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Corporation Law
SEC. 24 OF B.P. 68
Section 24.Election of directors or trustees. At all elections of directors, there must be present, either in person or
by representative authorized to act by written proxy, the owners of a majority of the outstanding capital stock,
or if there be no capital stock, a majority of the members entitled to vote. The election must be by ballot if
requested by any voting stockholder or member. In stock corporations, every stockholder entitled to vote shall
have the right to vote in person or by proxy the number of shares of stock standing, at the time fixed in the by-laws,
in his own name on the stock books of the corporation, or where the by-laws are silent, at the time of the election; and
said stockholder may vote such number of shares for as many persons as there are directors to be elected
or he may cumulate said shares and give one candidate as many votes as the number of directors to be
elected multiplied by the number of his shares shall equal, or he may distribute them on the same principle
among as many candidates as he shall see fit: Provided, That the total number of votes cast by him shall not exceed
the number of shares owned by him as shown in the books of the corporation multiplied by the whole number of
directors to be elected: Provided, however, That no delinquent stock shall be voted. Unless otherwise provided in the
articles of incorporation or in the by-laws, members of corporations which have no capital stock may cast as many
votes as there are trustees to be elected but may not cast more than one vote for one candidate. Candidates receiving
the highest number of votes shall be declared elected. Any meeting of the stockholders or members called for an
election may adjourn from day to day or from time to time but not sine die or indefinitely if, for any reason, no election
is held, or if there are not present or represented by proxy, at the meeting, the owners of a majority of the outstanding
capital stock, or if there be no capital stock, a majority of the members entitled to vote.
Viva voce is sufficient, unless ballot voting is requested
In stock corporations, cumulative voting in the election of
directors is mandatory
Right to cumulative voting cannot be curtailed by the by-laws
Number of voting stockholder votes = product of number of
shares owned and the number of directors to be elected
The BY-LAWS cannot provide against cumulative voting since this right is
mandated by law (Sec. 24)


(Montana) DISTRICT COURTS RULING: The right to vote
cumulatively is a right guaranteed by the Constitution of Montana.
Such right cannot be abridged by a corporate by-law or resolution of
stockholders or by a ruling of the president. Even if the by-laws be
treated as a contract between stockholders, such is against public
policy. The election of directors was void and a new election was
ordered to be held, at which stockholders could cumulate their votes.
Cumulative voting (one candidate): If A has 100 shares and there are
5 directors to be elected, he shall multiply 100 by five (equals 500) and
he can vote the 500 for only one candidate.
Freys formula (minimum no. of votes to elect one director)
X= # of shares required
Y= # of outstanding votes
Z= # of directors to be elected

X= Y +1
Cumulative voting (multiple candidates): If A has 100 shares, there
are 5 directors to be elected, and he only wants to vote for two nominees,
he can divide 500 votes between the two, giving each one 250 votes.
Baker & Carys formula (minimum no. of votes needed to elect multiple
X= # of shares required
Y= # of shares represented at meeting
D= # of directors the minority wants to elect D= total # of
directors to be elected

X= YxD +1
D + 1
Total number of
Total number of
directors one desires
shares represented at
to elect
the meeting

Total number of
directors to be
Applying the formula, for the minority to ensure the election of one (1)
member in a five-member Board of Directors, at a meeting where there are
100 shares represented,

1. How much shares does the minority needs to have/hold?

2. How many shares or votes remaining?