Sferlazzo v. Oliphant

Corporations—Power of Officers—Indorsement of Note by President—Custom.—The president and general manager of a corporation may be shown to be invested by custom or the usage of its business with authority to indorse and transfer commercial paper.

Id.—By-laws Declaring Powers of Officers—Whether Preclude Proof of Custom.—Proof of such usage is not precluded by a by-law of the corporation providing that the president “shall sign as president all certificates of stock, and other contracts and other instruments of writing which have been first approved by the board of directors, and shall draw all cheeks.”

Id.—Limitation on Power of Directors—By-laws not so Interpreted.—Such by-law is not a limitation upon the power of the directors of the corporation to invest its president and general manager with authority to do things of the kind in question in the ordinary and usual course of its business, and to signify their approval of his acts by the custom and usage of the corporation in the conduct of its affairs.

Id.—Special Meeting of Directors—Notice—Manner of Proving.—• The purpose of a by-law providing that service of the notice of a special meeting of directors shall be entered in the minutes, and ■that the minutes upon being read and approved at a subsequent meeting, shall be conclusive upon the question of service, is to facilitate the proof of the regularity of the board’s proceedings, ■but not to limit the manner of proving service. Hence it is error, in an action on a note executed to a corporation and indorsed by its president, to refuse to permit the plaintiff to prove by a witness that absentees from a special meeting of the board of directors at which a resolution was passed authorizing the president to indorse the note, had been duly served with written notice of the meeting.

Id.—Proof of Service of Notice of Special Meeting on Absentees— Whether Necessary.—Where the minutes of such a special meeting authorizing the president of the corporation to indorse its commercial paper are read in evidence without objection, and it appears therefrom that a quorum was present, it is not essential for the plaintiff to prove that the absentees were served with notice of the meeting.

Id,—Special Meetings of Directors—Presumption as to Regularity of Proceedings—Burden of Proof.—While it is true that special meetings of the directors of corporations are not legal unless called and noticed as the by-laws require, or unless these requirements are waived by the members of the board, either expressly or impliedly, by their presence and participation in the meeting, yet it is not incumbent upon a person relying upon the regularity of acts done at such meeting, to show affirmatively that the meeting was in faet called and noticed in the manner specified in the by-laws. The meeting having been held, and a quorum of the board having been present and done the act in question, their meeting and action are presumed to be regular and legal; and it is incumbent upon those who assailed the legality of the meeting and of the act in question to show that the meeting was not called and noticed as the by-laws require.