Salina Mercantile Co. v. Stiefel

Citations

• 82 Kan. 7
• 107 P. 774
• 1910 Kan. LEXIS 187

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. Corporations — Dividends out of Invested Capital Induced by Willful Deceit of Stockholders — Liability of Stockholders. Where the directors of a corporation intend to distribute only its accrued profits, but a stockholder, by willfully deceiving them as to the surplus on hand, induces them to declare and pay a dividend the effect of which is to reduce the amount of the invested capital, he thereby fraudulently obtains from the company the sum by which his own share in the distribution has been increased by such misrepresentation; and is liable to it in at least that amount.</p> <p>2. Fraud — Joint Wrongdoers — Authorization or Adoption of Another’s Act. Where several stockholders unite in the perpetration of such a fraud they are liable jointly to the extent of the total excess received by all.</p> <p>S. Corporations — Consent of Minority of Directors to Excessive Dividend Procured by Deceit of Majority. Where the participants in such a fraud constitute a majority of the board of directors, and by deceiving in the manner indicated the other members induce their concurrence in the declaration of such an excessive dividend, the situation presented is the same as though the conspiring stockholders, not being themselves directors, had so misled the entire membership.</p>