The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1906-03-10
Special to The Journal.

Special to The Journal. ST
Huron, S. D., March 1O.-Judge Whitney is
considering suit that is of great importa
to all companies to whom articles of incorpora- :,
ton have been issued in the state Of South
Dakota, but which do not maintain in fact,
offices in the borders of the state. The case
referred to is that of T.. A. Benson for him
self and others, against the American-Mexico
Mining & Development company and it's officers
and directors. l
The plaintiff is a stockholders in the COM
pany and claims that the promoters, who are
also the principal stockholders, in which is
tary and treasurer, received 100000 shaers of
it's capital stock without rendering services or
equivalent therefor, and that they have made
large profits at the expense of the company
by securing options on its treasury stock at
prices below those demanded by the company
Probably what is regarded the most serious
of all the charges is that the dividends paid
monthly since April, 1908, have been paid out
of the stock Of the company, and not out Of
its surplus profits. II.
On application of PLAINTIFF for the appoint
ment of a, receiver, Judge Whiting appointed
Thomas II. Null, states attorney for this coun-
ty. Mr.. Null went to Chicago where the Of
fees of the company are established, for the
purpose of Investigating its affairs and taking
charge Of the books. = 80 ~ ~.
Did Not Examine Books. ..
On making his GRAND known to the officers,
who had already been apprise dof his appoint
menr, IL Is Sald, Ar. Null was refused not
only the possession of the books, but was not
allowed to make proper examination of them
to enable him to report to the court the condi-
ton Of the affairs of the company. Consent to
do so, however, for his personal satisfaction
was accorded him, but not accepted, and he
returned to Huron no, wiser, he says, than when
he visited Chicago, as far as the business of
the company is concerned, except that he ell
joyed a friendly visit with the officers.
1t ts alleged that In spite of the fact that
the company was formed and Incorporated in
South Dakota, its officers refused to recognize
| Mr.. Nulrs rights as received. DR.. Phillips,
president of the company, was ordered to ap.
pear with the books Of the company, before
| a commissioner to giye!a deposition, but he
| failed to obey the subpoena. These facts being
! this city, he held that they constituted con
| tempt Of court, and fixed date for the de-
| PENDANT to present its showing, which it die
at considerable length. At the conclusion OF
| the arguments and showing by counsel on botf
| sides, the court refused, to consider otherwise
/ the orders Of the court had been obeyed. The
| company will, it is now understood, obey the
| orders and dispositions will be taken, books
| examined and such other proceedings taken a.
| shall purge it of the charge of contempt. =
Further hearing Of the will be 5hat
| March 27, in this city, at which time the'sregu
! lar March term of circuit court will be il
session. =. '.<' . af&e
Both plaintiff and defendant are represented
| by Chicago attorneys and with them are as
scc:rted prominen attorneys Of Huron. The
co est bids fai rto be an interesting one a!
well as an important one, as 1T involves many
questions bearing directly upon the laws regu
| lating the formation, of corporations in SoutI
Dakota. but which maintain only nominal Of
fees within the state. The question Of fail
ure on the part of these corporations to fill
annual reports with the proper officers in Soutl
Dakota, as required by law, is also involved.