Case ID: cal_167/html/0327-01.html
Source: Caselaw Access Project
Author: {"author": "THE COURT.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

[S. F. No. 6874.
    In Bank.
    March 4, 1914.]
    BANK OF LOS BANOS, Petitioner, v. FRANK C. JORDAN, Secretary of State of the State of California, Respondent.
    Corporations—Change in Number op Directors—Majority in Interest op Stockholders may Make.—Section 290 of the Civil Code, providing “that at any time during the existence of corporations for profit, . . . the number of the directors may, by a majority of ' the stockholders of the corporation, be increased or diminished to any number not less than three” means a majority in interest of the stockholders and not a majority in number only.
    THE PETITIONER is a corporation organized under the laws of the State of California, and having a capital stock of one hundred thousand dollars, divided into one thousand shares of the par value of one hundred dollars each. At a meeting of its stockholders, a resolution was adopted, increasing the number of its directors from five to seven by the affirmative vote of stockholders owning nine hundred and eighty-five shares. A certificate showing such change was filed in the office of the county clerk of the county in which the corporation had its principal place of business, and a certified copy thereof was presented to the respondent, as secretary of state of the state of California, with the request that he file the same. The respondent refused to file such certified copy of the certificate, for the reason that it failed to show that a numerical majority of all the stockholders of the corporation participated in such increase. This proceeding was then instituted for a writ of mandate to compel the respondent to file in his office the certified copy of the certificate. Further facts are stated in the opinion of the court.
    Edward F. Treadwell, and Lawrence J. Kennedy, for Petitioner.
    U. S. Webb, Attorney-General, and Robert W. Harrison, Deputy Attorney-General, for Respondent.
   THE COURT.

The opinion of the court is that the clause of section 290 of the Civil Code which is in these words, “provided, also, that at any time during the existence of corporations for profit, other than those of the character last herein-above provided for, the number of the directors may, by a majority of the stockholders of the corporation, be increased, or diminished to any number not less than three, who must be members of the corporation” means a majority in .interest of the stockholders and not a majority in number only. And sections 362 and 312 do not change that construction of 290 and do not require any more than a majority in interest.

Let the writ issue.