South-W. N. Gas Co. v. Fayette Fuel-Gas Co.

145 Pa. 13 | Pennsylvania Court of Common Pleas, Fayette County | 1892

no. 42.

Opinion,

Mr. Justice McCollum:

This is an appeal from an order of the Court of Common Pleas dismissing exceptions to a sheriff’s sale of the property of the Fayette Fuel-Gas Company. The appellant avers that he is a stockholder in said company ; that its property was sold in a lump, and for less than its value, on an alias fieri facias in favor of the South-West Natural Gas Company, and a like writ in favor of Noble McCormick and others; that there was no inquisition held nor valid waiver thereof; and that the sale was irregular, because the preceding writs of fieri facias were not returned as provided by the seventy-second section of the act of June 16,1836, P. L. 774.

It was the duty of the appellant to set forth in his petition the necessary facts to give him standing' in the court below to contest the sale. It was not enough for him to allege that he was a stockholder. The wrong done was against the corporation, and the redress for it should be sought and obtained through its duly appointed agents. Its directors were clothed with the power to control its action, and to decide whether it should engage in litigation. If the corporation was unable to act by reason of the misconduct or disability of its agents, and there was not suf. ient time to remove them and appoint others in their stead, the stockholders might invoke the aid of a court of equity to protect the corporate property and their own equitable right in it. But a mere refusal of the directors of a corporation, acting in good faith, to institute legal proceedings in its name to redress an alleged wrong against it, is not a sufficient ground for the interference of a court of equity at the instance of a stockholder, as it often involves the exercise of a sound discretion to determine whether it is expedient to begin litigation for an actionable injury. If, however, the directors were the authors of the wrong, or their refusal to bring suit was i*n excess of their discretionary powers, such interference would be justified : Morawetz on Corp., §§ 239-245, inclusive, and cases cited.

In the light of these well-settled and familiar principles, we examine the petition of the appellant. It alleges that he is a stockholder, but it does not state when he became such, or what the amount of his holding is. It avers that he appears “ for himself and other numerous stockholders of the Fayette Fuel-Gas Co.,” but it does not contain the names of the “ other stockholders,” nor inform us when they purchased their stock, or how many shares they own. It fails to charge any collusion between the corporation and the execution creditors, or that it is unable to act in the premises by reason of anj'- misconduct or disability of its authorized agents. In short, the petition is fatally defective, in that it omits the averments necessary to enable a stockholder to contest the sale. We have not considered the other questions discussed in the appellant’s paper-book, because, as we have seen, he has not placed himself in a position to raise them, and for the further reason that a refusal to set aside a sheriff’s sale is not reviewable here: Rees v. Berryhill, 1 W. 263; Sloan’s Case, 8 W. 194; Hoffa’s App., 82 Pa. 297; Jackson v. Morter, 82 Pa. 291.

Appeal quashed.

no. 43.

Opinion, Mr. Justice McCollum:

' This appeal is quashed for the reasons given in the opinion filed in No. 42 Juty Term 1891, decided at this term.

Appeal qupshed.