44 So. 473 | Ala. | 1907
The bill in this case was filed by tbe appellees against tlie appellants, alleging that the complainant American Ice & Enel Company was a corporation under the laws of Alabama; that after the corporation had been in operation about one year, and was prospering, the directors agreed among themselves that they would purchase for the corporation all of the capital stock which could be purchased on advantageous terms with the funds of the company; and that they did so purchase various shares of stock (set out in the bill) amounting in all to 158 shares, leaving outstanding 292 shares — and showing that the corporation is solvent, and that the shares of stock were worth largely more than the amounts for which they were purchased. The bill further averred that shortly before the 10th day of January, 1907, the day fixed for the annual meeting of the stockholders, G'hiepolich (one of the directors and general manager) sold his stock to Cañizas, another director, and that Andrew Dacovich (another director and secretary and treasurer) took from the treasury certificates evidencing 106 shares of the capital stock, which had been purchased, and altered or filled in the indorse-ments thereon, so as to transfer them to his son, J. P. Dacovich, and likewise took, altered, and transferred 9 additional shares to his other son, George H. Dacovich, making it appear that they were transferred on January 7, 1907; that the stubs from which said shares were taken had originally shown that they had been transferred to said company, but that said Dacovich had placed on each additional indorsements purporting to show that the transfer to said company was illegal, and that the shares had been transferred to his said two sons; that J. P. Dacovich attempted to transfer one of his shares to E. W. Faith, and that said Andrew Dacovich also changed the stock ledger so as to show said transfers; that this
It will be seen that there are no facts set up in the answer which change tbe equity of tbe bill. As 'to tbe original purchase of tbe stock by tbe directors with the funds of tbe company, whether tbe certificates were indorsed in blank, or indorsed to tbe company, under tbe facts stated, it was a purchase by tbe officers of tbe company, for tbe company. Tbe court has said, under such a purchase, “though perhaps binding inter partes, which, however, we do not here decide, it is very certain that it was voidable at tbe instance of creditors of tbe corpora
Under these principles the shares of stock, when purchased, became the property of the corporation, and unless the corporation repudiated the transaction, or by some corporate act authorized the sale and reissue of the stock, it was not within the powers of the officers to sell •and issue the same. The objections to the purchase of its stock by a corporation are for the purpose of protecting creditors and the prevention of fraud, and, whatever might be the theory in other aspects of the case, it is clear that this principle would not be made the instrument of fraud by the officers who occupy a fiduciary relation to the corporation and its shareholders. — M. & C. R. R. Co. v. Woods, 88 Ala. 630, 642, 7 South. 108; O’Conner Mining & Mfg. Co. v. Coosa Furnace Co. 95 Ala. 614, 617, 10 South. 290, 36 Am. St. Rep. 251; Lagarde et al. vfi. Anniston Lime & Stone Co., 126 Ala. 496, 500, 28 South. 199; De Bardeleben v. Bessemer Land & Imp. Co:, 140 Ala. 621, 632, 37 South. 511; Luther et al. v. C. J. Luther Co. et al., 94 N. W. 69, 72, 118 Wis. 112, 29 Am. St. Rep. 977; Sampson v. Fox, 109 Ala. 662, 671, 19 South. 896, 55 Am. St. Rep. 950. The fact that Cañi-zas refused to carry out the scheme agreed on by the directors can have no bearing on the case, as the agreement of itself was a violation of their fiduciary relations and as to his purchase individually .of. the. stork of Chiepolich and Russell, he h&cLjL .rightto ^purchase it, and was not under_any — lega 1 obligation to bring-it into the scheme.
The corporation was a proper party to the bill.
The decree of the court is affirmed.
Affirmed.