Ellsworth v. Dorwart, 95 Iowa 108

Ellsworth v. Dorwart

95 Iowa 108 | Iowa | 1895

Deemer, J.

Plaintiff is now, and for many years-has been, a stockholder in the Burlington, Cedar Eapids & Northern Kailway Company, a corporation organized under the general incorporation laws of this state. The defendant Dorwart is the secretary and assistant treasurer of this corporation, and the defendant lyes is its president and general superintendent. These officers have charge and control of the books of the corporation which are kept at the company’s general offices in the city of Cedar Kapids. On the twenty-first day of April, 1893, the plaintiff applied to the secretary for permission to examine the stock ledger, original record, stock book, transfer book, financial record, and all books and vouchers pertaining to-the financial affairs of the corporation. In compliance with this-request, Dorwart produced the stock book and stock ledger, and plaintiff was permitted to examine them for a few moments only; whereupon the defendant Ives directed that the books be taken from plaintiff, refused to permit him to examine them further, and denied him the right to examine any other of the books or vouchers of the corporation. The request was made by plaintiff as a stockholder, at a seasonable time and in a reasonable manner. Plaintiff thereupon brought' this action, but his petition was denied by the court,, and thereupon he prosecuted an appeal to this court,

*1101 2 *109The following are the material sections of the státútes bearing upon the questions for determination:.. *110Code, section 1078: “* * * The stock books of the company must be so kept as to show intelligibly the original stockholders, their respective interests, the amount paid on their shares, and all transfers thereof; and such boobs, or a correct copy thereof, so far as the items mentioned in this section are concerned, shall be subject to the inspection of any person desiring the same;” Section 1279: “The offices of secretary and treasurer, •or assistant treasurer, and general superintendent, of every railway corporation organized under the laws of this state, shall be kept where the principal place of business of such corporation is to be, in which offices the original record, stock, and transfer books, and all the original papers and vouchers of such corporation shall be kept; and such treasurer or assistant treasurer shall keep a record of the financial condition of the ■corporation which may be inspected at all reasonable hours by any stockholder or any committee appointed /by the general assembly. * * )It would seem from these sections that it is the absolute right •of any person to examine the stock and transfer books of a corporation organized under the laws of this state, whether he shows himself interested therein or not; and it likewise appears that anstockholder has the right •at all reasonable hours to inspect the records showing the financial condition of the corporation. A strict construction of the statute perhaps does not give him the right to examine the original papers and vouchers, and, if such right exists at all, it is given by a liberal construction of the language used •or by the common law. It is difficult for us to see' on what theory plaintiff was denied the right to inspect the original record, stock, and transfer books, and the •record of the financial condition of the company. The statute quoted plainly confers the right. ■ Plaintiff *111asked it at a reasonable time, and was denied it, for some reason which, is not disclosed.

3 It is said in appellees’ argument that plaintiff requested and prayed for more than he was entitled to, and that they and the court were justified in denying Mm the right to examine any of the books. We do not think this is the rule. It was the duty of the officer, upon request, to exhibit to plaintiff such books as he was entitled to, although he called for more than he could rightfully demand; and the court was not justified in refusing him all relief because he asked for more than he was entitled to.

4 It is also said that the granting of the writ rested in the sound discretion of the court, and that, as the court was authorized to find that plaintiff sought the books. to gratify an idle curiosity or with some unworthy motive, this court ought not to interfere. Concede that the court had a discretion in the matter, yet it is a legal discretion, which ought not to be abused. The statutes seem to confer the right in absolute terms, and, if it is to be refused in any case, it seems to us it should only be done when it is clearly apparent that the purpose of asking it is to gratify an idle whim, or to perplex, annoy, or harass the officers having the books in charge. Such intent does not appear in tMs case; and, if it did; we are not prepared to say that it would warrant the refusal of a statutory right. All that is shown in this connection is that plaintiff did not feel kindly toward Mr. Ives, the president, and that he had commenced some suits against him.

*1125 6 *111It is also contended that appellant had no right to examine the books at the time he requested it, because *112he was accompanied by Ms attorney and a stenographer. This is not a sufficient excuse. Plaintiff had the right to have Ms attorney with him, and the attorney had a right to an amanuensis. Neither was present for an improper purpose. Each was there to speed and facilitate the investigation. Foster v. White (Ala.) 6 South. Rep. 88. As we have seen, the statute does not confer the right to examine the original papers and vouchers of the corporation, and we think that, to entitle plaintiff to it, he should plead and prove that some property right is involved, or that some controversy exists, or that some specific and valuable interest is in question, to settle which an inspection of these documents becomes necessary. People v. Walker, 9 Mich. 328. Stettaner v. Construction Co., (N. J. Ch.) 6 Atl. Rep. 303.

The court was in error in denying plaintiff the right to examine the original record, stock, and transfer books, and the record of the financial condition of the corporation; and the judgment is reversed.