Case Name: ALBERT V. BILLS, Appellant, v. SILVER KING MINING COMPANY et al., Respondents
Court: Supreme Court of California
Jurisdiction: California
Decision Date: 1895-01-28
Citations: 106 Cal. 9
Docket Number: No. 13406
Parties: ALBERT V. BILLS, Appellant, v. SILVER KING MINING COMPANY et al., Respondents.
Judges: 
Reporter: California Reports
Volume: 106
Pages: 9–32

Head Matter:
[No. 13406.
In Bank.
January 28, 1895.]
ALBERT V. BILLS, Appellant, v. SILVER KING MINING COMPANY et al., Respondents.
Corporations—Stock Held in Trust—Dividends—Estate of Deceased Owner—Demand and Refusal—Statute of Limitations.—Where stock of a mining company was issued in the name of a trustee as the agent of another person, and the administratrix of the beneficial owner of the stock applied to the officers of the corporation for information as to the dividends upon the stock, who informed her that all dividends on the shares of stock had been paid to the trustee, and that no money was due or owing on account of any dividends declared during the lifetime of the beneficial owner, and the administratrix of the beneficial owner allowed the estate to be distributed and closed without reference to the dividends of the corporation, and without further demand for an inspection of its books or papers, or effort to discover whether it was true that the dividends had been paid to the trustee, the statute of limitations for a recovery of the dividends from the corporation on behalf of the distributees of the estate began to run from the time of the refusal of the corporation to pay any dividends to the administratrix, at which time the corporation put itself in a state of hostility to the estate of the deceased beneficiary with respect to any alleged obligation in the matter of the dividends, and no further demand or refusal was necessary to set the statute in motion.
Id.—Discovery of Fraud—Laches.—The statute of limitations for the recovery of dividends from a corporation cannot be avoided on the ground of fraud, in a ease where the facts are sufficient to put a person of ordinary intelligence and prudence on inquiry as to the truth, and where there is gross laches in not making any effort to discover the real facts with respect to the dividends, which might have been discovered by the use of slight diligence.
Appeal from a judgment of the Superior Court of the City and County of San Francisco.
The facts are stated in the opinion of the court.
Henry P. Bowie, and Crittenden, Foote & Van Wyck, and James L. Crittenden, for Appellant.
The causes of action alleged in the complaint are not barred by the statute of limitations, because the dividends were held in trust by the corporation and its officers as trustees for Reagan and his heirs until within about one year of the commencement of the action when the corporation first asserted a hostile claim to the dividends. It is well settled that the directors of a corporation are trustees for the stockholders. (Green’s Brice’s Ultra Vires, 477; Hoyle v. Plattsburgh etc. R. R. Co., 54 N. Y. 314, 328, 329; 13 Am. Rep. 595; Angell & Ames on Corporations, sec. 312; Gray v. New York etc. Co., 3 Hun. 389, 390; Koehler v. Black River etc. Co., 2 Black, 715, 721; The York etc. Co. v. Hudson, 19 Eng. Law & Eq. 261-65; European etc. R. R. Co. v. Poor, 59 Me. 278; Drury v. Cross, 7 Wall. 302; Jackson v. Ludeling, 21 Wall. 616, 624, 625; Ashurst’s Appeal, 60 Pa. St. 291; Story on Agency, secs. 210, 211; Richards v. New Hampshire Ins. Co., 43 N. H. 263-65; Peabody v. Flint, 6 Allen, 52-56; 2 Sugden on Vendors, 109 (London ed. 1824); Michoud v. Girod, 4 How. 554-59; Cumberland Coal etc. Co. v. Parish, 42 Md. 598, 605, 606 (1875), and cases cited; Blake v. Buffalo etc. R. R. Co., 56 N. Y. 485, 491, and cases cited; Ogden v. Murray, 39 N. Y. 202-04; Hodges v. New England Screw Co., 1 R. I. 312; 53 Am. Dec. 624, and cases cited; Marshall v. Baltimore etc. R. R. Co., 16 How. 326, 327; Butts v. Wood, 38 Barb. 188, 189 (1862) and cases cited; Scott v. De Peyster, 1 Edw. Ch. 513, 542, 543; Verplanck v. Mercantile Ins. Co., 1 Edw. Ch. 85; Great Luxemburgh Ry. Co. v. Magnay, 25 Beav. 586; Cumberland Coal Co. v. Sherman, 30 Barb. 553, 571, 572, and cases cited; Buell v. Buckingham, 16 Iowa, 290; 85 Am. Dec. 516; Hale v. Republican River Bridge Co., 8 Kan. 472; Kent v. Quicksilver Min. Co., 78 N. Y. 159, 180; Taylor v. Chichester etc. Ry. Co., L. R. 2 Ex. 390 (1879); Phosphate of Lime Co. v. Green, L. R. 7 Com. P. 43; Evans v. Smallcombe, L. R. 3 H. L. 249; Cumberland Coal Co. v. Sherman, 30 Barb. 553, 570; Cumberland Coal etc. Co. v. Sherman, 20 Md. 117, 121, 122; 1 Lead Cas. Eq. 260; 1 Perry on Trusts, 230, sec. 195; Hoffman Steam Coal Go. v. Cumberland Coal etc. Co., 16 Md. 456; 77 Am. Dec. 311; Charitable Corporation v. Sutton, 2 Atk. 404; Robinson v. Smith, 3 Paige, 222; 24 Am. Dec. 212; Gilman etc. R. R. Co v. Kelly, 77 Ill. 426, 421-37; Aberdeen Ry. Co. v. Blakie, 1 Macq. 461; San Diego v. San Diego etc. R. R. Co., 44 Cal. 106; San Francisco etc. R. R. Co. v. Bee, 48 Cal. 398; Flint etc. Ry. Co. v. Dewey, 14 Mich. 478; Northern Pac. R. R. Co. v. Kindred, 14 Fed. Rep. 77; Twin Lick Oil Co. v. Marbury, 91 U. S. 587; Duncomb v. New York etc. R. R. Co., 84 N. Y. 190; Gardner v. Ogden, 22 N. Y. 327; 78 Am. Dec. 192; Brewer v. Boston Theater, 104 Mass. 378; Ervin v. Oregon etc. R. R. Co., 22 Blatchf. 193; Mason v. Harris, L. R. 11 Ch. Div. 97; Menier v. Hooper’s Tel. Works, L. R. 9 Ch. 350; Goodin v. Cincinnati etc. Canal Co., 18 Ohio St. 169; 98 Am. Dec. 95; 2 Story’s Equity Jurisprudence, sec. 1252; Wood v. Dummer, 3 Mason, 309; Koehler v. Black River Falls Co., 2 Black, 715; Guild v. Parker, 43 N. J. L. 430; Pearson v. Concord R. R. Corp., 62 N. H. 537; 13 Am. St. Rep. 590; Gardner v. Butler, 30 N. J. Eq. 702; European etc. Ry. Co. v. Poor, 59 Me. 277; Paine v. Lake Erie etc. Ry. Co., 31 Ind. 283; Abbott v. Hard Rubber Co., 33 Barb. 578; Thompson on Liability of Directors, 243.) After demand and refusal, and not before, an action can be maintained by a stockholder against the corporation for accrued dividends. (Jones v. Terre Haute etc. R. R. Co., 57 N. Y. 205, 206; Philadelphia etc. R. R. Co. v. Cowell, 28 Pa. St. 329; 70 Am. Dec. 128; State v. Baltimore etc. R. R. Co., 6 Gill 387, 388; Le Roy v. Globe Ins. Co., 2 Edw. Ch. 657; Scott v. Central etc. R. R. Co., 52 Barb. 69; Hagar v. Union Nat. Bank, 63 Me. 512, 513; Hagar v. Randall, 62 Me. 439.) A demand is necessary before the right of action accrues in cases of agents and factors and others acting in a representative capacity, and until such demand the statute of limitations does not begin to run. (Clark v. Moody, 17 Mass. 145; Topham v. Bradick, 1 Taunt. 572; Cullings v. Benhings, 12 Mod. 444; Baird v. Walker, 12 Barb. 294; Sawyer v. Tappan, 14 N. H. 352; Hutchings v. Gilman, 9 N. H. 360; Taylor v. Bates, 5 Cow. 379; Paschall v. Hall, 5 Jones Eq. 108; Hays v. Stone, 7 Hill, 128; Krause v. Dorrance, 10 Pa. St. 462; 51 Am. Dec. 496; Baker v. Joseph, 16 Cal. 173; Green v. Williams, 21 Kan. 64.) The statute of limitations begins to run against the beneficiary of a trust only from the time when it is openly disavowed by the trustee. (Janes v. Throckmorton, 57 Cal. 388; Hearst v. Pujol, 44 Cal. 230; Oliver v. Piatt, 3 How. 411; Perry-on Trusts, secs. 863, 864; Van Dyck v. McQuade, 86 N. Y. 53; Le Roy v. Globe Ins. Go., 2 Edw. Ch. 657-62.) Where the relation of the parties is that of trustee and cestui que trust the statute of limitations does not commence to run until there has been an open denial and repudiation of the trust by the trustee, brought home to the cestui que trust in such manner as will require the latter to act as upon an adverse title. (Key v. Hughes, 32 W. Va. 184; Thomas v. Merry, 113 Ind. 83; Hargis v. Sewell, 87 Ky. 63; McClure v. Colyear, 80 Cal. 378-80; Ellis v. Ward (Ill., April 3, 1889), 20 N. E. Rep. 675, 676.) The statute of limitations does not begin to run in cases of trust until demand. (Zuck v. Culp, 59 Cal. 142; Mitchell v. Beckman, 64 Cal. 121; Miles v. Thorne, 38 Cal. 338; 99 Am. Dec. 384; Love v. Watkins, 40 Cal. 552; 6 Am. Rep. 624.) This action only accrued after demand, and the statute of limitations did not begin to run until demand. (Pothier on the Law of Obligations, 126, ed. of 1806; Angell on Limitations, 176, 177; Downes v. Phœnix Bank, 6 Hill, 298; Hill on Trustees, 388, note 2; Rush v. Barr, 1 Watts, 110; Kane v. Bloodgood, 7 Johns. Ch. 122; Murray v. Coster, 20 Johns. 576; 11 Am. Dec. 333.) The causes of action alleged in the complaint are not barred by the statute of limitations because the defendant corporation, through its officers and directors, was guilty of fraud, and the facts constituting the fraud were never discovered until within about a year of the commencement of this action. (Lataillade v. Oreña, 91 Cal. 575; 25 Am. St. Rep. 219.) The fraudulent concealment of a cause of action prevents the running of the statute of limitations. (Kane v. Cook, 8 Cal. 449, 456; Lataillade v. Oreña, 91 Cal. 575; 25 Am. St. Rep. 219; Stewart v. McBurney (Penn., Nov., 2, 1885), 1 Atl. Rep. 639, and cases cited at page 643, note 14; Appeal of Deake, 80 Me. 50, and cases cited; Traer v. Clews, 115 U. S. 537; Sears v. Hicklin, 13 Col. 143; Carrier v. Chicago etc. Ry. Co., 79 Iowa, 80; Cook v. Chi cago etc. Ry. Co., 81 Iowa, 551; 25 Am. St. Rep. 512; Kilbourn v. Sunderland, 130 U. S. 513; 30 Cent. L. J. 369, 373, subd. 8, and cases cited in notes 21-23, and 26, p. 391, subd. 5, and note 11; Jacobs v. Snyder, 76 Iowa, 522; 14 Am. St. Rep. 235; Carpentier v. City of Oakland, 30 Cal. 439.)
Garber, Boalt & Bishop, and F. A. Berlin, for Respondents.
The relationship between the corporation defendant and its stockholders was not one of trust which would exempt the corporation from the operation of the statute of limitations. (Kane v. Bloodgood, 7 Johns. Ch. 90; 11 Am. Dec. 417; Landis v. Saxton, 105 Mo. 486, 489, 490; 24 Am. St. Rep. 403.) Conceding that the defendant corporation is to be deemed to hold the dividends in trust for the plaintiff, and that a demand was necessary to set the statute in motion, it must have been made within a reasonable time, and, at the latest, within the statutory period for bringing the action, after the dividends were payable, and whether it was not made, or is presumed to have been made within that time, the action is, in either case, barred, unless saved by the alleged fraud. (Codman v. Rogers, 10 Pick. 119; Palmer v. Palmer, 36 Mich. 487; 25 Am. Rep. 605; Pittsburg etc. R. R. Co. v. Byers, 32 Pa. St. 22; 72 Am. Dec. 770; Morrison v. Mullen, 34 Pa. St. 17; Hamilton v. Hamilton, 18 Pa. St. 20; 55 Am. Dec. 585; Ball v. Keokuk etc. Ry. Co., 62 Iowa, 751, 753, 754; High v. Board of Commrs., 92 Ind. 580; Newson v. Board of Commrs., 103 Ind. 526; Kraft v. Thomas, 123 Ind. 513, 515; 18 Am. St. Rep. 345; McDonnell v. Branch Bank, 20 Ala. 313, 319; Wright v. Paine, 62 Ala. 340, 345; 34 Am. Rep. 24; Landis v. Saxton, 105 Mo. 486, 491; 24 Am. St. Rep. 403; Brust v. Barrett, 16 Hun, 409, 413; Atchison etc. R. R. Co. v. Burlingame, 36 Kan. 628, 633, et seq.; 59 Am. Rep. 578; Keithler v. Foster, 22 Ohio St. 27. And see Chalfin v. Malone, 9 B. Mon. 498; 50 Am. Dec. 525; Collard v. Tuttle, 4 Vt. 491; 24 Am. Dec. 627.) The true period of limitation here is two years under section 339 of the Code of Civil Procedure, subdivision 1, which applies to all actions at law not specifically mentioned in other provisions. (Piller v. Southern etc. R. R. Co., 52 Cal. 44; Lattin v. Gillette, 95 Cal. 317, 319; 29 Am. St. Rep. 118.) The appropriate remedy to recover declared dividends when, as here, a day of payment is prescribed, is an action of assumpsit at law. (1 Cook on Stocks and Stockholders, 3d ed., sec. 542; 1 Spelling on Corporations, sec. 446; 2 Spelling on Corporations, secs. 549, 589; 2 Beach on Private Corporations, sec. 602; 1 Wood on Limitations, 2d ed. sec. 58; King v. Paterson etc. R. R. Co., 29 N. J. L., 82, 88; 29 N. J. L. 504, 506; Jackson v. Newark etc. Co., 31 N. J. L. 277; Westchester etc. R. R. Co. v. Jackson, 77 Pa. St. 321, 318; Dalton v. Midland etc. Ry. Co., 13 Com. B. 474-78; conceded in Cross v. Eureka etc. Co., 73 Cal. 302, 306; 2 Am. St. Rep. 808.) Assuming that a suit for an accounting will also lie, and that this action should be treated as such instead of an action of assumpsit, it is neverthless subject to the same statutory bar, as the statute applies to all suits both in equity and at law. (Boyd v. Blankman, 29 Cal. 44; 87 Am. Dec. 146; Lux v. Haggin, 69 Cal. 255; Norris v. Haggin, 28 Fed. Rep. 279; Teall v. Slaven, 40 Fed. Rep. 774, 777; 1 Wood on Limitations, 2d ed., sec. 58, p. 132.) The alleged false and fraudulent representations to the administratrix did not excuse her failure to make demand and bring suit. Fraudulent concealment of a cause of action by the party liable, and consequent ignorance thereof by the complaining party, will not prevent or postpone the running of the statute of limitations where the action is not one for relief on the ground of fraud or mistake. (Stewart v. Thompson, 32 Cal. 263; Gale v. McDaniel, 72 Cal. 334; Soule v. Atkinson, 18 Cal. 225, 228; 79 Am. Dec. 174; Taylor v. Bidwell, 65 Cal. 489, 490; Farris v. Coleman, 103 Mo. 352, 366; Wagner v. Law, 3 Wash. 500, 517; 28 Am. St. Rep. 56; Rouse v. Southard, 39 Me. 404.) Where the fraud or concealment alleged, instead of being of the substance of the cause of action, relates to some collateral or incidental matter the case is not within subdivision 4 of section 338 of the Code of Civil Procedure, and like provisions. (Clausen v. Meister, 93 Cal. 555, 557; Chemical Nat. Bank v. Kissane, 32 Fed. Rep. 429; Myers v. Center, 47 Kan. 324; Humphreys v. Mattoon, 43 Iowa, 556; Rice v. Burt, 4 Cush. 209. See, also, Leach v. Moore, 57 Ark. 583, and other cases.) The alleged false representations, not appearing to have been authorized by the company, were manifestly no excuse for the failure of the administratrix to demand payment and bring suit within the statutory time. The fraudulent concealment of a cause of action which will prevent the running of the statute must be that of the party liable upon such cause of action. (2 Wood on Limitations, 2d ed., sec. 276, p. 712. See, also, Stevenson v. Robinson, 39 Mich. 160; Wood v. Williams, 142 Ill. 269, 274, 275, 277, et seq., 280, 281; 34 Am. St. Rep. 79; Wilson v. Williams (Ill., April 3, 1893), 33 N. C. Rep. 884.) Even assuming that the alleged false representations are sufficiently alleged to have been authorized by the corporation, they do not excuse the delay, for the complaint does not show that the administratrix used “due diligence” to discover the truth by inquiring of Anderson with respect to the matter. (Lataillade v. Oreña, 91 Cal. 577; 25 Am. St. Rep. 219; Hecht v. Slaney, 72 Cal. 363, 367; Wood v. Carpenter, 101 U. S. 140; Pearsall v. Smith, 149 U. S. 231, 233, 235, 237; Teall v. Slaven, 40 Fed. Rep. 774; St. Paul etc. Ry. Co. v. Sage, 49 Fed. Rep. 315, 322; Higgins v. Crouse, 63 Hun, 130, 139, 140; Cavanagh v. Britt, 90 Ky. 273.)

Opinion:
McFarland, J.
The court below sustained a demurrer to the complaint, and, plaintiff declining to further amend, judgment went for defendants. Plaintiff appealed.
The court below correctly sustained the demurrer, and gave judgment for defendants. The demurrer was upon various grounds, among others, that the com plaint does not state facts sufficient to constitute a cause of action, that the action is barred by several sections of the code about the limitations of actions, and that the plaintiff is shown to have been guilty of laches. The material averments of the complaint, which are made upon information and belief, are these: The defendant, the Silver King Mining Company, is a corporation, and during the years 1877,1878, and 1879 one Benjamin W. Reagan was the owner of a large portion of the shares of the capital stock of said corporation, which were represented by a certificate in due form, No. 72, issued to one J. W. Anderson, who was the agent of said Reagan for the purpose of holding said shares and collecting the dividends thereon. It was averred that between the twenty-fourth day of October, 1877, and the thirtieth day of June, 1879, the said corporation regularly declared dividends on its stock, and that upon said dividends * there became an'd was due and payable from said defendant, the Silver King Mining Company, to said J. W. Anderson, trustee, as agent of said Benjamin W. Reagan, on the shares of stock represented by said certificate No. 72," the sum of two hundred and twenty-four thousand nine hundred and thirty-two dollars and fifty cents. Said Reagan died intestate on the twenty-sixth day of July, 1879, and his widow, Mary A. Reagan, was duly appointed as administratrix. She entered upon said office of administratrix on the 10th of September, 1879, and continued to be such administratrix until the 7th of November, 1882, when she resigned, and one Joseph Nash was then duly appointed administrator, and remained such until the 6th of March, 1884, when there was a final decree of distribution of the estate, and a closing of the administration. It was averred that at periods before and after the said decree plaintiff herein, who married the said widow, took an assignment from all the heirs and distributees of their interest in the property of said estate. It is further alleged that said administratrix, Mary A. Reagan, on or about the tenth day of Septem ber, 1879, " applied to the defendant corporation and its officers in the city and county of San Francisco for information as to said shares of stock, and as to whether any dividend which had been declared thereon prior to the death of said Reagan, or any part of such dividend, was unpaid, and as to whether any money was due from said defendant corporation to said estate or to her as administratrix for or on account of any dividend or dividends declared by said defendant corporation prior to the death of said Benjamin W. Reagan"; and that the said corporation and its officers, for the purpose of defrauding said administratrix at said time, stated to said administratrix "that all dividends due on said shares of stock had been paid to said J. W. Anderson, and that no money was due or owing or unpaid on account of . . any dividends declared on said shares of stock during the lifetime of said Benjamin W. Reagan." It is further averred that said administratrix believed said statement as to said dividends. It does not appear that said administratrix, or her successor, the said Nash, or any other person interested in the estate, ever made any further effort to discover any facts with respect to said alleged dividends. No demand was made for an inspection of the books or papers of said corporation, and no effort was made to discover from said J. W. Anderson whether or not it was true that such dividends had been paid to him. Said dividends were not included in the inventory of said estate as property thereof; and said estate was distributed and closed without any reference to said alleged dividends. No reason is shown why inquiries were not made about said dividends of the said Anderson, the only averment in that respect being simply that he was absent from the state at the time of the death of said Reagan. There is no averment of any conspiracy between said corporation and the defendant, Anderson, to conceal any facts about said dividends, and no misconduct whatever is charged against said Anderson. It is merely averred that Anderson refused to bring this suit, and that, there fore, he is made a party defendant, there being also an averment, " on belief," that he asserts some right over said dividends. It is further averred that on the 10th of January, 1885, the person who afterward became the attorney of record of plaintiff in this present action informed plaintiff that said dividends had not been paid, and that this was the first information plaintiff had of that fact. This action was commenced, as appears by an amendment to the record, on the twenty-seventh day of April, 1886. The complaint contains nine counts, each on a separate dividend alleged to have been declared as aforesaid during the said period above mentioned; and judgment is demanded for the said sum of two hundred and twenty-four thousand nine hundred and thirty-two dollars and fifty cents, with interest. It is further averred that on January 10, 1885, the said Mviry A. Bills (formerly Mary A. Reagan) demanded of said corporation the payment to her of said dividends; and that on or about the 10th of! January, 1885, the said plaintiff demanded of said corporation the payment to him of said dividends, and also made the same demand on the 6th of January, 1886, and that the defendant corporation wholly refused to comply with any of said demands.
The action was clearly barred by the statute of limitations. If the alleged liability sued on is to be considered as one founded upon an instrument in writing, it is barred by section 337 of the Code of Civil Procedure. If it be not an obligation founded upon an instrument in writing it is barred by section 339 of said code. And, under any view of the liability, it is barred by section 343. Appellant contends that an action cannot be maintained for a dividend declared by a corporation until a demand shall have been made for the same; and that, therefore, the statute of limitations did not commence to run in the case at bar until the time in 1885 or 1886 when the said demands last above stated were made. There is some conflict of authority upon the point whether such a dividend is a debt owing by the corporation to the holder of the shares, or mere property of the shareholder rightfully in possession of the corporation, and, therefore, a conflict as to whether a demand is necessary before suit. But, in any event, no particular form of demand is necessary; and, therefore, waiving for the present the point above suggested, it is clear that what occurred between the administratrix and the corporation in 1879, as hereinbefore stated, amounted in law to a demand for the dividends. She was informed at that time by the corporation that there was no money due or owing- or unpaid on account of said dividends; and it was a clear refusal of her request for the payment of said dividends, and a denial of any liability of the corporation thereon. The corporation then and there put itself in a state of hostility to the estate of said Beagan with respect to any alleged obligation in the matter of said dividends, and no further demand or refusal was necessary; and, if suit had been brought against it, want of demand would not have been a defense. Appellant contends, however, that he is entitled to relief on the ground of fraud, and that, under subdivision 4 of section 338 of the Code of Civil Procedure, the cause of action did not accrue until what he contends to be the discovery of the facts constituting the fraud in 1885. But, waiving the question whether the averments of facts constituting the fraud in the complaint are specific enough, or whether such averments are sufficient if made only upon information and belief, still the statute of limitations cannot be avoided in a case where the facts are sufficient to put a person of ordinary intelligence and prudence on inquiry as to the truth. And in the case at bar the administratrix, Mary A. Beagan, was certainly guilty of the grossest laches in not making any effort to discover what she now alleges to be the real facts with respect to the dividends. She was informed that this large sum of money, amounting to nearly a quarter of a million, had been paid to Anderson, who she avers to have been the agent of her deceased husband, yet she never made any in quiry of the said Anderson as to the truth of the statement that this large amount of money had been paid to him; and she went on to administer the estate, and, without any allusion to said large sum of money, she and her successor, as administrator, and all interested in the estate, allowed it to be settled and finally distributed without any reference whatever to said dividends. Under these circumstances the plaintiff in this case cannot be heard to say that his assignors were deceived for so many years by an alleged false statement of the defendant corporation, which, if false, could have been disproved so easily by the use of the slightest diligence. The foregoing views render it unnecessary to consider other points made by respondent—as, for instance, that Anderson, being the holder of the certificate, could alone sue on it, and that the plaintiff is not the proper person to maintain an action upon said certificate; that plaintiff has not shown a proper deraignment of title from the heirs and distributees of the estate of Reagan; that the averments of fraud are not against the corporation, but simply against one or two of its officers; that, under any view, the plaintiff should have sued Anderson as trustee, and enjoined the corporation from paying dividends to him, and thus, through a decree in equity, have secured said dividends, etc.
The judgment and order appealed from are affirmed.
Harrison, J., and Van Fleet, J., concurred.