the intent of the legislature that the signature to the articles should be deemed an acceptance, leaving no other condition precedent to be performed, except the recording, this being a substantial compliance with the requirements of the law. 1 Morawetz, 32, 33, 27 et seq. In such cases the corporators are usually constituted only a quasi-corporation, "whose sole function is to bring into existence the corporations consisting of the real body of stockholders." But in our case the signers of the certificate, as appears from the recorded articles of agreement, were not only the sole corporators, but the only stockholders, and, as between themselves, constituted a corporate body, wanting only formal organization in order to transact business with the public.

The law, intending to protect the rights of minorities, requires that notice of the meetings of the stockholders of a corporation shall be given to every person who holds a share of the stock, and, if no other mode of notification be provided in the charter or by-laws of a company, or by statute, express notice must be given. The owner of every unit of interest constituting a part of the aggregate body of stock is entitled to the opportunity which due notice affords him of protecting it, by being present and participating in meetings. I Cook on Stockholders, § 574. The reason for this rule is plainly met, so far as the organization of the company is concerned, when it appears that all the stockholders assented to the call of the meeting, participated in it, and acquiesced in its consequences afterwards. The state has not complained or taken any steps to question its rights or annul its powers as a body politic. If we concede that section 665 of The Code was intended to apply in such a case as this, the only purpose of the legislature in enacting it was to provide that every corporator should have notice of the time and place of a meeting for organization. There was no necessity for proving a compliance with the statute, when every person interested had express notice and participated in the meeting. Angell & Ames on Corporation, § 492. The strict requirements as to notice, being intended to protect stockholders, may be waived by them, and when they do waive it, "the meeting and all proceedings are as valid as they would be had the full statutory notice been given." I Cook, supra, § 599.

It is always presumed that notice is given, and that any meeting of which a minute is found in the proceedings of the stockholders of a corporation, was regularly and lawfully held. Cook, § 600. When a party assumes the burden of showing irregularity, and actually shows that the meeting for organization, or any subsequent one, was not called in the manner prescribed by law or the by-laws of the company, the action of the meeting will nevertheless be declared valid when it appears that every stockholder who did not participate in the meeting ratified its action afterward. Stutz v. Handly, 41 Fed. Rep. 531; Nelson v. Hubbard, 96 Ala. 238; Campbell v. Argenta, etc., Co., 51 Fed. Rep. 1.

If the three directors, Amos Ragan, O. S. Causey and R. E. Causey, met at High Point without notice, they being also the holders of

all the stock, it was a waiver of the requirements of the by-laws that such meeting should be called by the president or a majority of the directors. Nelson v. Hubbard, supra; Jones v. Turnpike Co., 7 Ind. 547 Whether the directors met at Greensboro or High Point, and whether in pursuance of previous notice or not, is immaterial, if in fact they met together and agreed to create the indebtedness and authorize the execution of the mortgage to secure it, they, as stockholders and directors, constituting, as they did, the whole of each body, waived objection to the want of the notice prescribed by the by-laws, and the failure to make a record of their proceedings at that time does not affect the validity of their action. Handly v. Stutz, 139 U. S. 417. The signing of the minutes at another time would not affect the validity of the action of the board, if in fact all three met, discussed the question of executing the mortgage and agreed to what was afterward entered on the minutes and signed by them. It is true that the assent of each of the three, obtained at different times or places, to a certain course of proceedings, would not bind them, because it would not be the action of the directors as a collective body; but if, as a body, they assemble together and conferred in taking certain action they waived all objection to irregularities, though the meeting may have been informal and the minutes may not have been then recorded. The case of Duke v. Markham, 105 N. C. 131, is clearly distinguishable in that there the stockholders at no time assembled as a body, but the assent of each individual was asked and obtained, separately. It is not contended that the consent of each individual has the same force as the concurrence of all assembled together, given after an opportunity to discuss their proceedings, interchange views and acquire benefit of such consultation.

New trial granted.

Note. See 1833, Russell v. McLellan, 14 Pick. (Mass.) 63; 1839, Penobscot Boom Corp. v. Lamson, 16 Maine 224, supra, p. 283; 1840, Newton v. Carbery, 5 Cranch C. C. 632, Fed. Cas. 10,190; 1848, Blandford Third School Dist. v. Gibbs, 2 Cush. (56 Mass.) 39; 1852, Baldwin v. Hillsboro & C. R. Co., 1 Ohio Dec. 532; 1855, Taylor v. Newberne, 2 Jones Eq. (N. C.) 141; 1864, State v. Dawson, 22 Ind. 272; 1872, Lycoming Fire Ins. Co. v. Buck, 1 Luz. Leg. Reg. (Pa.) 357; 1875, Heath v. Silverthorn Lead M. Co., 39 Wis. 146; 1883, McKay v. Band, 20 S. C. 156; 1894, Glymont Imp. Co. v. Toller, 80 Md. 278, 30 AtỈ. 651; 1896, Quinlan v. Houston & T. Ry. 89 Tex. 356, 34 S. W. 738. See, also, I Thompson, §§ 60, 61; III Thompson, § 3652; IV Thompson, §§ 5266, 5388. 5416; VI Thompson, § 7703, et seq.; VII Thompson, § 8161. And other text books cited, supra, p.397.

Sec. 88. Acceptance must be within the state offering the charter.

MILLER V. EWER, 27 Maine 509, 46 Am. Dec. 619, infra, p.841.

Sec. 89. Renewals, extensions and amendments, must also be accepted, to make them effective.

COMMONWEALTH, EX REL. CLAGHORN ET AL. v. CULLEN.1

1850. IN THE SUPREME COURT OF PENNSYLVANIA. Rep. 133-145, 53 Am. Dec. 450.

13 Pa. St.

Error to the Common Pleas of Philadelphia county. An information in the nature of a quo warranto was filed in the court below on the 19th of May, 1849, by John W. Claghorn and others, to show cause why Peter Cullen and others claimed to enjoy the franchises, etc., of The Equitable Life Insurance Company, of Philadelphia. It set forth that a charter was granted in May, 1848, which provided that the corporate powers of the company should be exercised by a board of trustees, to consist of six persons and a secretary, to be elected on the second Monday in December, annually, or within forty days thereafter. Until the first election the board of trustees was to consist of the seventeen persons named as commissioners to receive subscriptions, and that thereupon the company went into corporation, and Claghorn was elected president; that on the 18th of January, 1849, within the forty days after the first election should have been held, a supplement to the charter was passed, which provided that the board of trustees should thereafter consist of seventeen persons and secretary, to be elected by the stockholders in the manner prescribed by the charter, and that the board as it consisted on the 1st of January immediately preceding, should be continued in office until the next annual election thereafter; that while the company were in operation under these two acts, the passage of another supplement was by some persons obtained on the 9th of April, 1849, which declared that the board of trustees should thereafter consist of seventeen persons, to be elected in May, annually, the first election to be held in May, 1849, and repealed the supplement of January; that the act last mentioned had been obtained without the assent of the board of trustees or of the company, and that although certain of the stockholders might have assented to it, such assent had not been given by the trustees nor by the company in meeting duly convened, and that said act was in no way binding; that nevertheless Peter Cullen, vice-president of the company, called a general meeting of stockholders, to elect seventeen trustees on the 7th of May; that the board 1 Arguments omitted.

27-WIL. CASES.

of trustees, before the day of election so named, passed resolutions refusing to accept the last supplement declaring the call for the meeting unauthorized, and appointing a committee to attend at the meeting of stockholders, to protest against any proceedings under that call; that the said Cullen, with others, still persisted in convening the meeting of stockholders at which the defendants were elected trustees, and the parties so elected thereupon ejected the old board of trustees, and usurped the franchises of the company.

The answer, after admitting the incorporation of the company and its going into operation, set forth that certain of the defendants who were of the number of commissioners and, therefore, of the first board of trustees, were not informed by the other members of the board of the intended passage of the supplement of January, 1849, in manner and form as set forth, yet that it was produced by Mr. Claghorn at a meeting of the board on the 24th of January, 1849, and that, although no acceptance thereof was ever made, either by the board or the stockholders, that the trustees continued to hold their offices under it; that while thus in office the supplement of April was passed, which was not only done with the knowledge of a large number of the trustees, but that the majority in value of the stockholders signed an acceptance of it and held an election in pursuance of its provisions. The answer set forth at length the proceedings of this election. To this the relators demurred.

The court below decided that there had been no such acceptance of either supplement as to render it binding on the corporation, and made the following decree:

This cause came on to be heard at the June term, and was argued by counsel, and thereupon, upon consideration thereof, the court do order, decree and adjudge as follows, this twenty-ninth day of September, A. D. 1849, to wit:

That judgment of ouster be entered against the defendants, and forasmuch, as in the opinion of the court, the relators are not entitled to possess and enjoy the offices and franchises of the said "Equitable Life Insurance Company," the court do order an election to be held for trustees of said company at a general meeting of the stockholders convened for that purpose by ten days' public notice in two or more of the daily papers of the city of Philadelphia, on Thursday, the eleventh day of October, A. D. 1849, between the hours of ten A. M. and two P. M., and the court do appoint Frederick Fraley, Charles F. Lex and William G. Alexander, Esqs., trustees to take charge of said corporation until others shall be elected in their stead, pursuant to the laws of this commonwealth, regulating said corporation and this order of court; and the court do direct that the trustees appointed as aforesaid by this decree, shall give the public notice aforesaid, and shall be the judges at said election and shall receive the votes of said stockholders duly qualified to vote, and shall make return to the court on Saturday, October 13, 1849, of the proceedings to be had by virtue of this decree.

The relators objected to this decree being entered on the ground

that the argument had been directed to the validity of the April supplement, and not to that of January. An argument was then ordered by the court as to the efficacy of the January supplement, and in the meantime no decree was entered. After this argument the decree

was entered as above.

The relators took out a writ of error, of which they notified the three trustees appointed by the court, and warned them not to proceed with the election. The court below, under the 15th section of the act of 13th of June 1836 (Pur. 990, quo warranto), then made a decree awarding execution of their former decree, notwithstanding the writ of error. The election was held and six of the defendants elected trustees. These proceedings the court confirmed and authorized the delivery of the property of the corporation by the three trustees appointed by the court, to the trustees thus elected.

The relators assigned for error:

1. "That the court below erred in deciding that the relators were not entitled to possess and enjoy the offices and franchises of the Equitable Life Insurance Company.

2. "That said court erred in ordering that an election for trustees of said company be held on October 11, 1849, and in appointing Frederick Fraley, and others, trustees to take charge of the corporation in the interim.”

BELL, J. So far as we may judge from the pleadings and accompanying exhibits, under which the cause is brought before us, it presents the history of a struggle between rival parties for the government of a private corporation, pending which, each has sought the aid of special legislation, apparently too hastily accorded to both. Such a course is usually detrimental to the best interests of companies entrusted with the management of capital; and, it is to be feared, the present instance can not be esteemed an exception. Both the supplemental acts, here in question, propose to graft upon the original act of incorporation, some very material alterations. Each provides for an increase in the number of trustees and for changing the time of their election. The earlier of them continued in office for an additional year the first board of managers, and directs the election of a secretary by the whole body of corporators. If, under the facts developed, this is to be regarded as a valid amendment of the charter, the second supplement of April, 1849, becomes of decisive importance, not only because it fixes a new time for the annual election, and restores the appointment of secretary to the board of trustees, but by force also of its repealing clause, is destructive of the first supplement. Should, however, this be decreed invalid, then the changes proposed by the younger enactment, in the organization of the board, as originally designed, and the time of the election of its members, must be deemed radical in their character.

Of the numerous decisions that have been pronounced on this subject, it is unnecessary to bring to view other than the case of Dartmouth College v. Woodward, 4 Wheat. 518, and our recent determination of in Brown v. Hummell, 6 Barr. 86, to prove that sub