Cummings v. State
| Decision Date | 18 May 1915 |
| Docket Number | 7131. |
| Citation | 149 P. 864,47 Okla. 627,1915 OK 334 |
| Parties | CUMMINGS v. STATE EX REL. WALLOWER. [d1] |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
By section 1227, Rev. Laws 1910, the persons signing articles of incorporation, and their associates and successors, shall be a body politic and corporate by the name and for the purposes stated in said articles. The subscribers thereto are therefore "stockholders," and the fact that they have not paid for the stock subscribed, or that stock certificates have not issued to them, does not affect their right to adopt by-laws.
By-laws typewritten on a sheet of paper and pasted in a book kept in the office of the corporation, though the book be not designated as provided by statute, is a sufficient compliance with section 1248, Rev. Laws 1910, providing that "all by-laws adopted must be certified by a majority of the directors and secretary of the corporation, and copied in a legible hand in some book kept in the office of the corporation, to be known as 'the book of by-laws,' and that no by-laws shall take effect until so copied."
The statute last mentioned should be construed in connection with section 2947 of the Revised Laws of 1910, providing that writing (with the exception named therein) "may be made in any manner"; thus authorizing a writing such as that involved to be typewritten, as well as traced by hand with pen or pencil.
While section 1248 requires that all by-laws be certified "by a majority of the directors and secretary of the corporation," and copied in the manner set out in the second paragraph, it does not undertake to make the by-laws ineffective, unless so certified; and such certification is not required, in an action between directors of the company charged with knowledge of the by-laws and their contents.
The function of a "by-law" is to prescribe the rights and duties of the members with reference to the internal government of the corporation, the management of its affairs and the rights and duties existing between the members inter se.
A director of a private corporation may empower an agent or attorney for him and in his name to make and serve a demand for a special meeting of a board of directors.
Mandamus will lie to compel the president of a corporation to call a special meeting of the board of directors, there being a valid by-law requiring the issuance of the call, and where the necessary demand therefor has first been made.
The right of the board of directors to discharge plaintiff in error as manager of the corporation cannot be considered a defense to an action for mandamus to compel the calling of a directors' meeting, though called for the purpose of considering his removal.
Error from District Court, Oklahoma County; Edward Dewes Oldfield Judge.
Suit for mandamus by the State, on relation of E. Z. Wallower against E. D. Cummings, as president of the Skirvin Operating Company, to compel respondent to call a meeting of the board of directors of the corporation. From a judgment directing the issuance of a peremptory writ, respondent brings error. Affirmed.
Choate & Choate and W. K. Snyder, all of Oklahoma City, for plaintiff in error.
McAdams & Haskell, of Oklahoma City, for defendant in error.
The board of directors of the Skirvin Operating Company, an Oklahoma corporation, was, on the date of the institution of the present action, composed of E. D. Cummings, E. Z Wallower, and W. B. Skirvin. E. D. Cummings was president and treasurer, E. Z. Wallower vice president, and W. B. Skirvin secretary, of said company. On January 7, 1915, there was served on said E. D. Cummings, as president of said Skirvin Operating Company, a written notice signed by E. Z. Wallower, acting through his duly authorized agents and attorneys, McAdams & Haskell, demanding that, as president of said corporation, said Cummings forthwith call a special meeting of the board of directors, to convene at the office of the corporation at Oklahoma City at the earliest possible date, allowing only the time necessary to give to each director three days' notice of the time, place, and purpose of such meeting, by letter addressed to his last-known post office address, as prescribed by the alleged by-laws of the corporation. The purpose for which the meeting was desired, it was said, was:
Cummings refused to call the meeting, and thereupon action was filed in the district court and an alternative writ of mandamus issued. The case coming on to be heard, the relator introduced his evidence and rested, whereupon the respondent demurred to the evidence, which demurrer being overruled, he then moved the court for judgment in his favor on the plaintiff's evidence, which motion was likewise overruled, and an order made and entered directing that a peremptory writ of mandamus issue, as prayed for by the relator, commanding the respondent E. D. Cummings, as president of the Skirvin Operating Company, to call a meeting of the board of directors of said corporation, to convene at the office of said corporation at Oklahoma City, Okl., within a time named. From the judgment the respondent has prosecuted an appeal to this court.
Relator's right to the writ is rested principally upon an alleged by-law of the corporation, providing that the president shall call such special meetings of the board of directors at any time upon the written demand of any one director; the purpose and object of the meeting being stated. On the part of the respondent, it is vigorously asserted that no such by-law was ever legally adopted by the stockholders of the corporation; that, such being the case, the calling of a special meeting of the board of directors by the president was discretionary on his part, and could not be controlled by the writ of mandamus.
Section 1246, Rev. Laws 1910, provides that every corporation formed under chapter 15 of the statutes must, within one month after filing articles of incorporation, adopt a code of by-laws for its government, not inconsistent with the laws of the United States or of this state, and further provides that:
At the trial there was introduced, over the objection of the respondent, certain purported records of the company, which were kept in a book called "Secretary's Record and Stock Account." These records consisted of typewritten pages pasted into said book. Included in these records is a stock subscription for one share each of the capital stock of the Hotel Operating Company, signed by C. L. Webb, J. Robbins, and I. M. Canfield. Afterwards, by amended articles of incorporation, the name of the corporation was changed to the Skirvin Operating Company. At a meeting held on August 6, 1913, as shown by the records, there were present all of the subscribers to the stock, namely, C. L. Webb, J. Robbins, and I. M. Canfield, all of whom waived notice of the call for the meeting and participated therein throughout. Among other business transacted at said meeting was the acceptance of the statutory grant of corporate authority, as shown by the certificate of incorporation, issued by the Secretary of State, the election of Webb, Robbins, and Canfield, as directors, after which the following appears:
"Thereupon the chairman produced a set of by-laws which she stated she had caused to be prepared for governing the business of the company and of the directors and stockholders of the company. It was thereupon moved that said by-laws be adopted and that the same be ordered to be recorded in a book of by-laws and be recorded at length in the minutes of the meeting. Said motion was unanimously adopted, and the said by-laws are in words and figures as follows:"
Then follow seriatim the by-laws so adopted, those pertinent to the issues involved being as follows:
Many objections going to the validity of these by-laws are urged by counsel for plaintiff in error, but those principally relied upon, as stated by counsel, are: (1) That the by-laws were never legally adopted according to the formalities prescribed by our statute; (2) that they were not adopted by stockholders; (3...
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