123 Ga. 312 | Ga. | 1905
(After stating facts.) 1. Among the reasons assigned why the refusal of the court to sustain the motion was erroneous are: (1) that the suit authorized to be instituted is premature, as the affairs of the corporation are still being liquidated; there is no certainty that'the shares of its capital stock will be depreciated, or, if so, that they will become depreciated in any particular amount; and (2) because the petitioning stockholders
2. Unfaithful officials of a corporation are primarily liable to it for their misconduct. But where they are. in control and minority stockholders are unable to secure relief within the corporation, such stockholders may usually maintain an equitable proceeding and thus call the managing officials to account for fraud or acts which are ultra vires. 3 Cook, Corp. (5th ed.) § 735. To such a proceeding, the corporation is a necessary party defendant, in order that the result may bind it and bar any future action which it might bring for the same cause. Bethune v. Wells, 94 Ga. 486. Had not the bank been placed in the hands of a receiver, the right of petitioners to bring the present proceeding would not be open to question. It is insisted, however, that after a receiver for the corporation has been appointed, all actions must proceed in his name, as he represents not only the corpora
3. Another assignment of error upon the refusal of the court to vacate its order allowing suit to be instituted is, “Because the petition on which the order was issued does not allege fraud or the commission of any ultra vires acts on the part of the directors.” In this connection the Civil Code, § 1860, is cited,
Judgment affirmed. AU the Justices concur, except Simmons, O. J., absent.