Southern Pacific Co. v. Bogert

Citations

• 250 U.S. 483
• 39 S. Ct. 533
• 63 L. Ed. 1099
• 1919 U.S. LEXIS 1768

Syllabus

<p>To constitute laches it is essential that there be acquiescence in the alleged wrong or lack of diligence in seeking a remedy, in addition to lapse of time. P. 488.</p> <p>So held where- there was a delay of over 22 years upon the part of minority shareholders in seeking to .affix a trust bn shares in a new/ corporation .held by the majority, but in the interval the plaintiffs, or others representing the minority as a class, had been diligent in attacking the foreclosure and reorganization proceedings through which such shares were acquired.</p> <p>When the cause of action is such that suit may be brought on behalf of the plaintiff and all persons similarly situated, it is not essential that each such person should intervene in order to avoid the charge of having slept on his rights. P.. 489.</p> <p>Long failure to discover the appropriate remedy, though well .known, does not establish laches if there has been due diligence and the delay has not prejudiced the defendant. P. 490.</p> <p>Judgments against-minority shareholders in suits to set aside a foreclosure and a reorganization agreement as fraudulent, and to compel a reduction of the assessment under the agreement and enjoin distribution of stock according to its terms, held, not to estop them, by way either of res judicata or of election, from maintaining a further suit to declare the majority shareholder their trustee of new shares taken by it under the reorganization. Id.</p> <p>The fact that the majority shareholder, as part of an unfair scheme of reorganization brought about through its control, guarantees the bonds of a new company, successor to the corporate property, and agrees to take the shares of the new company not taken by the minority, does not give it the status of a banker or underwriter, in relation to the- minority shareholders, and thus relieve it of its fiduciary duty to them in respect of the new shares so acquired, when its design was to secure the property for its own purposes and nothi