Montana Attorney General Opinion 15-149

Opinion No. 149 Corporations - Articl.es of Incorpora- tion-Amendment-SecretaI'Y of State -Capital Stock. HEIJD: The SeCl·etar~· of State is not vested with any discretion hut must accept for filing a certificate, fair on its face, of the proceedings of a cor- poration, which resulted in its articles of incorporation being amended so as to increase its capital stock, even though extraneous investigation by him apparently discloses that the actual ca]Jital paid in amounts only to $750.00. April 11, 193.'3. You have asked us whether or not under the provisions of Chapter 33, Laws of 1931, you are "ested with any discretion in accepting for filing a cer- tificate of the proceedings of a corpora- tion which resulted in its articles of incorporation being amended so as to increase its capital stock by authoriz- ing the issuance of one thousand shares of preferred stock of the par value of $100.00 each, where extraneous inves- 112 OPI~IO~S OF THE ATTORXEY GEXERAL tigation on your part has apparently disclosed that the actual capital paid in amounts to only $750.00. A close examination of the certifi- cate in question satisfies us that the proceedings were regular and that the pro\isions of Chapter 38, Laws of Hl31, were fully complied with. What, then, may the Secretary of State do under such circumstances'! The general rule is that he is charged with the duty of accepting and filing the certificate when it shows on its face that every- thing the statute requires has be~n done. In other words, his duty in the matter is controlled by the relevant law of the state alid not by his own discretion. Indeed, the remedy by mandamus is availahle against him where his duty to file is clear. (State \'. RotwHt, 17 Mont. 537; Mohall l!'armers' Elevator Co. v. Hall, 176 N. W. 131; State v. Benson, 128 Atl. 107; State v. Taylor, 44 N. E. 513; Oalifor- nia Tel. Co. v. Jordan, 126 Pac. 598; 7 Fletcher's Cyclopedia of the Law of Corporations, Sec. 3722; 38 C. J. 666, 667; note 52 L. R. A. (N. S·.) 436.) As the case of State Y. Rotwitt. above, is entirely in point the discus: sion may with propriety end here. We merely desire to add, however, that the clause which you quote from Section 1 of Chapter 33 is intended evidently to limit the authol;ty of a corporation to issue preferred stock and not to con- fer visitorial power on the Secretary of State. \Ve accordingly advise you to file the certificate.