into which the same is divided, and the par value of each share; provided, that when any corporation is to be formed for the purpose of originating and keeping a herd-register for the entry therein of any kind of thoroughbred horses, cattle, swine, sheep or other domestic animals, the total amount of the said capital stock of such herd-register company, may be any sum not less than two hundred dollars, and the amount with which they shall commence business shall not be less than one hundred dollars;

IV. The names and residences of the stockholders, and the number of shares held by each; (s)

V. The periods at which such company shall commence and terminate, not exceeding fifty years; which certificate shall be proved or acknowledged, and recorded as required of deeds of real estate, in a book to be kept for that purpose in the office of the clerk of the county where the principal office or place of business of such company in this state shall be established, and, after being so recorded, shall be filed in the office of the secretary of state; the certificate may contain any limitation upon the powers of the corporation, the directors, and the stockholders that the parties signing the same desire (vide sections 143, 144, 207); provided, such limitation does not attempt to exempt the corporation, the directors, or the stockholders, from the performance of any duty imposed by law. ()

12. The certificate is evidence.

The said certificate, or a copy thereof, duly certified by said clerk or secretary, shall be evidence in all courts and places.

13. Corporate existence begins when certificate is filed; continuance; dissolution.

Upon making said certificate, and causing the same to be recorded and filed as aforesaid, the said persons so associating, their successors and assigns, shall be, from the time of commencement fixed in said certificate (u), and until the time limited therein

(s) Subscriptions must be real, actual and honest. An attempt to acquire corporate functions by a pretentious or evasive compliance with the law will be declared abortive on the ground of fraud. 2 Stew. Eq. 242. But see Nat. Docks R. R. Co. v. Central R. R. Co., 5 Id. 755.

(t) Duties required of an incorporated company are in the nature of conditions annexed to the grant of the franchise. State v. Godwinsville, &c., Co., 15 Vr. 496.

(u) The recording and filing of the certificate of organization are not conditions precedent to the legal existence of the corporation. They are merely necessary evidence of such existence. That evidence being produced, the legal existence, "from the time of the commencement fixed in said certificate," is proved. Vanneman v. Young, 23 Vr. 403. Where the law authorizes a

for the termination thereof, incorporated into a company, by the name mentioned in said certificate; provided, that the legislature may at pleasure dissolve any company created by virtue of this act. (Vide sections 6 and 35 to similar effect.)

14. All companies hereafter established shall be governed by this act.

All companies that may be hereafter established within this state, under the provisions hereinabove contained, or under any law of this state, and also the officers of every such company, and the stockholders therein, may exercise the powers, and shall be governed by the provisions, and be subject to the liabilities hereinbefore and hereinafter provided. (Vide sections 2, 8, 9.)

15. Company may carry on business out of this state. [This section is given as amended by the supplement of May 9th, 1889. P. L., p. 412.]

Any company organized as aforesaid may carry on a part of its business out of this state, and have one or more offices and places of business out of this state, and may hold, purchase and convey real and personal property out of this state the same as if such real and personal property were situated in the State of New Jersey; provided, that the certificate of the organization of such company shall state what portion of its business is to be carried on out of this state, and in what town or city, county and state its principal office or place of business out of this state is to be situated, and also in what other state or states, territory or territories of the United States, and in what other countries it proposes to carry on operations, and shall also state the name of the town or city and county in which the principal part of the business of said company within this state is to be transacted, (v) and such town or city and county within this state shall be deemed to be the town, place and county in which the operations and business of the company are to be carried on and its principal place of business within this state, within the provisions of this act.

16. Business to be managed by directors, who shall be shareholders. Secretary and treasurer. Other officers and agents.

The business of every such company, shall be managed and

corporation, and an effort is made in good faith to organize a corporation under the law, and thereupon, as a result of such effort, corporate functions are assumed and exercised, the organization becomes a corporation de facto, and private persons who deal with it as a corporation cannot be permitted to say, with regard to those dealings, that it was not a corporation de jure, because some legal formality, not important for their substantial rights, had not been complied with. Ibid. Vide sections 179, 206, 208.

(v) Principal office may be changed. Section 125.

conducted by the directors thereof, (w) who shall respectively be shareholders therein, and such other officers, agents, and factors as the company shall think proper to authorize for that purpose (vide section 19); and every such company shall have a secretary and treasurer. (Vide section 18.)

17. Directors, when to be chosen; one to be president. Classification of directors.

[This section is given as amended by the supplement of May 9th, 1889. P. L., p. 412.] The directors shall not be less than three in number, (x) and, except as hereinafter provided, they shall be chosen annually by the stockholders at such time (y) and place as shall be provided by the by-laws of the company, and shall hold their offices for one year and until others are chosen and qualified in their stead; (2) and one of the directors shall be chosen president, either by the directors or by the stockholders, as shall be directed by the bylaws; but by so providing in its original certificate of incorporation, any company, organized under the act to which this is a supplement, may classify its directors in respect to the time for which they shall severally hold office, the several classes to be elected for different terms; provided, that no class shall be elected for a shorter period than one year or for a longer period than five

(w) There can be no doubt about the relations which the directors of a corporation hold to its stockholders. They are trustees. They are bound to use their authority for the maintenance of the rights and the protection of the interests of the stockholders. Elkins v. Camden and Atlantic R. R. Co., 9 Stew. Eq. 467; Stewart v. Lehigh Valley R. R. Co., 9 Vr. 505. A director cannot make for himself, or for his own benefit, a contract that will bind the company. The contract may be repudiated by the company at the instance of a stockholder. Guild v. Parker, 14 Id. 435; Gardner v. Butler, 3 Stew. Eq. 702. One who is a director in both of two companies, who are contracting with each other, is incapacitated from taking part in settling the terms of the contract. Met. Telephone Co. v. Domestic Telephone Co., 17 Stew. Eq. 568, 573. In the absence of a rule requiring the concurrence of a definite number, a majority of a quorum, duly convened, may act; but each is entitled to notice. Notice of stated meetings may be given by the adoption of a rule fixing the time; constructive notice will be sufficient, if some rule, legally prescribed, declares it sufficient; but for special meetings, in the absence of a rule for constructive notice, actual notice must be given. Ibid. Cadmus v. Farr, 18 Vr. 208. (x) Vide sections 1 (paragraph 6), 116, 173, 184.

(y) Vide section 106.

(z) Where the charter provides that annual meetings shall, for the election of directors, be held by the stockholders, the directors cannot, by a by-law, so change the time of holding the annual election that they will retain themselves in office more than a year. Elkins v. Camden and Atlantic R. R. Co., 9 Stew. Eq. 467. Any action by the directors designed to retain themselves in office and thus perpetuate their control over the affairs of the corporation, against the will of the holders of a majority of the stock, is illegal and void. Ibid.; 1 McCart. 380. Stockholders have a standing in court to test the legality of an election under the provisions of section 44. St. Lawrence Steamboat Case, 15 Vr. 529.

years, and that the term of office of at least one class shall expire in each year, and such directors shall hold office accordingly; any such company, whose directors shall be so classified and which shall have more than one kind of stock (vide section 25), may, by so providing in its original certificate of incorporation, or in its by-laws, confer the right to choose the directors of any class upon the stockholders of any class or classes, to the exclusion of the others. (a)

18. Secretary and treasurer to be chosen annually: secretary to be sworn; treasurer to give bond.

The secretary and treasurer shall also be chosen annually, either by the directors or the stockholders, as the by-laws may direct, and shall hold their offices until others are chosen and qualified in their stead; the secretary shall be sworn to the faithful discharge of his duty, and shall record all the votes of the company and directors in a book to be kept for that purpose, and perform such other duties as shall be assigned to him; and the treasurer shall give bond in such sum, and with such sureties, as shall be required by the by-laws, for the faithful discharge of his duty. (Vide section 16.)

19. All other officers, agents and factors of the company shall be chosen in such manner, and hold their offices for such terms, as shall be directed by the by-laws. (Vide section 16.)

20. When any vacancy occurs among the directors or secretary or treasurer by death, resignation, removal or otherwise, it shall be filled for the remainder of the year in such manner as may be provided for by the by-laws of the said company.

21. Stockholders may vote by proxy. Meetings. Quorum. [This section is given as amended by supplement of March 9th, 1891. P. L., p. 113.] At all meetings of the company absent stockholders may vote by proxy, (b) authorized in writing; and every company may determine by its by-laws the manner of calling and conducting all

(a) The acts of de facto officers are valid, so far as they create rights in favor of third persons; a de facto officer is such as has the reputation of being an officer, and yet is not a good officer in point of law. 5 Stew. Eq. 236; 9 Id. 548. The powers of the president of a corporation are strictly the powers of an agent-powers delegated to him by the directors, who are the managers and the persons in whom the control of the business and property is vested. The president may perform all acts of an ordinary nature, which, by usage or necessity, are incident to his office. He cannot confess judgment against the company. Stokes v. New Jersey Pottery Co., 17 Vr. 237.

(b) The power of attorney must be such written evidence of the agent's right to act as will reasonably assure the inspectors that the agent is acting by authority of the principal. It need not be in any prescribed form, nor be executed with any particular formalities. It is sufficient that it appear on its

meetings, what number of shares shall entitle the stockholders to one or more votes, what number of stockholders shall attend, either in person or by proxy, or what number of shares or amount of interest shall be represented at any meeting in order to constitute a quorum; (c) provided, that in no case shall more than a majority of shares or amount of interest be required to be represented at any meeting in order to constitute a quorum; and if the quorum shall not be so determined by the company, a majority of the stockholders in interest represented, either in person or by proxy, shall constitute a quorum.

22. The first meeting of every such company shall be called by a notice, (d) signed by a majority of the persons named in the before-mentioned certificate, and designating the time, place and purposes of the meeting, and such notice shall, two weeks at least before the time of such meeting, be published in some newspaper of the county where the corporation may be established, or if there be no newspaper in the county, then in a newspaper of an adjoining county, or said first meeting may be called without such notice or publication if two days' notice be personally served on all the parties named in the certificate, or if all the parties named in the certificate waive such notice and fix a time of meeting, then no notice or publication whatever shall be required of such first meeting.

23. Every stockholder shall have a certificate, signed by the treasurer, certifying the number of shares owned by said stockholder in such company. (e)

face to confer the requisite authority and be free from all reasonable grounds of suspicion of its genuineness and authenticity. In re Election of St. Lawrence Steamboat Co., 15 Vr. 529. See section 38, infra.

(c) For decisions relative to quorum and notices, vide section 16, note w. The statute secures to each stockholder the right to one vote,. at every election of directors, for each share of the capital stock of the company held by him, and makes the books of the corporation plenary and conclusive evidence of the ownership of the stock and of the right to vote. The right to hold elections for directors and to vote at such elections are rights inherent in the ownership of stock, and a stockholder cannot be deprived of these rights upon the allegation that he proposes to use his legal rights for purposes which others may think to be detrimental to the interests of the corporation. Camden and Atlantic R. R. Co. v. Elkins, 10 Stew. Eq. 273. See section 38, infra.

(d) If all the incorporators but one are present at the first meeting, and he afterwards assents to what was done, the incorporation is valid, although no notice was given. Babbitt v. East Jersey Iron Co. (June, 1876), Stew. Dig., p. 208, 13.

(e) The holding of a certificate creates a legal presumption of rightful ownership which can only be overcome by proof that it was illegally issued or legally forfeited. Certificates are the evidence furnished by the company of ownership of stock; they are the stockholder's title to his property. Downing v. Post, 3 Zab. 66, 79.