On August 26, 1959, Sealand Investment Corporation (hereinafter referred to as “Sealand”) filed a “Complaint for Diversion of Corporate Assets, Misappropriation of Corporate Opportunities, to Impose a Constructive Trust, for an Accounting, and for Breach of Fiduciary Relationship,” and named as defendants “Emprise Incorporated, a California corporation, Joseph A. Spray and Charles P. Gould, individually, Spray, Gould and Bowers, a partnership composed of Joseph A. Spray, Charles P. Gould and C. W. Bowers, J. P. Shirley, Jr., Gunther J. Shirley, Robert G. Shirley, Joseph A. Shirley, Louise Mary Shirley Cornell, Helen Adair Shirley, Edward Shirley, Michael Shirley, Franklin Shirley, Jacquiline C. Shirley, Jann E. Shirley, Hetty Shirley, John Shirley, Linda Shirley, Christopher Shirley, Florence Shirley, Loeta Spray, Joseph L. Spray, Terry Spray, Mary D. Gould, Lawrence K. Gould, Doe One through Doe Fifty.”

On January 15, 1960, “the defendants, severally, each for himself or itself, and not one for the other” filed a “Notice of Motion to Strike” wherein it was set forth that a motion “for an order (1) striking the complaint herein from the files and (2) dismissing the above entitled action” would be made on January 27, 1960. The motion was to be made among others, upon the ground “that Sealand Investment Corporation—has never authorized, directed, sanctioned or ratified, either directly or indirectly, the filing of said complaint or the commencement of the above entitled action; that said complaint was filed and the above entitled action commenced without any proper atvthorization by Sealand Investment Corporation plaintiff herein, or by the board of directors or by an officer or employee of said corporation having the power or authority to cause or direct the filing of such complaint or the commencement of the above entitled action- that the attorneys appearing of record herein for said plaintiff corporation are not and have never been employed by said corporation to act as its attorneys in this matter, either for the purpose of filing a complaint or commencing said action or otherwise; that said attorneys have never been authorized by said corporation, nor by any officer thereof with authority so to do, to file the complaint herein or to commence or maintain this action or to act in any other manner or capacity either as attorneys or otherwise for or on behalf of the plaintiff corporation; and that said complaint was filed and said action commenced without any proper authority or authorization by or on behalf of the plaintiff corporation so to do.” (Emphasis added.)

On the same date a “Declaration of Gunther Shirley in Support of Motion to Strike” was filed. He is the president, director and owner and holder of one-half of the issued and outstanding stock of plaintiff corporation.

It is therein set forth in part as follows:

On February 17,1960, an “Affidavit of Katherine E. Martin Powell in opposition to Motion to Strike” was filed. Among other things it provided in part:

The motion was heard and argued on March 30, 1960.

By a minute order dated February 18 th and entered February 23, 1960, the defendants’ motion to strike was granted and plaintiff was given 30 days to amend. Plaintiff failed to amend the complaint and by a minute order dated March 30th and entered April 1st, the defendants’ motion to dismiss the action was granted and costs were awarded against the plaintiff corporation. On April 11, 1960, a “Judgment of Dismissal and for Costs” was filed. It was entered April 13, 1960. The judgment provides in pertinent part as follows:

“Having heard oral argument from counsel, having examined all the affidavits, pleadings and documents before the court and being fully advised in the premises, and it appearing to the court:

On April 18th, 1960, a “Notice of Appeal and Request for Clerk’s Transcript” was filed wherein “Sealand Investment Corporation . . . hereby appeals . . . from the judgment in said action rendered in favor of defendants and against the plaintiff . . . and from the whole of said judgment.”

It was stipulated at the oral argument that the appeal of Sealand was from the dismissal aspects of the judgment only and not from the cost phases thereof, and that the words “and from the whole of said judgment,” as used in the notice of appeal, mean and refer in effect only to that part of the judgment which reads as follows: “the complaint herein be and the same are hereby dismissed ...”

The only real question involved is whether the secretary-treasurer, who owns 50 per cent of the corporate stock; is a director; and along with her husband constitute two of the four directors, may initiate an action on behalf of and in the name of the corporation against the other two directors who own the other 50 per cent of the stock in plaintiff, one of whom is the president thereof, and certain outsiders, for the alleged violation of their fiduciary duties to the corporation and defrauding of the corporation.

We think this is a ease of first impression in this state. Corporations Code, section 800, sets forth the powers of directors. Therein it provides as follows :

Katherine B. Martin Powell and Edward J. Powell are in our opinion seeking judicial-legislation so as to enable them to circumvent the available statutory remedy of a derivative action (Corp. Code, § 834).

The powers and duties of the directors and officers of plaintiff corporation are set forth in article IV through article IX of the by-laws of said corporation. Therein, it is provided in pertinent part as follows:

As noted the directors have the power to conduct, manage and control the affairs and business of the corporation and the president is expressly empowered to “exercise a general direction of the affairs of the corporation.” No managerial powers, as distinguished from ministerial powers, are conferred upon the secretary-treasurer.

As stated in 13 California Jurisprudence 2d, Corporations, page 104, section 334:

Kelly v. Ning Yung Benevolent Assn., 2 Cal.App. 460 [ 84 P. 321 ] involved an action by an assignee of an attorney to recover for certain legal services rendered. A careful reading of that case indicates, however, that a secretary, merely by virtue of his position as such, is not authorized to bind the corporation. The court spoke in terms of ratification and estoppel in the Kelly case, and neither of such elements is present in the case before us.

Appellant relies in great part upon the following eases: Gottlieb v. Avery Realty Co., 182 La. 703 [162 So. 571]; Warwick Sportswear Co. v. Simons, 4 Misc. 2d 482 [ 13 N.Y.S.2d 321 ] ; Rothman & Schneider, Inc. v. Beckerman, 2 N.Y.2d 493 [ 161 N.Y.S.2d 118 , 6 A.L.R.2d 895 ]; Gallagher v. Texagon Mills (S.D.N.Y. 1946), 67 P.Supp. 845; West View Hills, Inc. v. Lizau Realty Corp., 6 N.Y.2d 344 [ 160 N.E.2d 622 , 189 N.Y.S.2d 863 ]; Recamier Manufacturing Co. v. Seymour, 15 Daly 245 [ 5 N.Y. Supp. 648 ]; First Reformed, Presbyterian Church v. Bowden, 14 Abb. (N.C.) 356; Elblum Holding Corp. v. Mintz, 120 N.J.L. 604 [ 1 A.2d 204 ],

In Gottlieb v. Avery Realty Co., 182 La. 703 [ 162 So. 572 ], it is stated in part as follows:

In reversing the trial court’s dismissal of the action, the court stated at page 573:

Unlike the situation in the Gottlieb case, there is a remedy available in the case at bar, namely: a stockholder’s derivative action and furthermore we are not presently confronted with a public economic emergency.

Warwick Sportswear Co. v. Simons, 4 Misc. 2d 482 [ 13 N.Y.S.2d 321 ] is a short opinion, the facts of which are not fully set forth and further, it is not specifically stated who brought the action in behalf of the corporate plaintiff. Under the peculiar circumstances we deem that it is not wholly unreasonable to assume that it was the president. The court stated at page 321:

If our assumption is correct that it was the president who authorized the action against one of the plaintiff corporation’s directors, then the factual dissimilarity is obvious.

Rothman & Schneider, Inc. v. Beckerman, 2 N.Y.2d 493 [ 141 N.E.2d 610 , 161 N.Y.S.2d 118 , 64 A.L.R.2d 895 ], involved an action against strangers to the corporation as distinguished from an action against directors and/or officers of plaintiff corporation. The court stated in that case at p. 119 [161 N.Y.S.2d] :

Rothman and Schneider organized the plaintiff corporation. Each of them, along with his respective wife, owned 50 per cent of the corporate stock, and all four were directors. “Roth- man was president and Schneider, secretary-treasurer. The corporate by-laws vested in the board of directors ‘ control and general management of the affairs and business of the Company,’ the directors were to ‘act as a Board, regularly convened, by a majority’ and each director was to have one vote. . . . As a practical matter, however, no directors’ meetings were held, and Rothman and Schneider, according to the latter, ‘acted as equals and as partners . . . signed papers indiscriminately either Mr. Rothman as President and I as Secretary-Treasurer, verifying complaints or answers in litigation without any question ever having been raised.”

The court in sustaining the trial court’s determination that the service of summons and complaint should not be vacated, stated at pages 121-123 [161 N.Y.S.2d] :

The factual dissimilarities in the Rothman case and the ease before us are manifest.

In Gallagher v. Texagon Mills, 67 F.Supp, 845, certain unspecified officers and directors of a corporation instituted an action against the corporation. The question presented was whether the aforesaid officers and directors could deprive the corporate defendant of a defense to the action. The laws of New Jersey disqualify a director from voting upon a resolution concerning the matter in which he is interested. The court in holding that the disinterested directors and officers could assert the defense in the corporate name stated at page 846:

The differences between the Gallagher case and the ease before us are evident.

Both appellant and respondents rely upon the case of West View Hills, Inc. v. Lizau Realty Corp., 6 N.Y.2d 344 [ 160 N.E.2d 622 , 189 N.Y.S.2d 863 ]. In that case the president of plaintiff corporation brought the action in the name of the corporation against defendant corporation. In the first cause of action plaintiff alleged that it had been wrongfully and improperly required to pay for work, labor and services entering into the construction of an apartment owned and built by defendant corporation. For the second cause of action plaintiff alleged that certain individual defendants (that is, majority of board of directors of plaintiff corporation) had violated their fiduciary duties as directors and officers of plaintiff corporation. The individual defendants were the officers and directors of defendant corporation.

The question presented was “whether the president of the plaintiff corporation, at the time the action was originally instituted, had the power, as president, to institute the action on behalf of the corporation.” [Emphasis added.]

The majority opinion held that he did have the authority and stated at pages 864-866 [189 N.Y.S.2d] in part as follows:

“. . . when there has been no direct prohibition ‘the president has presumptive authority, in the discharge of his duties, to defend and prosecute suits in the name of the corporation’ (Rothman & Schneider v. Beckerman, 2 N.Y.2d 493, 497 [ 161 N.Y.S.2d 118, 121 , 64 A.L.R2d 895]; Matter of Paloma Frocks [Shamokin], 3 N.Y.2d 572 [ 170 N.Y.S. 2d 509 , 65 A.L.R2d 1317]; Twyeffort v. Unexcelled Mfg. Co., 263 N.Y. 6 [ 188 N.E. 138 ]; Hardin v. Morgan Lithograph Co., 247 N.Y. 332 [ 160 N.E. 388 ].)

“This is as it should be for unless the president actually or impliedly possesses such power the corporate interests may be prejudiced if not entirely destroyed. While, ordinarily, the powers of the president of a corporation are often enumerated either in the articles of incorporation or in the by-laws, it is not usual to find in them any reference to the power to defend or institute litigation in the name of the corporation. However, ... in situations requiring the exercise of such power to preserve and protect the interests of the corporation, it will he implied. This case presents such a situation. . . .

“We point out that in Rothman, supra, which dealt with an internal problem between equally divided interests in a close corporation, we recognized that a corporation is a separate, independent legal entity notwithstanding that, for convenience, the parties managed the corporation in disregard of accepted corporate procedures, much in the manner of a partnership. Here, the necessity of recognizing that a corporate entity has independent, separate legal rights is even more emphatic. . . . The coincidence that the plaintiff and defendant corporations were owned by the same individuals who, in turn, constituted the respective boards of directors makes it even more imperative to recognize that West View, as a corporation, has an independent and separate cause of action.

“This is not the classic situation requiring resort to a stockholders’ derivative action to protect minority interests. To be sure, President Zaubler, as an individual stockholder, is now in the minority, hut that fact does not deprive him of his right and duty to perform the obligations and functions of his office as president, nor does it prevent the corporation, as a corporation, from commencing an action in its own behalf simply because a majority of its board of directors are in a position to withhold authorization. . . .

It is readily apparent why the respondents would cite the West View Hills, Inc. case because it has to do with the president’s power, but we fail to see where the appellant can find anything therein which is of assistance to a secretary or to a secretary and a director in the circumstances of the ease before us.

In Recamier Manufacturing Co. v. Seymour, 15 Daly 245 , 24 N.Y.St.Rep. 54 [ 5 N.Y.S. 648 ], the president of plaintiff corporation, who was also a trustee thereof, authorized an action in the name of plaintiff corporation against certain other trustees and officers of plaintiff corporation for an accounting.

While the Recamier case involves the authority of the president, who is also a trustee, its holding is based, not upon the powers and authority of the office of the president, but upon the powers of “innocent” directors and trustees to maintain an action in the name of the corporation. This case might support the secretary-treasurer’s maintenance of the action in the name of the corporation merely because said secretary-treasurer is also a director (supposedly an innocent director). However, in any event later New York eases do not seem to follow the Recamier case.

First Reformed Presbyterian Church v. Bowden, 14 Abbott ’s New Cases 356 concerns a situation in no wise comparable to the present case. Plaintiff was a religious corporation organized under a special statute. The action was brought to restrain the defendants from diverting the temporalities of the plaintiff to the purposes of a denomination other than to which the church members of the corporation belonged. Defendants argued that the plaintiff did not authorize the bringing of the action. Because of the statutory provisions involved and the unusual circumstances present the court ruled in favor of the plaintiff. There is no special statute to concern us in the ease we are considering.

Elblum Holding Corp. v. Mints, 120 N.J.L. 604 [ 1 A.2d 204 ], involved the question of whether the president of a corporation, as such, has authority to employ and authorize an attorney to institute an action at law on behalf of the corporation against the corporate treasurer for rent due. The action was started at the behest of the president without official sanction of the board of directors. The control of the corporation was equally divided between two opposing factions. The court stated at pages 205-206 [1 A.2d], in part as follows:

“. . . We desire at the outset to mark the fact that the question here requiring decision is one of first impression with us. Our courts have not heretofore . . . decided whether a president of a corporation, qua president, has the author ity to employ and authorize an attorney to institute a suit in behalf of his corporation. Nor is there any concordance in the decisions of our sister states or in the writings of eminent and acknowledged scholars upon the subject.

“. . . there is, on the one hand, a respectable body of authority that, apart from the acts done by a president of a corporation in the course of its ordinary business, of acts done in pursuance of clothed, apparent authority, of acts done as incidental to his office, the powers of a president of a corporation to do a particular act depends upon the powers conferred upon him, either by statute, or by charter of Ms corporation, or by the by-laws, or by the directors thereof. And the mere fact he is president, without more, does not imply that he has any greater power than any other director. The following are some of the authorities so holding: [Citations including Campbell v. Hanford, 67 Cal.App. 155 [ 227 P. 234 ].]

“On the other hand, there is also a body of respectable authority to the effect that a president of a corporation, as such, may employ and authorize counsel to institute a suit in behalf of his corporation. [Citations.] . . .

“. . . our courts have held that the president of a corporation, as such, may, without special authority, perform all the acts, which either because of usage or necessity are incidental to Ms office, and may bind the corporation by contracts arising in the usual course of its business. And beyond this he, as president, has no more control over the corporate funds than any other director. [Citations.] And we have held that a president of a corporation may in pursuance of a power incidental to Ms office take the necessary steps in defense of litigation prosecuted against his corporation in order to preserve the corporate assets. [Citations.]

To summarize the eases cited by appellant (with the exception of the First Reformed Presbyterian Church case), all but two of them (i.e., Gottlieb v. Avery Realty Co. and Roth man & Schneider v. Beclcerman) involved the authority o£ the president of a corporation to institute an action in behalf of and in the name of the corporation.

The factual situation of the Gottlieb case is as heretofore indicated dissimilar and it appeared in that case that unless the secretary-treasurer was permitted to invoke the moratorium law on behalf of the defendant corporation said corporation would have had a right without a remedy.

Rothman and Schneider involved an action against strangers to the corporation. The court indicated in that ease that normally the authority vested in the president would not devolve upon a secretary or a treasurer. However, in that particular case the secretary-treasurer was in fact running the corporation and also, “. . . complete strangers to the corporation . . . actually charged with converting a portion of its assets, should not be permitted to question his authority and thereby frustrate the action.”

Whatever actual or implied authority resides in the president to initiate an action in the name of a corporation, there is ordinarily no such implied, presumed or inherent authority in the secretary-treasurer or other officers of the corporation.

The 1956 New York case of Kardweel Corp. v. Karper, 1 Misc. 2d 707 [ 148 N.Y.S.2d 132 ] illustrates the distinction. The action in that case was brought by the corporation for reformation of a contract. One of the defendants, who was president of the plaintiff corporation, moved to set aside the summons and complaint, and to strike out the appearance of plaintiff’s attorney on the ground that the corporation had not authorized the suit.

The moving defendant was the holder of 50 per cent of the outstanding stock of plaintiff corporation, and he and his wife were two of the four directors of plaintiff. The plaintiff corporation asserted through its vice-president and treasurer (i.e. the remaining two directors of plaintiff corporation) “that they authorized the suit; that they retained counsel with full knowledge, consent and approval of the other holder of one-half of the capital stock.” The court stated at page 134:

“. . . the proof is overwhelming on this state of the record that the suit was not authorized by the proper officer or by the board of directors. While a vice-president may generally act in the event the office of president is vacant, the facts here indicate that the president was never duly removed from office by the board of directors. In these circumstances the moving defendant still remains the president, and the vice-president (alone or with the treasurer) cannot authorize the present action ... in the absence of proof of being empowered to do so. The mere fact that the holder of fifty per cent of the stock consented to the action does not justify the suit in the name of the corporation, where (as here) the other fifty-per-cent stockholder objects to it. . . .

In Y or on & Ghiat v. Benguiat, 162 N.Y.S. 974 , the action was against an outsider. Plaintiff’s secretary and its treasurer constitute one-half of the board of directors, and are the holders of 50 per cent of the stock. They authorized the attorneys to commence the action. “The president of the corporation is a friend of the present defendant, . . . and it is plain that the president’s interests are antagonistic to the interests of the secretary and treasurer.” The court stated at page 975 that:

The California position with reference to the authority of corporate officers has been strict. Even the president, apart from acts done in the course of ordinary business, or in pursuance of apparent authority, depends upon the powers conferred upon him, either by statute, corporate charter, by-laws or the directors. The mere fact that he is president, without more, does not necessarily give him greater power than any other director. Campbell v. Hanford, 67 Cal.App. 155 [ 227 P. 234 ] ; Pacific Bank v. Stone, 121 Cal. 202 [ 53 P. 634 ],

In the case before us there is no claim that the Powells, or either of them, had previously conducted the affairs of the corporation without intervention, nor that they, or either of them, had ever assumed any management of the corporation to the knowledge of the Shirleys, or either of them. There was no emergency involved in the case in the sense that if the action was not filed and prosecuted as was attempted all would be lost forever for the corporation. As was said in Eardweel, supra, “the active projectors of the present action are not without remedy, since they may sue (if so advised) in a representative capacity as stockholders.”

Some of the cases referred to herein have been reviewed in brief in 31 New York University Law Review 1433, 32 New York University Law Review, 697 and 1391, and 34 New York University Law Review 1432, where it is appropriately stated, “The merry-go-round of the corporate president’s power to institute legal action in the corporate name still spins; and dizzily!”; 35 New York University Law Review 623 and 26 Pordham Law Review 339.

Mr. and Mrs. Powell must have authority before they can institute an action in the name of the corporation. The authority necessarily has to be actual, apparent or implied. Clearly there was no actual or apparent authority. Prom what has been said in the eases, and from the law and the facts of this ease, we think there was no implied authority in the Powells to bring the action.

We have no desire to be responsible for the opening of a Pandora’s box in the field of corporate law in California.

Por the reasons stated that part of the judgment which provides for the dismissal of the action is affirmed.

Wood, P. J., and Drapeau, J., pro tern., concurred.

Appellant’s petition for a hearing by the Supreme Court was denied May 16, 1961.

Assigned by Chairman of Judicial Council.