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In the early statutes authorizing the increase of stock not much was said about the manner of the issue. It could be issued by a vote of the corporation provided the issue was for the purposes of the charter and did not exceed the amount of the capital authorized by law. St. 1830, c. 53, § 3; Rev. St. 1836, c. 38, § 11. Then came a provision that no share should be issued for a less sum, actually paid in cash, than the par value of shares first issued. St. 1851, c. 133, §§ 8, 16; St. 1858, c. 167; St. 1859, c. 104; Gen. St. 1860, c. 61, §§ 6, 9. Gas companies could increase their stock at will for the purposes of the business for which they were chartered, subject only to the conditions that the stock should not exceed the amount fixed by the charter or by a general statute, as the case might be, and that the payment for the same should be made in cash to the amount of the par value. St. 1851, c. 133, §§ 8, 16; St. 1855, c. 146; Gen. St. 1860, c. 61, §§ 6, 15, 18.
It becomes necessary to look into the legis- | the corporation to be exercised under certain lation leading to this statute, and, since the penalties in case any of the restraining conprovision as to gas companies in the statute ditions were violated. is closely connected with similar provisions In this state of the law the Legislature of as to certain other public service corpora- 1893 appointed a joint special committee to tions, the examination should be correspond- sit during the recess and to consider among ingly extensive, so far at least as the provi- other things the expediency of such amendsions as to these other corporations tend to ments of our general laws relating to all throw light upon the interpretation to be corporations except municipal "as will better given to that applicable only to the gas com- protect the interests of the public as afpanies. fected by corporations, and of stockholders and bondholders therein," and to report in print to the then next Legislature. The committee reported in 1894 (Sen. Doc. No. 67), recommending after careful consideration the passage of certain bills, 12 in all, appended to the report; and in accordance therewith 3 bills relating to the issue of stock by service corporations were passed, namely, St. 1894, cc. 450, 452, and 462. The first provides that a gas company or electric light "shall company * issue only such amounts of stock and bonds, as may from time to time, upon investigation by the board of gas and electric light commissioners be deemed and be voted by them to be reasonably requisite for the purposes for which such issue of stock or bonds has been authorized." The board are to file a certificate specifying the amount to be issued and the purposes for which it is issued, and the proceeds shall not be applied to any other purpose. Penalties for violation of the act are imposed, and jurisdiction in equity is Afterwards from time to time the provi- given to enforce the orders of the board. sions as to the issue, distribution and dis- The second statute applies to corporations posal, by sale or otherwise, of the addition- engaged in transmitting intelligence by elecal stock were modified. See as to aqueduct tricity and to aqueduct and water comcompanies, St. 1875, c. 161; Pub. St. c. 110, §panies and, mutatis mutandis, is the same 7; as to railroad corporations, St. 1871, c. as the first except that the question of neces392; St. 1874, c. 372, § 46; St. 1878, c. 84; sity is to be settled by the commissioner of Pub. St. c. 112, §§ 58, 59; St. 1893, c. 315; as corporations. And so of the third statute to street railway corporations, Pub. St. c. (applicable only to railway and street rail113, § 16; St. 1893, c. 315; as to gas com-way companies), except that the board of panies, St. 1873, c. 39; Pub. St. c. 106, §§ 36, 39, 40, 41; and as to corporations where there is no other special provision made, St. 1870, c. 179; Pub. St. c. 105, § 20, and chapter 106, § 34. There long has been also a provision that no railroad corporation, telegraph or gas light company should declare any stock dividend or divide the proceeds of sale of stock among its stockholders. St. 1868, c. 310, § 1; St. 1871, c. 389; St. 1874, c. 372, § 177; Pub. St. c. 105, § 18, and chapter 112, § 61; St. 1894, c. 450; R. L. c. 109, § 20; St. 1903, c. 437.
Although by these and other statutes considerable restraint was imposed upon the issue of additional stock by public service corporations, to the end that there should be no stock watering and that the public should not be correspondingly burdened, still, up to 1894, there does not seem to have been any provision for any general supervision by a public board over the propriety or necessity of the issue. That question was left to the
railroad commissioners is to judge of the necessity. Of these 3 bills thus adopted by the Legislature, being those numbered 5, 6, and 7 in the report, the committee say that they "are designed to accomplish the intelligent supervision, by competent officials, of the issue of stock and bonds by the class of corporations named in such bills, in order that the stock and bonds so by them issued may be confined to the amount reasonably necessary for the accomplishment of the purposes authorized by the Legislature." As to the general reasons for proposing the legislation recommended in the report, the committee speak as follows:
"To the end that reasonable dividends, interest and profits should be paid only upon a sufficient capital to properly conduct the business of quasi public corporations, the committee recommends the passage of the bills heretofore referred to.
"The Legislature has many times enacted laws providing for the supervision of the
good results. The committee is of the opin- I was the amount that might be issued only ion that such supervision, more freely exer- under the authority of the commissioners; cised, while it may not wholly prevent over without their authority no amount could be capitalization by forms not now anticipated, issued." will tend to bring the corporations to which the bills apply into a compliance with the spirit and intention of our laws; and while the Legislature may at any time provide by law for an increase of capital stock and bonds for any purpose it sees fit, the committee feels that in order to secure a more careful and thorough investigation of the application of such increase, any such increase should be subject to examination by some expert authority of the commonwealth, and such the various boards or commissions are intended by our laws to be."
R. L. c. 109, § 24, the statute under which the board acted in this case, is in substance a consolidation of these three statutes of 1894, the words "reasonably necessary" being substituted for the word "requisite."
 What are the powers of the board under this section? It is to be premised that this statute has nothing to do with changing the limit of stock as fixed by law either in a special charter or by a general law. It deals only with the issue of stock within that limit. It cannot go beyond that limit, although it may reach it. If for instance, any one of the corporations named in this section desires to increase the limit already fixed by its charter or a general law, it can find no relief under this statute. (See in this connection St. 1874, c. 29, § 15, re-enacted in Pub. St. c. 113, § 15, as an example of a statute providing for such an increase beyond the limit theretofore authorized in the case of a railroad corporation.)
 Before St. 1894, c. 450, if a gas company desired to issue additional stock to an amount not in excess of the capital stock authorized by law, it determined the question whether the money to be raised was needed for purposes for which stock should issue, and also how much should be needed, and having so determined, it sold at auction stock enough to raise that amount; and there was no supervision over these matters by a public board.
 In view of the legislation leading up to St. 1894, c. 450, and of the obvious reasons, so far as respects the public served by these corporations, and reasons somewhat different but equally obvious so far as respects the bondholders and stockholders, for a change which should result in an authoritative and more efficient enforcement of the law as to the issue of stock, we are of opinion that it was the manifest purpose and legal effect of this statute, re-enacted in R. L. c. 109, § 24, to change the whole method of the issue of stock by the public service corporations therein named, and to take away from such corporations and to invest in public officers the right to determine the general question of the reasonable necessity of the issue. And the decision of the board is final, unless based upon some error of law.
But in acting upon an application the board is engaged in the performance of a quasi judicial function, and should be moved only by considerations logical to the issue and not inconsistent with the rights of parties. It is not to be assumed that in vesting the board with the decision of the general question the Legislature intended that the usual principles upon which stock could be properly issued were to be changed. The general question as to the necessity of the issue for the purposes for which it was lawfully authorized was the same and should be decided upon the same considerations, whether decided in the first case by the corporation itself (and, if need be, by the court afterwards), or by the board. There is no change in the question nor of the principles upon which it is to be decided. The only change is in the party deciding it.
 It is also to be noted that within its sphere of action the statute applies to every issue of stock, whether it be the first or any subsequent issue, and is absolute. Of St. 1894, c. 450 (re-enacted in this statute), Knowlton, J., in Attorney General v. Massachusetts Pipe Line Gas Co., 179 Mass. 15, 20, 21, 60 N. E. 389, 390, says: "The act is "The act is not directory, merely, but is, so to speak, jurisdictional. It prescribes the terms on which, and the method by which [a gas corporation] can issue capital stock divided into shares. As to the right of a corporation to fix the amount of its stock and to issue stock it prescribes a prerequisite on which the right to act depends. We think that the By what principles is the board to be elaborate requirements of section 1 of this guided in performing this function? It is statute were intended to be fundamental, un- not compelled to take for granted that the derlying the entire statutory authority of facts stated in the application are true. It such corporations to issue stock. Scovill v. may investigate and find the facts for itself. Thayer, 105 U. S. 143 [26 L. Ed. 968]. The  It is the duty of a public service corpofact that the special charter of the defend-ration to have its plant large enough to perant corporation fixes the capital stock at $1,- form the service for which it was establish000,000, with authority to increase it, does ed, and it has a corresponding right to have not give the corporation authority to issue such plant fairly capitalized. It is its duty any stock without a vote of the commission- to keep up the plant, whether by repairs or ers under the section just referred to. otherwise, out of its earnings, and this duty
ings in dividends. If the time comes when the plant of the corporation is insufficient for the performance of its corporate duties to the public, then it is subject to the same duty, and is invested with the same right with reference to the additional plant as in the case of the original plant-the duty to increase the plant and the right to capitalize fairly the value of that increase.
When the corporation has performed all its duties, and by its fortunate situation, good management, or any lawful conduct has remaining a surplus of earnings, it has the right to distribute this surplus among its stockholders in dividends. As between the public and the corporation the earnings belong to the corporation. In performing its full duty to the public and others it has
and with that demand the corporation must comply. The company may demand fair compensation for this service and with that demand the public should comply. The corporation can have no share in the benefit to the public, nor can the public have any share in the net profits available for dividends.
 Upon the question whether there shall be an issue of additional stock to meet liabilities incurred in increasing the efficiency or value of the plant, the amount of undivided profits on hand at the time the liabilities were incurred or the expenditures made which thereafterwards and before the application to the board have been lawfully distributed as dividends is entirely immaterial. We see nothing to take this case out of the
 Nor is this proposed increase a violation of the statutory provision against the issue of a stock dividend. It certainly is not in form such an issue. Nor is it in substance. The sum raised goes to increase the value of the plant, for the purposes of the business for which the petitioner was incorporated; and that is none the less true even if these expenses could have been paid by the funds since lawfully distributed as dividends.
done what it was chartered to do, and is entitled to the profits of the business for which it was chartered. If there be any reserved power in the charter whereby the profits can be reduced or the charter revoked, of course that power may be invoked if it appear that the charter is too favorable to the corporation. And in the case of a gas company the profits may be reduced by an order lowering the price of gas, if such order seems just and reasonable. R. L. c. 121, § 34. The relations between a public service corporation and the public to serve whom it is chartered are not that of a partnership, but the petition upon the grounds stated in the rather that of independent contracting par-record there was error in law.
It follows that in the decision to dismiss
ties. The public may demand proper service Writ to issue.
(215 Mass. 303)
WIER et al. v. AMERICAN LOCOMOTIVE CO. et al.
(Supreme Judicial Court of Massachusetts.
Suffolk. June 18, 1913.)
1. APPEAL AND ERROR ($ 1056*)-QUESTIONS REVIEWABLE-EVIDENCE-IMMATERIALITY.
Where the rule of damages for breach of contract adopted by the trial court was correct, the exclusion of evidence affecting only the question of damages was immaterial.
[Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 4187-4193, 4207; Dec. Dig. § 1056.*]
2. APPEAL AND ERROR (§ 1010*)-FINDINGSCONCLUSIVENESS.
The findings of the trial judge, who saw and heard the witnesses, must stand, unless plainly wrong.
[Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 3979-3982, 4024; Dec. Dig. 1010.*]
3. PRINCIPAL AND AGENT (§ 81*)-RIGHT TO COMMISSIONS-CONSTRUCTION OF CONTRACT
Where defendant,. a manufacturer of automobiles, who had made experiments with a view of manufacturing taxicabs, gave the exclusive right to sell its automobiles to plaintiff for a commission, and during the life of the agreement defendant manufactured taxicabs, and plaintiff negotiated for their sale, and the machines were actually delivered by defendant to the purchasers, and plaintiff, after making such sales, repeatedly requested payment of the commission thereon, but defendant never promised to pay commissions, or admitted that they were due, and while the contract was in force sent out notices to agents who had similar contracts, stating that no commissions would be allowed on the sale of taxicabs, but no notice was received by plaintiff, and he had no knowledge thereof, a finding that the term "automobiles" included taxicabs was justified; the word "automobiles" ordinarily including "taxicabs." [Ed. Note.-For other cases, see Principal and Agent, Cent. Dig. §§ 194-214, 219, 223; Dec. Dig. § 81.*]
4. CONTRACTS (§ 155*)-CONSTRUCTION-MEANING OF WORDS.
The words of a contract, if doubtful, must be construed most strongly against the party preparing the contract under the direction of its general counsel.
[Ed. Note. For other cases, see Contracts, Cent. Dig. § 736; Dec. Dig. § 155.*] 5. ACCOUNT STATED ($ 4*)-PRINCIPAL AND (§ 4*)-PRINCIPAL AND AGENT ($ 81*)-ACTS CONSTITUTING-CONTRACTS-COMPENSATION.
Where the manager of a corporation, given the exclusive right to sell a manufacturer's automobiles, frequently demanded payment of commissions on taxicabs sold, and the manufacturer had no reason to believe that the right to the commissions was waived or abandoned, a subsequent agreement between the manufacturer and the owner of all the stock of the corporation, which fixed the amount of the claim of the manufacturer against the corporation, while the assets of the corporation included no claim against the manufacturer, did not amount to an account stated, so as to preclude the corporation from recovering commissions, nor operate as an estoppel against the corporation; it not appearing that the owner of the stock had any knowledge of the taxicab transactions which might bind the corporation.
[Ed. Note. For other cases, see Account Stated, Cent. Dig. §§ 14, 15; Dec. Dig. § 4;* Principal and Agent, Cent. Dig. 88 194-214, 219, 223; Dec. Dig. § 81.*]
6. PRINCIPAL AND AGENT (§ 89*)-COMPENSATION-RECOVERY-LACHES.
Where a manufacturer gave an agent the exclusive right to sell its automobiles for a commission, and the agent contemplated that taxicabs were included in the word "automoview of the cordial relations existing, that he biles," but the manufacturer did not believe, in while the agent never waived his right thereto, would be called on to pay the commissions, but frequently demanded payment thereof, though he made no attempt to collect the same prior to the bringing of suit therefor in January, 1912, and the agency terminated in 1908, the agent' was not guilty of laches, barring re
[Ed. Note. For other cases, see Principal and Agent, Cent. Dig. §§ 216, 229-239; Dec. Dig. § 89.*] 7. PRINCIPAL AND AGENT (§ 82*)-BREACH OF CONTRACT-MEASURE OF DAMAGES.
Where a manufacturer of automobiles, who gave to an agent the exclusive right to sell automobiles in specified territory for a commission of 20 per cent. of the list price, sold automobiles in the territory below the list price, the agent was entitled to recover the specified commission on the list price on automobiles sold, less the expense which he would have incurred in making the sales.
[Ed. Note. For other cases, see Principal and Agent, Cent. Dig. §§ 216-219; Dec. Dig. § 82.*] Report from Superior Court, Suffolk County; John C. Crosby, Judge.
Bill in equity by Charles J. Wier against the American Locomotive Company and another, in which the Park Square Automobile Station, a Maine corporation, was admitted as a party plaintiff. The court made various findings and rulings, embodied in a memorandum of rulings, findings of fact, and order for decree, and reported the case to the Supreme Judicial Court for determination. Decree for plaintiff ordered.
The suit was begun in January, 1912. The contract referred to was made January 2, 1908, and should continue until October 31, 1908, unless sooner terminated by either party on notice.
Sawyer, Hardy & Stone, of Boston (Edward C. Stone, of Boston, of counsel), for plaintiff. R. G. Dodge and F. W. Johnson, both of Boston, for defendant.
DE COURCY, J. It is not now in dispute that the real parties in this case are the Park Square Automobile Station, a Maine corporation herein referred to as the plaintiff, and the American Locomotive Company, a New York corporation hereinafter referred to as the defendant. The question involved in the trial was whether the plaintiff is entitled to damages, and if so, how much, on account of an alleged breach of a certain contract, whereby the plaintiff was given the exclusive right of sale of the defendant's automobiles in certain counties of Massachusetts for a given period, and the defendant agreed not to sell such automobiles within that territory except to the plaintiff. The contract was executed January 1, 1908, between the plaintiff and the American Loco
*For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes
motive Automobile Company, which later was merged in the defendant company, and the defendant recognizes the contract as binding upon it. The breach complained of is the alleged sale in Boston by the defendant itself of 50 taxicabs to the Taxi Service Company, and 10 to the Armstrong Transfer Company, during the term of the contract.
The trial judge filed a memorandum of facts found by him, declined to make certain findings and rulings requested by the defendant, and in view of his findings and on all the evidence ruled that the plaintiff is entitled to a decree ordering the defendant to pay the sum of $39,600 with interest thereon from the date of the filing of the bill. The report of the case to this court states: "The defendant desires to have the full court pass upon its exceptions to my rulings on points of evidence, and also desires to have the full court pass upon all the evidence in the case with a view to determining as to the correctness of my findings and rulings. In order that all these matters may be submitted to the court at one time, I now at the request of the defendant American Locomotive Company, and with the consent of the parties, report the case and the questions of fact and law arising therein, it being intended hereby to present to the court all the questions that would be raised by a bill of exceptions and by an appeal after decree."
 The only exceptions as to evidence now insisted upon by the defendant relate to the exclusion of a question to the witness Best, and the offer of proof made in connection therewith. These affect only the question of damages and admittedly are immaterial if the rule of damages adopted by the court is correct. In view of our decision on that issue later, the exceptions as such need not be further considered.
[2-4] On the merits of the case, the first contention of the defendant is that it was not intended by the parties that the word "automobiles" in said agreement should include taxicabs. There is strong support of this view in the evidence. Neither the defendant nor the American Locomotive Automobile Company had manufactured taxicabs commercially before the time when this contract was made. The conduct of the plaintiff's manager, Christopher F. Whitney, at the time of these sales, and his failure to assert a claim at an earlier date than he did, especially in view of the financial difficulties of the ⚫ plaintiff and its indebtedness to the defendant, tend to show that he construed the contract as not covering the sales of taxicabs. On all the evidence the trial judge regarded this question as a close one and so stated.
The judge found as a fact, however, that "the word 'automobiles' as used in the agreement of January 1, 1908, includes taxicabs and was so understood and intended by the parties thereto." And his memorandum pro
"5. The evidence shows that the American Locomotive Automobile Company had not manufactured or sold taxicabs prior to the date of its contract with the plaintiff company, but that about the time said contract was entered into plans were under consideration and experiments made with a view to such manufacture and sale. During the year 1908, while said contract was in force, six taxicabs were sold to one Cummings about which a special arrangement was made and under which arrangement the plaintiff company was paid a commission of $100 on each taxicab so sold. I further find that while said agreement of January 1, 1908, was in force the American Locomotive Automobile Company sold and delivered in Boston 50 taxicabs to the Taxi Service Company for $2,600 each, and 10 taxicabs to the Armstrong Transfer Company for $2,600 each. I find that the list price of sale taxicabs according to the price list furnished and promulgated by the American Locomotive Automobile Company was $3,350 each.
"6. I find that it was within the contemplation of the parties when the agreement of January 1, 1908, was entered into that taxicabs were included in the word "automobiles," although at the date of said contract no taxicabs had been manufactured by the American Locomotive Automobile Company. I find that Whitney, the manager of the Park Square Auto Station, began the negotiations with the representative of the Taxi Service Company for the sale of taxicabs and took him to the defendants' factory in Providence, R. I., and there conferred with the representatives and officers of the defendant company; that afterwards and during the term of the agreement of January 1, 1908, and while it was in force, said 50 taxicabs were sold by the American Locomotive Automobile Company to the Taxi Service Company. I further find that Whitney, as manager of the plaintiff company, since said sales of said taxicabs to the Taxi Service Company and to the Armstrong Transfer Company has repeatedly made requests to Manager Joyce of the defendant company for payment of the commissions upon said sales, but that said Joyce never promised Whitney to pay the same or admitted to Whitney that such commissions were due or payable, and none of said commissions have ever been paid. further find that after January 1, 1908, and while the contract of that date was in force, the defendant company sent out notices to agents who had contracts with it similar to that which it had with the plaintiff company, stating in substance that no commissions would be allowed in the sale of taxicabs. find, however, that no such notice was received by the plaintiff company, and that its officers or agents did not have knowledge of said notice."
By the long-established rule these findings