The daily Argus. (Rock Island, Ill.) 1873-1877, 1875-03-26
KEOKUK-NORTHERN LIN E
The Court Declares the Sale of the Nc
Cune Stock to Commodore w.
tA +. Davidson Valid.
The Intsrlocutory order Restraining Him
From Voting. Selling or Dispcsing
ofthe Stock Dissolved.

Upon the formation of the Keokuk
Northern Line Packet Company over ia
year ago, the old Keokuk Packet Company
put into the new organization property to
the value OF $4,000, and took in pay
ment therefor 500 shares Of stock of the |
new company. Desiring to close up the |
affairs of the Keokuk packet company, the
directors of it sold 1913 shares of this |
stock to VIM, f. Davidson.
This action was claimed to be in direct
opposition to one of the bylaws of the new
corporation and a number of lawsuits re-
suited. One of these was in the nature
of an injunction sued out by Thomas j.
Buford against William f. Davidson, re-
straining him from voting, selling or in
any way disposing of the shares Of stock
transferred to him by the Keokuk Packet
company. Eminent counsel was en-
of the merits of the case was had before
Judge krunl some two or three months
ago. Judge Krum took the matter under
advisement and ON Monday rendered de-
cision dissolving the injunction, and Of
which the following is the substance:
OPINION OF JUDGE KRUM.
/. Defendants objection. that suit can
not be maintained by plaintiff without
previous effort TO OBTAIN proper action Dy
the corporation-not well taken.
Allegations of the bill are to the effect
that the issue of stock to the Keokuk
Packet company was without valid con
sideration that the Keokuk Packet com
pany took no title to the stock, and by it.
transfer gave no title to the defendant
VIM. +. Davidson that some of the di
rectors of the Keokuk Northern Line
Packet company combined with McClur,
and Davidson TO give the latter control o
the corporation for improper purposes
and that, 10 furtherance of such scheme
steps were about to be taken by directors
which would iDjure the corporation and II
reparably damage the interests of plaintiff
as stakeholder The allegations are sui
fcient to justify proceedings in name Q
the plaintiff .-
True, that bill must show that suitabl
redress is not attainable through action O
the part OF the corporation. "A forms
application and refusal need not be al
legged, if enough appear to show that sue
an application would be unavailing, the
the directors themselves are the partie
charged with the wrong, or by who's
fraud or wilful collision the wrong ha
been accomplished, and the suit is to b
brought against them. They are by tn
the service of representing the corporatio
in any action for the restoration of il
rights, whether by suit or other proceed
ing. If the corporate action is under til
control of such parties, it is sufhcieI
reason, of necessity, to warrant proceed
ings by suit, in the name and behalf of th
individual stakeholder y Brewer VS. Bo,
ton theatre l04 May 37S
z. No Importance attached by court
defendants point, that the affidavit to tn
bill is contracdicted by the affidavit to tt
reply.
Whether substantial contradiction e,
lists, or whether under our statue, in tf
event OF hearing on a motion TO dissOly
and the introduction Of evidence upon sue
hearing, much Importance would be a
tached to the afhdavits added to the plea
ings; in any event, more substanti
ground, upon which action of the court
based, in the present instance.
3. For the purposes of the motion, su
gestion of failure to join the keokuk Pac
ct company, as party defendant, has
weight. The bill seeks other relief
sides the restraining order. Necessa
parties, who have not been joined as .ye
may be joined at any time before final d
cree. In view of the relief sought, the
can be no reasonable controversy, that Il
keokuk Packet company is a necessal
party defendant. But the failure to jo
such defendant is not fatal objection
the maintenance OF the restraining on
1.-THE relief sought by plaintiff eau be ha
Mt all, it may be necessary to bring befo
the court in their proceedings, all of Il
corporations, whose property was tran
ferred to the Keokuk Northern Line Pac
ct company. But the question need U
be now considered,
4. The material questions under NJ
ton are:
First, whether the Keokuk Packet co,
pany could lawfully become stockhold
in the Keokuk Northern Line Packet co
paDy,.~
This question is determined adversely
plaintiff, upon the broad ground that
action Of the Keokuk Packet comnany
becoming stakeholder in the keok
Northern Line CT mpany was lawful; Il
available and sufficient consideration '