Leach v. Davy, 199 Mich. 378

Leach v. Davy

199 Mich. 378 | Mich. | 1917

Ostrander, j.

(after Stating the facts). In the mandamus proceeding relator relies upon a common-law right, and, assuming the right exists and was violated, mandamus is the proper, if not the only, adequate remedy. The right to the remedy was in the court below, and is here, based upon the theory that a director of a private business corporation has an unqualified right to the inspection of the books and papers and correspondence of the corporation. And it is insisted for relator that the point should be decided upon the record made in the court below; at least, that relator’s right to the writ when it was granted, and therefore to costs, ought to be determined. It is also contended that the answer to the order to show cause contains no direct, unequivocal allegation that relator’s motive for securing the information he sought was to use it to the detriment and injury of the American Logging Tool Company, but that all averments in that behalf are conclusions, opinions, or inferences, or are based upon information and belief.

*383It is the general, perhaps the universal, rule, statutes and by-laws aside, that a director of a corporation has the right, by reason of his relation to the corporation, to at any time inspect the books and papers of the corporation. Whether this right may be affected by the motives of the director, may be denied him because his purposes are hostile to the corporation, is a question which has not been answered by the courts always in the same way. The absolute right of a director of a corporation to inspect its records, regardless of his motives, was affirmed in People, ex rel. Muir, v. Throop, 12 Wend. (N. Y.) 183. On the other hand, Heminway v. Heminway, 58 Conn. 443 (19 Atl. 766), seems to go upon a contrary doctrine. See, also, People, ex rel. Leach, v. Central Fish Co., 117 App. Div. 77 (101 N. Y. Supp. 1108); compare People, ex rel. Althause, v. Consolidated Mines Co., 122 App. Div. 617 (107 N. Y. Supp. 191); Machen v. Electrical Manfg. Co., 237 Pa. 212 (85 Atl. 100, 42 L. R. A. [N. S.] 1079, Am. & Eng. Ann. Cas. 1914B, 420); 7 R. C. L. § 434.

The situation is peculiar. The court below directed respondents to submit documents to inspection by relator. The writ of certiorari superseded action. It is now asserted, and not denied — in the brief of relator it is admitted — that the fact upon which relator based his right, and on which judgment went for relator, does not now exist. In certiorari proceedings questions of law are involved, and the judgment of this court affirms or disaffirms the judgment reviewed. To affirm here means that the writ will issue, to dis-affirm requires us to find the court below in error. And yet, whether the court was or was not in error, the writ, upon the facts now appearing, ought not to issue. Relator is not contending that as stockholder merely he has made a case requiring the issuing of the writ.

It is at least unusual to grant a motion to remand *384a récord for the purpose of incorporating therein matter which has come into existence since the hearing and to order a rehearing in the court below upon the aihended pleadings. But, if in a special proceeding like this one it is made to appear that the foundation for an asserted and denied personal right no longer exists, why should recognition of the right be compelled by the writ of mandamus? To permit the issuance of the writ of mandamus by affirming the judgment when it is apparent that, if immediately applied for by the relator, it would be denied, is to do a foolish thing.

In the circumstances we grant the motion to remand with leave to apply to the circuit court for an order permitting amendment of the answer to the order to show cause for examination of the issue presented by the pleadings as amended, and for such further order and direction as to that court may seem proper.

Kuhn, C. J., and Stone, Bird, Moore, Steere, Brooke, and Fellows, JJ., concurred.