Wight v. Springfield & New London Railroad

Gray, C. J. Although the directors of a railroad corporation are usually chosen by the stockholders from their own number, there is no rule of law that makes the holding of stock an indispensable qualification of a director, unless prescribed by some act of the Legislature or by-law of the corporation. The only adjudication upon the subject, cited at the argument, supports this view. State v. McDaniel, 22 Ohio St. 354. And the statutes expressly requiring directors of banks and insurance companies to be members of the corporation, and the first directors of a railroad corporation incorporated under the general law to be associates, strengthens the conclusion that the Legislature intended to leave the qualifications of directors in the permanent organization of such a corporation to the determination of the stockholders. Gen. Sts. c. 57, § 41; o. 58, §§ 27, 43. St. 1872, e. 53, § 4. Sargent v. Webster, 13 Met. 497, 504. The remarks of the court in Penobscot Railroad v. Dummer, 40 Maine, 172, 174, and in Spering’s Appeal, 71 Penn. St. 1, 21, on which the respondent relies, do not appear to have been necessary to the decisions, and the reports do not show what the statutes were under which the cases arose. The St. of 1874, c. 251, authorizing towns and cities to subscribe .for and hold stock in railroad corporations, by § 2 authorized any town or city to become an associate for the formation of a railroad corporation in compliance with the general railroad act of 1872, c. 53, “ with all the powens and privileges enjoyed by any individual associate,” and in § 5 provided that “ the selectmen of towns, and such persons as may be authorized by vote of the city council of cities, may, at all meetings of the corporations [228] in which the stock or securities are held, represent their respective municipalities, and vote upon each and every share of stock owned by them respectively.” Under the authority conferred by this statute, the city of Springfield has become the owner of three fourths of the capital stock of the Springfield and New London Railroad Company. It would be a most unreasonable construction of the statute to limit the choice of the city in the election of directors to the holders of the remaining fourth part of the stock. For these reasons, we are of opinion that the petitioner has been duly elected a director of the respondent corporation, and that a Peremptory writ of mandamus must issue.