97 Cal. 610 | Cal. | 1893
The defendants, having foreclosed a mortgage on the laud of the plaintiff, purchased the land at the foreclosure sale for a sum less than the amount due on the mortgage, and caused a judgment to be docketed against the plaintiff for the deficiency. The plaintiff brought this action to set aside and annul the decree of foreclosure and the judgment for the deficiency, and also to cancel the notes and mortgage on which the decree was founded, on the alleged ground of fraud in procuring the notes and mortgage.
The judgment of the court below was in favor of the plaintiff, granting all the relief prayed for. Defendants appeal from the judgment, and from an order denying their motion for a new trial.
The facts, as found by the court, relevant to the questions presented are substantially as follows: In March, 1887, the administrator of the estate of Augustine Olvera offered for sale, at public auction, a tract of laud situate in the county of San Diego, containing four thousand
One Charles H. Forbes requested the defendants to join him in the purchase of the land, and to furnish the money to make a payment of ten per cent of the purchase-money required to be paid at the time of the hid, which they did.
On March 19, 1887, Forbes hid in the land at the price of $5.05 per acre, and paid ten per cent of the purchase-money, furnished by defendants, amounting to $2,272.50, it being understood that Forbes, Flash, and Childress should be equally interested in the purchase.
On April 15, 1887, the sale was confirmed by the court as a sale to Forbes alone. A copy of the order of confirmation was delivered to Forbes on April 15th, but was not recorded in San Diego County until June 6, 1887.
In the latter part of April, 1887, the defendants and Forbes employed H. T. D. Wilson and N. D. Coleman to sell the land, and for that purpose to organize a corporation to make the purchase from the estate of Olvera, at the price of twenty-five dollars per acre, amounting to one hundred and twelve thousand five hundred dollars, for which,’in case of such sale, Wilson and Coleman were to be paid a commission of five dollars per acre, amounting to twenty-two thousand five hundred dollars.
On May 8, 1887, a written agreement was signed between Forbes, Flash, and Childress of the first part, and Wilson of the second part, witnessing,—■
“That the said parties of the first part, in consideration of the covenants and agreements on the part of the said party of the second part hereinafter contained, agree to sell and convey unto the said party of the second part, and said second party agree to buy, all that certain lot or parcel of land situate in the county of San Diego, and state of California, and hounded and particularly described as follows, to wTit: All that portion of that certain rancho situated in the county of San Diego,*617 state of California, known as the Rancho Ex-Mission of San Diego, described as follows: .... containing about 4,500 acres, for the sum of one hundred and twelve thousand five hundred dollars, gold coin of the United States; and the said party of the second part, in consideration of the premises, agrees to pay said sum to the said parties of the first part, the said sum of $112,500 to be paid as follows, to wit: $10,000 on or before May 20, 1887; $27,500 within sixty days; $20,000 within six months; $20,000 within twelve months; $20,000 within eighteen months; $15,000 within twenty-four months. Deferred payments to be secured bjr mortgage on said land, and to bear eight per cent interest per annum from date. The parties of the first part agree to release land under above agreement at the rate of fifty dollars per acre outside of town sites, and at rate of one hundred and fifty dollars per acre in town sites.
“ And the said party of the second part agrees to pay all state and county taxes or assessments of whatsoever nature which are or may become due on the premises above described.
“It is further agreed that time is of the essence of this contract, and in the event of a failure to comply with the terms hereof, by the said party of the second part, the said parties of the first part shall be released from all obligations in law or in equity to convey said property, and said party of the second part shall forfeit all right thereto, and to moneys heretofore paid under this contract, and their interest in or to said moneys or said property shall thereupon immediately cease as fully as if said moneys had never been paid or this agreement entered into. And the said parties of the first part, on receiving such payment at the time and in the manner above mentioned, agree to execute and deliver to the said party of the second part, or to his assigns, a good and sufficient deed of grant, bargain, and sale.
“And it is understood that the stipulations aforesaid*618 are to apply to and bind the heirs, executors, administrators, and assigns of the respective parties.
“In witness whereof, the said parties to these presents have hereunto set their hands and seals the day and year first above written.
“ Chas. H. Forbes. ■
“H. L. Flash.
“A. D. Childress. “Harvey T. D. Wilson,
“ Per FT. D. Coleman.”
This agreement was prepared by Childress, and signed by Coleman for Wilson during Wilson’s absence; and the court finds that it was a sham, and not intended to' be binding upon either party.
On May 20, 1887, the following agreement, called the subscription contract (plaintiff’s Exhibit A), was drawn, and subscribed by all the parties thereto at or within a few days after its date:—
“ Los Angeles, California, May 20, 1887.
“We, the undersigned, hereby agree to pay for the proportion of property hereinafter described, as is set opposite our signatures, according to the terms stipulated in this writing.
“ We agree to buy forty-five hundred acres of laild in San Diego County, lying north of the city of San Diego about six miles, to wit:—■
“All that portion of that certain rancho situate in the county of San Diego, state of California, known as the Rancho Ex-Mission of San Diego, described as follows, to wit: .... containing about forty-five hundred acres. For the foregoing land the sum of one hundred and twelve thousand five hundred dollars, in legal money of the United States, is to be paid on the following terms, — the same being twenty-five dollars per acre: ten thousand dollars down, to bind the trade; twenty-seven thousand five hundred dollars within sixty days, without interest; thirty-seven thousand five hundred dollars in one year; and the balance, thirty-*619 seven thousand five hundred dollars, in two years from date of purchase. Deferred payments to be secured by mortgage on said land, and to bear eight per cent (8%) interest per annum from date. The parties buying being guaranteed a release on any part they may sell, upon their paying for the part so released at the rate of fifty dollars per acre outside of town sites, and at the rate of $150 per acre in town sites. It is further agreed that parties selling shall furnish satisfactory abstracts fifteen days prior to the second payment ($27,500.00), and that the ten thousand dollars, first payment, shall remain in the Childress Safe Deposit Bank, of Los Angeles, California, in trust, until said abstract or title papers are presented.
a C. E. Mackey, one tenth; J. H. Outhwaite, per N. D. Coleman, one tenth; A. D. Childress, two tenths; P. C. Baker, one tenth; J. W. Montgomery, one tenth; Harvey T. D. Wilson, one tenth; Nicholas D. Coleman, one tenth; Flower, Jones & Co., one tenth; R. A. Thomas, one twentieth.”
La Tourette, who took one twentieth, did not sign this contract, but authorized Coleman to take that share for him, and there is no question that he was a party to the contract.
On May 26, 1887, Forbes and the defendants executed to Wilson and Coleman the following instrument: —
“ Los Angeles, Cal., May 26, 1887.
“Having entered into an agreement with H. T. D. Wilson and N. D. Coleman, of Los Angeles, California, for the sale of a certain tract of land, about forty-five hundred acres, lying in San Diego County, California, known as a part of lot seventy (70) of the Ex-Mission grant, for the sum of one hundred and twelve thousand five hundred dollars, on terms as shown by a bond or agreement held by them, which expires on May 21, 1887, we hereby set forth the terms of the commission we obligate ourselves to pay to said Coleman and said Wilson. We agree they shall receive the sum of*620 twenty-two thousand five hundred dollars, as follows: Out of the first ten thousand dollars cash payment that shall be made in the purchase of said land, said Coleman and Wilson shall receive three thousand dollars; out of the next payment of twenty-seven thousand' five hundred dollars,.they shall receive the sum of seven thousand dollars; the balance of said commission shall be paid, six thousand two hundred and fifty dollars in one year and six thousand two hundred and fifty dollars in two years from date of sale, with 8% interest per annum from date, by the surrender to said parties, four notes of thirty-one hundred and twenty-five dollars each, signed by the. company purchasing, two of said notes due in one year and two of said notes to be due in two years from date of purchase. This agreement, however, is subject to the consummation of sale as set forth in agreement of sale made this day.
[Signed] “ Chas. H. Forbes.
“H. L. Flash.
“ A. D. Ci-iildress.”
On the fourth day of June, 1887, according to the verbal agreement and understanding of all the parties at the time the subscription agreement of May 20th was. signed, the plaintiff corporation was organized with a capital stock of $500,000, divided into five hundred shares, 450 of which were subscribed for as follows: E. A. Thomas, 25; J. W. Montgomery, 50; C. E. Mackey, 50; J. H. Outhwaite, 50; P. C. Baker, 50; A. D. Childress, 100; N. D. Coleman, 50; H. T. D. Wilson, 50; and J. E. La Tourette, 25.
Between the time of the execution of the subscription agreement (May 20th) and the sixteenth day of July, 1887, Thomas, La Tourette, Montgomery, Mackey, Outhwaite, Flower, Jones' & Co., and Baker paid to the defendant Childress, as trustee, to be applied to the purchase of the land by the corporation, the sum of twenty-six thousand seven hundred dollars, about one fifth part of which had been so paid before the organization of the corporation. Out of the money so paid to
On July 19th, Flash and Childress entered into a written agreement, reciting their several relations to the transactions above stated, and agreeing, among other things, that Childress should act as trustee for Flash in all matters pertaining to the land transactions until all the purchase-money should be paid by the corporation, and should also act as trustee for the corporation.
On July 20th, Forbes conveyed the land to Childress as trustee for the corporation, and on the same day the corporation made its promissory notes for the unpaid balance of the purchase-money (seventy-five thousand dollars), payable in one and two years to “A. D. Childress, trustee, or order,” with interest at eight per cent per annum; and to secure these notes the corporation, on the same day, executed a mortgage on the land to “A. D. Childress, trustee.” The notes were antedated to May 31st. It does not appear on the face of the mortgage or notes for whom Childress was trustee, but the court found that he held the notes and mortgage for himself and Flash,—Forbes having theretofore assigned all bis interest to them.
On January 28, 1889, on his own motion, Childress conveyed the legal title of the land to the corporation, and about the same time assigned the notes and mortgage to Flash, but, to the extent of his interest, in trust for himself.
On February 18, 1889, Flash commenced the action
On May 4, 1889, the mortgaged land was sold by the sheriff, under the decree of foreclosure, to Flash, for the sum of $31,500, leaving a deficiency' of $58,126.14, for which a judgment was docketed in favor of Flash, against the corporation. The sheriff executed a deed to Flash, November 8, 1889.
The fraudulent acts by which the corporation was induced to purchase the land and to execute the notes and mortgage, as found by the court, are substantially as follows: That the defendants, by their agents, Wilson and Coleman, for the purpose of inducing Mackey, Montgomery, Thomas, La Tourette, and Flower, Jones & Co. to subscribe the agreement of May 20th, and to subscribe for stock in the corporation, represented to them that Forbes and Flash held a contract for the purchase of four thousand five hundred acres of land from the estate of Olvera, deceased, at the price of twenty-five dollars per acre, which price was the lowest figures for which the land could be purchased; that those who would subscribe the agreement of May 20th -would get in “ on the ground-floor, at bed-rock figures ”; that a corporation was to be immediately formed for the completion of the purchase under the said contract held by Forbes and Flash, and upon the organization of the corporation, shares of the capital stock would be issued to the subscribers of the agreement in proportion to their subscription; and that all such representations were willfully false, except that Forbes and Flash held a contract for the purchase of the land; that defendants, by their said agents, fraudulently concealed from the subscribers last above named that the contract price of said land was only $5.05 per acre, and also concealed. the facts that Childress was interested with Forbes and Flash in said contract of purchase from the estate of Olvera, that Forbes and Flash were interested with Childress in his subscription to the agreement of May
This action was commenced on December 17, 1889,
1. Counsel for appellants contend that the findings of fact show no cause of action in favor of plaintiff, for the reason that the frauds found were committed, not against the corporation, but only against the individual subscribers to the agreement of May 20, 1887, who, by virtue of that agreement, became the purchasers of the land, and subsequently conveyed it to the plaintiff, but did not assign to the plaintiff their rights of action for fraud in the sale of the land to them.
I think counsel are mistaken in contending that the agreement of May 20th is a contract of purchase, in any proper sense of the term. No party to it purports to be seller, or agrees to sell. All are represented as agreeing with each other to purchase the land, but from whom they propose to purchase is not expressed or implied in the written agreement. The agreement as written imposes no obligation upon the owner of the land in favor of the subscribers, nor upon the subscribers in favor of such owner.
From other evidence than the subscription agreement, however, the court found that it,was never the intention of the subscribers, or any of them, to purchase the land, but merely to take stock in a corporation thereafter to be organized by the subscribers which should purchase the land from the estate of Olvera, or complete a purchase thereof under the contract held by Forbes and Flash, such stock to be issued to them in proportion to their subscriptions, it being an expressed and well-understood condition of their subscriptions that such corporation should be organized to make the purchase. Childress, who represented Flash, demanded this condition, as he would not personally sign the notes and mortgage for the deferred payments; nor would Thomas subscribe without this condition. All the subscribers were informed by Wilson and' Coleman, before they subscribed, that a corporation would immediately be organized to make the purchase of the
At the time the corporation was organized, Childress,. Flash, and Forbes were still the owners of the contract to purchase from the administrator of the estate of Olvera, made in the name of Forbes; and two days thereafter (June 5th), Forbes, who was not then known, except to defendants and their agents, to be interested in the transaction, recorded the order of the probate court confirming the administrator’s sale to him. On July 16th the administrator’s deed was executed to Forbes, for the use of Childress, Flash, and himself. On July 20th the purchase of the land by the corporation, ostensibly from Forbes, but really from Childress, Forbes, and Flash, was consummated by a conveyance from Forbes to Childress, trustee for the corporation, in consideration of thirty-seven thousand five hundred dollars in cash,, and the notes of the corporation then made to Flash, as trustee for- Forbes, Flash, and Childress, for seventy-five thousand dollars, secured by the mortgage of the corporation as above stated. The thirty-seven thousand five hundred dollars cash paid was the money of the corporation theretofore advanced by the subscribers, as aforesaid, through Childress, their trustee, in payment for their stock in the corporation. Such having been thereat nature of the transactions, dressed in gauzy disguise, no doubt the corporation .purchased' immediately from the defendants and Forbes. That the defendants so understood it is further evinced by the agreement between them of July 19, 1887, and the letter of Childress to the corporation dated January 5, 1889.
The defendants, by their agents, Wilson and Coleman, and otherwise, were evidently promoters of the corporation to purchase their own property. A promoter of a corporation is defined by Mr. Morawetz (sec. 545). to
no technical legal meaning, and applies to any person who takes .an active part in inducing the formation of a company, whether he afterwards becomes connected with the company or not.”
The definition given in Cook on Stocks and Stockholders (sec. 651) is as follows: “ A promoter is one who brings about the incorporation and organization of a corporation. He brings together the persons who become interested in the enterprise, aids in procuring subscriptions, and sets in motion the machinery which looks to the formation of a corporation. A promoter is considered in law as occupying a fiduciary relationship towards the corporation.”
“The subscriptions of the share-holders are made upon the trust that the promoters are men of rectitude and business sagacity, who will use their knowledge and exercise their control over the enterprise for the benefit of the company.....Justice demands that the promoters of a company should not abuse the confidence placed in them by the subscribers for shares, or derive any unjust advantage through their control over the organization or management of the company.” (Morawetz on Corporations, sec. 545.)
Again, at section 546, the same author says: “ Accordingly, it has been held that if persons start a company, and induce others to subscribe for shares for the purpose of selling property to the company when organized, they must faithfully disclose all facts relating to the property which would influence those who form the company in deciding upon the judiciousness of the purchase. If the promoters are guilty of any misrepresentation of facts or suppression of truth in relation to the character and value of the property or their personal interest in the proposed sale, the company will be entitled to set aside the transaction, or recover compensation for any loss which it has suffered.”
It therefore appears that the corporation was the party directly injured by the fraud, and was the proper party to bring this action.
2. While admitting that Wilson and Coleman were promoters of the corporation, counsel for appellants contend that the finding that they were authorized by the defendants to promote the corporation is not justified by the evidence.
That Wilson and Coleman were the authorized agents of defendants and Forbes to sell the land, and were to be paid a large commission for their services, there is no doubt. The agreement of May 26th as to the amount and manner of payment of their commission would be nonsense on any other supposition. A large portion of the commission (twelve thousand five hundred dollars) ivas to be paid in notes of “ the company purchasing which notes were understood to be the notes of an incorporated company, and not the notes of the persons who subscribed the agreement of May 20th, since Childress, who subscribed that agreement for himself and Flash, had made it a condition of his subscription that he was not individually to sign notes for the deferred payments of the purchase-money, but that a corporation should be formed to purchase the land and to make the notes for the purchase-money. The reason he assigned for this was, that, being a banker, his credit might be injured by signing such notes individually.
Under this head, counsel also contend that the agreement of May 8, 1887, was a contract of sale of the land from Forbes, Flash, and Childress to Wilson, but the finding of the court that it was not is 'fully justified by the evidence. Coleman testified that when it was presented to him by Childress, in the absence of Wilson, he protested against signing it for Wilson, for the reason that he had no specific authority to do so; and that he would not have signed Wilson’s name if he had not understood that it would not be enforced against Wilson. Wilson testified that he was dissatisfied with it, and withdrew it. Besides, it is inconsistent with the agreement of May 26, 1887, in regard to the commission to be paid to Wilson and Coleman. It was evidently prepared by Childress for the purpose of concealing his interest as a seller to the contemplated corporation.
Again, counsel have made extracts from the findings and complaint, in which the subscribers of the agreement of May 20, 1887, are carelessly designated as purchasers; but, read in connection with their context, these expressions cannot be understood to mean that the subscribers of the agreement of May 20th purchased the land, except in the sense that their purchase of capital stock of the corporation gave them an interest in the land purchased by the corporation.
3. There is nothing worthy of special consideration in the points to the effect that the court erred in admitting evidence objected to by defendants’ counsel, except to say, that Wilson and Coleman having represented the defendants in promoting the corporation, what they said to induce subscriptions to the agreement of May 20fch was competent evidence against their co-conspirators.
4. Appellants contend that the plaintiff is barred by its own laches, especially in that it neglected to move the court in which the foreclosure was had to set aside the judgment of foreclosure within six months after its rendition, upon which motion, it is claimed, the plaintiff could have obtained all the relief to which it is entitled in this action.
But I think this point is not maintainable, even on the facts as claimed by appellants, viz., that the defrauded stockholders had general notice of the fraud on June 5, 1889, — one month after the foreclosure sale, — and within the month of June consulted a lawyer as to their rights and remedies, and thence had more than four months within which to make their motion, under section 473 of the Code of Civil Procedure, to set aside the judgment. While it may be true that they had notice on June 5th that they had been defrauded, and generally of the mode and means by which the fraud had been perpetrated, yet it does not appear that they were then sufficiently informed as to the particulars, nor as
At the annual meeting of September 28, 1889, a new board of directors was elected, constituted of Thomas, Montgomery, Mackey, La Tourette, and Wilson, the first four of whom were of the victimized stockholders; and on the same day the new board adopted a resolution authorizing and directing the commencement of this
But a more conclusive answer to appellants’ contention as to the six months’ limitation is, that none of the grounds upon which a party may be relieved from a judgment under section 473 of the Code of Civil Procedure appear to have existed in this case. The judgment was not taken against the corporation through its “ mistake, inadvertence, surprise, or excusable neglect,” but through the fraud of its directors, in aid of the original fraud by which the notes and mortgage were procured. Having notice of the original fraud constituting a meritorious defense to the foreclosure action, a majority of the directors-—- Childress, Wilson, and Coleman— purposely, willfully, and fraudulently permitted the judgment to be taken by default. There was no mistake, no inadvertence, no surprise, and no excusable neglect. Therefore, conceding, as I do, that the judgment and default might have been set aside, and leave to answer obtained on motion, on the ground of fraud, independently of section 473 of the Code of Civil Procedure, yet such motion was not subject to the six months’ limitation prescribed by that section of the code. Nor was the remedy by motion on the ground of fraud exclusive of the remedy by regular suit in equity, unless it was pefectly adequate. (Baker v. O’Riordan, 65 Cal. 368.) The only relief to which the corporation would have been entitled on such motion was the setting aside of the judgment and default, with leave to answer, which would have been but one step circuitously leading to the same equitable relief which has been directly obtained by this suit. The very next step must have been the commencement of a distinct suit in equity, which, though called a cross-suit, commenced by a cross-complaint, would have been> in fact and sub
Should it be claimed that the corporation might have obtained complete and adequate relief in the foreclosure suit by simple answer without a cross-complaint, the answer is, that adequate and complete relief embraced the cancellation of the notes and mortgage, and possibly more, which is affirmative equitable relief that could not have been obtained without a cross-complaint in the foreclosure suit, or a separate suit in equity.
It only remains, under this head, to consider the effect of the delay of the commencement of this action, independently of the six months’ limitation prescribed by section 473 of the Code of Civil Procedure. Was such delay, under the circumstances of the case, sufficient to bar the remedy ?
The mere lapse of time less than the statutory period of limitation will not bar an action for equitable relief, unless the delay, under the circumstances, has been such as to justify the presumption that the defendant may have been prejudiced thereby. The bar of an equitable remedy in such cases is not imposed upon the plaintiff as a penalty for his negligence, but is intended merely to protect tie defendant from such consequences of the delay as may be prejudicial to his rights. In the case of New Sombrero Phosphate Co. v. Erlanger, L. R. 3 App. Cas. 1230, it was contended that the remedy was barred by laches of the complainant, similar to such as claimed in this case, but the delay was held to be insufficient. Speaking to this point, Lord Penzance said: “ The nearest approach to a definition of the equitable doctrine upon this head which is to be found amongst the cases cited is the statement made in the case of Lindsay Petroleum Co. v. Hurd, L. R. 5 P. C. 221. Delay is there said to be ‘material, where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might fairly be re
Considering all the facts and circumstances, I think
5. Counsel for appellants further contend “ that the findings do not support the judgment, for the reason that Childress and Flash bought the land for themselves, and on their own account, before the corporation was formed, or any steps taken towards its formation.”
It is not claimed, however, that for this reason there was no fraud, nor that the corporation was not entitled to some species of relief, but only that “the remedy allowed by the court — ‘ secret profits ’— is inapplicable, because Childress and Flash, even conceding them to have been promoters of the corporation from the time the first steps were taken towards its formation, were not promoters at the time of the original purchase from the Olvera estate.”
Counsel say, under this head: “The point is this: Conceding misrepresentations as to the price paid the Olvera estate, as well as concealment of Childress’s ownership, and that these things were fraudulent and actionable, still, inasmuch as there was no agency when defendants and Forbes bought from the Olvera estate, the recovery of ‘ secret profits ’ was not authorized or appropriate relief.”
By this I understood counsel to mean that there was no confidential or fiduciary relation between the defendants and the corporation in respect to the contract of purchase from the estate at the time it was made. Conceding this, it is found by the court, and for the purpose of this point is admitted by counsel, that the defendants afterwards placed themselves in a fiduciary relation to the corporation by promoting it, and while in that relation, by means of the fraudulent -representations and concealments found, induced the corporation to purchase their land, whereby they made “ secret profits ” exceeding seventy-five thousand dollars. Admitting, for the sake of argument, that the relief granted (the canceling of the notes and mortgage) was equivalent to a recovery of secret profits fraudulently made, in what
An objection to the recovery of secret fraudulent profits similar to the objection under consideration was answered in the case of Getty v. Devlin, 54 N. Y. 412. In that case, the subscribers to a paper agreed jointly, and for their mutual benefit, to purchase certain lands for a specified price. The court said: “ No one of the subscribers could, after this, purchase the lands for a less price, and compel his associates to allow him more than he paid. His purchase would inure to the benefit of all the subscribers. That this is so is so thoroughly settled, both upon principle and authority, that it will not be disputed. .... If this be so as to a purchase made after the subscriptions are written, why should not
I think this is a satisfactory answer to appellants’ point grounded on the fact that defendants purchased the land from the estate of Olvera before the date of the subscription agreement of May 20th.
It is suggested that just and appropriate relief could have been granted only by a rescission of the sale and restoration of the land to the defendants, as in the Sombrero case, supra.
Conceding that such rescission would have been a practicable mode of relief, I do not think it exclusive of any other mode by which a court of equity might have given appropriate relief, doing no injustice, to the defendants. But it does not appear that such rescission and restoration of the parties to their original status was practicable, or desired by the defendants; nor does it appear that it would have been less onerous upon the defendants, as above shown. The land should not have been restored to defendants unless they were able to refund all the money which they and their associates in the fraud had wrongfully obtained from the corporation, and caused it to expend, with interest, which must have amounted to more than forty thousand dollars. Were the defendants solvent, independently of the land? If not, could forty thousand dollars have been realized from the land? These and perhaps other difficult questions must have been solved before it could have been determined whether rescission was the proper or even practicable mode of relief. Had the defendants requested that mode, and tendered payment of the requisite sum of money in the court below, they would be in a more favorable position to advocate this point here.
6. The point is made, that the effect of the decree is more favorable to Wilson and Coleman than to defend
In answer to this, it is enough to say that it is a matter that does not concern the corporation. It concerns only the defendants and their co-conspirators in the fraud, and must be adjusted, if at all, among themselves. As before remarked, the relief granted to the corporation is equally favorable to all the stockholders. The grievances of individual stockholders suffered from the wrongs of other stockholders could not have been redressed in this action.
I think the judgment and order should be affirmed.
Belcher, C., and Searls, C., concurred.
For the reasons given in the foregoing opinion, the judgment and order are affirmed.
Harrison, J., Garoutte, J., McFarland, J.
Hearing in Bank denied.
