In re Cape May & D. B. N. Co.

• Decision Date: 01 December 1888
• Citation: 51 N.J.L. 78,16 A. 191
• Parties: In re CAPE MAY & D. B. N. CO.
• Court: New Jersey Supreme Court

16 A. 191

51 N.J.L. 78

In re CAPE MAY & D. B. N. CO.

Supreme Court of New Jersey.

December 1, 1888.

(Syllabus by the Court.)

On application to set aside an election of directors.

The Cape May & Delaware Bay Navigation Company is a corporation of this state. At an election for directors, held May 28, 1888, two tickets were voted, one of which will be called the "Wyckoff Ticket," the other the "Edmunds Ticket." Eighteen hundred shares of the capital stock of the company had been issued, and were outstanding. Of this stock 150 shares were standing on the company's books in the name of Jonathan Cone. Cone died in Philadelphia on the 11th of. October, 1887, leaving a will, appointing Rebecca C. Cone and Lorenzo H. Cone, executors. The will was duly proved by the executors before the register of wills in Philadelphia, and letters testamentary granted thereon. Lorenzo H. Cone, the executor, produced before the inspectors of election an exemplified copy of the testator's will, with letters testamentary upon it, and also a proxy from his co-executrix, and offered to vote upon the 150 shares of stock standing in the testator's name. The inspectors rejected the vote. Of the votes received 895 were cast for the Wyckoff ticket, and 755 for the Edmunds ticket. The inspectors certified the election of the Wyckoff ticket. The votes tendered on the Cone stock and rejected were for the Edmunds ticket. If these votes had been received, the Edmunds ticket would have had a majority of the votes cast, and also the votes upon a majority of the company's capital stock. Application was made by the persons named on the Edmunds ticket to review the election, pursuant to section 44 of the general corporation act, (Revision, 184.)

Argued before DEPUE, VAN SYCKEL, and DIXON, JJ.

S. H. Grey, for applicants. J. A. Benton and David J. Pancoast, contra.

DEPUE, J., (after stating the facts as above.) The Cone stock had not been transferred to the executors on the company's books. It stood there in the estator's name The inspectors of the election certify that for that reason hey rejected the vote on that stock. A corporation organized for the purpose of trade or business is an artificial person with perpetual succession, in which is vested the title to property, real or personal; the affairs and business of which are managed and transacted by officers as trustees for the stockholders. The incidents of the ownership of shares of stock are the right to participate in the management of the corporation by the election of officers in she manner prescribed by the charter or by general laws, and to participate in he profits of the business and in the final disposition of the corporate property, and to restrain the diversion of the property of the corporation to purposes other than those for which it was created. As the means of enabling stockholders to participate in the management of the corporation, section 38 of the general corporation act provides that each stockholder shall have one vote for each share of the capital stock held by him at all elections for managers or directors, unless otherwise provided in the charter, certificates of stock, or by-laws. Revision, 184. Neither the company's charter, nor its certificates of stock, nor its by-laws, contain any provision on this subject, if it should be competent to provide for inequalities in the voting powers of stockholders by certificates of stock or by-laws, unless the power to make such regulations is conferred by the charter. Cook, Stocks, § 608. Section 36 makes the books of the corporation the only evidence as to who are the stockholders, and as such entitled to vote at elections. Revision, 183. As between parties, no other evidence of the transfer of property in the stock will avail against the books upon the question of the right to vote. Downing v. Potts, 23 N. J. Law, 66-76; In re Steam-Boat Co., 44 N. J. Law, 530. Thus far the act regulates the right of voting where the person who appears by the company's books to be the owner of the stock is living, and has neither a guardian nor a trustee. Section 39 makes provision in case of death of the stockholder, or where his property is under the care and control of a guardian or trustee. It enacts that "every person holding stock in any company as executor, administrator, guardian, or trustee shall represent the shares of stock in his hands at all meetings of...