99 Minn. 475 | Minn. | 1906
(after stating the facts as above).
The appellant contends that the power to surrender its charter is inherent in the shareholders of every corporation, that they can do so without statutory authority, and that the petition here presented complies with the statutes of this state.
1. There is some authority for the rule that the stockholders of a private corporation may surrender the charter without the consent of the state, but the cases are not well considered and are unsound in principle. The grant of the franchise to be a corporation is an exercise of the sovereign power of the state. The acceptance of the grant imposes obligations which may not voluntarily be abandoned at will.
It is conceded that this is true in respect to corporations of a public or quasi public character, but it is contended that private business corporations are of such a character that the stockholders only are inter
In some states provision is made for a formal expression of the consent of the state to the surrender of the charter of a corporation. The-statutes of this state recognize the importance of permitting the members or stockholders of private corporations to freely wind up the business and have the corporation dissolved. Upon proper application made-to the court and a showing such as is required by the statute the court is authorized to make an order dissolving the corporation and appoint a receiver to wind up its business. This proceeding is consistent with' the theory of a contract relation between the corporation and the state, and provides for the acceptance of the surrender by the state, acting-through one of its organs, upon compliance with the conditions imposed:
2. The statutes recognize the right of the members of a corporation to surrender the charter and prescribe the methods in which it may be done. By section 2852, subd. 7, R. R. 1905, every private corporation is empowered “to wind up and liquidate its business in the manner provided by law.” The right is granted by section 2882 to the corporation and by section 3175 to individual members thereof. Section 2882 provides that: „
Whenever any corporation, except a bank of discount and deposit or a savings bank, has determined, upon the affirmative vote of a majority of each class of its stock entitled to vote, or of its members if without capital stock, that it is for the interest of all persons concerned therein that it be dissolved, it may cause appropriate action to be taken to effect such dissolution.
The appropriate action is provided by section 3175, as follows:
A majority in number or interest of the members of a corporation desiring to close their concerns and dissolve the corporation may present a petition to the district court of the county of its principal place of business, setting forth the name of the corporation, when and by or under what law it was incorporated, the names and addresses of the bondholders, stockholders or members, and if not then transacting business, when it ceased to do so, the amount of its indebtedness, the amount and character of its personal property, and the amount and description of its real estate. It shall also state the grounds upon which dissolution is sought and the interest of the petitioner and shall pray for proper relief.
A subsequent section provides for a hearing, and, if any of the grounds specified in the petition are sustained, the court shall adjudge the corporation dissolved and appoint a receiver to close its affairs.
It is apparent, when we read these sections together, that they provide for the dissolution of a corporation upon the petition of the cor
The petition in this case was made by one who claimed to represent a majority in interest of the members of a stock corporation. But the petition discloses that the petitioner is a single stockholder who is the owner of but one-fifth of the capital stock of the corporation. The statute provides that a petition may be presented by “a majority in number or interest” of the members of a corporation. When read in connection with the preceding sections it is reasonably clear that it applies both tO' corporations with and without capital stock. When there is no capital stock, the petition must be presented by a majority in number of the members. A corporation 'having capital stock can be dissolved only on the petition of stockholders who represent a majority of the stock, as they only can represent a majority in interest of the members of such corporation.
Any other construction of the language would lead to the absurd conclusion that a stock corporation may be dissolved upon the petition of a number of individuals, who hold in the aggregate but an insignificant amount of stock, against the wishes of a single member who holds much more than a majority, of the stock. This would be, not only unreasonable, but inconsistent with the recognized rule that the right to control a joint-stock corporation is vested in the holders of the majority of the stock.
The petitioner represents neither a majority in numbers nor interest of the members of this corporation. He represents but one-fifth of the capital stock. It is true he alleges that all the stock which has been issued to others than himself has never been paid for and was fraudulently issued. Until this fact is determined in a proper proceeding, the holders of all outstanding stock in the corporation are entitled to vote at corporate meetings, and to be heard in a proceeding of this character. Downing v. Potts, 23 N. J. L. 66. The recital in
The regularity of the proceedings in other respects therefore' requires no consideration.
Order affirmed.