DIRECTORS. Persons appointed or elected according to law, authorized to man age and direct the affairs of a corporation or company. The whole of the directors collect ively form the board of directors.
2. They are generally invested with cer tain powers by the acts of the legislature to which they owe their existence.
In modern corporations created by statutes, it is generally contemplated by the charter that the business of the corporation shall be transacted exclusively by the directors. 2 Caines, N. Y. 381. And the acts of such a board, evidenced by a legal vote, are as com pletely binding upon the corporation, and as complete authority to their agents, as the most solemn acts done under the corporate seal. 8 Wheat. 357, 358.
3. To make a legal board of directors, they must meet at a time when, and a place where, every other director has the oppor tunity of attending to consult and be coo Suited with; and there must be a sufficient number present to constitute a quorum. 3
La. 574. 6 id. 759; 13 id. 527. See 11 Mass. 288 ; 5 Litt. Ky. 45; 12 Serg. & R. Penn. 256 ; 1 Pet. 46.
4. Directors of a corporation are trustees, and as such are required to use due diligence and attention to its concerns, and are bound to a faithful discharge of the duty which the situation imposes. They are liable to the stockholders whenever there has been gross negligence or fraud, but not for uninten tional errors. 1 Edw. Ch. N. Y. 513 ; 8 Mart. La. N. s. 80; 3 La. 575. See 4 Mann. &G. 552.
5. Provision is usually made, in the act under which a company is incorporated, for the election of directors. Such election usu ally takes place once a year, and is generally by a vote of the stockholders. In the bank ing laws of many of the states, directors of banks are made personally liable for the debts of the bank when they have exceeded their powers.