Court Opinion

ID: 6744225
Source: CourtListenerOpinion
Date Created: 2022-07-20 23:42:53.458033+00
Date Added: 2024-06-11T16:02:01.917483
License: Public Domain

OPINION
By ROSS, J.
If the offending directors have unlawfully appropriated the funds of the corporation, they are responsible to the corporation therefor, and in a, proper suit can be made to account to the corporation. The instant case is by a stockholder and for *576such stockholder. The liability of directors for1 malfeasance is to the corporation, not to an individual stockholder or director. No demand upon the corporation to institute such suit appears alleged in the pleadings, and while it appears that such a demand under the circumstances related in the petition might be vain and futile, in any event the stockholder must seek relief for the corporation, not for himself individually. 10 Ohio Juris. 352-357.
If the corporation owes the plaintiff for services rendered, he can recover compensation for such services in an action at law against the corporation.
A suit for a receivership is never entertained by a court of equity, where the whole action is confined to such relief. A receiver is only appointed as ancillary relief.
“The appointment of a receiver is an extraordinary provisional remedy of ancillary character, regulated by statutory provision and allowable only in cases pending for some other purpose.” Hoiles v Watkins ct, 117 Oh St, 165. Paragraph 1, syllabus.
In this case the corporation is alleged to be doing a profitable business which the appointment of a receiver would undoubtedly jeopardize.
There is no foundation laid for the prayer for the accounting.
The demurrer was properly sustained, and the motion for a receiver was properly refused.
The judgment is affirmed.
HAMILTON, PJ, and CUSHING, J, concur.