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12 Johnston v. Johnston PDF
12 Johnston v. Johnston PDF
39
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p. 6il, Jliid.)
-1. In.; Io.; NOTICE ; Pr:ESENCIC OF STOCKlIOLDt:KS PERSOKALLY OR BY
PROXY r.IAY Cl.IRE l)EFECT I:'< NoTlCE.�\.Vhen all the stockholder�
are present either in person or by p1·oxy during the stock
holders' nreeting, \\"hat.>cver dl•feet there is in tl1e notiee is cured
i)y their presenee and acquiescence. (18 CJS, 1231.)
I
I
SEPTEMBER 27, 1965 OFFICIAL GAZETTE 6163
.
"This notice is being called at the instance of Mr. Logan Johnston
on the basis of his claim that he represents the majority of the
stocks of the Company.
"As indicated in the letter of Mr. Logmi Johnston, dated May 29,
1963, matters \Vhich were not taken up, or not finished, in the
regular annual stockholders meeting held last April 2, 1963 will be
taken up in this special stockholders' meeting.
'The busin'tlss agenda for this special stockholders' meeting shall
be as follows:
"1. Finamcial Report
2. Additional report of the President on the operations of the
business and the status of the Company
3. Recommendations and proposals of the President" (Exh. 6.)
Pursuant to this notice, another stockholders meeting was
l1eld at the principal office of the corporation on July 20,
1963. During that meeting, \Vhich 1vas presided by re
spondent Louis A. Johnston, after the roll was called and
a quorum was declared, F. Logan Johnston moved for the
election of a ne\v board of directors, claiming that there
was no valid meeting on April 2, 1963 because there was no
quorum. The motion >vhich was duly seconded by Ireme
Johnston was overruled by the Chair. F. Logan Johnston
insisted that his motion ¥las In order and asked for a div
ision of the house, but the Chair stood pat on its former
ruling. Sensing that he owned and/or represented the
majority of the stocks of the corporation, F. Logan Joh11s
ton then and there nominated his own set of directors,
V1•hich nomination the Chair overruled, and after moving for
a division of the house, properly seconded by Johnston,
\Vhich the Chair likewise ovt1·ruled, the petitioner cast their
votes in faYor of their nominees. Those elected to the new
board \Vere F, Logan Johnston, Irene R. Johnston, Felisa
P. Johnston, I,ouis A. Johnston and Elizabeth J. Araneta.
Immediately after the election of the said directors, F.
Logan Joh11ston invited Louis A. Johnston and Elizabeth
J. Araneta to attend the board meeting which his bloc was
holding upstairs. The two respondents declined the invi
tation saying that they "do not recognize that body.'' Peti�
tioners convened as a board and elected the follo\ving
officers: F. Logan Johnston, president and general manager;
Irene R. Johnston, vice-president and assistant general
manager; and Felisa P. Johnston, secretary-treasurer.
After the election of the petitioners to the offices above
mentioned, they made a demand on the respondents for the
turnover of the records and functio11s of their respective
positions, but as this de1nand \\'as not honored by the reM
spondents the instant petition for quo \varranto was filed
in court.
The crucial issues in this appeal are: (1) \vhether or not
the appellants 'vere validly elected as directors and officers
of the corporation in the meeting of April 2, 1963; (2)
6164 OFFICIAL GAZETTE VoL. 61, No. 39
vious years, even after the issuance of the court's order '
special case No. 576 of the same court, 'vhich was still f
effective on April 2, 1963 (Exh. I}. (
Considering all the foregoing, the withdrawal of F. q
Logan Johnston from the meeting of April 2, 1963, al� n
though it actually defeated the existence of the quorum, s
was neither unreasonable nor u11justified. He11ce, the con a
tention of the appellants that his withdra\val did not pro n
duce the effect of nullifying all the proceedings ,,·hich \vere J
held thereafter, upon the authorities cited by thein, cannot
SEPTEMBER 27, 1965 OFFICIAL GAZETTE 6167
the manner the votes of the petitio11ers \Vere cast be ques '"
suf
tioned for, "In the absence of mandatory provision to the
offi,
contrary in the charter or by�la\vs, the voting at a corporate Col
meeti-9.g may be either by ballot, vi-va voce, or by a sho'v
Be
of hands." (p. 81, Id.)
01'
It is contended in the appellants' brief that "Consider
deJ
.·
oft
'\Vas already told that only the business specified in tl1e
•nd
notice could be taken up?'' (pp. 13-14.) , implying that sco1
a presiding officer could prevent a question to be put to the stoc
house even ori whimsical and capl'icious gron11ds. As well aIth
said, n1eetings shall be conducted witl1 fair11ess and good \
faith to\vards all 'vho are entitled to take part, and in did
such a wa}' as to enable then1 to express their vote upon Jul:
questions coming before the 111eeti11g. "The ordinary par ti or
liamentary usages and practice and rules of order apply to
SEPTEMBER 27, 1965 OFFICIAL GAZETTE 6169
\Ve conclude fron1 all the foregoing that the trial court
did not err in holding that the election of directors in the
July 20 meeting \Vas proper as well as the subsequent elec
tion of the officers of the corporation held on the same date.
,, .•
6170 OFFICIAL GAZETTE VoL. 61, No. 39
. SO ORDERED.
JwJ,gment affirmed.
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