Nye v. Storer
| Decision Date | 27 February 1897 |
| Citation | 168 Mass. 53,46 N.E. 402 |
| Parties | NYE v. STORER et al. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
W.B. French, for appellant.
T.E Grover, for appellees.
If we assume, in favor of the plaintiff, without deciding, that he has alleged such facts in the conduct of the corporation and its directors as would enable him, as a stockholder, to obtain relief if it appeared that the acts complained of were illegal, we come to the substance of the charges of illegality. See Dunphy v. Association, 146 Mass 495, 16 N.E. 426. The corporation was established under St.1877, c. 98, "for the purpose of holding personal property and real estate where a wharf, warehouse and other public buildings may be erected, and building lots sold or leased for the erection of private residences or cottages under such rules and regulations as the association may prescribe." Section 3 provides that "all buildings, booths or other structures erected or attached to the grounds of the association shall for purposes of taxation, be considered real estate taxable in the town of Wareham." The bill avers that "the corporation has built a wharf, public buildings, and many private residences or cottages, and its real property is now of great value." It also avers that for many years, during the summer season, the directors have conducted camp meetings and concerts upon the grounds of the company, and it is fairly to be inferred from the bill that a valuable part of the property of the corporation is adapted to this use. It is stated in the bill that the plaintiff has lately objected to the continuance of this business by the corporation, and that he notified the other directors that in his opinion it was illegal. Thereupon a lease of a part of its real estate was executed by the corporation, through the action of its directors, to an association of individuals consisting of the directors other than the plaintiff. At a subsequent meeting of the corporation, at which all the stockholders were represented, the lease was ratified. It is not contended that any of these proceedings were illegal in form, and the principal objection to them is that they are an invasion of the charter of the corporation, inasmuch as the corporation was not authorized to carry on the business of conducting camp meetings for profit, and the effect of the lease is to permit such a business to be conducted by others with the corporation's property. We are of opinion that this objection is not well founded. The corporation is expressly authorized to hold real estate, consisting in part of a wharf, hotel, and other public buildings. The right to hold such property includes the right to lease it so as to make it produce income. Pub.St. c. 105, § 6; Dupee v. Water-Power Co., 114 Mass. 37, 43. It would be too strict a construction of the statute to decide that a corporation which may lease real estate for profit can lease it only to be used in those kinds of business which it is authorized by its charter to carry on. At the time of making this lease, the corporation was in possession of property which for many years had been used in summer for holding camp meetings. We see nothing in its charter to forbid its leasing the property for such a use. There are no facts stated in the bill to support the charge that the lease was made to evade the charter.
The only other ground of objection to the lease is that it was fraudulent. But in this part of the case there...
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