CHAPTER I.

I. CORPORATIONS.

POWERS AND PRIVILEGES DEFINED AND LIMITED AND DUTIES PRESCRIBED.

(Title III. of Chapter 18 of Part I. of N. Y. Revised Statutes of 1830.)

1. General powers.

§ 1. Every corporation, as such, has power,

1. To have succession by its corporate name, for the period limited in its charter; and when no period is limited, perpetually :

2. To sue and be sued, complain and defend, in any court of law or equity:

3. To make and use a common seal, and alter the same at pleasure:

4. To hold, purchase, and convey such real and personal estate as the purposes of the corporation shall require, not exceeding the amount limited in its charter :

5. To appoint such subordinate officers and agents as the business of the corporation shall require, and to allow them a suitable compensation:

6. To make by-laws, not inconsistent with any existing law, for the management of its property, the regulation of its affairs, and for the transfer of its stock.

2. In what corporations to vest.

§ 2. The powers enumerated in the preceding section shall vest in every corporation that shall hereafter be created, although they may not be specified in its charter, or in the act under which it shall be incorporated.

3. What other powers to be possessed.

§ 3. In addition to the powers enumerated in the first section of this title, and to those expressly given in its charter, or in the act under which it is or shall be incorporated, no corporation shall possess or exercise any corporate powers, except such as shall be necessary to the exercise of the powers so enumerated and given.

4. Exercise of banking powers prohibited.

§ 4. No corporation created, or to be created, and not expressly incorporated for banking purposes, shall by any implication or construction, be deemed to possess the power of discounting bills, notes, or other evidences of debt, of receiving deposits, of buying gold and silver bullion, or foreign coins, of buying and selling bills of exchange, or of issuing bills, notes, or other evidences of debt, upon loan, or for circulation as money.

5. Liability of stockholders.

§ 5. Where the whole capital of a corporation shall not have been paid in, and the capital paid shall be insufficient to satisfy the claims of its creditors, each stockholder shall be bound to pay on each share held by him the sum necessary to complete the amount of such share, as fixed by the charter of the company, or such proportion of that sum as shall be required to satisfy the debts of the company.

6. Quorum.

§ 6. When the corporate powers of any corporation are directed by its charter to be exercised by any particular body, or number of persons, a majority of such body, or persons, if it be not otherwise provided in the charter, shall be a sufficient number to form a board for the transaction of business; and every decision of a majority of

the persons duly assembled as a board shall be valid as a corporate act.

7. Forfeiture for non-user not to apply in certain

cases.

§ 7. If any corporation hereafter created by the legislature, shall not organize and commence the transaction of its business within one year from the date of its incorporation, its corporate powers shall cease.

8. Reservation of power to repeal, etc.

§ 8. The charter of every corporation, that shall hereafter be granted by the legislature, shall be subject to alteration, suspension, and repeal, in the discretion of the legislature.

9. Trustees in case of dissolution.

§ 9. Upon the dissolution of any corporation created or to be created, and unless other persons shall be appointed by the legislature, or by some court of competent authority, the directors or managers of the affairs of such corporation at the time of its dissolution, by whatever name they may be known in law, shall be the trustees of the creditors and stockholders of the corporation dissolved, and shall have full power to settle the affairs of the corporation, collect and pay the outstanding debts, and divide among the stockholders the moneys and other property that shall remain, after the payment of debts and necessary expenses.* *

10. Their powers.

§ 10. The persons so constituted trustees shall have authority to sue for and recover the debts and property of the dissolved corporation, by the name of the trustees of such corporation, describing it by its corporate name,

* 1 R. L. of 1813, p. 248, § 1.

and shall be jointly and severally responsible to the creditors and stockholders of such corporation, to the extent of its property and effects that shall come into their hands.*

11. Certain books to be open at certain times for examination. Penalty.

(Title IV. of Chapter 18 of Part I. of N. Y. Revised Statutes of 1830.) SECTION 1. The book or books of any incorporated company in this state, in which the transfer of stock in any such company shall be registered, and the books containing the names of the stockholders in any such company, shall, at all reasonable times during the usual hours of transacting business, be open to the examination of every stockholder of such company, for thirty days previous to any election of directors; and if any officer having charge of such books shall, upon demand by any stockholder as aforesaid, refuse or neglect to exhibit such books, or submit them to examination as aforesaid, he shall, for every such offence, forfeit the sum of two hundred and fifty dollars, the one moiety thereof to the use of the people of this state, and the other moiety to him who will sue for the same, to be recovered by action of debt in any court of record, together with the costs of such suit.t

12. Dividends from surplus profits only.

§ 2. It shall not be lawful for the directors or managers of any incorporated company in this state to make dividends, excepting from the surplus profits arising from the business of such corporation.

13. Capital not to be reduced. tend forth 184 And it shall not be lawful for the directors of any such company to divide, withdraw, or in any way pay to the stockholders, or any of them, any part of the capital

* 1 R. L. of 1813, p. 249, § 2.

+ Laws of 1825, p 448, § 1.

stock of such company, or to reduce the said capital stock, without the consent of the legislature.

14. Notes for instalments on stock, not to be discounted.

And it shall not be lawful for the directors of such company to discount or receive any note, or other evidence of debt, in payment of any instalment actually called in and required to be paid, or any part thereof, due or to become due on any stock in the said company.

15. Nor notes to withdraw instalments paid.

Nor shall it be lawful for such directors to receive or discount any note, or other evidence of debt, with the intent of enabling any stockholder in such company to withdraw any part of the money paid in by him on his stock.

16. Liability of directors for violating these provisions. Extent of liability.

And in case of any violation of the provisions of this section, the directors under whose administration the same may have happened, except those who may have caused their dissent therefrom to be entered at large on the minutes of the said directors at the time, or were not present when the same did happen, shall in their individual and private capacities, jointly and severally, be liable to the said corporation, and to the creditors thereof in the event of its dissolution, to the full amount of the capital stock of the said company so divided, withdrawn, paid out, or reduced, and to the full amount of the notes or other evidences of debt so taken or discounted in payment of any stock, and to the full amount of any notes. or other evidences of debt so discounted with the intent aforesaid, with legal interest on the said respective sums, from the time such liability accrued.