13 Ohio St. 123 | Ohio | 1862
From the agreed statement of facts in this case, it appears that the directors of the company, now represented by the defendant in error, heretofore brought an action to recover from the plaintiffs in error the amount of certain assessments which had been made on their premium notes, executed at the time policies were taken out by the principal in those notes: and’the validity of those assessments was denied by the plaintiffs in error. A defense was accordingly made to the action, in regard to the merits of which, we have no jneans of judging.
While this controversy was still pending, and its result uncertain, the plaintiffs in error proposed to end the litigation, by paying the amount then claimed, if the company would cancel the policies of the principal in the notes (which would, of course, terminate his membership in the company), and would also surrender up the premium notes, upon which the assessments then in controversy had been made, and which constituted the basis upon which alone assessments against them could be made. This proposition was submitted to the directors of the company, and was by them accepted. The plaintiffs in error thereupon paid the pending claim of the company, and the directors, several months afterward, at a regular meeting, entered upon their records an order, directing the cancellation of the policies, and the surrender of the notes, and this order was carried into execution. We think there is no room to doubt, fro n the terms of this contract, that the intention of the parties was, not only to terminate the membership of Daniel Wadsworth, the principal in the notes, but also, that the sums of money then paid should be accepted in full satisfaction of all liability to further assessments upon the notes which were then surrendered. These notes formed, as we have said, the basis of all assessments ;
Eor this contract on the part of the directors, it is not denied that the settlement of the controversy then pending, by the payment of their disputed claim, would constitute a valid consideration.
If, then,.we have construed the contract correctly, the only question in the case is one of power on the part of the directors — could they bind the corporation which they represent, by such a contract ?
The 5th section of the company’s act of incorporation, provides that, at the expiration of a member’s term of insurance, his premium note, or such part of it as shall remain unpaid after deducting all losses and expenses occurring during said term, shall be relinquished and given up to him. The-9th section provides for his discharge, upon the payment of the whole of his note, and the surrender of his policy. And by the 12th section, when the property insured has been alienated by sale, and the member has surrendered his policy to the directors, he shall be entitled to receive his deposit notes, upon payment of his proportion of all losses and expenses to that time. Now, it is claimed, that as no other cases of discharge are provided for in the charter, the directors could relieve from liability in such cases only. But, these are all cases in which a member has a right to demand the surrender of his premium or deposit note, and the directors have no discretionary power to retain it. These sections throw no direct light upon the question, whether the parties whose agreement created the contract of insurance, may not, by special contract, made upon sufficient consideration, cancel and put an end to its stipulations. To ascertain the extent of the discretionary powers conferred on the board of directors, we must look, not to these sections of the charter, but to the 4th, which, it will be seen, is very comprehensive in its-terms. It reads thus :
Sec. 4. The board of directors shall superintend the con*130 cerns of said company, and shall have the management of the funds and property thereof, and all matters and things thereto relating, and not otherwise provided for by said company. They shall have power from time to time to appoint a president, secretary, treasurer, and such other officers, agents and assistants as to them may seem necessary, and prescribe their duties, fix their compensation, take such security from them as they may deem necessary for the faithful performance of their respective duties, and them remove at pleasure; they shall determine the rates of insurance, the sum to be insured on any building, and the sum to be deposited for the insurance thereof; they shall order and direct the making and issuing of all policies of insurance; the providing of all books, stationery and other things needful for the office of said company, and for carrying on the affairs thereof, and ' may draw on the treasurer for the payment of all losses which may have happened, and for expenses incurred in transacting the concerns of the company. They shall elect one of their own number to act as president; they may hold their meetings monthly, and oftener if necessary, for transacting the business of the company, and shall keep a record of their proceedings, and any director disagreeing with the majority of the board at any meeting, may enter his dissent with his reasons therefor, on record.”
It is evident, from this section, that the board of directors was intended to be the directing mind of the corporation, in the transaction of all its business concerns. The directors appoint, all the other officers and agents of the company, prescribe their duties, fix their compensation, and remove them at pleasure; dictate the terms of every policy of insurance issued; draw on the treasurer for the payment of losses and expenses; and have the general superintendence of the concerns of the company; the management of.all its funds and property, and all matters and things in relation thereto, not otherwise provided for. In the absence of any special provision of the charter, or by-law of the company, to the contrary, we think it clear from these general powers, that the judgment of the directors must determine when ac
The judgment of the court of common pleas will be reversed, and judgment entered for the defendants below.