Opinion ID: 1596494
Heading Depth: 2
Heading Rank: 2

Heading: Type of Corporation (General Purpose or Special Purpose)

Text: ¶ 15. Keene argues that the trial court erred by finding that the Academy is a general-purpose corporation. He contends that the Academy is a specific-purpose corporation set up for the purpose of conducting a school business. The Academy's articles of incorporation state, in part: THIRD: the specific purpose or purposes for which the corporation is organized stated in general terms are: (1) To organize, own and operate primary schools, secondary schools and/or colleges and other educational institutions for the education of youth. (2) To fix the curricula for such schools, colleges and other such institutions and the standards and qualification of admission of pupils and students and for their retention in such schools, colleges and other such institutions and to reject any applicant for admission or to expel any person so enrolled and attending for any cause whatsoever. (3) To select and employ such principals, teachers, professors, instructors and other employees as the corporation may deem necessary and advisable and to deny or terminate such employment at the will of the corporation. (4) To prescribe, charge and collect such fees as the corporation may find necessary and proper to be collected from pupils and students and to vary such charges in any or all individual instances as may be determined by the corporation so that it shall not be necessary for all the pupils or students in the same grade or classes to pay the same or identical fees or tuition, but such fees or tuition as may be charge in each case and each instance to be solely within the discretion of the corporation. (5) To have and to exercise all powers conferred by the laws of the State of Mississippi upon corporations. (6) To purchase, own, lease, hire, or otherwise acquire real and personal property, improved and unimproved, or every kind and description, and to sell, dispose of, lease, convey, encumber and mortgage said property, or any part thereof. To acquire, hold, lease, manage, operate, develop, control, build, erect, maintain for the purposes of said corporation, construct, reconstruct or purchase, either directly or through ownership of stock in any corporation, any lands, buildings, offices, stores, warehouses, plants, machinery, rights, easements, privileges, franchises and licenses, and to sell, lease, hire or otherwise dispose of lands, buildings or other property of the corporation, or any part thereof. (7) To do all and everything necessary and proper for the accomplishment of the objects herein enumerated or necessary or incidental to the benefit of the corporation. ¶ 16. In reaching its decision, the trial court determined at the hearing for summary judgment that the Academy is a general-purpose corporation. The trial court determined that the formation of the Foundation was in line with the purpose of the Academy's articles of incorporation. Further, the trial court noted the language in subsection six, in particular the language that pertained to the Academy's ability to sell, lease, hire, and to dispose of land, buildings, or other property belonging to the corporation. ¶ 17. The trial court did not err by finding that the Academy is a general-purpose corporation. While one of the enumerated corporate purposes for the Academy is for the organization and operation of schools, it has many others, including (5) To have and to exercise all powers conferred by the laws of the State of Mississippi upon corporations, and section six, concerning the sale, lease, acquisition and disposal of real and personal property, among other powers. Keene cites Tallahatchie Valley Electric Power Association (TVEPA) v. Mississippi Propane Gas Association, Inc., 812 So.2d 912, 919 (Miss. 2002) and Blue Cross and Blue Shield v. Protective Life Insurance Company, 527 So.2d 125, 127-28 (Ala.Civ.App.1987) for authority. Decisions from other jurisdictions are merely informative and not binding authority on this Court. Paz v. Brush Engineered Materials, Inc., 949 So.2d 1, 7 (Miss.2007); Cucos, Inc. v. McDaniel, 938 So.2d 238, 241 (Miss.2006); Griffith v. Gulf Refining Co., 215 Miss. 15, 61 So.2d 306, 307 (1952). While the Court may utilize these decisions as persuasive authority if it finds them well-reasoned, the decisions are not binding, and this Court is at perfect liberty to disregard them. Paz, 949 So.2d at 7. ¶ 18. Tallahatchie Valley is distinguishable from Keene's case because it involved compliance with statutory laws for regulating rural electric power companies. In Tallahatchie Valley, this Court determined whether Mississippi's Electric Power Association Law prohibited TVEPA, a rural electrical power company, from acquiring a controlling interest in an entity that did not provide electricity. Tallahatchie Valley, 812 So.2d at 914-15. See also Miss. Code. Ann. § 77-5-201 to 255 (Rev.2009). TVEPA's board of directors invested in a propane gas business. Id. at 915. However, both the statutory Act and TVEPA's charter confined it to using electrical energy. Id. at 918. This Court found that the Act expressed a clear legislative intent that limited a corporation under the Act to acquisition of electrical energy. Id. This Court held that TVEPA's corporate purpose is limited to and cannot exceed the powers granted by the statutory scheme pursuant to which it was created. Id. ¶ 19. Keene also cites Blue Cross for the proposition that a specific-purpose corporation has only those powers necessary to effect its corporate purpose. Blue Cross, 527 So.2d at 127-28. As noted above, rulings from other jurisdictions are nonbinding on the courts of Mississippi. Paz, 949 So.2d at 7. In Blue Cross, the corporation sought to acquire a life insurance company and to market life insurance. Id. at 126. The Court of Appeals of Alabama determined that Blue Cross was purely a statutory creature whose powers were derived from the Alabama Code. Id. The Alabama court also determined that Blue Cross was a specific-purpose corporation limited to maintaining a health-care service plan, and marketing life insurance was prohibited. Id. at 128. Like Tallahatchie Valley, Blue Cross is distinguishable from Keene's case because it was governed by specific statutes created for regulating a specific industry. Accordingly, this issue is without merit.