Opinion ID: 1561464
Heading Depth: 1
Heading Rank: 4

Heading: Compliance with Procedural Requirements of the Appraisal Statute

Text: Section 909(9)(E) provides in pertinent part that [t]he court shall determine whether each shareholder ... has satisfied the requirements of this section and is entitled to receive paryment for his shares. Lido argues that section 909(9)(E) preconditions recovery on strict compliance with the statute's detailed reporting and notice requirements and that the Dissenters did not strictly comply with these requirements. The referee found that the parties had effected notice, fulfilling the purpose behind the reporting and notice requirements, and so had substantially complied with those requirements. The statutory language providing that the court (and here the referee) shall determine compliance imparts a measure of flexibility to the determination whether the shareholder has complied with the prerequisite steps and is entitled to payment. One of the purposes behind the enactment of the Maine Business Corporations Act was to afford a corporation the greatest possible flexibility with its structures and procedures. Maine Proposed Business Corporation Act vii (1971). Under a similar provision in its appraisal statute, Delaware courts enjoy substantial discretionary power to tailor the appraisal process to suit the facts of the case. See Tabbi v. Pollution Controls Indus., Inc., 508 A.2d 867, 869 (Del.Ch.1986) (the statutory requirements are to be liberally construed for the protection of the dissenting stockholders within the limits of orderly corporate procedure and consistent with the purpose of the requirements). See also Sarrouf v. New England Patriots Football Club, 397 Mass. 542, 549, 492 N.E.2d 1122, 1129 (1986) (The statute is designed to provide an equitable, simple, and expeditious remedy to dissenting stockholders. It should not be construed strictly against them); Folk on the Delaware General Corporation Laws § 262.2, at 151 (2nd ed. 1988). The referee found that the Dissenters had complied sufficiently with the outlined procedural steps to meet the requirements of section 909 and that under the statute they were entitled to relief. His factual finding is supported by competent evidence and provides an ample foundation for his discretionary ruling that the Dissenters had cleared the preliminary procedural hurdles to maintaining their appraisal action.