Woodroof v. Howes

Citations

• 88 Cal. 184
• 26 P. 111
• 1891 Cal. LEXIS 670

Syllabus

<p>Corporation —■ Fraud — Sale of Corporate Property. — If the directors of a corporation, for the purpose of defrauding a portion of the • stockholders, sell and convey land of the corporation for one tenth of its value, they commit a fraud.</p> <p>Id. — Connection of Defendants with the Fraud.— If the directors are the implements and representatives of the grantees, and act with their connivance, and with their knowledge of the inadequacy of price, the grantees are participants in the fraud.</p> <p>Inadequacy of Consideration — Fiduciary Relation.—Inadequacy of consideration, where a fiduciary relation exists, is a fact tending to show actual fraud.</p> <p>Pleading — Fraud. — While the facts constituting the fraud complained of must be pleaded, it is sufficient to set them forth in ordinary and concise language.</p> <p>Id. —■ Fraudulent Intent. — A fraudulent intent is one of the facts constituting actual fraud, and must be alleged. But it is sufficient to allege it in terms.</p> <p>Demurrer — Admission. — A demurrer admits the truth of all allegations which are well pleaded, however improbable the facts alleged may he.</p> <p>Corporation — Suit by Stockholder to Protect Corporate Interests — Instance. — Where an executory contract for the purchase of land is assii ned to a corporation nnder an agreement that the assignors shall pay all the installments of the purchase-money, and subsequently the corporation intrusts certain of the shares of its capital stock to the assignors under an agreement that they will sell the stock at not less than a fixed price, and apply the proceeds, as received, to the payment of the purchase-money under the original contract, and they sell the stock, hut convert the proceeds to their own use, and by means of their control of the corporation prevent any legal proceedings from being taken in its name, a stockholder may maintain a suit in equity to compel them to perform their agreement, the corporation being joined as a defendant.</p>