Court Opinion

ID: 9574745
Source: CourtListenerOpinion
Date Created: 2023-08-21 21:07:41.981166+00
Date Added: 2024-06-11T12:44:54.341102
License: Public Domain

Johnson, J.,
dissenting: My study of-the record leaves the impression that the variance between the form of the second issue and the allegations of the defendants’ further defense, on which the issue is based, is not of sufficient moment to necessitate overthrowing the verdict and trial, particularly so in view of the apparent agreement of the parties on the form of the issue and of the full and com píete charge delivered by the presiding Judge thereon. Here it is to be noted that the defendants admitted failure to comply formally with the requirements of Gr.S. 55-115 prior to the commencement of the action. The question sought to be presented by the second issue as submitted, i.e., the bona lides of controlling management and the legal sufficiency of the means employed by such management in setting aside as capital the bulk of accumulated profits after dividends, was raised, as was the companion question of acquiescence or estoppel of the plaintiffs, not by the plaintiffs’ complaint but rather by the defendants’ affirmative defense. Therefore the burden of the issue was on the defendants to show good faith of controlling management. The issue as framed submitted the question of bona fides in reverse: whether the defendants acted arbitrarily and in bad faith, rather than in good faith. Moreover, the burden of the issue was placed on the plaintiffs. All this was favorable to the defendants. This being so, they are not in position to challenge the form of the issue or the verdict rendered thereon. The theory of the trial should prevail. Thrift Corp. v. Guthrie, 227 N.C. 431, 42 S.E. 2d 601.
HoAvever, it would seem that the judgment should be vacated and the cause remanded for further hearing on the question of the extent to which *507the plaintiffs should be bound, on the ground of acquiescence or estoppel, by the action of controlling management in investing accumulated profits in equipment and permanent improvements. This question, does not appear to have been properly determined before judgment. Therefore, my vote is to uphold the verdict and trial, with direction that the judgment be vacated and a further hearing ordered to determine the extent, if any, to which accumulated profits were invested in equipment and permanent improvements or otherwise capitalized with the approval and acquiescence of the plaintiffs.
The findings of the jury, or of the presiding Judge sitting as chancellor in the exercise of his equity powers, in respect to this question would determine whether controlling management has improperly withheld payment of dividends in the past; and, if so, then mandatory injunction should issue directing payment of a proper dividend, the amount thereof to be fixed and determined by the court on the basis of the facts found on the issue of acquiescence or estoppel. The jury verdict on the second issue is sufficient to justify retention of the cause on the equity side of the docket (13 Am. Jur., Corporations, section 708), and I am inclined to the view that such retention will be more conducive to an expeditious final determination of the cause.