Court Opinion

ID: 3501925
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:08:48.259638+00
Date Added: 2024-06-11T14:16:06.011908
License: Public Domain

Plaintiff sued defendant declaring on all the common counts in assumpsit, giving notice the cause of action was based upon a promissory note given by defendant to plaintiff December 21, 1923, for $3,460 with interest at 6 per cent. per annum. This promissory note constituted plaintiff's sole bill of particulars. Defendant pleaded the general issue and gave notice that for a valuable consideration plaintiff did release defendant from all liability on the note sued upon. Plaintiff moved for summary judgment. Defendant filed an affidavit of merits which set forth in substance that the consideration for the note sued upon was used to take up checks of the Detroit Milling Company in which both plaintiff and defendant were interested, and defendant, in consideration of plaintiff's promise to cancel the note in question and deliver the same to him, agreed to vote in favor of a loan by the Stott Realty Company to the David Stott Flour Mills Corporation of $150,000, so the plaintiff would not lose his interest therein, and defendant did so, and plaintiff now refuses to carry out his agreement. The court rendered summary judgment against defendant, who appeals. The only question is whether the agreement set forth in the affidavit of merits is good. If so, plaintiff is not entitled to summary judgment. *Page 552 
The question is, assuming defendant's affidavit of merits is truthful, whether the agreement alleged to have been made by him with plaintiff, whereby in consideration of the release of defendant from liability on his promissory note he agreed as a stockholder to vote in favor of a loan from the Stott Realty Company to the David Stott Flour Mills Corporation in the sum of $150,000, both plaintiff and defendant being stockholders in both said corporations; and plaintiff being fearful unless such loan could be made he would lose his interest in the David Stott Flour Mills Corporation, was a good and sufficient consideration for the release of defendant from liability on his note. Plaintiff contends such an agreement as is alleged in defendant's affidavit of merits is opposed to public policy and void. Defendant contends such an agreement is valid and binding. In order for such a contract as alleged by defendant in his affidavit of merits to be valid and binding, it must be based upon a consideration. There is a consideration if the promisee in return for a promise does anything legal which he is not bound to do or refrains from doing anything which he has a right to do, whether there is any actual loss or detriment to him or actual benefit to the promisor or not. 9 Cyc. pp. 312, 313; 13 C. J. p. 316.
The contract alleged by defendant is not invalid for want of consideration.
A corporation belongs to its stockholders. They own it. Shares of stock are only proportionate interests therein. Certificates of stock are evidence of fractional ownership. Those who own a corporation not only have a right to control its affairs, but it is their duty to do so. No stockholder or group of stockholders have a right to defraud any other stockholder or group of stockholders, nor will they *Page 553 
be permitted to take advantage of the corporation itself for their own personal benefit; but, subject to these restrictions, stockholders have a right to agree between themselves to vote together as a unit, to control and manage the affairs of a corporation, and such agreements are not contrary to public policy. 14 C. J. pp. 913, 914, and cases cited. If such an agreement is founded upon a sufficient consideration and is not opposed to public policy, the question is whether the affidavit of merits of defendant states facts sufficient to constitute a contract. Such affidavit alleges there were parties competent to contract, a subject-matter of the contract, a valid consideration, mutuality of agreement, and mutuality of obligation. These are said to be the essentials of a valid contract. We think the showing of defendant sufficient to entitle him to a trial and the entry of summary judgment was error. Judgment should be reversed, with costs, and case remanded.