Gorrill ex rel. Chelsea Oil & Gas Co. v. Greenlees

Citations

• 104 Kan. 693
• 180 P. 798
• 1919 Kan. LEXIS 338

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. Action — Recovery of Money — Proper Party Plaintiff. The pleading and proof were sufficient on their face to enable the plaintiff to bring this action.</p> <p>2; Corporation — -Directors’ Meeting — Notice. Ordinarily, a directors’ meeting, to be binding, must be a regular one, of which the directors have general notice, or a special one, upon due notice to each.</p> <p>3. Same — Directors’ Meeting — Presumption of Regularity. Generally, the transaction of corporate business at a meeting of the directors, or a quorum thereof, raises the presumption of due notice properly given, but when the governing body- — -the directors — acts for the corporation, the result must be determined, not by the degree of formality observed, but by the practical and legal effect of such action.</p> <p>4. Same — Agreement—By Majority of Directors — Acquiscence for Three Years — Agreement Ratified. A majority of the directors of a corporation which had' made a certain escrow agreement with an agent to sell all its stock and assets on certain terms, at an informal meeting, without notice to thé others, directed that the property be turned over by the agent to a purchaser on making a first payment, contrary to the terms of the escrow agreement. This direction was followed; the stockholders received and retained four payments on the purchase price, aggregating about two-thirds thereof, and also received and retained certain shares of stock put -up as collateral to secure the payment of the purchase price. For nearly three years no director-objected to what had been done. Held, that by this course of conduct the corporation acquiesced in, and ratified, such action of the majority of its directors, and could not hold such selling agent liable on the original escrow agreement.</p> <p>5. SAME — Stockholder Not Entitled to Maintain Action. The plaintiff, a stockholder, being bound by the action and acquiescence of the corporation, cannot maintain an action — upo