Court Opinion

ID: 6532442
Source: CourtListenerOpinion
Date Created: 2022-07-19 20:20:40.398393+00
Date Added: 2024-06-11T15:55:24.493879
License: Public Domain

REED, District Judge.
A large portion of the affidavits of the parties is taken up with charges and countercharges relative to the management of the corporation. With these charges and the policy of the corporation, and who should become the directors of the corporation, this court has nothing to do, so far as disclosed by the pleadings. The only question before the court at this time is: Who is entitled to vote the stock standing in defendant’s name on the books of the corporation? The affidavits of both of the parties, in the face of the corporation minutes, are so indefinite in the statement of facts that I am unable to determine the rights of the parties by a preliminary hearing, except that it clearly appears that the plaintiff is the owner of at least 65,000 shares of stock standing in the name of the defendant. The minutes of the corporation, showing allotments made for the various claims, are presumably correct, and these minutes are, to a certain extent, corroborated by the affidavit of the defendant.
This being so, I am of the opinion that an injunction pendente lite, except as to the 65,000 shares, should be denied; this especially so since the action was commenced a few days only prior to the annual meeting of the corporation, when the question of who should vote the stock would naturally come up. Plaintiff had, according to his own statement, at least six *318months prior to the bringing of the action, opportunity of having his rights as to any shares of stock held by the defendant finally determined. In Hilles v. Parrish, 14 N. J. Eq. 380, where a bill was filed, as this was, a few days before the election, to restrain certain stockholders from selling or assigning their stock, or voting upon it at the election, the court held that, inasmuch as the probable effect would be to change the result of election and control the offices of the company, without allowing the stockholders sought to be restrained to be heard in their own defense, the injunction should be denied.
The general rule with reference to preliminary injunctions is well settled that the power-should be exercised with great caution, and should not be granted except in cases of urgent necessity. The basis of an injunction rests upon the principle of a clear and certain right to the enjoyment of the subject-matter in question, and an injurious interruption of that right, which, on a just and equitable ground, ought to be prevented. To warrant the allowance of the right, it must clearly appear that some act has been done or threatened, which will produce irreparable injury to the plaintiff. Here the facts are directly in dispute, and, as appears at present, the case is doubtful. It is well settled that, if the facts on which the right of injunction is based are in dispute, the injunction should be denied.
Under the circumstances, I am of the opinion that the defendant should not vote, at the annual election on the 25th of May, the 65,000 shares of stock held by him and admitted by him as belonging to the plaintiff. The plaintiff is therefore entitled to an injunction pendente lite, restraining the defendant from voting the 65,000 shares of stock standing in his name at the next, annual meeting. The temporary restraining order will be dissolved, except as herein indicated.