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RELIGIOUS, SOCIAL, AND BENEVOLENT CORPORATIONS.
§ 594. $595.
Corporations for purposes other than profit, how formed.
How much land friendly, etc., societies may hold.
What may be provided for in their by-laws.
CORPORATIONS FOR PURPOSES OTHER THAN PROFIT, HOW FORMED.
Sec. 593, C. C. Any number of persons associated together for any purpose, where pecuniary profit is not their object, and for which individuals may lawfully associate themselves, may, in accordance with the rules, regulations, or discipline of such association, elect directors, the number thereof to be not less than three nor more than eleven, and may incorporate themselves as provided in this part. En. March 21, 1872. Amd. 1880, 6.
Act relating to mutual benefit and relief associations: See post, Statutes at Large, title "Benefit Societies.''
Benevolent associations not insurance companies: Ante, sec. 451, C. C.
Section 175 of the corporation act of 1850, page 373, as amended in 1870, pages 46 and 402, is the basis of the section.
The original section has "Any number of persons associated together for religious, social, benevolent or other purposes, included
in the subdivision of section 286," instead of "any number of persons associated together for any purpose."'
Sanchez v. Grace M. E. Church, 114 Cal. 300, 301, 46 Pac. 2; Perkins v. Fish, 121 Cal. 321, 53 Pac. 901; People v. G. G. Lodge, No. 6, 128 Cal. 260, 262, 60 Pac. 865.
Construction of Section-Number of Incorporators, etc.-This section must be read in connection with sections 594 and 292 of this code, and as so read require the subscription and acknowledgment of at least five persons in addition to the verification required by 594 to form a valid incorporation. (People v. G. G. Lodge, No. 6, 128 Cal. 257, 60 Pac. 865.)
Insurance Association-Assessment Plans.-A life insurance association formed under sections 451 and 593 et seq., of the Civil Code as an association without profit of persons as members thereof, for the purpose of equalizing the risk of death and to pay to the nominees of such members as may die stipulated sums of money, has declared objects which are lawful and commendable; and its articles of incorporation being in due form for such a corporation, need not set forth any capital stock nor guarantee fund such as is required of life insurance corporations formed under section 437 et seq., Civil Code. (Perkins v. Fish, 121 Cal. 317, 53 Pac. 901.)
Where no fraud is shown either in the organization of an invalid insurance association or in the conduct of its business, all the members of the assumed corporation were parties to the representation that its organization was valid, and stood in equal relation to all the facts connected therewith; and, in so far as wrong was done thereby, the members were in pari delicto, neither of them should be permitted to take advantage of his own wrong as against another. (Perkins v. Fisher, 121 Cal. 317, 53 Pac. 901.)
A member of an invalidly organized insurance association, by continuing to be a member thereof, paying assessments and receiving statements, until the company failed, must be held to have acquiesced in the acts and representations of the managers of whom he complains. (Perkins v. Fisher, 121 Cal. 317, 53 Pac. 901.)
ADDITIONAL FACTS, ARTICLES OF INCORPORATION TO SET OUT.
Sec. 594, C. C. In addition to the requirements of section 290, the articles of incorporation of any association mentioned in the preceding section must set forth the holding of the elec
tion for directors, the time and place where the same was held, that a majority of the members of such association were present and voted at such election, and the result thereof; which facts must be verified by the officers conducting the election. En. March 21, 1872.
Section 176 of the corporation act of 1850, page 374, as amended 1862, page 125, is the basis of this section.
People v. Selfridge, 52 Cal. 333; People v. G. G. Lodge, No. 6, 128 Cal. 260-262, 60 Pac. 865.
Failure to Comply With This Section.-A certificate which omits altogether to make the statement required by this section is insufficient to constitute the association a corporation. (People v. Selfridge, 52 Cal. 333. To same general effect: McCallion v. Hibernia etc. Soc., 70 Cal. 168, 12 Pac. 114; People v. Montecito etc. Co., 97 Cal. 278, 33 Am. St. Rep. 173, 32 Pac. 236.)
Construction of Section.-"The requirements of this section were evidently for the purpose of having at least some evidence in the articles of incorporation that the association at an election decided to incorporate. The section does not state that the result must have been in favor of incorporation, but that the result of the election must be stated in the articles."
6, 128 Cal. 262, 60 Pac. 865.)
(People v. G. G. Lodge, No.
AMOUNT OF REAL ESTATE LIMITED.
Sec. 595, C. C. All such corporations may hold all the property of the association owned prior to incorporation, or acquired thereafter in any manner, and transact all business relative thereto; but no such corporation must own or hold more real estate than may be necessary for the business and objects of the association, and providing burial grounds for its deceased members, not to exceed six whole lots in any city or town, nor more than fifty acres in the country, the annual increase, income, or profit whereof must not exceed fifty thousand dollars; provided, that any such corporation now or hereafter having, and having had continuously, for the next preceding three years, the
care, custody, control, and maintenance each year, upon an annual average of not less than one hundred orphans, half-orphans, and indigent minor children, at any one orphan asylum, shall be entitled and allowed to own and possess any number of acres not exceeding one hundred and sixty acres of land in the country, outside of any incorporated city or town, and the annual income or profit of which does not exceed fifty thousand dollars; and provided further, that the limitations herein provided for shall not apply to corporations formed, or to be formed, under section six hundred and two of the Civil Code, when the land is held or used for churches, hospitals, schools, colleges, orphan asylums, parsonages, or cemetery purposes, or to corporations organized other than for profit, when the land is timber land, and not exceeding one hundred and sixty acres in extent, and is held or used for the purposes of the organizations, in which case said land shall be subject to all laws regulating the preservation of forests. En. March 21, 1872. Amd. 1881, 9; 1899, 10; 1903, 136.
Section 182 of the corporation act of 1850, page 374, as amended in 1862, page 125, is the basis of this section. The original section is the same as the above down to the proviso, except that it had "twenty acres'' instead of "fifty acres. The amendment of 1881 is the same as the amendment of 1899, except that the amendment of 1899 removes the restriction from timber land. The section as above differs from the amendment of 1899, in that it has "fifty acres'' instead of "twenty acres," and omits, after the first proviso, the proviso that "such orphan asylum shall be situated on such lands."
Sanchez v. Grace M. E. Church, 114 Cal. 300, 301, 46 Pac. 2; Wheelock v. First Pres. Church, 119 Cal. 483, 51 Pac. 841.
Real Estate Holdings.—Religious society organized as a corporation, using and controlling certain premises for church purposes, which prior to its incorporation had been deeded to trustees of the religious society which formed the corporation, will be presumed to hold possession of the premises as a corporation, although no formal act is shown, and though it controls the premises through agents other than the legal officers of the corporation. (Sanchez v. M. E. Church, 114 Cal. 295, 46 Pac. 2.)
The function and object of a religious corporation is to stand in the capacity of an agent holding the title to the property, with power to manage, and control the same in accordance with the interest of the spiritual ends of the church. (Wheelock v. First Pres. Church, 119 Cal. 483, 51 Pac. 841.)
HOW MUCH LAND FRIENDLY, ETC., SOCIETIES MAY HOLD.
Sec. 596, C. C. In addition to that provided for in the preceding section, friendly societies and pioneer associations may hold such real estate as may be necessary to carry out their charitable purposes, or for the establishment and endowment of institutions of learning connected therewith. In case any such corporation is the owner, by donation or purchase, of more lands than herein or in preceding section provided for, such surplus must be sold and conveyed by the corporation within five years after its acquisition. Such sale may be made without the order or decree of the superior court, as hereinafter provided. En. March 21, 1872. Amd. 1877-78, 84; 1880, 6.
Section 182 of the corporation act of 1850, page 374, as amended in 1863, page 34, is the basis of this section. The original section has, instead of "friendly societies," the words "Masons, Odd Fellows." The amendment of 1877-78 added "Good Templars."
DIRECTORS TO MAKE VERIFIED REPORT ANNUALLY.
Sec. 597, C. C. The directors must annually make a full report of all property, real and personal, held in trust for their corporation by them, and of the condition thereof, to the members of the association for which they are acting. En. March 21, 1872.
Section 183 of the corporation act of 1850, page 374, is the basis of this section.
SALE AND MORTGAGE OF REAL ESTATE.
Sec. 598, C. C. Corporations of the character mentioned in section 593 may mortgage or sell the real property held by them,