Court Opinion

ID: 9865084
Source: CourtListenerOpinion
Date Created: 2023-09-25 16:23:15.511831+00
Date Added: 2024-06-11T12:37:15.290114
License: Public Domain

Mr. Justice Bouck, dissenting.
It seems to me that the majority opinion herein virtually repeals ’35 C. S. A., ch. 41, §27 (e) [S. L. ’21, §4, p. 198, 201], which prohibits the encumbering of corporate assets by a mining or manufacturing corporation without a previous authorizing* vote at a special meeting of the *367stockholders. The only argument made in favor of the judgment of affirmance is that the plaintiff stockholder ratified the directors ’ admittedly unauthorized encumbering of the assets of this mining corporation by granting a proxy to one who voted in his name at a stockholders’ meeting called “for the purpose of electing directors of the company and for the transaction and ratification of any and all other business that may come before the meeting.” (Italics are mine.) Neither the notice nor the minutes of the directors ’ meetings nor the minutes of the stockholders ’ meeting for alleged ratification can be said to have given the slightest inkling that one of the matters sought to be ratified was the unauthorized mortgage which the directors had placed upon the corporation’s assets, when the statute expressly stated that such encumbering is void. To say that the notice stated the ‘ ‘ object ’ ’ of the meeting in that regard within the meaning of the section is to give judicial sanction to the doctrine that “language is the art of concealing thought.” Without saying that there can be no ratification under any circumstances whatever, if the mortgage is given without the stockholders’ consent in advance, I do say that, aside from the question of a sufficient notice, the plaintiff stockholder had nothing like that detailed and complete knowledge of pertinent facts which is a prerequisite to binding a person by ratification. Compare: Montrose Land and Inv. Co. v. Greeley Nat. Bank, 78 Colo. 240, 241 Pac. 527.
Moreover, I think counsel for the stockholder have presented conclusive reasons for holding that the creditor to whose personal representatives the mortgage was given after his death had duly exercised an option whereby he accepted a certain large block of the capital stock of the corporation in full settlement of his claim and to the exclusion of any right he might otherwise have had to demand a mortgage as security. Justice, I think, requires a new trial.
Lack of time is my justification for filing this hurriedly written memorandum of dissent.