Corporations

Introduction

A corporation is a legally created mechanism for transacting business. The corporation is an entity recognized by the law as having a unique identity, separate from that of its shareholders. This identity allows a corporation to enter into contracts, be a party to litigation, and carry on other activities in much the same way as a natural person. Most importantly, the corporate identity shields its shareholders from personal liability for activities attributed to the corporation within its stated purpose. Corporations may be formed for nonprofit or public purposes. Most corporations, however, are created to provide a vehicle for investing and carrying on business for profit. This research guide focuses on these "for-profit" corporations.

Although the roots of corporation law stretch deeply to Roman and Canon law, modern corporation law emerged with the dawn of the 20th century. Grand construction projects demanded financing that often could not be derived from a single source. The corporate structure offered a means to pool financial resources. Corporate attributes such as those protecting shareholders were designed to make the investment an attractive one.

Because most of these projects were local in scope, their oversight was initially left to the individual states. In addition, the nation's founders had considered and defeated provisions for federal incorporation. Thus, it still remains that American corporations are organized under state laws.

One unintentional result of state regulation was that states began to compete with each other to attract corporate registrations (and the revenue that followed them). States simplified the registration process and gave protections and other benefits to those corporations that organized under their laws. At one time, New Jersey was the leader in this race toward permissiveness. Now, the undisputed champion is Delaware. For this reason, the law of Delaware is given special emphasis in issues of corporation law.

One other set of laws is also of national significance in corporation law. It is the Model Business Corporation Act (MBCA), created by the American Bar Association. The first MBCA was published in 1950 (a Uniform Business Corporation Act published in 1928 was not widely adopted and is currently only of interest for historical purposes). The MBCA was last revised in 1984. Many of the individual state statutes are based on the MBCA so there tends to be a strong degree of uniformity between states. The MBCA's commentary may also be useful in interpreting adopted provisions.

About this Research Guide

This research guide is not intended to be comprehensive, but rather will list some of the major sources of law in the area and a variety of tools for the researcher to use when confronted with a legal issues involving corporations. Links in this research guide will take the researcher to information about the resource, and in some cases, will link to full text of the resource. The titles of materials held in the Seattle University Law Library are linked to the bibliographic records in the library's catalogs. The title or citation for Web-based materials will be linked to the internet site where those materials or information about them may be found. Citations to materials that are available on Westlaw, Lexis, or other databases, including cases, statutes, and law review articles of interest, may be linked to their source in one of those databases, and if so, will be available only to authorized users.

This research guide is limited to resources on the law of corporations. It does not include other business entities such as partnerships and limited liability companies. The guide does not attempt to cover the numerous subtopics involving corporations such as corporate taxation, securities law and the law of acquisitions and mergers. Those topics may, however, be discussed to some degree in the resources cited in this guide.

Resources for Researching Corporations Law

As previously stated, corporation law is generally the province of the individual states. Today, most state's corporation statutes are based on the Model Business Corporation Act. Because of this, the commentary to the Model Act can be useful in interpreting the purpose behind the language used in a particular provision. The annotations to the Model Act also provide cases from the various adopting states. These case decisions can provide persuasive authority for statutory interpretation if the courts of the state you are researching has not addressed the issue.

Statutes

Online versions for some state's corporation laws are available from Findlaw and also through Lexis and Westlaw.

The Washington Business Corporation Act is codified in Title 23B of the Revised Code of Washington.

Cases

Although the United States Supreme Court has decided cases encompassing corporation law, the vast majority of precedent in this area comes from the state courts. These state court decisions are usually based on the statutes of that particular state. There is an entire digest topic devoted to "Corporations" in the West key numbering system. A researcher can either browse its topic analysis or use the Descriptive Word Index to find corporation cases using the applicable West digest.

Cases can also be found using online research. Both Lexis and Westlaw have databases devoted specifically to corporation law. These databases can be further limited to specific states, if that is desireable.

Finally, because most corporation cases involve interpreting a state's corporation act, cases can often be located in that state's annotated code.

Caveat: Even though most precedent on corporation law comes from the state, authority over certain ancillary issues may be federal. For example, securities law (regulating the registration and trading of stocks) is predominantly a federal issue.

Books

For a general overview of the law:

The Law of Corporations in a Nutshell by Robert W. Hamilton, Reserve KF1414.3H35 2000, is fairly current, has few footnotes, and provides a useful glossary.

Corporation law by Franklin A. Gevurtz, Reserve KF1413.G48 2000, is the Hornbook covering the subject.

For more detailed analysis:

Fletcher Cyclopedia of the Law of Private Corporations by William Meade Fletcher, Reserve KF1384F55, is a voluminous set discussing in detail the American law of corporations. It includes history, definitions, and policy as well as black letter law. Fletcher is the most cited secondary authority in corporate law.

The Model Business Corporation Act, Reserve KF1404.A15A44, is published by the Committee on Corporate Laws, a committee of the American Bar Association Section of Business Law. Although the last major revision took place in 1984, the committee continues to review and revise sections of the MBCA. The ABA publishes the offical text and comments of the MBCA with statutory cross references. For additional analysis of the MBCA, the Model Business Corporation Act Annotated contains digests of cases decided by courts in states that have adopted the provisions of each MBCA section.

Business Organizations, by Zolman Cavitch, Reserve KF1366.C3, is another multivolume set on the subject. It is smaller and less scholarly than Fletcher, leaning more toward a practice orientation.

Folk on the Delaware General Corporation Law (4th ed. 1998), Reserve KFD213F59 1998, is organized by code section (of the Delaware Code). The numbering of the Delaware Code is different than the MBCA. However, the general outline of how the subject is arranged is fairly similar. Because the state of Delaware has been a leader in the area of corporate organization and operation, legislators and judges in other states take notice of the provisions of the Delaware Code and the policies behind those provisions.

For practice-oriented treatment:

In addition to those works mentioned above (particularly Fletcher and Business Organizations), several other works are written with the practicing lawyer in mind.

BNA publishes a series of portfolios called BNA's Corporate Practice Series, KF1397.C654 . There are more than 50 portfolios on a wide range of topics. They include worksheets (appendix material), bibliographies, and "practical scholarship" with a practitioner's focus. Each portfolio addresses a specific issue and is in the catalog under its own title. Even so, the portfolios are all shelved together.

Similar to the above, Lexis publishes a series of Business Law Monographs.

For Washington treatment:

Washington business entities: law and forms by Stewart M. Landefeld and Eric A. DeJong, Reserve KFW213.L36 2005, is a multivolume work that describes Washington corporation law and provides a generous supply of forms.

Washington Lawyers Practice Manual, Vol. V, Ch. XIII Business Law Practice, by the King County Bar Association, Reserve KFW80.W27 1990. Although the textual analysis is fairly minimal, there is a generous supply of checklists and forms to help the practitioner.

Washington Corporate Law Handbook by Robert J. McGaughey, Reserve KFW213.M39. This volume contains a well-organized discussion of the law of corporations in Washington. This text is sprinkled with citations to relevant primary authority.

In addition to the above, there are often Continuing Legal Education (CLE) seminars on business law. The coursebooks from these CLE's may contain chapters on issues (particularly emerging or changing) issues in corporation law.

For ancillary subjects:

Some of the major works on related areas of law include:

Federal Income Taxation of Corporations and Shareholders by Boris I. Bittker and James S. Eustice, Reserve KF6464.B5 2000.

Securities and Federal Corporate Law by Harold S. Bloomenthal and Samuel Wolff, Reference KF1439.B542 1998.

Federal Securities Law Reporter by CCH, Reference KF1436.5.C6.

Finding additional resources:

Supplementary resources in our collection can be located by using our catalog of print and non-print resources. Using Library of Congress subject headings will help you get an overview of the materials available. Some suggested headings are:

Corporation Law

Corporations

Incorporation

Corporate Governance

Subchapter S Corporations

Close Corporations

Directors of Corporations

Nonprofit Organizations

Periodical Articles

Law reviews and journals reflect the latest thinking on topical issues. Over a thousand are published in the United States and the Law Library receives almost all of them. Abbreviations abound in this area so it is best to ask for help at the law library reference desk. Periodicals are located on the Court level which is reached by the elevator inside the library. Washington state periodicals, such as the Seattle University Law Review, are located in Reserve. To find articles on a particular topic, use either of the online indexes, LegalTrac or Index to Legal Periodicals. Both titles offer indexes by author, title, subject, case, and statute. For law school students, both services are available on Lexis and Westlaw.

There are several legal periodicals devoted exclusively to corporation law and related issues. These include: The Journal of Corporation Law, Delaware Journal of Corporate Law, Business Lawyer (the official publication of the ABA's Section on Business Law), Corporate Practice Commentary, and Securities Regulation Law Journal.

Forms

There are numerous forms essential to the creation and operation of a corporation. From inception (Articles of Incorporation) to termination (Articles of Dissolution), legal documents evidence the life of a business entity.

The most comprehensive collection of such forms is Fletcher's Corporation Forms Annotated, Reserve KF1414. It contains thousands of sample forms. Its comprehensiveness offers numerous alternatives to many documents. It also contains wording for particular clauses that can be inserted into documents. In addition to organizational documents, Fletcher contains sample operational forms (such as those for meeting minutes).

For Washington forms, the Office of the Secretary of State has many of the basic forms available for downloading on its Web site. In addition, there is a two-volume set called Washington Corporate Forms 4th Floor KFW213.A65H64 1998, that comes with a companion disk that has digitized versions of the printed forms in the books. The previously mentioned Washington Business Entities: Law and Forms and Chapter XIII, Vol. V of Washington Lawyer Practice Manual also contain many useful forms.

Filings

By statute, corporations are required to file certain documents with their state of incorporation. The Articles of Incorporation and Annual Report give basic information such as the registered name, the registered office, and the registered agent. The latter two are particularly important because they are the place and person that must be served process in litigation involving the corporation. In Washington, corporate filings are retained at and available from the Office of the Secretary of State. Corporate filings from all 50 states are available on many databases including Lexis and Westlaw (database: CORP-ALL for all states CORP-XX for particular states [XX = the particular state's postal abbreviation], law student passwords may not access all the available databases).

Other Information on Corporations

Information on corporations is available from many places. Publicly traded corporations must file documents with the Securities and Exchange Commission. Services like Standard & Poor and Hoovers also collect and disseminate information about corporations (generally used for investment purposes). A detailed discussion of these sources is beyond the scope of this research guide.