299 Mass. 569 | Mass. | 1938
William Kavanagh, a successful furniture dealer in Springfield, caused his business to be incorporated under the name of Wm. Kavanagh Furniture Co. on or about August 1, 1928, and died May 7, 1930. By his will he gave to the company fifty-four shares of its stock; to various parties to this case, employees of the company, amounts aggregating nine hundred twenty-six
Friction arose among the leading stockholders and employees of the company. The defendants Nelen and Cavanagh planned to get rid of the trust and to obtain the
After these transactions, the company had nine hundred ninety-nine shares in its treasury, the plaintiff Hennessey held one share, the plaintiff Vaughan one hundred thirty-five shares, the plaintiff Burgess fifty-five shares, the plaintiff Pernice fifty-five shares, the plaintiff Williams one hundred thirty-five shares, the plaintiff Walker fifty-five shares, the plaintiff Leahy fifty-five shares, the defendant Nelen four hundred fifty-four shares, and the defendant Cavanagh fifty-six shares; a total of two thousand shares. The defendants Nelen and Cavanagh together have held and still hold a controlling interest.
The amended bill alleges that the consent, which the master finds was given to the transactions under attack by all the stockholders, including all the plaintiffs except Hennessey, was procured by false and fraudulent representations. It is enough to say that the master does not find this allegation supported by the evidence. The bill attacks the purchase of the stock of the defendants Murphy, Starr, William P. Noctor and Loretta K. Mahoney Noctor as a fraud upon the company. The master finds no fraud. Moreover, on December 8, 1933, all the stockholders, including all the plaintiffs except Hennessey, voted to ratify and confirm all the official acts of the officers for the preceding year and up to the date of the vote. This ratified the purchase which Nelen made for the company as treasurer, under the authority and direction of the directors. At the same meeting of the stockholders, the payment of the consideration for the purchase was specifically ordered by unanimous vote. Furthermore, the defendants Murphy, Starr, William P. Noctor and Loretta K. Mahoney Noctor were given an agreement under seal, signed by all the other stockholders, including all the plaintiffs except Hennessey, by which the purchase was approved and the payment of the consideration by the company was guaranteed by the individual signers. These acts make it immaterial whether the treasurer and the directors had authority to contract for the purchase of the stock or not. “Where, as here, all
The master finds that Nelen was incompetent as treasurer and manager, but finds that the business did not suffer because of his incompetence, and that the company is not insolvent. The refusal of the master to allow the plaintiff Burgess to contradict the record of the meeting of the directors on November 6, 1933, by testifying that he was not in fact present, seems to us of no importance, in view of the consent of all the stockholders, including all the plaintiffs except Hennessey, to the whole transaction in question. The judge was right in confirming the master’s report and in dismissing the bill.
Interlocutory decree affirmed.
Final decree affirmed with costs.
Alignment Number of Name. in this suit. shares.
Raymond Tatro . 1
John J. Vaughan . Plaintiff 55
Charles R. Burgess Plaintiff 55
Frank C. Perniee . Plaintiff . ■ 55
Thomas J. Williams Plaintiff 55
Thomas J. Walker Plaintiff 55
Thomas F. Leahy Plaintiff 55
Frank D. Nelen . Defendant . 280
Anna B. Cavanagh Defendant 56
William E. Murphy Defendant 112 Lucy A. Starr Defendant 55
William P. Noctor Defendant 55
Loretta K. Mahoney Noctor, who died before June 5, 1934 . William P. Noctor, Admr. Defendant . 55
Mary C. McCowley 1 Wm. Kavanagh Furniture Co. Defendant 54
Union Trust Co. of Springfield, Trustee under will of William Kavanagh . . • * s * . 1,001 2,000
Name. Number of shares already held. Number of shares received under decree.
Anna B. Cavanagh . 56 . 170
William P. Noctor . 55 166
Frank C. Pernice . . 55 165
Charles R. Burgess . 55 166
Thomas J. Walker . 55 166
Thomas F. Leahy . 55 165.
Raymond Tatro . . 1 3
332 1,001