49 Kan. 224 | Kan. | 1892
The opinion of the court was delivered by
The charter of the Bank of Lyons provided for seven directors, and those who had been elected directors were Bell, Porter, Deupree, Stiner, (all residents of the state,) .Grey, Webb, and Slatten. Slatten lived in Missouri, and sold his stock in 1888 or 1889, and had nothing to do with the bank subsequent to that time. Grey was, at the
The principal question for determination in this case is, whether the deed of assignment executed by the president and secretary of the Bank of Lyons to R. B. Shumway for the benefit of its creditors is wholly void. The general rule is, that the directors of a bank or other corporation have-no implied authority to act singly; they can act only as a board. It is also the general rule, that where no provision, is made in the statute, or in the by-laws of a bank or corporation, for the notice required for regular meetings of the directors, or the mode of calling special meetings, all meetings must be called by special notice, to be given to each director. (Beach, Priv. Corp., §§279-283; Railway Co. v. Comm’rs of Anderson Co., 16 Kas. 302; Scott v. Paulen, 15 id. 162; Aikman v. School District, 27 id. 129; National Bank v. Drake, 35 id. 564.)
A similar case is decided in Chase v. Tuttle, 55 Conn. 455. In that case two of the directors, by reason of being absent from the state, did not receive the notification of the meeting. A sufficient number, however, received notice and attended the meeting to constitute a quorum; and, under the circumstances, the court declared that it would seem unreasonable to hold that a majority of the whole number, being present, could not do a legal act binding the corporation. The exigency demanded immediate action, to save the property and to save expense. It is easy to see how disastrous might be the consequences were we to adopt the principle contended for by the defendants. The situation of the absent directors might be much more remote and inaccessible than in the present case, requiring several months to reach them by actual notice. Must the corporation remain paralyzed all this time, without ability to protect itself? (See also Halifax Sugar Refining Co. v. Francklyn [Ch. Div. 1890], 8 Rly. & Corp. L. J. 91—93; Edgerly v. Emerson, 23 N. H. 555; Bank v. Flour Co., 41 Ohio St. 552.)
The demurrer will be sustained, and the peremptory writ of mandamus will be issued as prayed for.