The Hawaiian star. [volume] (Honolulu [Oahu]) 1893-1912, 1899-11-01

the pending litigation and providing .
more capital has Deen authorized by the .
stockholders.
The vote was:
For the proposition, 25, 944 shares.
Against the proposition, 571 shares.
This action was taken at the adjourn /
ed meeting from last Friday, held at |
the Chamber of Commerce rooms this .
morning. Nice-President b. F. Dilling- /
ham presided. The minutes of Fridays /
meeting were approved The calling of
the roll was by vote dispensed with.
f. NJ. Hatch moved to amend the re- .
solutions authorizing the increase of
stock by striking out the words lis
hereby increased" and inserting the
words 1.-THE directors are hereby author !
lied to increase" With this change in
the wording, the proposition was be-
fore the meeting.
j. A. Magoon said he wished to cor
rcct a msstatement of fact which Mr..
Thurston had made at the meeting Fri
| day.
There has been talk" he said, "of
| thirty three suits and injunctionS
! against the company. There is no suit
! against the company involving the right
| of the company to issue the stock in
| dispute. The company can issue it. and
the only question involved is to
! whom it shall be issued. To take the
! action proposed is to take the property
| of one set of men and give it to another.
| The company has the right to issue adj
| ditional stock but the stockholders have
| the right to purchase it al par in pro-
portion to their holdings, and thereby
| to benefit by the issue. 1t is said this
action will relieve the company from
| litigation but will it? We who believe
we are being deprived of our rights will
not stand idly by and suffer There are
many, | believe, who feel this way who
| here because of various rpa-
sons. The dispute is with Dillingham;,
not with the company. To take this ac-
ton is to take the property of the COM
pany and give it to Dillingham;"
L. A. Thurston. replying, said, "I wish
to correct Mr. Magoon who is a well
intentioned gentleman who makes mis-
takes of law. The usual rule in regard
to new issues of stock is as he has stat
ed it. But there is one exception, When
stock is issued for another purpose
which is for the general benefit of the
| corporation and thereby for the equable
and proportional benefit of each stock
holder it may be issued without the
stockholders having the first right to
purchase. For instance, suppose the
company had put a 100000 mill on a
ten acre lot and it should then turn out
| that Mr.. MagoOu owned the land If he
should say he would waive his right
to the land and his right to whatever
was on it in consideration of the issu-
ance of 100000 of stock to him, the
company could do that for it would be
for the general benefit of the corpora
ton The sole question here is, Is this
action for the general benefit of the
company? If it is it comes within the
exception to the general rule. While
| the litigation is going on the company
is being held up. 1t is for the general
benefit to stop litigation
Mr. MagOon answered that as he had
LII. Il.
s not refusing to pay their aSSesSme nts
on the stock in dispute, but the com
pany was refusing to receive 1t, and re-
n ferred to Senator McCandess from
z whom he got the information for veri-
fication. Senator McCandless said the
San Francisco subscribers had rendered
n their money for every assessment lev
= led.
Mr. Thurston replied that that was
so. But as the company had refused
to recognize them as subscribers it OF
: course could not receive their money
while the Honolulu subscribers who
: We're recognized had refused.
G. NJ. Cooke asked if the agents, Cas-
tie & Cooke had refused to advance
I more money. Mr. Thurston said they
: had already advanced large sums while
still larger sums We're required and il
was not reasonable to expect them tC
n continue advancing.
n E. ID. Tenney said Castle &, Cooke haC
t not refused to make further advances
r. ID. Silliman said that notwith-
n standing Mr.. Thurston was always
d right in his law he was wrong in one
=. particular. THE courts have laid dowr
a hard and fast rule that minority
, stockholders cannot be deprived of THEN
= vested right to participate in new is
sues of stock, and have invariably come
to their relief to protect them against
just such instances as Mr.. Thurston'
ten acre lot, where the real purpose was
= to affect elections or some similar pur,
[ pose. The corporation had no liability
in this case. Castle & Cooke stock haC
n always been higher than Dillingham;
: stock because purchasers of the latter
= took it with all the chances attached t.
IT, They took it with notice of it's in.
n tirmities. Where the company SOLD
= stock to bona fide purchasers for value
and then failed to deliver it, it was
liable for the market value of the
stock. But that was not this case"
In addition, Mr. Silliman insisted tha
the thirty-three suits were a "bogey-
- man." for as soon as one was finally
| determined the decision i'm the other,
must follow it, though the litigRntS
: might prosecute their suits if they
, wanted to.
n f.. b. McClanahan replying said this
r last statement was mistake, 9TH,
termination of one suit i'm no wise af
e fects the other. Not only may tn,
others be prosecuted but rightfully pro
= secuted, because they involve differen
principles and issues of fact. The
questions of estoppel notice and dealius
p with an agent differ i'm all the suits
one man may have had notice Will,
= another had not. The Soper suit Whicl
has been tried and the McCandless sui
= which has not differ.
"Nor has Mr. Silliman correctly stat
s ed the rule in regard to stockholders
participation in new issues of stock
There is an exception as Mr.. Thurst tol
has clearly stated it. Where the issu
works an equal and proportional bene
fit to all stockholders and is for tn
| ,f Ia. no stock