The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1914-07-09

proved that the making of the con-
tract was to the detriment Of the min
GRITTY stockholders. Both of said ele-
ments Of interest and detriment must
exist (Wheeler V. Abilene Nat Bank,
1853 Fed, 1894; Jones v. Missouri
Edison Co. 144 Fed. 1861. The reason
detriment to the holders Of the minor
ity stock from the transactions and
not the benefit the holder Of the ma
jority stock derives therefrom (Wheel-
ler v. Abilene Nat. Bank, supra). I'm
less there Is actual fraud established
the court will not set aside a voidable
contract at the suit of a minority
stockholder. To do so would be futile,
for while the court was making the
decree the majority stockholders might
ratify and adopt the contract (Foss v.
Harbottle, 2 Hare, 461). In Farmers
Loan & Trust Co. V. N. Y. & Northern
r. r. 150 N. Y, 410) the action had
been brought to foreclose a second
mortgage for failure to pay the inter-
est The appellants, minority stock
holders of the defendant company, had
been allowed to intervene and defend.
They offered evidence to prove that
the New York Central Railroad COM
pany, for the avowed purpose of abb
sorbing the defendant, had purchased
a controlling interest in its stock and
second mortgage bonds that it elected
a board of directors subservient to it's
interests who so managed the said
Northern Railroad company by, among
other things, refusing business in its
behalf that it's earnings were INSULT
cient to pay the interest upon the sec
ond mortgage bonds and 1t defaulted
thereon; that, owning controlling in
terest in said bonds, said New York
Central Railroad company caused de-
trustee under the mortgage, to fore
close The court held that 1t was err
ror to have excluded this testimony;
that If the above facts were establihs-
corporation for which a minority
stakeholder would be entitled to re-
lief. The court cited a number Of
cases in all of which some specific
fraudulent act had been performed by
reason of the control of the majority
of the stockholders or the other cor
poration holding control. In Pearson
". Railroad (62 N. H., 53D, the de-
PENDANT companies feeling aggreved
| by the tolls charged by the Concord
Railroad company, sought to procure
remedy therefor by gaining control
of said company and the making of
the contract in question by a board of
| directors elected by themselves. The
defendants thus acquired control of
the Concord company for the manifest
purpose of compelling it to enter into
an agreement which its directors,
when not under the control of the de-
PENDANTS, had already held was unde-
sirable. An examination of other
cases cited by the plaintiff shows that
fragrant fraud was the real ground for
granting relief In the case at bar the
circumstances are entirely different.
THE contract complained of was an eX-
tension of one that had been made two
years before and which was practical
" upon the same terms. No question
has ever been raised as to the propri-
ETY. or fairness of the first contract.
The second contract recited that it was
the desire of the Federal company to
sell, ard of the Smelling company to
that might be produced from the pro-
perties owned or leased by the Federal
company for a further period to be-
gin on the day of the expiration of the
contract then in force between the
two companies and to end on the 31st
day of August, 1880. BY the stipua-
tons of this new contract the Federal
company agreed to sell all its ores,
etc, to the Smelling company during
such period. The prices at which such
sales were to be made We're the same
as those mentioned in the contract Of
1908, that is to say for 80 per cent of
the lead contents of such ores, 80 per
cent of the average price in the city
of New York; for common desiverized
lead in lots of so tons or more, so long
as the selling price should exceed $40,
then 80 per cent of $410, plus one
half of the excess over $4.10. The new
contract further contained substan-
TALLY all the other provisions of the
then existing contract of 1903, includ
ing the provisions authorizing the
Smelling company to deduct the
freight thereon to Denver or Pueblo,
though shipment and delivery should |
be made to the Smelling company at !
any other point. 1t contained, among |
other things, an additional provision |
giving to the Smelling company the |
right to designate deliveries ito any
works wherever located and |
whether said smelling works shall be
owned by the Smelling company or by
any other persons" a provision re-
curing the Federal company to de- /
liver to the Smelling company not less l.
than 10000 tons per year of ores
shines and concentrates was also omit
ted. 1t was not established that an,