Parsons v. Tacoma Smelting & Refining Co.

Citations

• 25 Wash. 492
• 65 P. 765
• 1901 Wash. LEXIS 422

Syllabus

<p>CORPORATIONS •— ACTS OF TRUSTEES-WHEN VOIDABLE AT SUIT OF STOCKHOLDER.</p> <p>The action of a majority of a board of trustees is voidable upon the complaint of a stockholder, where the vote of a trustee interested adversely to the corporation was necessary to effect such action; and Bal. Code, § 4257, which provides that “a majority of the whole number of trustees shall form a board for the transaction of business and every decision of a majority of the persons duly assembled as a board shall he valid as a corporate act,” is inapplicable in such cases, since the policy of the law forbids a trustee to assume a double function where there are adverse interests to he considered.</p> <p>SAME-ACTS IN EXCESS OF CORPORATE POWERS-VOIDABLE, ALTHOUGH AUTHORIZED BY MAJORITY OF STOCKHOLDERS.</p> <p>The articles of incorporation of a corporation constitute a contract entered into by all the stockholders, whose terms cannot be abrogated without the consent of all; hence a lease of the corporate property authorized by a majority vote of the stockholders is voidable at the suit of a non-consenting stockholder, where the articles of incorporation contain no express power to make such lease.</p> <p>SAME — CAPITAL STOCK-OWNERSHIP BY ANOTHER CORPORATION.</p> <p>One corporation cannot acquire the right to purchase and hold stock in another corporation merely by expressing such power in its articles of incorporation, where such ownership of other corporate stock is not expressly authorized by statute.</p>