Court Opinion

ID: 9565444
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:21:18.496607+00
Date Added: 2024-06-11T09:19:38.979916
License: Public Domain

HALL, Chief Justice
(concurring and dissenting):
I join the opinion of the Court, except the portion thereof that concludes that the proxies were terminated by operation of law.
The language of U.C.A., 1953, § 16-10-31, which limits the life of proxies, is plain and unequivocal. It simply provides:
No proxy shall be valid after eleven months from the date of its execution, unless otherwise provided in the proxy.
(Emphasis added.) Therefore, imposition of the statutory proxy-life of eleven months is conditioned upon the absence of *292a contrary agreement between the parties to the proxy.
In the instant case, the proxies did “otherwise provide” since they contained express language that declared them to be irrevocable. The irrevocable nature of the proxies effectively neutralized the termination language of the statute, and therefore they remained valid until revoked.
Generally, a proxy is revocable at the pleasure of the stockholder even though by its terms it is declared to be irrevocable.1 However, a proxy, coupled with an interest, constitutes an exception to the general rule, and such a proxy is irrevocable whether or not the instrument so provides.2 Again, however, there is an exception to that exception. Although a proxy is given for a valuable consideration, it may be revoked where it is used for a fraudulent purpose.3
In this case, the trial court aptly observed that the proxies were coupled with an interest, but it erred in not declaring them to have been lawfully revoked. The stockholders had every right to revoke the proxies by reason of the breaches of faith on the part of Baggs and in light of his unauthorized activities that were wholly inconsistent with the purpose of the proxies and contrary to the best interests of the corporation and the stockholders.
On remand, I would also direct the entry of a judgment declaring the proxies invalid, but would do so on the basis of the lawfulness of the revocation thereof by the stockholders.
HOWE and DURHAM, JJ., concur in the concurring and dissenting opinion of HALL, C.J.

. 19 Am.Jur.2d Corporations § 675.

. Id. at § 676.

. 18 C.J.S. Corporations § 550g.