Russell v. Henry C. Patterson Co.

Citations

• 232 Pa. 113
• 81 A. 136
• 1911 Pa. LEXIS 683

Syllabus

<p>Corporations — Officers—Compensation—Salaries—Ratification.</p> <p>1. A majority of the stockholders of a corporation, who are also the directors, may at a regular stockholders’ meeting ratify and confirm against the vote and protest of a minority stockholder a resolution of a majority of the board of directors increasing the salaries of two of such directors as officers of the company where such salaries are found by the court to be fair and reasonable compensation for the services rendered.</p> <p>2. In such a case the act of the directors in increasing the salary was not void but only voidable, and may be ratified at a stockholders’ meeting.</p> <p>3. When directors vote at a board meeting they act as agents of the corporation occupying a fiduciary relation, but when the same persons vote as stockholders at a stockholders’ meeting, they hold no trust relation to the company which would deprive them of the right to vote as their interests dictate. They may therefore in their independent position as stockholders ratify their own voidable acts as directors, if such ratification involves no fraud.</p>