Price v. Union Land Co.

Citations

• 187 F. 886
• 110 C.C.A. 20
• 1911 U.S. App. LEXIS 4253

Syllabus

<p>1. Corporations (§ 320*) — Stockholders’ Suits — Grounds for Relief.</p> <p>A hill by stockholders against the corporation and individuals, which alleges that the individual defendants control the corporation, that they have issued to themselves a large proportion of its stock without consideration, and have caused property purchased with money of the corporation to be conveyed to themselves and to another corporation defendant organized by them, states a cause of action for relief on behalf of the corporation by the restoration of its property, and also incidentally by the cancellation of the stock wrongfully obtained by the individual defendants, by means 'of which their diversion of the property was made possible.</p> <p>[Ed. Note. — For other eases, see Corporations, Cent. Dig. §§ 1420-1439; Dec. Dig. § 320.*]</p> <p>2. Corporations (§ 320*) — -Stockholders’ Suits — Parties.</p> <p>In such a suit, persons who were formerly - stockholders, but were induced to part with their stock to the individual defendants by false and fraudulent representations may join as complainants on allegations of such facts, and may be restored to their status as stockholders.</p> <p>[Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1426-1439; Dec. Dig. § 320.*]</p> <p>3. Equity (§ 149*) — Stockholders’ Suits — Pleading.</p> <p>A right to maintain a suit against the officers of a corporation for fraudulent misappropriation of its property is a right of the corporation, and stockholders suing in such right cannot join therewith a cause of action for fraud and deceit practiced on them when they purchased their stock which is personal.</p> <p>[Ed. Note. — For other cases, see Equity, Cent. Dig. §§ 342, 36S -370; Dec. Dig. § 149.*]</p> <p>4. Corporations (§ 320*) — Stockholders’ Suits — Right to Maintain in Federal Court — Equity Rule 94.</p> <p>In a stockholders’ suit in a federal court, it is a sufficient compliance with equity rule 94 if complainants clearly show in their