O.C.G.A. § 14-2-302 (2019)
General powers
Every corporation has perpetual duration and succession in its corporate name, unless its articles of incorporation adopted on or after April 1, 1969, or an amendment thereto adopted on or after April 1, 1969, provides otherwise. Unless its articles of incorporation provide
CORPORATIONS & PARTNERSHIPS
otherwise, every corporation has the same powers as an individual to do all things necessary or convenient to carry out its business and affairs, including without limitation power: (1) To sue, be sued, complain, and defend in its corporate name; (2) To have a corporate seal which may be altered at will, and to use it, or a facsimile of it, by impressing or affixing it or in any other manner reproducing it; (3) To make and amend bylaws, not inconsistent with its articles of incorporation or with the laws of this state, for managing the business and regulating the affairs of the corporation; (4) To purchase, receive, lease, or otherwise acquire, own, hold, improve, use, and otherwise deal with real or personal property or any legal or equitable interest in property, wherever located; (5) To sell, convey, mortgage, pledge, lease, exchange, and otherwise dispose of all or any part of its property; (6) To purchase, receive, subscribe for, or otherwise acquire, own, hold, vote, use, sell, mortgage, lend, pledge, or otherwise dispose of, and deal in and with shares or other interests in, or obligations of, any other entity; (7) To make contracts and guarantees, incur liabilities, borrow money, issue its notes, bonds, and other obligations (which may be convertible into or include the option to purchase other securities of the corporation), and secure any of its obligations by mortgage or pledge of any of its property, franchises, or income; (8) To lend money, invest and reinvest its funds, and receive and hold real and personal property as security for repayment; (9) To be a promoter, partner, member, associate, or manager of any partnership, joint venture, trust, or other entity; (10) To conduct its business, locate offices, and exercise the powers granted by this chapter within or without this state; (11) To elect directors and appoint officers, employees, and agents of the corporation, define their duties, fix their compensation, and lend them money and credit; (12) To pay pensions and establish pension plans, pension trusts, profit sharing plans, share bonus plans, share option plans, and benefit or incentive plans for any or all of its current or former directors, officers, employees, and agents; (13) To make donations for the public welfare or for charitable, scientific, or educational purposes;
(14) To transact any lawful business that will aid governmental policy; (15) To provide insurance for its benefit on the life or physical or mental ability of any of its directors, officers, or employees or any other person whose death or physical or mental disability might cause financial loss to the corporation; or, pursuant to any contractual arrangement with any shareholder concerning the reacquisition of shares owned by him at his death or disability, on the life or physical or mental ability of that shareholder, for the purpose of carrying out such contractual arrangement; or, pursuant to any contract obligating the corporation, as part of compensation arrangements, or pursuant to any contract obligating the corporation as guarantor or surety, on the life of the principal obligor, and for these purposes the corporation is deemed to have an insurable interest in such persons; and (16) To make payments or donations or do any other act not inconsistent with law that furthers the business and affairs of the corporation.
History
(Code 1981, § 14-2-302, enacted by Ga. L. 1988, p. 1070, § 1; Ga. L. 1989, p. 946, § 11; Ga. L. 1990, p. 257, § 3.)
Annotations
Law reviews. - For article analyzing legal basis for corporate contributions to private educational institutions, see 5 Mercer L. Rev. 249 (1954). For article discussing issuance of debt securities under the Georgia Business Corporation Code, see 3 Ga. L. Rev. 11 (1968). For article summarizing law relating to jurisdiction and venue over domestic and foreign corporations in Georgia, and service thereon, see 21 Mercer L. Rev. 457 (1970). For article, ‘‘Use of Limited Partnership to Invest in Depreciable Realty,’’ see 21 Mer-
cer L. Rev. 481 (1970). For article, ‘‘Foreign Corporations in Georgia,’’ see 10 Ga. St. B. J. 243 (1973). For article discussing establishment and transaction of business in Georgia by a foreign corporation, see 27 Mercer L. Rev. 629 (1976). For article on the limit of corporate social responsibility, see 33 Mercer L. Rev. 519 (1982). For note on statutory restrictions upon corporate ownership of real property, see 13 Mercer L. Rev. 410 (1962). For note, ‘‘Ultra Vires in Georgia,’’ see 16 Mercer L. Rev. 320 (1964).
COMMENT Source: Model Act, § 14-2-302. The enumerated powers are similar but not identical to those found in the former law, § 14-2-21. The law of corporations has always proceeded on the fundamental assumption that corporations are creations with limited power; such an assumption was articulated by the United States Supreme Court as early as 1804, Head & Armory v. Providence Insurance Co., 6 U.S. (2 Cranch) 127, 169 (1804), and appears never to have been seriously questioned as a judicial matter. It is clear that narrow and limited power clauses are undesirable: they encourage litigation by bringing into question reasonable transactions that further the business and interests of the corporation and to the extent transactions are unauthorized, may defeat valid and reasonable expectations. Modern corporation law tends to view the corporation as a creature of contract, rather than as a creature of a state that zealously guards its powers through narrow grants to corporate entities.
CORPORATIONS & PARTNERSHIPS
The general philosophy of Section 14-2-302 is thus that corporations formed under the Code provisions should be automatically authorized to engage in all acts and have all powers that an individual may have. The powers of a corporation under the Code exist independently of whether a corporation has a broad or narrow purpose clause. Corporate powers to act as fiduciaries are limited by Code Section 7-1-242 to specific financial institutions and certain other corporations under limited circumstances. Note to 1989 Amendment The 1989 amendments added a new subsection (15) and renumbered former subsection (15) as subsection (16). Subsection (15) restored a specifically enumerated corporate power contained in former O.C.G.A. § 14-2-21(15) (1982). The language was expanded, following N.C. Gen. Stat. § 55-17(b)(4), to cover matters other than life insurance, and to specifically create insurable interests in corporations. The Model Act did not contain such language in its powers clause, and it was thought necessary to restore this language in view of the negative implications that might otherwise flow from the omission. Georgia common law creates doubts about the extent of the insurable interests of employers. Turner v. Davidson, 171 Ga. 736, 4 S.E.2d 814 (1939). While provisions in the Insurance Code attempt to create an insurable interest, they do so only for ‘publicly owned’ corporations, a term defined in neither the corporate nor insurance codes. See O.C.G.A. §§ 33-24-3(c) and 33-42-6(a)(4) (Supp. 1988). Note to 1990 Amendment The 1990 amendment clarifies that all corporations, including those formed before the adoption of the 1969 Corporate Code, have perpetual existence unless their articles (or an amendment thereto adopted after April 1, 1969) specify otherwise. The old Code, at Section 14-2-21(a), provided that each corporation existing on the date of adoption of the old Code (April 1, 1969) had perpetual duration unless its articles of incorporation were affirmatively amended after adoption of the 1969 Code to provide for a limited period of duration. Because old Section 14-2-21(a)(2) was arguably repealed by the new Code, the question arose whether the repeal of the 1969 Code’s automatic grant of perpetual duration, when read with new Section 14-2-302, required a corporation formed prior to April 1, 1969 with a limited duration to refer to its pre-1969 articles of incorporation to determine its legal duration. Since such corporations may have passed the limit of their legal existence, the new 14-2-302 was amended to specify that any corporation existing on April 1, 1969 has perpetual duration unless its articles were subsequently amended to provide otherwise. Cross-References Bylaws, see §§ 14-2-206, 14-2-207, 14-2-1020, 14-2-1021, 14-2-1113 and