library Vol8 Partnership, Private Corporations, Public Corporations", by Albert H. Putney. Also available from Amazon: Popular Law-Dictionary.
5 Justice Cooley in the celebrated case of The People vs. Hurl-burt, 24 Mich., 96, says: "Now, it must be conceded that the judicial decisions and law writers generally assert that the state creates the municipal bodies, endows them with such of the functions of corporate life and entrusts them with such share in the local government, as to the legislative judgment shall seem best; that it controls and regulates their action while they exist, subjects them to such changes as public policy may dictate, and abolishes them at discretion; in short that the corporate entities are mere agencies which the state employs for the convenience of government, clothing them for the time being with a portion of its sovereignty, but recalling the whole or any part thereof whenever the necessity or usefulness of the delegation is no longer apparent."
In the United States municipal corporations are created by the various State legislatures in the following manner, to-wit:
First, By special act of the legislature granting the charter.
Second, By general act of incorporation authorizing their organization on compliance with the conditions prescribed.
Municipal corporations may exist by prescription, when they are shown to have exercised corporate powers and privileges for such a length of time as to warrant the presumption of a legislative grant; they may exist also by implication, where powers are conferred which cannot otherwise be exercised, or the enforcement of a bona fide liability validly incurred. It has been conclusively settled by our U. S. Supreme Court that Congress has the power to create or author-become an appropriate means of exercising any of the ize the creation of public corporations, whenever they constitutional powers of the general government.6