Daily globe., 1879-05-16
Decisions by the Court.

lUCGODor Ierm,t 1o(O.J
Rufus J. Baldwin and the State National
bank of Minneapolis, respondents, VS..
Thomas 81. Garfield, appellants.
Syllabus-By the articles Of incorporation
of the Minneapolis Agricultural and Mechani-
cal Association "a corporation formed under
the general laws of the State), the govern ment
of the association and the management of its
affairs is vested in the board of directors. The
legal effect of this is to invest the directors
with such government and management as a
board, and not otherwise. The general rule is
that the governing body, an such, Of a corpora
tion, are agents Of the corporation only as q
board, not Individually. They have no au-
thority to act for the corporation, save when
assembled at board meeting, The separate
such governing body, is not the action OF the
constituted body, clothed with the corporate
powers
Application of this rule to the facts of this
case, in which deed of real estate, belonging
to the association before mentioned, executed
directors, acting separately and not as .
board, without any authority from
the board Of directors, is held void as con-
veyance and equally Intellectual as contract to
convey.
enacts that the stock of corporations like the
association aforesaid shall be transferable
only on the books of such corporation in such
form as the directors prescribe. Provisions of
this kind are intended solely for the protection
and benefit of the cooperation. They do not
incapacitate shareholder from transferring
his stock without any entry upon the corpora
| tion books. Except against the corporation,
| the owner and holder of shares of stock may
| as an incident of his right of property, trans
| fer the same as any other personal property OF
which he is owner.
Holders of the stock of corporation,
l - L = =.
pledgers, are interested in the preservation OF
the corporate property and in preventing il
from passing out Of the hands of the corpora
tion. They have therefore right TO take lega
means to preserve the corporate property and
| to prevent it from being lost to the corpora
value is practically impaired by a cloud upo1
the title of the corporation to real property
they have right to have the cloud removed.
| The deed before mentioned purports, upol
its face to be the deed of the association afore
naid. Although it is not its deed, that fact
not apparent upon its face, but the deed !
upon it's face regular and valid. Whether it i
30 in fact and law depends upon the extrinsi
consideration whether its execution was au
thorized by the board of directors. IT, there
fore, throws cloud upon the title Of the assu
citation.
/ While the title to certain real property wa
in said association, one K, who owned all tn
stock eff the association, executed in his ow
name deed of said property. As respects tn
title of the association to said property, thi
deed is void upon its face, and is therefore
not cloud upon such title.
defect of parties must be taken advantag
of by answer or demurrer, otherwise it
waived.
I The question of who shall be made parties
a proceeding in equity, is question of COZ
venience and discretion, rather than of abst
Lutte right, and a question to be determined az
cording to the exigencies of the particular cas-
; Application of this rule to the facts of th
case:
person holding stock Of a corporation not {
a stockholder, but merely a pledge ma
bring an action his own account and in hi
own name to protect his rights and his inte
ests pledge, aud is not required in sue
matter to act through the ASSOCIATION.
The taking by national bank of the stoc
of corporation collateral security for
, loan of money is not a violation of that provi!
ion of the national banking act making it il
competent for national bank to loan none
upon a mortgage of real estate although ii
property of such corporation consist wholly
real estate.
} The defendants claim of estoppel considert
and held not to be sustained by the facts
the case. BERRY, j.
;, In another appeal in the same cause the cou
;, directs the judgment to be modified In accor'
: ance with opinion in preceding case.
In still another appeal in the same cause Il
: court orders discharging order to show caus
and restraining order held upon the facts pr
scribed to have been properly made. Appeal
: bility of same doubted.