Court Opinion

ID: 6518294
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:28:41.814419+00
Date Added: 2024-06-11T15:55:04.962431
License: Public Domain

McCLELLAN, C. J.
The Jasper Land Company has two boards of directors, or rather there are two sets of men each claiming to be and constitute its board of directors. Each of these alleged boards is attacking the integrity and existence of the other in divers proceedings at law and in chancery. Moreover, the individuals who dominate each of these boards are personally, directly or representatively, interested in the property and affairs of the corporation inimically to the complainants who are minority stockholders, so that it Avould seem that neither set of alleged directors are proper persons to invoke the remedies on behalf of the. corporation which complainants as shareholders are entitled to have employed, or Avill in good faith invoke them to the righting' of the Avrongs complained of, even if either set Avere in undisputed possession of the corporation’s assets and control of its affairs; but Avhethér so or not, it is plain to us that neither set is so in possession and control of the property and affairs of the company as to be able to take the necessary steps to the effectuation of the relief the stockholders are entitled to. In such case the appointment of a receiArer, eAren though the *657corporation be solvent, to take charge and control of its effects and concerns, at least until there is a recognized board of directors competent to faithfully and efficiently conserve the interests of all the stockholders, is within the proper exercise of the jurisdiction of the chancery court.—Edison Gouraud v. The Edison United Phonograph Co., 52 N. J. Eq. 620; Sternberg et al. v. Wolff et al., 29 L. R. A. (N. J.) 762; Sheppard v. Oxenford, 1 Kay & J. 491; Featherstone v. Cooke, L. R. 16 Eq. 298; Trade Auxiliary Co. v. Vickers, Ib. 303; Stevens et al. v. Davison, 18 Gratt. (Va.) 819; Tompkins Co. v. Catawba Mills et al., 82 Fed. Rep. 780.
. The inutility of an application to the corporate authorities — whoever they may he — for redress of the grievances complained of is sufficiently shown by the bill to justify the complainants in filing it without making such application.
The bill has equity for the purpose indicated. The answers and affidavits do not overturn the case- made by it. The chancellor properly overruled the motion to dismiss for the want of equity and the demurrer, and appointed a receiver as prayed. .
Affirmed.