Arizona republican., 1904-09-11
VOL. XIV. NO. IA

never have been, but are mere dum-> mics, or straw shareholders, ostensi- ply holding in their names on the books of said corporation lone share of said stock and that such shares are in fact the property of said Arizona Water company, so far as it can law fully hold said stock
 Compliments aver that such direc- tors as Cleary. Christy and Onns are acting and have always acted solely as agents of said Arizona Water com paDy and as such they have ben nov ed by 1t to act, and as such they con- trol the canal companies affairs and not otherwise"
 It is charged that, notwithstanding the fact that each of these dams when in the condition in which they are ob- ligated to be kept. is sufficient for its limited purposes as described in it's franchise and contract, the Arizona Water company, at an alleged stock holders meeting held in the month of September. 1901, by force of its holding a majority of it's shares, voted to es- tablish a contract stipula-iag that each of the three individual companies pay to the Arizona Water company $2, 800 annually for the carriage through its Arizona canal, water of the Salt river. which each individual canal was entitled to divert and carry through Its own canal for its own purposes. Com plainants aver that this contract Is not only unnecessarily. but that it is still in effect, having been executed by "dun- mics or straw directors" moved there to by, and acting solely for. the bene- fit of and at the request of the Arizona Water company, and that said con- tract was utterly beyond the power of the individual canal company to make and was and is of no force and effect whatever, and was caused to be eNeCut- ed and carried out by the Arizona Wal CT company, its majority stockholder. in breach of trust with it's relation both to the individual canal company and to its minority shareholders.
 It Is alleged that each of the three canal companies have thus uselessly paid $750O which should have been dis bursed among its shareholders. It is insisted that Cleary, Christy and Orme. having as acting directors of each ca nal company, sanctioned, authorized and paid this sum, are themselves par ties to such wrongdoing and are per sonally liable to the canal company and to it's shareholders for the sums thus disbursed through them.
 Another allegation made is the state ment that the Arizona Water compa- ny, in willful violation of obligations and duties to the canal company. has for four years required the canal coni- pany to pay annually in excess Of s1, 900 more than the actual cost and equitable proportionate expense of maintainance, operation and manlge- ment of the individual canal. For this sum also the complainants allege that the dummies or straw shareholder. Cleary. ChEisty and Orme are liable.
 W. B. Cleary figures in the capacity of attorney at law in the last of the statements made by the comploinants. They allege that Cleary. since 1900. has been paid $50 per month by each canal company to serve that company as general manager and secretary and that "in addition thereuntO the said board of directors, acting in behalf of the Arizona Water company and In breach of duty toward the minorty shareholders, have wrongfully and un- lawfully ordered that Cleary he paid for | alleged legal services pretendedStO have been rendered by said Cleary and that 1 the amounts thus paid Cleary was in large sums of money, the exact amount not being yet known. but exceeding the sum of $500 per year. Compiainants | declare that "these pretended legal | services are wholly without benefit to | the canal company and were simulat- Led for the purpose of increasing the compensation and salary of Cleary. de | spite the fact that the company has regularly paid an attorney other than | Cleary for performance of all legal ser vices required" and that Cleary. Chris
 ty and Orme are liable each to the ca
 nal companies and their shareholders l for sums thus unlawfully obtained.
 It. is therefore prayed that in each case the individual canal company be
 awarded judgment in the sum of S7.50l
 at the hands of the Arizona Water company, Cleary. Christy and Orme.
 that judgment of S4,OO0 be given each
 company for money paid in excess of the actual cost of operation, likewise
 against the Arizona Water company. l-Cleary, Christy and Orme: and that W. B. Cleary be required to refund each | company $2,600 and interest on each installment for funds "wrongfully and
 unlawfully obtained by Clesry by
 means of unlawful charges for simu- lated and worthless alleged legal ser vices pretended to have been rendered
 by him; this last liability to be shar-
 ed by Christy and Orme."
 It is also prayed that there be grant
 ed an injunction forever restraining
 these canal companies from entering
 into any contract to the Arizona Wat
 CT company or from paying any sum-
 of money to that company on account
 of the carriage of water; that eacl company be forever restrained iron
 payment of sums for any comminSiec expenses and that they each be torevel
 restrained from payment of any sum:
 to W. B. Cleary for legal services a'
 long as he is employed and paid a'
 secretary and general manager or th'
 said companies.