Andrews v. Mines Corp.

• Decision Date: 24 February 1910
• Parties: ANDREWS v. MINES CORPORATION, Limited, et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

205 Mass. 121

91 N.E. 122

ANDREWS v. MINES CORPORATION, Limited, et al.

Supreme Judicial Court of Massachusetts, Suffolk.

February 24, 1910

COUNSEL

Solomon Lewenberg, for petitioner.

Walter N. Buffum and Jas. S. Allen, Jr., for respondents.

OPINION

KNOWLTON C.J.

This is a petition for a writ of mandamus upon which a justice of this court, after a hearing, entered an order that the writ should issue, and then, at the request of the respondents reported the case to this court. As the proceeding is at law such a report brings before us only questions of law, and the decision of the single justice must be given effect unless some error of law appears.

The petitioner is a stockholder in the respondent corporation, and his petition is that the corporation and the other defendant, who is a director and the treasurer of the corporation, having custody of its books and records, be directed to give him an opportunity to examine these books. The petitioner is a citizen of this commonwealth, and the corporation has a usual place of business in Boston and holds its meetings there. Its books and records are there in the hands of Davison, the other defendant. The president of the corporation also resides in this commonwealth.

The right of a stockholder in a corporation to inspect its books and records for good reasons, and under proper conditions, was considered at length in Varney v. Baker, 194 Mass. 239, 80 N.E. 524. The principal question in the present case is whether this right will be enforced in this commonwealth against a foreign corporation and its officers, when its books and the officer having the custody of them are here, and when it has a usual place of business in Massachusetts. The circumstances of the present case call for the exercise of this jurisdiction, if it ever can properly be exercised.

It has often been decided that this court will not take jurisdiction, in ordinary cases, to regulate the internal affairs of a foreign corporation which ought to be managed under the laws and by the direction of the courts of the state or country where it is organized. Smith v. Mutual Life Ins. Co., 14 Allen, 336; Williston v. Michigan etc., R. R., Co., 13 Allen, 400; Kansas, etc., Construction Co. v. Topeka, etc., Railroad Co., 135 Mass. 34-40, 46 Am. Rep. 439; Kimball v. St. Louis, etc., Railroad, 157 Mass. 7, 31 N.E. 697, 34 Am. St. Rep. 250; Wason v. Buzzell, 181 Mass. 338, 63 N.E. 909; Eectric Welding Co. v. Prince, 195 Mass. 242-256, 81 N.E. 306. But the right which is sought to be enforced here is one of general, if not universal, recognition from early times. It is referred to in different cases as a right existing at common law. In order to enforce it, the court is not called upon to investigate the internal affairs of the corporation, or to make any order that affects it in the management of its business, or in the relations of stockholders to one another. By virtue of the laws which permit the corporation to do business in this commonwealth and subject it to the jurisdiction of our courts, any proper jurisdiction may be exercised, which concerns its dealings with third parties here whereby their rights are affected. Rights of third parties, whether they happen to be stockholders or not, if the rights are such as are recognized by our laws, may be enforced by our courts, unless they relate to such internal affairs of the corporation as ought to be regulated only by the courts of the state or country to which it owes its existence. Where all that is desired is an examination of books, and the corporation has a usual place of business in this commonwealth, and the books and their custodian are here, there is every reason of policy and convenience why our courts should enforce a stockholder's right to examine...