The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1897-04-08

company, the business of which, defined
in its articles, is the same as the business
of the Minnesota company, and its principal
place of business is also South st. Paul. The
business in which the Dakota company has
been actually engaged is slaughtering hogs;
and since it commenced operations, the bust
ness of slaughtering hogs has been gradually
absorbed by 1t and diverted from the Mime
sofa company, so that at present the Mime
sofa company does none of that business and
the Dakota company does all the Strengthening
of hogs at South st. Paul. A large part Of the
product of the Dakota company is sold to the
Minnesota company, and the portion not sold
to the Minnesota company is sold by it for the
account of the Dakota company. The Dakota
company is deriving large profits from the
business which 1t so carries on, Its business
is under the control and management of De-
holders
Recently Defendant Shufeldt has acquired,
in his own name, saughtertng and packing
houses at New Brighton and has commenced
and is carrying on in his own name, the bust
ness of slaughtering hogs at thai place, with
the purpose of absorbing the entire business
Of slaughtering and packing. All the hogs
available at South st. Paul ard New Brighton
are sufficient only for one establishment. De-
PENDANT Shufeldt has taken a large quantity
of machinery belonging to the Minnesota COM
pany from its plant, and placed 1t In his pack
ing house at New Brighton, charging himself
with the same upon the books of the Min
nesota company. He alleges that the acquisi-
ton of the property at New Brighton and the
has been with the intention of turning the
same over to the Minnesota company if that
company sha. see fit to take It,
The situation, briefly stated, is that Shu-
feldt while president and In entire control of
the Minnesota company, has organized an
other company, in which he has consider
abe pecuniary interest, and which he also
manages with the same powers as the Min
nesota company, and located at the same
pace, and which under his direction, has
entirely absorbed one important branch Of
business formerly Minnesota
company, and that substantially all the bust
ness the Minnesota company is doing is
such as is furnished it by the Dakota COM
pany. He, as the manager OF the Dakota
company, has taken to the Dakota company
from the Minnesota company, and with his
consent as manager Of the Minnesota com
pany. the business of s-aughtering hogs; and
he, for the Dakota company, is selling to
himself, for the Minnesota company, the
product Of the hogs so slaughtered Further,
Shufeldt as an individual has acquired a
plant at New Brighton and is engaged in
the slaughtering and packing business there
on his own account, in direct antagonism to
the business heretofore carried on by the
Minnesota company, and he has purchased
for himself, from himself. as president and
manager of the Minnesota company, a large
amount of the machinery and property of
the Minnesota company. He says he is will
ing to turn the business over eventually to
the Minnesota company, but upon what terms
does not appear. Under present conditions,
| II 1t is turned over, he will fix the terms for
both parties. In the meantime tn business
is being carried in his name for his bene-
fit. and the business is baing diverted from
the Minnesota company. The actions of Shu-
feldt have been concurred in by the directors
Of the company, but the directors have no
interest in the corporation, and they are SIM
ply Shufeldts agents.
Extended arguments upon these facts are
not necessary.
The position of Shufedt in the Dakota COM
pany and his position with reference to the
new business started in his own name at
New Brighton, inconsistent with his posi-
ton an officer of the Minnesota company.
He is attempting to serve two masters.
Directors and officers Of interpretations Oc-
curY positions Of trust toward their corpora
! tons, and they are not allowed to deal with
the corporate property for their private gain.
| They have no right to deal with themselves,
and for the corporation, at the same time and
| It is not a justification excuse that no
loss has resulted. They not permitted to
occupy these inconsistent positions in which,
necessarily, their own interest comes in con-
fict with hteir duty to their principal. Relief
against transactions of this sort without a
showing Of actual fraud. will always be
awarded by court OF equity at the suit Of
the ceStui que trust.
This action is not brought by minority
stockho!der, but by stakeholder holding all
the stock and in view of the situation now
existing, I think plaintiffs motion to re-
move the officers and directors and for re-
cetver must be granted. Whether the plain
; tiff through the influence of the defendant,
Shufeldt. may In the future be induced to
change its attitude and abandon the action,
cannot be determined now. The situation can
be acted upon when it arises
Counsel for plaintiff may draw the necess-
sary order. The court will receive such sug-
gestons as counsel for the respective parties
NAV desire to make to the person to be
appointed receiver and as to the amount of
/ the bond to be given. Tho receiver will take
! charge of all the assets of the Minnesota com
! pany, together with its books and papers, and
carry on the business until the election and
qualification of new directors, when applica-
ton may be made to the court for the dis
/ charge of the receivers.