State ex rel. Price v. DuBrul

Citations

• 100 Ohio St. (N.S.) 272

Syllabus

<p>Corporations — Organization — Election of directors — Cumulative voting — Right not exhausted, when — Failure to choose entire board — Rights of newly elected directors — Shareholders to continue balloting, when — Effect of failure to participate in balloting — Quo warranto.</p> <p>1. The provision of Section 8636, General Code, relating to the cumulative voting of shares, was adopted for the protection of minority shareholders. Any shareholder may cumulate his vote and vote his cumulated shares singly or distributively for one or more candidates for 'director.</p> <p>2. The cumulative privilege may be exercised by the shareholder, on the first an.d successive ballots, as long as directors remain to be elected.</p> <p>3. If a corporation has five directors, the valid election -of four persons entitles such persons to be inducted into office in place of the old board of five directors.</p> <p>4 Where the shareholders have failed, whether voting cumulatively or otherwise, to elect a quorum of the new board, at an annual meeting of stockholders, it is the privilege of the shareholders to ask for successive voting for directors to fill the board, and the ruling of the chairman, that because of a tie, caused by cumulative voting of all the shares on the first ballot, further balloting could not proceed, but the old board held over, is arbitrary and illegal.</p> <p>S. Where two factions of stockholders, each holding an equal number of shares, participate in an annual election for directors, ’and two are selected, either faction may request the voting to proceed .until it is demonstrated that further balloting is futile; and in such' case, where one faction does not exercise its voting prerogative but remains silent, while the other proceeds, and, by the cumulative voting method, elects other directors, the former faction cannot question the validity of the election of such directors.</p>