Kansas Constitution Article Twelve - Corporations
Kansas Constitution – Article 12: Corporations
Article 12 of the Kansas Constitution governs corporations, including both public and private corporations. Here's a summary of its key sections and themes:
Section 1 – Corporate Powers
The legislature may provide for the formation of corporations.
All existing corporations and those formed under general laws are subject to regulation, alteration, or repeal by the legislature.
Section 2 – Public and Municipal Corporations
The property and franchises of public or municipal corporations cannot be taken or applied for any other use without due process and just compensation.
Section 3 – Limited Liability
Stockholders in corporations are only liable for the amount unpaid on their stock (i.e., limited liability).
Section 4 – Foreign Corporations
Foreign corporations must not have greater rights or privileges than domestic corporations organized under Kansas law.
Section 5 – Banking Restrictions
No corporate banking businesses can be established without legislative permission.
Banking institutions must secure deposits and follow state regulations.
Section 6 – Eminent Domain
Corporate property may be taken for public use in the same manner as private property, with fair compensation.
Section 7 – Railroads as Common Carriers
Railroads are declared public highways and must operate as common carriers, subject to regulation by the state.
Section 8 – Consolidation of Railroads
Railroad companies organized under Kansas laws may not consolidate with competing companies under other jurisdictions without state consent.
Section 9 – Individual Liability for Corporate Fraud
Officers and agents of corporations are personally liable for corporate fraud or misconduct.
This Article empowers the state legislature to control, regulate, and, when necessary, limit the powers and operations of both public utilities and private corporations, with an emphasis on fair business practices, liability, and public interest.
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