Bacon v. Irvine

Citations

• 70 Cal. 221
• 11 P. 646
• 1886 Cal. LEXIS 770

Syllabus

<p>Corporation—Action by Stockholders—Request on Directors to Brins — Must be Made in Good Faith. —The action was brought by certain stockholders of a corporation against the company, its president, directors, and other officers, for the purpose of procuring the appointment of a receiver of the corporate property; to compel each and all of the defendants to account to the company; that an assessment levied upon its capital stock be rescinded; and that the sale of the stock in payment of the assessment be enjoined. The complaint alleged that all of the'individual defendants had conspired together and embezzled a large amount of the corporate funds- It further alleged that the plaintiffs had requested the directors of the corporation to bring the action in the name of the company, but that they had refused. On the trial, no evidence connecting the directors with any fraudulent act or embezzlement of the corporate property was introduced, and it appeared that the sole object of the action was to compel the defendants, other than the directors, to account to the company for certain corporate property alleged-to have been fraudulently appropriated by them. Held, that the action could not be maintained by the stockholders, for the reason that the request made by them on the directors to bring the action was simulated, and did not express the real nature of the action that they desired to have brought.</p>