Holder v. Lafayette

• Decision Date: 30 September 1873
• Citation: 1873 WL 8692,71 Ill. 106,22 Am.Rep. 89
• Parties: CHARLES W. HOLDERv.LAFAYETTE, BLOOMINGTON AND MISSISSIPPI RY. CO.
• Court: Illinois Supreme Court

71 Ill. 106

1873 WL 8692 (Ill.)

22 Am.Rep. 89

CHARLES W. HOLDER

v.LAFAYETTE, BLOOMINGTON AND MISSISSIPPI RY. CO.

Supreme Court of Illinois.

September Term, 1873.

OPINION TEXT STARTS HERE

APPEAL from the Circuit Court of Livingston county; the Hon. CHARLES H. WOOD, Judge, presiding.

Messrs. SPENCER & REEVES, for the appellant.

Mr. L. E. PAYSON, for the appellee.

Mr. JUSTICE WALKER delivered the opinion of the Court:

In 1867, appellant was elected by the board of directors, treasurer of the company. He was, at the time, one of the directors. The board never fixed any salary, fees or compensation of the treasurer. He acted from the 1st day of September, 1867, until the 31st day of January, 1872, when he settled with the company, and they allowed him for his services as treasurer during that time, the sum of $4000, and drew a warrant in his favor for that sum on the treasury of the company. A warrant of attorney was given by the company, and a judgment was subsequently confessed for that amount, in favor of appellant, but, on motion, it was set aside and the company let in to plead, and on a trial, by consent of parties, by the court without a jury, the issues were found for the defendant, and a judgment rendered accordingly, from which plaintiff appeals to this court.

According to the rule announced in the case of Cheeney v. The Lafayette, Bloomington and Mississippi Railway Co. 68 Ill. 570, the question is, whether the services thus rendered were extraordinary and entirely disconnected from the duties devolved upon him as a director. The board of directors were in the possession of the funds and property of the corporation, and that body had entire control over it, and could disburse it as they chose, either by themselves, by one or more of their number, or by some other person not of the board of directors. Having done so through one of their members, we must suppose that they chose to regard it as a part of his duty as director. Had not such been the intention, it seems to us that a salary would have been provided by a by-law or resolution.

Again, they are managing a fund as trustees for the stockholders, and they have no right to use or appropriate the funds of their cestuis que trust to themselves. They have no power to waste, destroy, give away or misapply it, and when they were elected by the shareholders, no provision having been made for their compensation, the stockholders had a right to suppose they were acting under the common law rule, that, as trustees, they could not claim payment for their services. But it is said there was an understanding, when appellant agreed to act as treasurer, that he should receive a fair compensation....