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CHAP. IX.

vest.

5. To appoint such subordinate officers and agents, as the busi- Art. IV. ness of the corporation shall require and to allow them a suitable compensation;

6. To make by-laws not inconsistent with any existing law, for (600] the management of its property, the regulation of its affairs, and for the transfer of its stock.

Hodges v. City of Buffalo, 2 Denio, 110; Chautauqua County Bank v. Risley, 4 id. 480 ; Barry v. Merchants’ Exchange Company, Sandf. Ch. 280 ; Moss v. The Rossie Lead Mining Co., 5 Hill, 137 ; Bank of Havana v. Wickham, 7 Abb. Pr. 139 ; Brady v. Mayor of Brooklyn, 1 Barb. 590 ; Boom v. City of Utica, 2 id. 104 ; Curtis v. Leavitt, 17 id. 309; Barion v. Port Jackson and Union Falls Plank Road Co., id. 397 : Thompson v. Erie Railway Co., 42 How. 91 ; Bingham v. Wiederwax, 1 N. Y. 509 ; Hay v. The Cohoes Co., 2 id. 159 ; Farmers' Loan and Trust Co. v. Curtis, 7 id. 466 ; Riley v. The City of Rochester, 9 id. 64; Nicholl v. The New York and Erie Railroad Co., 12 id. 121 ; Bank of Attica v. Manufacturers and Traders' Bank, 20 id. 501 ; Driscoll v. The West-Bradley and Carey Manufacturing Co., 59 id. 96.

§ 2. The powers enumerated in the preceding section shall vest In what in every corporation that shall hereafter be created, although they tions to may not be specified in its charter or in the act under which it shall be incorporated.

New York Firemen's Insurance Co. v. Sturges, 2 Cow. 664; McCullough v. Moss, 5 Denio, 567.

§ 3. In addition to the powers enumerated in the first section of What other this title, and to those expressly given in its charter, or in the act be posunder which it is or shall be incorporated, no corporation shall possess or exercise any corporate powers, except such as shall be necessary to the exercise of the powers so enumerated and given.

Moss v. The Rossie Lead Mining Co., 5 Hill, 137; Feeny v. People's Fire Ins. Co., 2 Robt. 600 ; People v. The Manhattan Co., 9 Wend. 392 ; Farmers' Loan and Trust Co. v. Carroll, 5 Barb. 613 ; Green v. New York Central R. R. Co., 12 Abb. Pr. N. S. 480 ; Halstead v. The Mayor, etc., of New York, 3 N. Y. 433 ; Thompson v. Schermerhorn, 6 id. 92 ; Talmage v. Pell, 7 id. 328 ; Curtis v. Leavitt, 15 id. 54.

8 4. No corporation created, or to be created, and not expressly Exercise of incorporated for banking purposes, shall by any implication or powers pro

hibited. construction, be deemed to possess the power of discounting bills, notes, or other evidences of debt, of receiving deposits, of buying gold and silver, bullion or foreign coins, of buying and selling bills of exchange or issuing bills, notes or other evidences of debt, upon loan, or for circulation as money.

People v. The Manhattan Co., 9 Wend. 392 ; Curtis v. Leavitt, 17 Barb. 316 ; New York Life Ins. and Trust Co. v. Beebe, 7 N. Y. 364.

sessed.

CHAP. IX.
Art. IV.

stockholders.

for nonuser.

§ 5. Where the whole capital of a corporation shall not have been Liability of paid in, and the capital paid shall be insufficient to satisfy the

claims of its creditors each stockholder shall be bound to pay on each share held by him, the sum necessary to complete the amount of such share, as fixed by the charter of the company, or such proportion of that sum as shall be required to satisfy the debts of the company.

Tallmadge v. Fishkill Iron Co., 4 Barb. 382; Cutting v. Damerel, 23

Hun, 339; Mann v. Pentz, 3 N. Y. 415. Quorum. § 6. When the corporate powers of any corporation are directed

by its charter to be exercised by any particular body, or number of persons, a majority of such body, or persons, if it be not otherwise provided in the charter, shall be a sufficient number to form a board for the transaction of business; and every decision of a majority of the persons duly assembled as a board, shall be valid as a

corporate act. Forfeiture

§ 7. If any corporation hereafter created by the legislature shall not organize and commence the transaction of its business within one year from the date of its incorporation, its corporate powers shall cease.

Johnson v. Bush, 3 Barb. Ch. 237; People v. Bowen, 30 id., 24 ; People v. The Troy House Co., 44 id. 625.

§ 8. The charter of every corporation that shall hereafter be

granted by the legislature shall be subject to alteration, suspension repeal,

and repeal, in the discretion of the legislature.

Hartford and New Haven R. R. Co. v. Croswell, 5 Hill, 383; Suydam v. Moore, 8 Barb. 358; Northern R. R. Co. v. Miller, 10 id. 260; White v. The Syracuse and Utica R. R. Co., 14 id. 539; Troy and Rutland R. R.

Co. v. Kerr, 17 id. 581. Trustees in

§ 9. Upon the dissolution of any corporation created, or to be created, and unless other persons shall be appointed by the legislature, or by some court of competent authority, the directors or managers of the affairs of such corporation at the time of its dissolution, by whatever name they may be known in law, shall be the

trustees of the creditors and stockholders of the corporation dis[601] solved, and shall have full power to settle the affairs of the corpo

ration, collect and pay the outstanding debts, and divide among the stockholders the moneys and other property that shall remain after the payment of debts and necessary expenses.

(1 R. L., 248, § 1.) McCullough v. Moss, 5 Denio, 567 ; Kane v. Bloodgood, 7 Johns. Ch. 128; Huntley v. Beecher, 30 Barb. 587 ; Tinkham v. Borst, 31 id. 411; Owen

Reservation of power to

etc.

case of dissolution.

CHAP. IX.

Smith, id. 645; Hoffman v. Van Nostrand, 42 id. 174; Towar v. Hale, Art. IV. 46 id. 365; Heath v. Barmore, 50 N. Y. 302 ; Central City Savings Bank v. Walker, 66 id. 424; affirming S. C., 5 Hun, 34. § 10. The persons so constituted trustees shall have authority Their

powers. to sue for and recover the debts and property of the dissolved corporation by the name of the trustees of such corporation, and shall have full power to settle the affairs of the corporation, describing it by its corporate name; and shall be jointly and severally responsible to the creditors and stockholders of such corporation, to the extent of its property and effects that shall come into their hands.

(1 R. L., 249, $ 2.) Merchants' Bank v. Bliss, I Robt, 405 ; Owen v. Smith, 31 Barb. 645 ; Heath v. Barmore, 50 N. Y. 302.

ARTICLE V.- SPECIAL PROVISIONS RELATING TO CERTAIN

CORPORATIONS AND JOINT-STOCK ASSOCIATIONS. 1828. R. S., Part 1, Ch. XVIII, *Title IV — Special Provisions

relating to certain corporations.
Sec, I. Certain books of incorporated companies to be kept open for certain time,

2. Certain prohibitions and restrictions upon directors of corporations, officers, etc.
3. Debts of corporations not to exceed certain amount; penalty for excess.
4. Certain transfers of property prohibited; corporations dissolved in certain

cases.
5. Supreme court to correct illegal elections; proceedings for that purpose.
6. By-laws regulating elections; evidence of right to vote.
7. Oath to be taken by inspectors of elections.
8. On failure to hold elections of directors, new day to be appointed; proceed-

ings.
9 and 10. (Relate entirely to companies incorporated for banking purposes.)

11. Extent and application of the provisions of this title. § 1, The book or books of any incorporated company in this Certain

books to be State in which the transfer of stock in

any
such company shall be

open

at cer

ta in times. registered, and the books containing the names of the stockholders in any such company, shall, at all reasonable times during the usual hours of transacting business, be open to the examination of every stockholder of such company for thirty days previous to any election of directors; and if any officer having charge of such books shall, upon demand by any stockholder as aforesaid, refuse or neglect to exhibit such books, or submit them to examination as aforesaid, he shall for every such offense forfeit the sum of two hundred and fifty dollars, the one moiety thereof to the use of the people of this State, and the other moiety to him who will sue for

*This title inserted in the Revised Statutes pursuant to the "Act concerning the Revised Statutes," passed December 10, 1828, $ 15.

CHAP.

IX. Art. V.

to be reduced

the same, to be recovered by action of debt in any court of record, together with the costs of such suit.

(L. 1825, 448, $ 1.) Bank of Columbia v. Attorney-General, 3 Wend, 588; Matter of Long Island R. R. Co., 19 id. 37; Brouwer v. Cotheal, 10 Barb. 216 ; People, ex rel. Richmond, v. Pacific Mail Steamship Co., 50 id. 280; Cotheal v. Brouwer, 5 N. Y. 562 ; Sage v. Lake Shore and Michigan Southern Ry. Co., 70

id. 220. Dividends

§ 2. It shall not be lawful for the directors or managers of any plus profits incorporated company in this State to make dividends, excepting only.

from the surplus profits arising from the business of such corporaCapital not

tion; and it shall not be lawful for the directors of any such company to divide, withdraw, or in any way pay to the stockholders, or any of them, any part of the capital stock of such

company, or to reduce the said capital stock, without the [602] consent of the legislature; and it shall not be lawful for the diNotes for rectors of such company to discount or receive any note, or other installments on stock, evidence of debt, in payment of any installment actually called in not to be discounted and required to be paid, or any part thereof, due or to become

due on any stock in the said company ; nor shall it be lawful for

such directors to receive or discount any note, or other evidence to withdraw

of debt, with the intent of enabling any stockholder in such

company to withdraw any part of the money paid in by him on paid.

his stock; and in case of any violation of the provisions of this Liability section, the directors under whose administration the same may of directors

have happened, except those who may have caused their dissent ing these provisions. therefrom to be entered at large on the minutes of the said di

rectors at the time, or were not present when the same did happen, shall in their individual and private capacities jointly and severally be liable to the said corporation, and to the creditors thereof in the event of its dissolution, to the full amount of the capital stock of the said company so divided, withdrawn, paid out or reduced, and to the full amount of the notes or other evidences of debt so taken or discounted in payment of any stock, and to the full amount of any notes or evidences of debt so discounted with the

intent aforesaid with legal interest on the said respective sums, Not barred by statute

from the time such liability accrued; and no statute of limitations.

tions shall be a bar to any suit at law or in equity, against such

directors for any sums for which they are made liable by this secProviso.

tion: Provided, That this section shall not be construed to prevent a division and distribution of the capital stock of such com

Nor notes

installments

for violat

of limita

CHAP. IX.

Art. V.

Not barred

of limitations.

pany, which shall remain after the payment of all its debts, upon the dissolution of such company, or the expiration of its charter.

(L. 1825, 448, § 2.) Northern R. R. Co. v. Miller, 10 Barb. 260; Bank of Niagara v. Johnson, 8 Wend. 645.

§ 3. The total amount of the debts which any incorporated Amount of company shall at any time owe, whether for deposits, or by bond, bill, note, or other contract, over and above the actual deposits with the said company, shall not at any time exceed three times the amount of the capital stock actually paid in, and in case of any excess the directors under whose administration the same may Liability of have happened, except those who may have caused their dissent for excess. therefrom to be entered at large on the minutes of the said directors at the time, and except those who were not present when the same did happen, shall in their individual and private capacities, jointly and severally, be liable for such excess to the said corporation, and in the event of its dissolution, to any of the creditors thereof, to the full amount of such excess, with legal interest from the time such liability accrued ; and no statute of limitations shall

by statute be a bar to any suit at law, or in equity, against such directors for any sums of money for which they are made liable by this section.

(L, 1825, 448, 3.) Tallmadge v. The Fishkill Iron Co., 4 Barb. 388.

$ 4. Whenever any incorporated company shall have refused (603] the payment of any of its notes, or other evidences of debt, Certain in specie, or lawful money of the United States, it shall not

property be lawful for such company, or any of its officers, to assign or

prohibited. transfer any of the property or choses in action of such company to any officer or stockholder of such company, directly or indirectly, for the payment of any debt; and it shall not be lawful to make any transfer or assignment in contemplation of the insolvency of such company, to any person or persons whatever; and every such transfer and assignment to such officer, stockholder or other person, or in trust for them or their benefit, shall be utterly void.

(Laws of 1825, 450, $ 6. The remainder of the original section of the R. S. repealed by Laws of 1880, chap. 245.)

Bowen v. Lease, 5 Hill, 221; Heroy v. Kerr, 8 Bosw. 199 ; Smith v. The New York Consolidated Stage Co., 18 Abb. Pr. 419; De Ruyter v. The Trustees of St. Peter's Church, 3 Barb. Ch. 119; Harris v. Thompson, 15 Barb. 62 ; Loring v. United States Vulcanized Gutta Percha Co., 30 id. 644: Galway v. United States Sugar Refining Co., 36 id. 256; People v. Troy House Company, 44 id. 625 ; Erie Railway Co. v. Vanderbilt, 5 Hun, 123 ;

transfers of

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