Court Opinion

ID: 6878300
Source: CourtListenerOpinion
Date Created: 2022-07-23 21:10:56.80346+00
Date Added: 2024-06-11T16:05:32.210036
License: Public Domain

On Rehearing.
PHILLIPS, Circuit Judge.
The appellees filed a petition for rehearing and we granted oral argument thereon.
Judge Lewis adheres to the views expressed in his former opinion. This opinion expresses the views of Judge Bratton and the writer.
At the oral argument, counsel for appellees advanced two principal propositions : First, that the plan is unfair in that the provisions for distribution of the assets of the trust and stock in the Toklan Royalty Corporation are not in accord with the provisions of the trust agreement and discriminate in favor of the holders of common shares in the trust to the detriment of holders of preferred shares in the trust. We are convinced that it is impossible to determine from this record the relative rights of the several classes of owners of beneficial certificates in the trust to participation in the distribution of the capital assets of the trust or the stock of the Toklan Royalty Corporation other than from the decree of the district court of Tulsa County, Oklahoma, entered in the case of Alta L. Hamrick et al. v. Imperial Royalties Corporation et al., No. 56614, on November 8, 1935. In their petition below appellees did not challenge the validity of that decree. But they undertake to do so hereon jurisdictional grounds. Alta L. Ham-rick brought cause No. 56614 as a class suit. The present trustees were appointed by the court in that suit. The decree of November 8th is not set forth in full in this record. The undisputed proof is that it was entered on petition of the trustees for an order construing certain terms of the trust and directing the trustees with reference thereto, and after notice given.1 It was entered by a state court of general jurisdiction.2 The attack here is collateral. It will be presumed that the court had jurisdiction both of the subject-matter and the parties and that all facts necessary to-give the court jurisdiction to render the particular decree were duly found, the contrary not affirmatively appearing.3 ****It follows that the challenge to the decree here is not-well taken.
The plan provides for the distribution to each holder of beneficial certificates in the trust, his share of the liquidating value of the assets of the trust or stock in the Toklan Royalty Corporation at his election, in accordance with the relative rights of the several classes of holders of beneficial certificates in the trust, as adjudged by the decree of November 8th. The challenge to the fairness of the plan is not well grounded.
Second, counsel for the appellees challenge the power of the trustees to con*253vey the assets of the trust to the Toklan Royalty Corporation because the powers and objects of that corporation are broader than the objects of the trust and the power of the trustees thereunder. Counsel for the appellees admitted at the oral argument that the trustees had power to convey the assets of the trust to the corporation under method three provided for in Section 29 of the amended declaration of trust.4 They assert, however, that the powers and objects of the corporation should be substantially the same as the objects of the trust and the powers of the trustees thereunder. With this we agree. The amended certificate of incorporation of the Toklan Royalty Corporation authorizes it to engage generally in oil and gas prospecting, producing, refining, processing, and distributing. The amended declaration of trust authorized the trustees to use and invest the trust fund “for the operation of the business of owning, buying, selling, and otherwise acquiring or disposing of oil and gas royalties, and of oil and gas royalty acreage, developed and undeveloped, and including casinghead gas and gasoline rights and royalties in the United States of America and in the Republic of Mexico.” Thus, it will be seen that the powers of the corporation are much broader than the objects of the trust.
We are of the opinion that the plan would be free from objection and the proposed transfer to the corporation valid, if the third paragraph of the articles of incorporation of the Toklan Royalty Corporation were amended to read substantially as follows:
“The nature and business of the corporation and the objects and purposes proposed to be transacted, promoted, and carried on by it are the business of buying or otherwise acquiring, owning, holding, and selling or otherwise disposing of oil and gas royalties, oil and gas royalty acreage, developed and undeveloped, and casinghead gas and gasoline rights and royalties in the United States of America and Republic of Mexico, with all powers necessary or incident thereto, including the following, to-wit:
“(a) To hold, purchase, or otherwise acquire, and to lease, exchange, convey, mortgage, or otherwise dispose of oil and gas royalties, oil and gas royalty acreage, developed and undeveloped, and casinghead gas and gasoline rights and royalties.
“(b) To enter into, make, and perform contracts of every sort and description to effectuate the objects of the corporation.
“(c) To issue shares of its capital stock as authorized for cash, property, either real, personal, or mixed, leases, or for any combination of the foregoing.
“(d) To conduct its business in all or any of its branches in the state of Delaware and in any and all other' states and territories of the United States and in the Republic of Mexico.
“(e) To perform any other acts and do all things that may be necessary or convenient to the attainment of the purposes of this corporation to the same extent as natural persons lawfully might or could do in so far as such acts or things are permitted to be- done by corporations organized under the general laws of Delaware.
“The particular specifications of objects, powers, and purposes herein shall not be in limitation but rather in furtherance of the powers granted the corporation under the laws of the state of Delaware.”
If the appellants shall so amend the articles of incorporation of the Toklan Royalty Corporation within 60 days from the date of the filing of this opinion and furnish satisfactory evidence thereof to this court, then the decree will be reversed and the cause remanded with instructions to dismiss the bill of complaint with prejudice. If appellants fail so to amend the articles of incorporation and furnish such evidence to this court within the time fixed, then the decree below will be affirmed.

 The only evidence as to the notice was that of one of the trustees who testified without giving particulars that notice was given. His evidence with respect to notice was not controverted.

 Oklahoma Constitution, Art. 7, § 10, Okl.St.Ann.O.S.1931, § 13562.

 Harvey v. Tyler, 2 Wall. 328, 341, 342, 17 L.Ed. 871; Galpin v. Page, 18 Wall. 350, 365, 366, 21 L.Ed. 959; Hatten v. Hudspeth, 10 Cir., 99 F.2d 501, 502; Cohen v. Portland Lodge, No. 142, B. P. O. E., C.C.Or., 144 F. 266, 268; Fishel v. Kite, 69 App.D.C. 360, 101 F.2d 685, 687, 688; Petroleum Auditors Ass’n v. Landis, 182 Okl. 297, 77 P.2d 730, 731, 732; Yahola Oil Co. v. Causey, 181 Okl. 129, 72 P.2d 817, 819; Myers v. Carr, 173 Okl. 335, 47 P.2d 156, 160; Fletcher v. Superior Court, 79 Cal.App. 468, 250 P. 195, 197; Thompson v. Farmers’ Exchange Bank, 333 Mo. 437, 62 S.W.2d 803, 811, 812.

 See concurring opinion of PHILLIPS, Circuit Judge, herein.