State v. Sibley

25 Minn. 387, 1879 Minn. LEXIS 17

Opinion

Cornell, J.

Footnotes

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Substantially the claim of respondents, as set forth in their answer, is based upon the proposition that the corporation which was created by the territorial act of October 20, 1849, contains and can contain but nineteen members, and those the corporators therein named, and such others as have since been or may hereafter be chosen by such body to fill any vacancies in their number occasioned by death or otherwise; and that the corporate body, as thus constituted, is rightfully entitled to the exclusive possession and enjoyment of all the rights, powers, privileges and franchises which were conferred by that act. In support of this proposition, it is claimed that the word “associates, ” in the first section of the charter, is without meaning, as there used, and has no force or effect whatever. This claim is clearly repugnant to the general rule of construction which requires some effect to be given to every word or provision of a charter or statute, whenever it can be done without violence to any other provision, or to the general tenor and purpose of the enactment. As was said by Chief Justice Shaw, in delivering the opinion of the court in Lechmere Bank v. Boynton, 11 Cush. 380, “the term ‘associates,’ as often used in acts of incorporation, is ambiguous. It may mean those who are already associated with the persons named, or those who may come in after-wards.” And the inquiry here, as it was there, is to ascertain in what sense the word is used in the particular charter under consideration.

In determining this question, it is admissible, if necessary, to consider any competent evidence aliuncle the charter, in explanation of the ambiguity. If a charter, granted in terms to several persons therein named and their associates, was in fact granted upon the joint request and application of those named, and others associated with them in applying for it, it might reasonably be supposed that the legislature intended ■to embrace them all within the grant, and that the word “associates” was used to designate those of them not spe■cifically named in the charter. If, however, the grantees so •named had no actual associates at the time, or if the charter was given by the legislature of its own motion, and without solicitation or application from any one, the use of such term in the connection here found might very properly be regarded .as intended to apply to such persons as might become members of the corporation, upon and after its organization. And this latter is evidently the sense in which the term is used in the charter under consideration; for it is not claimed •nor pretended that it was procured by or upon the request of the grantees therein designated by name, or that it was founded upon any petition or application whatever.

That the term as here used is not meaningless, as claimed by respondents, is further apparent from the language and •the whole tenor of the act itself. It is first enacted that the nineteen persons therein so designated, “and their associates, be and they are hereby constituted a body ' corporate and politic, by the name and style of the Minnesota Historical Society,” and then, in proceeding to enumerate the specific powers and franchises which are conferred, and how and by whom they shall be exercised, this significant language is used: “And by that name they” (the corporators and their associates) “and their successors shall be, and they are hereby made capable in law to contract and be contracted with, sue- and be sued,” etc. The legislature could scarcely have chosen more plain and unequivocal language in which to express an intention that the continuous artificial body it was about to-.create should consist of a membership comprising .the grantees named in the charter, their associates, and the successors of' both of these classes, instead of the successors of the original grantees alone; and that the powers and franchises vested in the corporation should belong to it as representing, for the time being, the entire body of its then existing members, of whatever class. The grantees so named in the act as the-then sole possessors of the franchises, had, of course, the exclusive right of rejecting the charter, or of accepting its provisions, and organizing the corporation under it. When this latter was done, their functions as such original corporators, merely, were at an end. The society thereupon at once sprang into active life and being as a distinct corporate entity, and became immediately possessed of all the rights, privileges and franchises expressly conferred by the charter,, and endowed with all such other incidental powers and attributes, not prohibited by it, as belong, under such circumstances, to every private corporation aggregate. It had, therefore, the right to admit new members at pleasure, for every such corporation possesses that incidental power when not restrained by its charter, and the charter in this instance contains no such restriction. Angelí & Ames on Corp. § 83. In the exercise of this, as of every corporate power not regulated by some charter provision, it could provide general rules upon the subject in its by-laws, subject to alteration and amendment, prescribing the terms and conditions of membership, and the mode of admitting new members, or it could determine each case as it arose, according to its own pleasure; “for in every case involving the exercise of a corporate power not otherwise regulated in the charter, the sole law of the corporation is the collective will of a majority of its members, as expressed while regularly acting together in a body, in their organized capacity. ”

The society, in this instance, at its first organized meeting, and before the adoption of any by-laws, elected as its first president, for the term of three years, without objection so far as appears, an honored and distinguished citizen, who forthwith took upon himself the duties of the office, and thenceforth for the entire term continued to exercise its functions, without question as to his right so to do. He has since been re-elected, and held the same office, and has.always exercised and enjoyed the rights, and borne the duties and responsibilities of a member. Yet it is now claimed that he has never been such in fact and in law, for the reason that he was not one of the original corporators 'named in the charter, nor the lawful successor of one, and for the further reason that for a long time after the adoption of the constitution and by-laws of the society, he failed, through inadvertence or otherwise, to sign the same, in accordance with a direction therein contained. Like objections are urged against the asserted legal rights of other parties to be considered members, who, though admitted under and in pursuance of the by-laws, and constantly recognized and allowed to act as members by the society in all its corporate transactions and doings for years, have, nevertheless, omitted likewise to comply with this requirement of the by-laws. The first of these objections, which applies also to all members who have been admitted under the by-laws of the society, has already been sufficiently considered, and held invalid, on the ground that the corporate right of admitting new members was vested in the corporation representing all its members, and not in the original nineteen and their successors alone. The other objection is equally untenable.. The provision of the by-laws in question is simply directory. A mere failure to comply with it, unintentionally, as was manifestly the fact here, if followed for years by an active participation in the corporate doings of the society, without question from any one, will not invalidate a membership thus asserted, acted upon and a-cquiesced in. The foundation of the right of membership is the mutual consent and agreement of the corporation and the party claiming or asserting it; and in all cases where this exists, and the fact of membership has been distinctly recognized and acted upon by both parties for years, the right exists, unless there is some specific jorovision in the charter to the contrary. The election of a party to an office whose duties can only be performed by a member of the corporation, and permitting him to enjoy and exercise its functions for a long period of time, unchallenged by any one, are corporate acts of the strongest character, evidencing an assent of the corporation to the admission of such party to all the rights and privileges of membership. Upon this branch of the case, the conclusion is that the corporate body which was created by the original charter of October 20,1849, consisted, at the time the amendatory act of March 1, 1856, was passed, of the then remaining members of the corporators first named in the charter, and such their then associates as had been theretofore admitted to membership by the society, according to its by-laws, or in any other lawful way.

This brings us to the consideration of the question, whether said act of 1856 has been accepted in its entirety by .the society as thus constituted? The act itself is silent upon the subject of its acceptance. The original charter contains no provision regulating the manner in which the corporate right •of consenting to amendments shall be exercised, nor providing for its exercise, for and in behalf of the society, by any body of its officers, or any portion of its members. The right •therefore resides in the corporation itself, to be exercised by '.and through the collective body of all its members. A formal vote of acceptance, by a majority of such body, duly ■convened for that purpose, would be an acceptance binding •upon the corporation. But this mode of acceptance is not indispensable, when, as in the case before us, no statutory provision exists requiring it. It may be done by any corporate act which clearly recognizes the validity of the amendment, and necessarily presupposes an acceptance of its provisions and benefits by the corporation; and if the new act .grants additional powers and privileges to the company of a beneficial character, an acceptance may be presumed upon slight evidence. These rules are too well settled upon principle and authority to require discussion, or to admit of dispute. Angell & Ames on Corp. § 83; Sons of Temp. v. Brown, 11 Minn. 254 (356;) Bangor, etc., R. Co. v. Smith, 47 Me. 34; Com. v. Cullen, 13 Pa. St. 133.

■ That there has been an unqualified acceptance by the ■society, in this case, of all the provisions of the act of March 1, 1856, is beyond any reasonable controversy upon the evidence before us. At a special meeting held soon after its passage, a resolution was adopted and spread upon the records of the society, declaring an acceptance in express terms, and that it would then proceed to the election of an executive -council under its provisions, to take charge of the affairs of the corporation, as was therein provided; and such council was there and then unanimously elected by the members then present. Conceding the irregularity and even the invalidity *of these proceedings, as claimed by respondents, on the ground that the requisite notice of such meeting had not been properly served upon all the members, it is clearly shown that their validity has remained unquestioned, and been distinctly and repeatedly recognized and acted upon by the society at various subsequent regular meetings, and by various corporate acts, for over twenty years. The entire administration ■of the affairs of the society, for that whole period, has been ■conducted by the executive council then chosen and ever ■since continued under the provisions of section 2 of the amendatory act, by the exercise on its part of the corporate powers • of the society, and by the selection of its agents and officers, as therein provided, and this without any protest whatever from any one, until quite recently. The additional privileges- and powers granted by that act have also been used by the society in acquiring and holding, exempt from taxation, a. large amount of real and personal property, in excess of the limit prescribed by the original charter. Under these circumstances, there would seem to be no ground for any serious-controversy over the question of acceptance.

For the reasons above given, the court awards judgment of' ouster against the respondents.

Berry, J., did not sit in tins case.