Brantner v. Red River Valley Livestock Ass'n

50 N.W.2d 287, 235 Minn. 267, 1951 Minn. LEXIS 775
CourtSupreme Court of Minnesota
DecidedDecember 7, 1951
DocketNo. 35,612
StatusPublished
Cited by6 cases

This text of 50 N.W.2d 287 (Brantner v. Red River Valley Livestock Ass'n) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brantner v. Red River Valley Livestock Ass'n, 50 N.W.2d 287, 235 Minn. 267, 1951 Minn. LEXIS 775 (Mich. 1951).

Opinion

Magney, Justice.

The Eed Eiver Valley Livestock Association is a corporation organized October 11, 1918, under the laws of the state of Minnesota. The articles of incorporation were filed in the office of the secretary of state. The period of duration was fixed at 80 years in the articles. Petitioners, 17 in number, are shareholders and stockholders of the [268]*268association. They petitioned the court for an order dissolving the corporation on the ground that under the 30-year limitation in the articles the corporation had ceased to exist and had no authority to continue to do business. They asked that a receiver be appointed and that the assets of the corporation, estimated at $60,000, be distributed to the stockholders thereof according to their respective interests therein. At the hearing on the petition, the corporation appeared specially and moved for dismissal of the petition on the ground that the court had no jurisdiction to act in the premises. The court granted the motion on the ground stated, and petitioners appeal.

It is conceded by petitioners that this proceeding is one for involuntary dissolution brought under the provisions of M. S. A. c. 301, with special reference to §§ 301.49, 301.50, and 301.51. Section 301.49, so far as here applicable, provides:

“A corporation may be dissolved by involuntary proceedings in the discretion of the court when it is made to appear:
*****
“(5) That the period for which the corporation was formed has terminated without extension.”

The court in this instance did not exercise its discretion, but based its order on the ground that it had no jurisdiction. Section 301.50 reads:

“A petition for involuntary dissolution of a corporation may be filed by:
“(1) A shareholder; * * *”

The above sections are a part of c. 301, which, as stated in § 301.01, “may be cited as the Minnesota business corporation act.” The purpose of incorporation and the qualifications of incorporation under this act are set out in § 301.03 as follows:

“Three or more natural persons of full age may form a corporation under sections 301.01 to 301.61 for any lawful business purposes ; provided * * * that where other statutes prescribe a special [269]*269procedure for the incorporation of designated classes of corporations, such corporations shall be formed under such statutes and not under these sections.”

The trial court held that the association was not incorporated as a business corporation, but as a nonprofit corporation, and that the provisions of the Minnesota business corporation act relative to involuntary dissolution of corporations did not apply.

Article II of the articles of incorporation provides:

“The object and general nature of the business of this corporation shall be the improving of live stock and to aid, assist and encourage the raising, improving, exhibiting, selling and developing of live stock and poultry, particularly within the counties of Kittson, Becker,' Red Lake, Pennington, Mahnomen, Marshall, Norman, Roseau, Clay, Polk, Clearwater, Ottertail and Wilkin, in the State of Minnesota, and the promotion of the general welfare of said territory, and the buying, selling, holding, leasing and controlling of such property as may be necessary and incidental to such purposes. The corporation shall be non-political and shall engage in no business for pecuniary profit ” (Italics supplied.)

The corporation was indexed in the office of the secretary of state as a business corporation, and the fee paid by the incorporators was the fee required of a business corporation. No amendments to or changes in the articles of incorporation have been made since its organization.

Testimony of the president and secretary of the association tended to show that there had been no profit-making activity by the corporation ; that it had never paid dividends to its members; that its main activities were the sponsoring of a winter show, livestock sales, and exhibitions; that it was the recipient of substantial gifts; and that it had received biennial grants from the state legislature. The association has 2,500 members, and 2,875 ten-dollar certificates have been issued. Some members have more than one certificate, but no member has more than one vote.

[270]*270By the language used in the purpose clause of its articles of incorporation, the activities of the corporation are not limited to livestock and poultry owned by the stockholders or members of the corporation. It is evident that the purpose of the corporation is to improve livestock generally in the area involved, to encourage all to raise better stock, to improve the marketing methods of stock raisers, and in general to stimulate interest in better livestock and better livestock marketing. The assistance and encouragementj which is the purpose of the corporation, is directed toward that industry in the entire 13-county area. The statement of specific purposes is followed by a broad summary statement, namely, “the promotion of the general welfare of said territory, * *

We have quoted the paragraph of the articles of incorporation which sets out the purpose of the corporation with some comment on such purposes, together with some facts relative to its activities. With that background, we must proceed to determine whether the court was in error in holding that the corporation was not a business corporation and therefore that M. S. A. 301.49, 301.50, and 301.51 had no application to a petition by minority stockholders for the involuntary dissolution of the corporation. Since the association by its articles was prohibited from engaging in any business for pecuniary profit, it is obvious that it could not properly be incorporated under the business, corporation act. The making of pecuniary profit is the paramount purpose of such corporations. The business corporation act clearly is aimed at industrial and commercial corporations organized for profit. Detailed provisions concerning dividends and rights of minority stockholders are unnecessary if applied to nonprofit corporations. The purpose to exclude such corporations is indicated by the provisions of § 301.03, by the detailed provisions of c. 309, and by other chapters relating to cemetery corporations, chambers of commerce, boards of trade, and others. The purpose of the association here is more in line with the kind of a corporation provided for in § 309.01, which reads:

“Any three or more persons may form a corporation for any one or more of the following purposes: religious, social, moral, educa[271]*271tional, scientific, medical, surgical, benevolent, charitable, fraternal, or reformatory, * *

The purpose of this association, as detailed in its articles of incorporation, places it well within the category of corporations organized for educational purposes and, without too much stretching of the meaning of words, for scientific purposes. Section 309.02 provides a special procedure for the incorporation of corporations for purposes set out in § 309.01.

We are not required to analyze former or present statutes to determine under what statute a corporation with purposes such as are expressed in the instant articles of incorporation could have been incorporated in 1918 or could now be incorporated.

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State Ex Rel. Humphrey v. Delano Community Development Corp.
571 N.W.2d 233 (Supreme Court of Minnesota, 1997)
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Bluebook (online)
50 N.W.2d 287, 235 Minn. 267, 1951 Minn. LEXIS 775, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brantner-v-red-river-valley-livestock-assn-minn-1951.