Court Opinion

ID: 9547856
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:53:16.139814+00
Date Added: 2024-06-11T15:18:09.766878
License: Public Domain

DURHAM, Justice
(dissenting):
The majority opinion, while acknowledging that a corporate president may act for the corporation in the absence of authorization from the board of directors in order to preserve or protect corporate assets, holds that the corporation here is in “no danger of losing a significant asset.” I disagree.
On a motion to dismiss, the trial court is required to accept the facts alleged in the complaint as true for purposes of the motion. In this case the verified complaint alleges that the respondents have failed and refused to execute and transfer title to the corporation for its undivided one-half interest in the real property, and have persisted in claiming that a “sale” from the corporation occurred by virtue of the unauthorized deposit of $14,000 into the corporation’s bank account.1 The complaint further alleges, in paragraph 11, as follows:
That the reasonable rental value of the premises is $450.00 per month, and the Defendants have failed to remit to the Plaintiff for its one-half undivided rental interest in the above described property from November 1978, the time of the payment in full of the above referenced Real Estate Contract, at which time Plaintiff should have been conveyed an undivided one-half interest in the title to the property. Therefore, Plaintiff has been damaged in loss of rents in the amount of $7,200.00, plus accrued interest. Plaintiff will suffer additional damages of $225.00 per month for the time Defendant continues to withhold rents from Plaintiff.
The majority opinion appears to hold that a corporation may be forced to sell its interest in real property by virtue of the unauthorized deposit of a sum of money in an amount never agreed to by the corporation in one of its accounts. The deadlock on the LPE Board of Directors prevents any resolution authorizing a sale just as absolutely as it prevents any resolution authorizing this litigation. The fact that all the directors accepted an appraisal as “valid" has no bearing on the issue of whether the corporation will accept the appraisal price in a proposed purchase. In the absence of a valid sale, LPE is being deprived (perhaps permanently) both of title to its undivided one-half interest in property, which may be appreciating in value, and of its share of the past and future rents. There should be *1213no question that such title and rents constitute “significant assets” which bring this case within the holding of Kamas Securities Co. v. Taylor, 119 Utah 241, 226 P.2d 111 (1950). I would reverse.
STEWART, J., concurs in the dissenting opinion of DURHAM, J.

. The majority opinion apparently attaches some significance to the fact that the $14,000 has never been returned. However, the record reflects that directions from the corporation president to its treasurer to return the funds have been ignored, the treasurer being aligned with the respondents in this dispute. Since the deposit of the funds, notice to all parties has been given that the corporation did not accept those funds as payment in connection with the proposed sale which is the subject of dispute between the parties. The entire sum, plus interest, was tendered to the defendants in the complaint and the complaint recites that it was deposited with the court upon the commencement of the action.