### No. 80-176 IN THE SUPFIEME COURT OF THE STATE OF MONTANA

JEANNE SKIERKA and ANNETTE SKIERKA, Plaintiffs and Respondents,

SKIERKA BROTHERS, INC., a Corporation, JOHN SKIERKA and BERNICE SKIERKA, Defendants and Appellants.

Appeal from: District Court of the Twelfth Judicial District, In and for the County of Liberty. Honorable B. 

### W. Thomas, Judge presiding. Counsel of Record: For Appellants: Church,Harris, Johnson & 

### Williams, Great Falls,Montana Douglas C. Allen arged and Donald A. LaBar arqued,

~dr Respondents:

.Donald

### R. Marble, Chester,Montana Jardine, Stephenson Law Firm, Great Falls,Montana John D. Stephenson argued, Great Falls,Montana

Submitted: March 

### 24, 1981 Decided: May 20, 

### 1981 Filed: 

# 20

# 1981'

I/ A 

# . ClefkMr. Justice Fred J. Weber delivered the opinion of the Court.

John Skierka (defendantJohn) and Bernice Skierka (defendant erni ice), husband and wife, and defendant Skierka Brothers, Inc. (corporation),a close-held family corporation, appeal from the judgment of the DistrictCourt of the Twelfth Judicial District, Liberty County, the Honorable B. W. Thomas, presiding. After trial without a jury, the DistrictCourt concluded thatJeanne Skierka (plaintiff Jeanne) and Annette Skierka (plaintiff Annette) had established their right to rescind their transfer of assets to the corporation, made inexchange for stock, on the basis of fraud and mutual mistake. The District Court also concluded that the plaintiffs had established their right tohave the corporation liquidated under section 35-1-921 (1) (a)(i:i.)

## , MCA, because of oppressive acts by defendant John Skierka, who 

### is incontrol of the corporation. The judgment orders the corporation to transfer back to the plaintiffs whatever property and assets they have transferred to the corporation inexchange for stock, together with additional property and assets representing one half (50%)of the fairmarket value of the other corporate assets on the date of transfer, or, inthe alternative, to transfer to the plaintiffs other property and assets of equivalent value, as the parties may agree. If the parties fail to agree within a reasonable 

### timeas to the other assets to be transferred to the plaintiffs, then the judgment decrees that the court

### willdissolve the corporation inaccordance with section 35-1-922, MCA

# . ~ppellants/defendants present the following issues for review: 

### 1. Is plaintiffs! action barred by the applicablestatuteof limitations? 2. 

### id the DistrictCourt err inconcluding thatdefendant John Skierka's acts as executor and as surviving partner cons

### tituted 

### a fraud? 3. Did the District Court err inconcluding that the parties acted under mutual mistake atthe 

### timeof plaintiffs' transfer of assets to the corporation? 

### 4. Did the District Court 

### err indecreeing that the corporationmay be liquidated on the grounds of oppression? Weaffirm the DistrictCourt's findings and conclusions

on allissues. Albert Skierka and the defendant John were brothers. Albert died, leaving his widow plaintiff Jeanne, and his daughter, plaintiff Annette, surviving. For 

### a number of years before his death, Albert had conducted a ranching and farming business as an equal partner with defendant John under the partnership name Skierka Brothers. Portions of the land used by the partnershipwere owned separately by John and Bernice Skierka and Albert and Jeanne Skierka. No land was owned in the partnership name. The land which was used by the partnership and owned separatelyhad been acquired by the two families ina checkerboard fashion. During Albert's lifetime, he and defendant John discussed the desirabilityof incorporating inorder toinsure continuity of management and toplan for minimizing taxes. Much of the preliminary incorporationwork was completed by the date of Albert's death, February 5, 1973. Albert lefta 

### willleaving his estate tohiswidow, plaintiff Jeanne, and naming his brother, defendant John, as executor without bond. Asexecutor, defendant John filed his firstand final account and petition for distribution onJune 26, 1974. All of Albert's property was distributed to plaintiff Jeanne. On May 1, 1973, while defendant John 

### was serving as executor of his brother's estate, a meeting was held between plaintiffs Jeanne and Annette and defendants John and Bernice for the purpose of discussing incorporation of the ranching and farming business. An attorney and an accountant, each of whom had been consulted inthismatter, were also in attendance. Atthe conclusion of the meeting, several documents 

### were signed by the parties, which resulted inthe following: 1. Allproperty owned by plaintiff Jeanne and used in the partnership operation, aswell asher family residence,

were transferred to the new corporation, Skierka Brothers, Inc., inexchange for 12,318 shares of 

### its capital stock. 2. Allproperty owned by defendants John and Bernice and used in the partnership, as

### well as their family 

### residence, were also transferred to the corporationbut in exchange for 12,682 shares of 

### its capital stock. '(John received 7,502 shares and Bernice 5,180 shares.) Defendant John's family thereby acquired 364 shares more than plaintiff Jeanne's family, resulting invoting control which became the critical issue. The attorney inattendance had advised the parties to transfer allreal property holdings, whether personal residence or farming property, to the corporation inexchange for stock holdings inorder to secure certain tax advantages. During the May meeting the attorney and the accountant explained thatJeanne would receive slightly 

### less than 50 percent of the stock because her personal residence

was worth less than the defendants' personal residence, both of which were transferred to the corporation in exchange forstock

# . The stock issued to the parties 

### is subject to restrictions contained inthe bylaws of the corporation. These restrictions provide that the stock can only be transferred by written consent of the holders of a majority of the stock. In the absence of such consent, the shareholder desiring to sell

### is to give written notice of his intentions to the secretary of the corporation. The corporation then has a 90-day option topurchase the stock ata price 

### setby

a vote of the holders of a majority of the stock. In the event the corporation elects not topurchase the stock, the other stockholders have a 90-day option to purchase atthe price setby the holders of a majority of the stock. The articles of incorporation provide that the 

### termof the corporation 

### is "perpetual". These restricti-onson stock transfer and the significance of her minority shareholder statuswere never explained toJeanne Skierka atthe meeting. In fairness to all, we point out that the evidence indicates that none of the parties appreciated the significance of the control which the defendant John's family obtained. The directors of the new corporationwere defendants John and Bernice, and plaintiff Jeanne. Following the organizational meeting plaintiff Jeanne made giftsof stock toplaintiff Annette. Plaintiff Annette 

### was made a director atthe next annual meeting of the corporation in 1974. For a year ormore after the incorporation, the personal relationships between the parties remained cordial and friendly. Their relations started to deterioratewhen plaintiff Jeanne, after consulting with her own attorney on May 29, 1975, came to 

### a realization of her position as 

### a minority stockholder and of the restrictions on the 

### sale of her stock. Her attorney wrote 

### a letter to the corporation'sattorney requesting thatJeanne'

### s stock interestbe made equal to that of John and Bernice Skierka. No action was taken on this request, but 

### it resulted inan open break between the two families. Atallof the corporation meetings through 1976, the parties unanimously agreed on the stock valuations. After 1976, plaintiffs Jeanne and Annette voted against the stock valuations upon advice of counsel, based upon a claim of insufficientvalue. In an effort to remedy the unequal stock interest and to give plaintiff Jeanne an equal voice with defendant John in the conduct of the corporation, Jeanne called for a special meeting of the corporation. This meeting was held

on April 27, 1977, and alldirectors were present. Motions to amend the bylaws to create an office of executive vice president having equal power and authority with that of the president and to electplaintiff Jeanne to that office

### were moved by plaintiffs Annette and by Jeanne, who voted in favor of each. Defendants John and Bernice voted against the motions. Each of the resolutions failed for lack of a majority vote. Shortly thereafter, on April 29, 1977, plaintiffs Jeanne and Annette filed a complaint seeking to dissolve the corporation. The plaintiffs alleged fraud and oppressive conduct on the part of defendant John and his family, waste of corporate assets, and that the corporationwas deadlocked. After trial, the District Court found the evidence insufficient to support the allegation that the corporation

was deadlocked. It did find thatdefendant John, by permitting himself to be placed incontrol of the corporation, violated the fiduciaryduties of a trustee, inhis capacity



### as executor of his deceased brother's estate and ashisdeceased brother's surviving partner, and therefore, acted fraudulentlyunder section 72-20-207, MCA. The court also found that the parties, intransferring their assets to the corporation, made the transfer inthe mistaken belief that each family would have equal ownership and equal voice in themanagement of the business. Last, the court found the actsof defendant John incontrolling the corporation

### were oppressive. As 

### a result, the court ordered that the transaction by which plaintiff Jeanne transferred property to the corporation be rescinded, and that one half of the corporation's other assets be transferred toJeanne, or else the courtwould liquidate the corporation itself. ISSUE #1: STATUTE OF LIMITATIONS Former section 93-2607(4), R.C.M., 1947, now section 27-2-203, MCA, setthe following period of limitation: "Two-year limitation. Within two years:



### "4. Ah action forreIief on the ground of fraud or mistake, the cause of action in such case not tobe deemed to have accrued until the discovery by the aggrieved party of the facts constituting the fraud or mistake." Defendants argue that any fraud ormistake occurred on

or prior toMay 1, 1973, the date of plaintiff Jeanne's transfer of property inexchange for stock, so that the above statutebars this actionwhich was filed over three years later. Defendants further argue that the running of the statutewas not tolled pending plaintiff Jeanne

## 's actual discovery of her inferior position, because she could or should have discovered her position in 1973when the difference in stock ownership 

### was explained to her, and all 

### terms and bylaws of the corporationwere 

### set forthin the documents which she executed as secretary-treasurer. Defendants citeKerrigan v. O'Meara (1924), 71Mont. 1, 227 P. 819, as support for their contentions. However, that case points out the reason for distinguishing 

### it from thisappeal: 

# ".

.

# . Unless there 

### is some relation of trustor 

### -- confidence between the parties which imposes upon 

### a defendant the duty of making a full disclosure 

## - 

## --- -- of the facts, there must be some active affirmative concealment of the fraud, something said or done to continue the deception or toprevent inquiry and lullplaintiff intoa sense of security, inorder topostpone the running of the statute." Kerrigan, 71Mont. 7, 227 P. 821. (Emphasis added.) The court inKerrigan found no relation of trust or confidence which would impose 

### a duty todisclose upon the defendant. The court then found that the statute had not been tolled, and the plaintiff was barred from asserting his claim. The rule as stated inKerrigan was restated by this Court in Anderson v. Applebury (1977), 173Mont. 411, 419-420, 567

Although Kerrigan did not concern a situationwherein the defendant had held a position of trust and confidence in relation to the plaintiff, that part of the stated rule 

### is supported by other authority. See 54 C.J.S. Limitation 

## - of Actions, S194; 

### 37 Am.Jur.2d 

## -- Fraud and ~eceit, S409. Here, defendant John did occupy a position of trust 

### and confidence 

### inrelation toplaintiff Jeanne, asdiscussed below. Hewas executor of his brother's estate atthe 

### time of incorporation. Also, he was partner tohis brother at the date of death; that status imposed upon defendant John the duties of a trustee. See former section 91-3205, R.C.M., 1947, now section 72-12-704, MCA. Such relationships may have technically ended when the estatewas closed and the partnership ceased to function, but the effect of the confidential relationship did not cease until May 29, 1975, the date on which the trial court found thatplaintiff Jeannefirstdiscovered her inferior position. This action was filed on April 29, 1977, so 

### it comes within the two-year statuteof limitations. ISSUE #2: FRAUD The DistrictCourt concluded thatplaintiff Jeanne had established her right to rescind her part of the transaction which created the corporation, as follows: "1. Plaintiffs have established their right to have the transaction whereby Plaintiff, Jeanne Skierka, and Defendant, John Skierka, transferred assets to Skierka Brothers, incorporated, [sic] in exchange for stock rescinded on the basis that the actsand failures to 

### act of the Defendant, John Skierka, who was then a trustee ineach of his capacitiesasexecutor of his deceased brother's estate and as surviving partner, resulted inplacing him incontrol of said corporation and are, as a consequence, fraudulent pursuant to Section 72-20-207 of the Montana Code." That conclusion 

### isbased upon the trial court's findings that the two brothers had been equal partners inthe ranch business; that defendant John was executor of his brother's estate; that atthe 

### time the incorporation took place, all parties believed control would be and was divided equally; but that, asa resultof the accountant's valuation of the two houses, defendants John and Bernice ended up incontrol of the corporation. PastMontana cases have assumed, without explicitly stating, that an executor of 

### a decedent's estate occupied a position of trusteeship over the assets and in favor of the devisees. See In

### re Jennings' Estate (1925), 74 Mont. 449, 461-462, 241P. 648, 652; Inre Eakins' Estate (1922), 64 Mont. 84, 93, 208 P. 956, 960. (The Montana Probate Code

now specifically places allthe duties of a trusteeupon personal representatives. Section 72-3-610, MCA.) 

## 30

# r The trustee statutes, sections 864,etseq., R.C.M.,

## 9o/ 1947, now sections 72-20-%@0, 

### et seq., MCA, provide as follows: "Trustee's obligation 

## -- of good faith. In allmatters connected with his trust, a trustee 

### isbound to act in the highest good faith toward hisbeneficiary and may not obtain any advantage therein over the latter by the slightestmisrepresentation, concealment, threat, or adverse pressure of any kind. (72-20-201, MCA. ) "Trustee's influence not tobe used for his advantage.. 

### ------ A trustee may not use the influence which his position gives to him to obtain any advantage from his beneficiary. (72-20-202, MCA.)

"Duty to disclose adverse interest. If a trustee ac

### -- 

## - quires any interestor becomes charged with any duty adverse to the interestof his beneficiary inthe subjectof the trust, he must immediately inform the latter thereof and may be atonce removed. (72-20-206, MCA. ) "Violation of obligations as fraud. Every violation of the provisions of the preceding sectionsof this chapter 

### is a fraud against the beneficiary of the trust. (72-20-207, MCA.) "Presumption against trustees. Alltransactions between a trustee and his beneficiary during the existence of the trust or while the influence acquired by the trustee remains by which he obtains any advantage from hisbeneficiary arepresumed tobe entered intoby the latter without sufficient consideration and under undue influence." (72-20-208, MCA;) In 

### itsMemorandum on Order Denying Post-trial Motions, the DistrictCourt gives 

### itsreasons for finding fraud: 

# ".

. . Atthe 

### timethe corporation was created and the assets of the parties were transferred to 

### it, John Skierka stood ina trustrelationship to Jeanne Skierka, both as the surviving partner and as executor. More than that, he stood ina relationship of trustand confidence toJeanne asone towhom she could look and did look for guidance and advice on business affairs. The evidence further shows that atthis time Jeanne was stilldistraught over her husband's death and was not paying close attention to business details, although desirous of carrying outher latehusband's desire to convert the partnership to a corporation. In the view of this Court, John Skierka had an affirmative duty to 

### see thathe and Jeanne retained positions of equality upon 

### creation of the corporation, and 

### itwas a breach of his duty topermit 

### a resultwhich placed him in

### a superior position, incontrol of the corporation and the disposition of the stock. Although defendants argue thatthe transaction occurred in the presence of an independent attorney and accountant who explained the significance of the transaction toJeanne Skierka, the attorney and accountant admit that they told Jeanne that the unequal stock ownership was not really important and they failed to discuss with her the by-law provision which restricts the 

### sale of stock or to advise her what effect this could have on her asa minority stockholder. So 

### it 

### is clear that the full significance of the transaction was not explained to Jeanne. In the Court's view this situation comes within the definition of constructive fraud: 'Any breach of duty which, without an actually fraudulent intent, gains an advantage to the person in fault or anyone claiming under him by misleading another to his prejudice 

# .

# . .' Section 28-2-406, MCA." Because the resultof the incorporation 

### is to give defendants John and Bernice control over the assetswhich plaintiff Jeanne acquired by 

### willfrom her latehusband, the trustee statuteshave clearlybeen violated, regardless of John's good intentions. Defendants cite the case of Boatman

v. Berg (1978), 176Mont. 208, 577 P.2d 382, as support for their argument that some wrongful actmust be shown before 

### a trustee can be found tohave committed fraud upon his beneficiary. Boatman, this Court found wrongful act, because 

### it was clear there that the trustee had given good and adequate consideration for allof the property which the plaintiff had transferred to him; the trustee did not benefit atthe expense of the beneficiary. Here, defendant John personally benefited atthe expense of plaintiff Jeanne when he gained the power tovalue Jeanne's stock and to control corporate operations. That condition

### was not present inBoatman. The evidence does show thatJeanne, since the date of incorporation, has been able towithdraw allthe money she has needed and thatJohn has managed the corporation competently and efficiently. However, competent management does not correct the initialwrong: defendant John obtained

an advantage over plaintiff Jeanne without having fully disclosed the consequences.

### ISSUE #3: 

### MISTAKE As 

### an alternate ground in support of plaintiff Jeanne's right torescind her transfer of property, the District Court found that therewas a mutual mistake by the parties intheir belief that the unequal stock ownership would make

no real difference so far as control of the corporation

### was concerned. If 

### the factswere understood, then atleast the parties were mistaken as to their legal effect. See conclusion no. 2 

### of findings of factand conclusions of law; Memorandum on Order Denying Post-trial Motions, p. 2. 

### Finding of factno. 12

### states: 

# ".

. . At

### the 

### time, no

one considered that the unequal stock division was of any particular legal or practical significance. Up to the 

### time of thismeeting, itwas always considered by the parties that the corporation would continue the 50-50 ownership and management relationship which existed under the partnership." That finding of the court 

### isnot disputed. Rather, defendants claim that no mistake can be found under the law because the widow failed inher legal duty to fully read the incorporation and conveyance documents before signing, citing former section 13-313, R.C.M., 

### 1947, now section 28- 2-409, MCA. As

### previously pointed out, the duty was not so much on thewidow todiscover asitwas on the trustee to fullydisclose. In the trialcourt's view, the fact thatno disclosurewas made by defendant John indicates the mistake under which the parties 

### were acting. Findings of fact should not be set 

### aside unless clearly

erroneous. Rule 52(a),M.R.Civ,P. We find no such clear

error. ISSUE #4: 

### OPPRESSION Section 35-1-921, MCA, 

### provides 

### as follows:"Power of court to liquidate assets and business of 

### - corporation--venue. (1)The district courts shall have fullpower to liquidate the assets and business of 

### a corporation: 

### "(a) inan action by a shareholder when 

### it is

### established that:

"(ii) -the'actsof the-di.rec€orsor those incontrol of the corporation are illegal, oppressive, or fraudulent 

# . .

# ." The DistrictCourt specifically found that no deadlock existed in the corporation (findingof factno. 23) and that defendant John 

### isa competent operator, managing the business competently and efficiently (findingof factno. 17). The court's conclusion no. 3 states: "Plaintiffshave established their right tohave the assets and business of Defendant Skierka Brothers, Incorporated, liquidated pursuant to the provisions of Section 35-1-921 (1) (a)(ii) of theMontana Code on the basis that the acts of Defendant John Skierka, incontrol of the corporation, are oppressive." The court's conclusion was based upon the following findings: "16. Annual meetings of the stockholders and directors of Skierka Brothers, Incorporated, have been held every year 

# . . . Atthe meetings through 1976, allparties unanimously agreed on the stock valuations. After 1976, Jeanne and Annette Skierka voted against the valuations established upon advice of counsel. In 1979, the meeting was held by unanimous consent.

"18. Since 

### its incorporation, Defendant John Skierka, aspresident, has operated Skierka Brothers, Incorporated, as he has seen fit, carrying on farm and ranch operations at

### times and inmanners thathe determined, including the selling or storage of grain crops, the purchase of equipment, the purchase and sale of livestock and their operations, the hiring of employees, includingmembers of his family, and the wages and salariespaid, whether incash or grain shares or both, the right touse corporate equipment and supplies, including gasoline and oil, and ingeneral alloperations whatsoever."21. On April 27, 1977, a special meeting of the board of directors of Skierka Brothers, Incorporated, was held atthe 

### lawoffices of Jardine, Stephenson, Blewett and Weaver inGreat Falls. Present atthe meeting were allof the directors, Jeanne Skierka, Annette Skierka, John Skierka and Bernice Skierka. Also presentwere John Weaver and John Stephenson, counsel forJeanne Skierka and Annette Skierka, and Don LaBar and Paul C. Bunn, counsel for Skierka Brothers, Incorporated. The motion to create an executive vice-presidency with power equal to the president was defeated, as

### well as a motion to expand the board of directors from four to five. "22. The actsof Defendant John Skierka have been and areoppressive inthathe has run the corporation as President ashe has seen fitand since early in 1974 has denied the Plaintiffs, Jeanne Skierka and Annette Skierka, any part or voice in the operation, either as directors or asminority stockholders, except for participation in the annual meeting.

### " In 

### itsMemorandum on Order Denying Post-trial Motions, the court stated: "As far as the issue of oppression 

### is concerned, thisCourt has taken a broad view of the application of this principle to 

### a closely-held corporation. The finding of oppression here 

### isbased on the exclusion of the minority stockholders from participation inthe operation of the corporation, and not on a lack of probity on the partof the majority." Under section 35-1-921, MCA, the courtmay liquidate the corporation where the acts of those in control are oppressive. Two key areas of oppression may be mentioned. The first

### is the actionby defendant John and his family of fixing the stock valuation atwhich plaintiff Jeanne's family may sell. The second 

### is the defeatingby defendants John and Bernice of the motion to create an office giving to plaintiff Jeanne power equal to that of defendant John. Model Business Corporation Act Annotated second edition, section 97 atp. 554, points out as follows with regard to the historical right of the court to liquidate the assets of



### a corporation:"American jurisprudence has created two categories of exceptions to the rule that an equity courthas no inherent right to liquidate the assets and business of a corporation. The first

### is ina suitin equity by shareholders who are suffering as a result of the conduct of the business of the corporation in such a way that they can have no equitable relief without liquidation of the 

### assets and business of the corporation. The second 

### is ina bill in-equity by a creditor who can have no relief unless the assets and business of the corporation are converted to cash and operations ceased." The Model Business Corporation Act 

### as adopted inMontana has extended the rules for involuntary dissolution. Aspointed out inModel Business Corporation Act Annotated atp. 554: "The Model Act provides rules to cover involuntary dissolutions by shareholders by defining four factual situations inwhich the courts

### willhave the power to liquidate the assets and business of the corporation 

# . . . Second, the controlling directors ormanagers acting inan illegal, oppressive or fraudulentmanner. While the terms 'illegal', 'oppressive' or 'fraudulent' are subject tojudicial interpretation, they have somewhat limited definitions within alljurisdictions." A leading case in the interpretation of the Model Act 

### (Mo

# . App

# . isFix v. Fix Material Co. Inc. /1976), 538 S.W.2d 351, in which the courtmakes the following observations: "The Illinois courtsmade it clear, when construing the Illinois Statute (theModel for s351.485 [theMissouri statute])

## , that 'oppression' 

### is, inand of itself, an independent ground for relief not requiring a showing of fraud, illegality, mismanagement, wasting of assets, nor deadlock, though these factorsare frequently present 

# .

# . . "Ithas often been stated that oppression suggests



# . .

# . 'a visible departure from the standards of fair dealing, and a violation of fairplay on which every shareholder who entrusts hismoney to a company 

### isentitled torely.

## ' '



# . .

# . Such definitions are suggested perimeters of the broad 

### termrather than narrow definitions which would tend torob the 

### term of itsuseful flexibility. Aswe read the statute, it 

### is intended the courts 

### willproceed on a case-by case-basis.'" Oppression may be more easily found ina close-held, family corporation than ina larger, public corporation. As the court stated inThisted v. Tower Management Corporation (1966), 147 Mont. 1, 409 P.2d 813:"It

### is to be noted that a close corporation 

### is one inwhich management and ownership are 'substantially identical to the extent that 

### it 

### isunrealistic to believe that the judgment of the directors

### willbe independent of thatof the stockholders.' 52 Northwestern L.R. 345. By 

### itsvery nature, intracorporate problems arising ina close corporation demand the unusual and extraordinary remedies available only in a court of equity." 147 Mont. 14, 409 P.2d 820. "'Courts of equity are not bound by cast-iron rules. The rulesby which they aregoverned 

### are flexible and adapt themselves to the exigencies of the particular case. Relief 

### willbe granted when, inview of allthe circumstances, to deny 

### itwould permit one of the parties to suffer a gross wrong atthe hands of the other party who brought about the condition

# . . .1 I1 147 Mont. 15, 409 P.2d 821. The extensive and detailed findings of factof the DistrictCourt disclose facts clearly sufficient to support

a conclusion of oppression under the foregoing statuteand authorities. The trial of thismatter lasted two and onehalf days. The trial court had ample opportunity to observe the witnesses and learn of their problems. The trial court's findings should not be disturbed unl-ess

### we find they are "clearly erroneous". We do not so find. Wedo note that the trial court 

### willnot liquidate the corporation because of oppression unless the parties areunable to agree upon the property division and transfer tobe made to the plaintiffs. CONCLUSION We affirm the DistrictCourt's conclusions on allissues, and remand the case for proceedings inaccordance with that court

## 's judgment

# .I." Y.



### We concur: