In spite of the principle stated in the preceding section, it is settled "that directors may contract with agents or employes of their corporation, who are likewise directors, and that, though always subject to close scrutiny, and voidable for fraud or overreaching, such contracts are not ipso facto void;85 that when for compensation, and the latter is fair and reasonable, these contracts will be sustained;86 further, that a contract of this kind may be ratified and made valid by acquiescence of the stockholders; 87 finally, that where a board of directors votes excessive salaries to certain of its members, who are also officers or employes of the corporation, even though such action may subsequently be ratified at a stockholders' meeting, when called in question by a minority stockholder, the action of the board is subject to review by a court in equity, and, if the finding of the latter tribunal is that the salaries in question are exorbitant, it may determine the value of the services rendered by the officers or employes in question, and restrain the corporation from paying in excess thereof.88 But, of course, in such instances, ordinarily, there is no way of satisfactorily determining the value of services to be rendered in the future, when conditions, ex necessitate, may be essentially different from those in the past. Therefore, generally speaking, in cases of this character, a court of equity may deal only with the facts presently before it, and thus determine the reasonable compensation actually earned. Exceptional cases may arise, however, where, contemplating a continuance of an ascertained state of facts and guarding their decree accordingly, judicial tribunals may determine compensation to be paid in the future. . . . " If courts may depart at will from the rule just stated, and substitute their judgments for the legally exercised discretion of the directors of private business corporations, in determining the question of future compensation to be paid to the tatter's employes then there is no reasonable limit to the right of judicial interference with corporate management; but, fortunately, this is not the law." 89
Co. v. Campbell, etc., Co., 83 Md. 36, 34 Atl. 369; Landis v. Saxton, 89 Mo. 375, 1 S. W. 359; Kelsey v. New England St. Ry. Co., 62 N. J. Eq. 742, 48 Atl. 1001; Yeoman v. Lasley, 40 Ohio St. 190. Cf. Yellow Poplar Lumber Co. v. Daniel, 109 Fed. 39, 48 C. C. A. 204. But in Merchants' Line v. Baltimore & O. R. Co., 222 N. Y. 344, 118 N. E. 788, it was held that the fact that the plaintiff had bribed an employee, thinking him an official of the defendant corporation, did not invalidate a contract entered into later with the real official, who knew nothing of the bribery.
81 Green v. Robertson, 64 Cal. 75, 28 Pac. 446; Ranney v. Donovan, 78 Mich. 318, 44 N. W. 276; Webb v.' Paxton 36,
Minn. 532, 32 N. W. 749; Knauss v. Gottfried, etc., Brewing Co., 142 N. Y. 70, 36 N. E. 867. Cf. Erland v. Gibbons, 176 N. Y. App. Div. 552, 163 N. Y. S. 582.
82Janscn v. Williams, 36 Neb. 869, 55 N. W. 279, 20 L. R. A. 207; Porter v. Woodruff, 36 N. J. Eq. 174.
83 Fish v. Leser, 69 111. 394; New York Central Trust Co. v. Nat. Protection Ins. Co., 14 N. Y. 85; and cases cited supra, n. 78,79, see also supra Sec. 1022.
84 Supra, Sec. 1022.
86 Sotter v. Coatesville Boiler Works, 257 Pa. 411, 101 Atl. 744, 747, citing Union Pacific It. Co. v. Credit Mobilier of America, 135 Mass. 367, 376; Nye v. Storer, 168 Mass. 53, 55, 46 N. E.
402. As to contracts made on behalf of one corporation with another by a director in both, see Globe Woolen Co. v. Utica Gas Ac. Co., 224 N. Y. 483,121 N. E. 378.
86 Citing Wainwright v. P. H. & F, M. Roota Co., 176 Ind. 682, 97 N. E. 8; Sotter v. Coateaville Boiler Works, 257 Fa. 411, 101 Atl. 744; Fillebrown v. Hayward, 100 Mass. 472, 478, 77 N. E. 45; Fraker v. A. G. Hyde & Sons, 135 N. Y. App. Div. 64, 119 N. Y. S. 879.
87 Sotter v. Co&tesville Boiler Works, 257 Pa. 411, 101 Atl. 744, citing Kelley 8. Newburyport & Amesbury Horse R. Co., 141 Mass. 496, 499, 6 N. E. 745. See also Thomas v. Brownville etc. R. Co., 100 U. S. 522, 27 L. Ed. 1018, 3 Sup. Ct. Rep. 315.
88Sotter v. Coatesville Boiler Works, 257 Pa. 411, 101 Atl. 744, citing Reynolds v. Diamond Mills Paper Co., 60 N. J. Eq. 2S9, 310, 60 Atl. 941 et aeq.; Lillard v. Oil, Paint A Drug Co., 70 N. J. Eq. 197, 56 Atl. 254, 58 Atl. 188; Davis v. Thomas A Davis Co., 63 N. J. Eq. 572, 52 Atl. 717; Wayne Pike Co. v. Hammona, 129 Ind. 368, 379, 27 N. E. 487; Fillebrown v. Hayward, 190 Mass. 472, 478,77 N. E. 45. The Pennsylvania court added: "This rule is fully recognised by us in Russell v. Patterson, 232 Pa. 113, 81 Atl. 136, 36 L. R. A. (N. 8.) 199."