Court Opinion

ID: 7944753
Source: CourtListenerOpinion
Date Created: 2022-09-08 23:19:02.078435+00
Date Added: 2024-06-11T16:33:52.238109
License: Public Domain

Ostrander, J.
{after stating the facts). The bill is lacking in certainty of averment. It was filed March 29, 1907, a]?out 30 days after the adjourned stockholders’ meeting. Whether the defendant company engaged in the manufacture of goods prior to the completion of its *376factory in November, 1906, does not appear. The objectionable personal conduct of Edward Crawford began, it is averred, “from October, 1906.” Assuming that it did nothing from April, 1905, to November, 1906, except to build and equip its factory, the bill was filed about five months after manufacturing operations were begun. A by-law of the company provides:
“Dividends of net profits on hand shall be declared as often and at such times as all the directors may decide.”
We are not informed whether a dividend was, or should have been, declared. And while another by-law creates an executive committee with power to authorize and make contracts “ and to carry on and conduct all ordinary business for the company, fix the compensation of officeis and employ és,” it is by inference only, and that not a necessary one, that it can be determined whether the salaries of complainants were ever .fixed by the company, or any continuing contract of hiring was ever made by them and the corporation. No misappropriation of corporate funds is charged, no denial of access to the books of the company, no mismanagement which does not consist in the use of authority with respect to the internal economy which complainants claim belonged to them'. If, as may be presumed, Edward Crawford voted his 400 shares of stock at the last annual meeting in favor of directors other than the two complainants, it is immaterial that three other shares were voted by other persons. If those elected directors are, as from the averments of the bill they must be assumed to be, shareholders, they are eligible to the position. We assume that the increase of capital was authorized for the purpose of selling stock. If the new board of directors has changed the policy of the corporation, the change is not set out in the bill. The charges are too vague, uncertain, and indefinite to warrant the interference of a court with the affairs of the defendant corporation, unless for the purpose of amending some wrong to complainants for which defendant Edward Craw*377ford is responsible. The theory of the pleader seems to be that there has been a breach of the personal agreement pursuant to which the corporation was organized, for which defendant Edward Crawford is responsible, and in his interest. If the corporation is indebted to complainants for unpaid salary, the remedy is an action at law by each complainant against the company. If complainant Aid-rich has been wrongfully discharged as an employe by the machinations of Crawford, his remedy is at law for his damages. The court is not asked to compel the corporation or to compel Crawford to specifically perform the agreement. We do not mean to intimate that such performance could be or would be enforced by the cour+ As to the stock of the company issued to complainants (we infer, in the absence of specific allegations, that it was issued to them and stands in their names, respectively), and deposited in escrow, it is evident that Edward Crawford and the corporation must deal with it at their peril. According to the agreement, it is to be paid for by dividends to be applied from year to year. Whether a court of equity may compel such application is not now a practical question. The bill, aided by all reasonable intendments, does not state a case for equitable interference.
The decree of the court below is reversed, and a decree will be entered in this court sustaining the demurrers and remanding the record. Appellants, will recover costs of both courts.
Blair, Montgomery, Hooker, and Moore, JJ., concurred.