The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1900-05-01
The Blackwell Factory Will
Now be Sold.
HILL NAMED AS RECEIVER
Judge Simonton Thinks Maj. Guthrie's Inter
WV in the News and Observer Was a
Threat That Was Calculated TO In
danger the Good Will of Co.

the blackwell Durham Tobacco Com
pany case was received here yester-
day.
1t is in favor Of the trust on every
point-making the receivership per
manent and ordering the sale of the
property.
This IS a suit, it will be remember
ed. brought by officers. directors and
employees Of the American Tobacco
Company. who are also large stock
holders in the Blackwell Company. to
have a receiver appointed for the
Blackwell Company and close up its
business.
The suit was against BlackwelFs
Durham Tobacco Company and the
minority stockholders in it, II was
based on an interview with MAJ. VIM.
\. Guthrie, one Of the minority stock
holders. published in the News n
Observer some months ago. In this
interview Major Guthrie declared his
intention to ask the Legislature to re-
peal the charter of the Blackwell
Company on the ground that it was a
trust.
AS soon as the interview appeared
the president. vice-president, secreta-
~. treasurer and several directors II
employees of the American Tobacco
Company went before Judge SlmOntOn
at Charleston and asked that A re-
ceiver be appointed. The petition was
granted and p. s. Hill. secretary of
the American Tobacco Company. was
named as temporary receiver, and
April 18th at Charleston was fixed
as the time for hearing argument as
to whether the appointment of the re
ceiyer should be made permanent.
The case was duly argued at the
time set. The opinion of the court
rendered yesterday makes the receiv-
ership permanent and orders sale Of
the property. The opinion is quite a
long me-. making seventeen typewrit-
ten pages.
The first ten pages reviews the bill.
setting forth the facts in the ease and
stating the reasons why the court
should intervene and grant the relief
PRAYER for. Two pages are de@oted
to MAJ. Guthrie's answer and the con-
tentions therein.
On the issues mus raised Judge ST
montOn delivers the following Opin-
ion:
The Blackwell Durham Tobacco Com
pany is a solvent going corporation. Can
this court under the circumstances stated.
appoint a receiver for this corporation
and take proceedings looking to its final
dissolution?
The general rule as laid down by text
writer's is that the general jurisdiction Of
equity over corporations does not extend
to the power of dissolution of the corpo-
ration or to the winding up of it's affairs.
seQue6trating the corporate property and
effects and in that connection appointing
a receiver, unless such jurisdiction is eX-
rressly conferred by statute. (Beach on
Modern Equity Juris. sec. 967. Cook on
stockholders. vol. /, sec. 629).
The reason of the rule is stated in Re
publican Mountain Silver Mines VS.. Grown
ct al. 10 L. S. Appeals 209; C.C.A. 412:
"A court Of equity. however. has no
power to %interpose its authority for the
purpose Of adjusting controversies that
have arisen among the shareholders or
directors Of q corporation. relative to the
proper mode of conducting the corporate
BUSINESS, as it may do in case OF a Simi-
lar controversy arising between the mem
bers Of an ordinary partnership. Corpora
tions are in a certain sense legislative
bodies. They nave & legislative power
when the directors or shareholders are
duly convened that is fully adequate to
settle all questions affecting their bust
ness interests or policy, and they should
be left to dispose of all questions of that
nature without applying to the courts
for relief. A shareholder in a corporation
cannot successfully invoke the power of a
chancery court to control it's officers. or
board of managers. or to wreSt the cor
/, porate property from their charee through
the agency of a receiver, SO long as they
neither do nor threaten to do any
fraudulent or ultra wires acts, and so
long as they keep within the limits of by
laws which lave been prescribed for their
/ g~overnance. If in either of the cases last
specified a shareholder is nevertheless Is
satisfied with the business policy that is
being pursued, or the methods of corpo-
rate management. he must seek redress
within the corporation, in the mode pre-
scribed by its charter and bylaws, rather
than by an appeal to the courts"
But this statement of a general rule
does not meet the question made in the
bill upon the circumstances admitted in
the answer. This is not: an application
to stop a gOing corporation in a success
full career, wind up its business and dis
tribute its assets among the corpora
tors. The bill alleges. and the answer
admits. that among the stockholders Of
this company there is a grave collision
not upon the business conduct of the
company, nor as to the mode of conduct
ing it's operations, but as to ite future
existence; that a single stakeholder. and
he possessing but one share, has declared
his fixed purpose to seek at the hands
of the Legislature a repeal of its char
ter, 4 termination of it's existence. the
winding up of its affairs by trustees. sue-
gested in whole or in part by himself. one
Of whom bears his own name, presumably
his kinsman Not only so but he has
avOwed his intention, if he fail in this
application, to bring the question before
the people of North Carolina. the agitate
it on the stump, and to make it a oues-
ton in ~rolitics. Whether he NAV suc.
coed or whether he may fail. the same re-
suit will follow SO far as the interests
of the corporation are concerned. With
the we'll known timidity of capital its
business must be injured. disorganized
and ruined. The good will of these man,
ufacturing corporations, the brand which
they use, are valuable portions of their