LEGAL PHASES OF COOPERATIVE ASSOCIATIONS. 9 
The purpose of by-laws is to provide rules for the regulation of 
the affairs of the corporation. They can make provision consistent 
with law and with the charter for any matter or thing relative to 
the conduct or business of the corporation. By-laws should perform 
the same office for a corporation or association that a blue print 
performs for a builder. They should constitute a working plan for 
the corporation. Among the matters usually provided for in the 
by-laws of a corporation are the following: The time, place, and 
manner of calling and conducting its meetings and the giving of 
notice thereof, the number of members constituting a quorum, the 
qualifications and duties of directors and officers and their com- 
pensation, if any, and suitable penalties for violation of the by-laws. 
By-laws are to be distinguished from rules adopted for the guid- 
ance of the public dealing with the corporation. The members of a 
corporation and its directors and officers are generally conclusively 
presumed to have notice of by-laws, and of what they contain, and 
hence are bound by them, although, as a fact, they may be ignorant 
of them. 21 
The great importance of members, officers, and directors knowing 
the provisions of the by-laws of their association is thus apparent. 
On the other hand, strangers having no knowledge of the by-laws 
are not bound by them. If notice of the by-laws, either express 
or implied, reaches strangers it is usually held to be binding on 
them. 22 
A question which will readily occur to anyone is whether the 
majority of the members of an association may adopt by-laws which 
will be binding upon the minority who oppose their adoption. 23 
The answer is that they may, if such by-laws are reasonable and 
consistent with the charter and the general law. However, the 
majority can not adopt and enforce by-laws which violate the law 
or run counter to the purpose for which the association was formed. 
In an Arkansas case, a majority of the members of a corporation 
sought through a by-law to make what, under the circumstances, 
was held to be an attempted gift of a sum of money to one of their 
members. Certain stockholders of the corporation opposed the by- 
law and later resorted to the courts to prevent the turning over of 
the money. It was held that the action contemplated was a distinct 
violation of their rights and was, therefore, illegal. 24 A by-law 
must be general in its application and not aim at a particular mem- 
ber. 23 As indicating the possible scope of bj'-laws, a Nebraska case 
21 Brenl. v. Washington Bank, 10 Pet. 594 ; Columbia Bldg., etc. Ass'ns v. Junguist, 
111 Fel. (.45 ; Washington Cooperative E. & P. A. v. Taylor (Wash.), 210 Pac. 806. 
^Rathbun v. Snow, 123 N. Y. 343, 25 N. E. 379, 10 L. R. A. 355. 
23 Iowa State & Savings Bank v. C Nat Bank, (Neb.) 83 N. W. 9S2. 
24 G. W. Jones Lumber Co. r. Wisarkana Lumber Co., 125 Ark. 65, 187 S. W. 1068. 
25 Budd v. Multnomah St. R. Co., 15 Greg. 413, 15 Pac. 659. 
