1906-1908 Ind. Op. Att'y Gen. p. 47

Before an organization can care for dependent, neglected or delinquent children, it must submit its intended articles of incorporation to the board of state charities for approval. Where an organization fails to comply with the prerequisites for association, the organization has no legal standing to

Year: 1906Length: 1,102 wordsOfficial source
CTIARITiES, BOARD OF STATE-POSITIONS OF ORGANI- ZATIONS UNDER SECTION 9, P. 521, ACTS 1903, -WHOSE ARTICLES HAVE NOT BEEN SUB-iITTED TO BOARD. December 22, 1906. Hon. Amos W. Butler, Secretary Board of State Charities, City: Dear Sir-In your communication of December 17th, you ask the following questions: "What is the position of two kinds of organizations under section 9, page 521, of the acts of 1903, whose articles of asso- ciation have not been submitted to the board of state charities?" (a) Is an organization whose articles of association have been filed with the secretary of state and a certificate issued to it, and which states specifically one of its duties is to care for de- pendent and neglected children, legally incorporated, and what is its standing with regard to the right to care for such children? (b) Is an organization whose articles of association have been filed with the secretary of state and a certificate issued to it and which articles do not state that its purpose is to care for such chil- dren, any legal right to engage in that work? The statute to which you refer reads as follows: "No association whose objects may embrace the caring for dependent, neglected or delinquent children shall here- after be incorporated in this state untess the proposed arti- cles of incorporation shall first have been submitted to the board of state charities, and the secretary of state shall not issue a certificate of incorporation unless there shall be first filed in his office the certificate of said board of state charities that said board has examined the said articles of incorporation and that in the judgment of said board the incorporators are -reputable persons,. that the proposed work is needed, and the incorporation of such association is desirable and for the public good; amendments proposed to the articles of incorporation or association having as its object the care and disposal of dependent. neglected or delin- quent children shll be submitted in like manner to the board of state charities, and the secretary of state shall not record such amendment or issue his certificate therefor unless there shall first be filed in his office a certificate of the board of state charities that they have examined the said amendment, that the association is in their judgment per- forming in good faith the work undertaken by it, and that the said amendment is, in their judgment, a proper one and for the public good." It will be observed that this section expressly provides as fol- lows: "No association whose objects may embrace the caring for dependent, neglected or delinquent children shall hereafter be incorporated in this state unless the proposed articles of in- corporation shall first have been submitted to the board of state charities," etc. While it is well settled that a corporation which has attempted in good faith to organize under an existing statute, and has ac- tually exercised corporate powers thereunder is to be deemed a corporation de facto, it is equally well recognized that where a statute prescribes a condition precedent which is to be performed by the adventurers before the corporate entity can come into ex-istence, a strict performance of such condition is imperative. The rule is stated in 7 Thompson on Corporations, section 8210, qnoting from a, decision of the supreme court of Pennsyl- vania: "t is essential to the creation of a corporation under an enabling statute that all material provisions should be stibstantially followed. " 4 " What provisions are ma- terial must be gathered from the relation of each to the proposed scope of the act; and when therefore successive steps are prescribed for the-creation of corporations, these nmst obviously be regarded as imperative." In 7 Amer. & Eng. Ency. of Law, p. 655, the rule is thus laid down: "A broad distinction exists between those statutory re- q Iirements made necessary by general incorporation laws as prergquisites to the existence of corporate powers, and those acts required of individuals seeking incorporation, but not made prerequisites to the exercise of such powers Without a compliance with the requirements of the former clause there can be no corporation, either de facto or de jnre. and any material omission in respect thereto may be taken advantage of collaterally in any form in which the incorporation can properly be called in question." I am of the opinion that it was the legislative intention that before an association could care for dependent, neglected or de- linquent children, it must submit its intended articles of incorpo- ration to the board of state charities for the latfer's approval and that a failure so to do is not a mere irregularity of incorporation, but is the omission of a prerequisite. The purpose of the statute was to throw safeguards around the organization of societies, orphanages and similar institutions for the benefit of the children which should be entrusted to their. charge. Corporations organized for such purposes are in a sense per- forming the duty of the state to dependent, neglected or delin- quent children, and it was eminently fit that the state should have a direct voice in determining whether the corporation onght to be organized and whether it should exercise any powers under the law. This view is substantiated by section 10 at page 522 of the acts of 1903, which provides as follows: "'This act shall be liberally construed to the end that its purpose may be carried out, to wit: that the care, cus- tody and discipline of the child may approximate, as nearly as may be, that which should be given by its parents, and in all cases where it can properly be done, the child is to be placed in an approved family home and become a mem- ber of the family by legal adoption. or otherwise." i\ly opinion is, therefore, that where organizations of either of the two classes mentioned in your communication have failed to comply with section 9, supra, they have no legal standing, are neither de jure nor de facto corporations and their right to ex- ist can be questioned either in a proper action brought on behalf of the state, in the nature of quo warranto., or collaterally by an individual. OIL INSPECTOR-PUBLIC RECOIDS OF. December 31, 1906. Ifon. Sid Conger, Supervisor of Oil Inspection, City: Dear Sir-I am in receipt of your esteemed favor of December 29th, in which you state: "We would like your opinion as to what would con- stitute the public record or the information that should be open to inspection of any and all person interested." [4-19395]
1906-1908 Ind. Op. Att'y Gen. p. 47: Before an organization can care for dependent, neglected or delinquent children, it must submit its intended articles of incorporation to the board of state charities for approval. Where an organization fails to comply with the prerequisites for association, the organization has no legal standing to | Justis AI