The Anaconda standard. [volume] (Anaconda, Mont.) 1889-1970, 1898-11-29
Judge Clancy Upheld in the B. q
N. Case Appeal.
AN OPINION BY PIGOTT
Exhaustive and Eiaborats-The Proceed
ings We're Instituted by il me,
Forester and John Maginnis.
Covers important Points.


junction proceedings Instituted by
James Forester and John Maginnis to
restrain the Boston & Montana stock
holders from voting or allowing TO be
voted any of the capital stock In favor
OF ~disposing Of the property OF the cor
poration to a corporation of the same
name organized under the laws OF New
York. and from ratifying or adopting
any deed OF conveyance of the said
property heretofore made in the name
OF the Montana corporation to the New
YORK corporation. or any act OF the
board of directors with reference to
such transfer. The opinion. which was
prepared by Justice Pigott. Is exhaust
i've and deliberately covers the many
litigation as h court has been called
to pass upon since 1t decided the IA
nous Fourth OF July case.
Last June a meeting OF the stockhold-
ers OF the Boston & Montana was called
to meet in Butte to effect the transfer.
Messrs. Maginnis and Forester. as
owners of 200 shares OF stock. protest.
ed against h proposed transfer n
applied to Judge Clancy for a restrain
Ing order to prevent 1t from being ac-
complished. The court issued a tempo
rary order, after declining to accept a
bond offered by the Boston & Montana
for $4,000 to subsequently purchase
Forester n Maginnis' 200 shares of
stock and indemnify them for any dam
ages that might accrue from the trans
fer. From the lower courts ruling the
company appealed. The supreme court
affirms Judge Clancy and holds in
substance that our statutes do no con-
fer upon two-thirds of the stockholders
of a solvent and prosperous corporation
the right to take the citizenship of the
corporation TO another state without the
consent Of all the stockholders.
One OF the contentious OF the Boston
& Montana was that the plaintiffs, For
rested and Maginnis. acquired the stock
In question In the interest Of the Mon
tana Ore Purchasing company. a rival
corporation, between which and the
Boston & Montana there existed an I'M
friendly feeling; that the action was not
brought In good faith, but from i'm
proper motives n In the interest OF the
rival corporation and not for the bene-
nj OF non-assenting stockholders. In
disposing OF that contention the SUI
preme court says: The court below
found that plaintiffs owned the shares
and that they were acting in good faith
and we cannot say that the evidence
received Of the hearing so clearly
proves the contrary as to warrant us
In deciding that the lower court erred
In determining the question as IL did.
Neither does the court believe, as claim
ed. that plaintiffs were guilty of unrea-
sonable delay in commencing the suit.
Nor did Il err in refusing to accept the
bond rendered by the defendants. In
regard to the latter the supreme court
says:
Section $40 Of the code of civil pro-
cedure confers upon the court a discre-
tionary power TO vacate an injunction
granted ad interim or pendente lite,
the alleged wrong or injury IL
reparable and capable OF being ade-
quately compensated for in money,
upon defendants executing such an un-
dertaking n the court may require.
We do not think the court abused Its
discretion. As counsel well says. IL
plaintiffs were clearly entitled to an In
junction In this case. the district court
would not have been justified in accept
ing an undertaking In lieu of the bond.
which would be licensing the commits
sion OF a wrong not susceptible to COM
pensatory. damages. The present value
of the shares held by plaintiffs might
be accurately determined by a judg-
ment. but the profits by way of future
dividends on their shares that might
accrue from the Montana company can
not be predicted with approach to rea-
sonable certainty. Moreover, IL the
transfer and the vote OF the sharehold-
ers I'm attempted ratification objected
to by plaintiffs, are ultra wires as to
them. hen IL Is manifest, upon the
plainest principles OF law, that no court
may rightly compel them to dispose of
their shares I'm invite. III. as a matter
of law. the proposed transfer was shown
TO be ultra wires the corporation, plaint-
iffs were entitled. as OF right, to the
injunction; and in such event, were a
bond accepted and injunction refused.
the fact would seem apparent that the
court had decided that plaintiffs prop
erty could not be taken without their
consent. and at the same time had per-
mitted II to be done, an inconsistency
needing no comment"
As 20 the right OF a prosperous and
solvent corporation TO vote 10 transfer
it's property without the consent OF all
the stockholders. the court says: AT
common law neither the directors nor
a majority of the stockholders have
power to sell or otherwise transfer all
the property of a going, prosperous
corporation as against the dissent of a
single stakeholder, unless. perhaps,
such disposition Is one OF the purposes
or Is the object for which IL is created.
This doctrine is firmly established by
the authority OF adjudged cases and
rests upon the soundest principles"
Counsel for the Boston q Montana set
up hat certain sections OF the state
laws OF 1887 constituted an enabling act
granting to stockholders owning two
thirds of the shares power to dispose
of all the property OF a solvent and
prosperous corporation. despite h pro-
tests OF other stockholders. The court.
In disposing OF that contention, says:
Nov. by the common law. a solvent
and prosperous corporation may, with
the unanimous consent OF Its stockhold-
ers. dispose OF Its entire assets. but may
not to do SO without such unanimity.
Again. at the common law, a corpora
ton which Is insolvent or unable TO
execute the purposes for which II was
created. may, by its directors Cor at
least by the directors and a majority OF
Its stockholders). sell or assign all its
property when the best interests OF the
stockholders would be served thereby.
In the proper pursuit OF It's business and
within the purposes for which IL was
created. a corporation may. by the COM