Waite v. Windham County Mining Co.

Poland, Ch. J. The plaintiff was appointed treasurer of the company by the directors of the same. All the directors were present at the time except one, and without reckoning the plaintiff, a majority of the board were present and made the appointment. It is not found that the director who was not present was not notified, so that he might have been present if necessary. But we are riot [611] prepared to say that the action of a majority was not legal though one member was not notified. Nor do We deem it necessary there 'should be any formal meeting of the directors in order to enable them to do any act which was properly within their power to do. The bylaws of the company expressly provide that the treasurer shall be appointed by the directors. The plaintiff entered upon the performance of his duties as treasurer, and no question seems ever to have been raised by the absent director, or any stockholder of the company, but that he had been legally appointed. From this, the assent of the absent director, and of the company, may well be assumed, if that were necessary, and after acquiescing without objection, and allowing him to perform the services and duties of the office, they can-, not be permitted to refuse payment for services, on the ground that he did not legally hold the office. The defendants claim that the directors could not legally contract with the plaintiff as to the amount of his compensation as treasurer. As before said the directors have the power of appointment, and in the absence of any prohibition in the charter or by-laws, on the directors, and of any other person to whom, or mode in which, the salary or compensation of the treasurer is to be determined, we think the power to fix his compensation, or agree with him upon it, belongs to the directors as an incident of the power of appointment, as otherwise they might be wholly unable to fill the office. They might not be able to find any person to accept it, unless he could have his compensation fixed. But we think further, that in the case of a business corporation like this, such a power is incident to the general power and duty of the office, position and duties of directors. They have the general care and oversight of the interests and affairs of their constituent corporation, and may as well agree with the treasurer on the price of his services, as for those of laborers or any other employee of the company. There is nothing in the report that would justify the conclusion that the price agreed on for the plaintiff’s salary as treasurer of the company was intended as a cover for usury, and nothing from which we can say that the contract was not fairly and honestly entered into both by the plaintiff and the directors with whom the contract was made. Nor is there any claim made but that the plaintiff performed [612] all the duties of treasurer with fidelity, and to the full satisfaction of the company and its officers. The plaintiff was therefore entitled to his compensation as treasurer, according to the contract price. No question is made but that the plaintiff was duly appointed the secretary of the company, and that the compensation agreed upon for that office, is binding on the company. The agreement for the payment of the one per cent, a month upon the moneys advanced by the plaintiff for the company, we consider a direct contract for the payment of a greater rate of interest than is allowed by law, and therefore not binding. It was a direct loan of money by the plaintiff to the company to be repaid at all events. If the contract had been that the plaintiff was to be paid a certain per cent, for endorsing the paper of the company to enable them to raise money to use, such a contract might be good, as a compensation for the risk and responsibility incurred. But this was a direct loan of the plaintiff’s own money, and though he might incur risk of losing it by the failure or inability of the company to pay, he could not take an additional rate of interest for such risk. The law will not enable a lender of money to graduate his rate of interest on a loan, according to the risk he runs of the solvency of his debtor. If there had been some contingency upon which the money was advanced, by which the plaintiff might have lost any claim to have his money back, such a contract would have been valid. But this was a direct loan, to be repaid absolutely, and any contract for more than lawful interest upon it was usurious. This claim should have been disallowed. The judgment is reversed, and judgment rendered for the plaintiff for the sum of $1056.37. and interest since September 13th, 1864. The plaintiff to recover no costs in this court, and the defendants’ costs in this court to be deducted.