Hallenborg v. Cobre Grande Copper Co.

• Decision Date: 12 January 1904
• Docket Number: Civil 822
• Citation: 8 Ariz. 329,74 P. 1052
• Parties: AXEL W. HALLENBORG et al., Plaintiffs and Appellants, v. COBRE GRANDE COPPER COMPANY et al., Defendants and Appellees
• Court: Arizona Supreme Court

74 P. 1052

8 Ariz. 329

AXEL W. HALLENBORG et al., Plaintiffs and Appellants, v. COBRE GRANDE COPPER COMPANY et al., Defendants and Appellees

Civil No. 822

Supreme Court of Arizona

January 12, 1904

APPEAL from a judgment of the District Court of the Fourth Judicial District in and for the County of Yavapai. R. E. Sloan Judge. Affirmed.

Affirmed. 200 U.S. 239, 50 L.Ed. 458.

The facts are stated in the opinion.

John J Hawkins, J. F. Wilson, A. B. Cruikshank, and Henry G Atwater, for Appellants.

Barnes & Martin, L. H. Chalmers, Herndon & Norris, Ben Goodrich, and Eugene S. Ives, for Appellees.

OPINION

KENT, C.J.

-- The amended complaint in this action contains in substance the following allegations: That the plaintiffs are stockholders in the Cobre Grande Copper Company, an Arizona corporation one of the defendants herein, and that the plaintiff Hallenborg is a creditor of said company. That since January 1, 1900, the said Cobre Grande Copper Company has been engaged in a series of litigation with the defendants William C. Greene, George Mitchell, and their associates confederates, and agents; that said litigation, among other things, involved the title and right of possession to certain mining property situate in the state of Sonora, republic of Mexico. That the Cobre Grande Copper Company claims to be the rightful owner and entitled to the possession of said property, and that the defendant Greene wrongfully and fraudulently had dispossessed said company, and is now in the wrongful and fraudulent control of the same. That suits are pending in the courts of Mexico, brought by the Cobre Grande Copper Company, to recover possession of said property. That actions in replevin, instituted by the company, are pending in New York and in Texas. That there was pending, at the time of the commencement of this suit, an action in the district court of the third judicial district of the territory of Arizona, in and for the county of Maricopa, against the defendant Greene, the defendant Mitchell, and the defendant Phoenix National Bank to prevent the delivery by said bank to said Greene of certain deeds to said mining property held by said bank in escrow, and to have the right of the Cobre Grande Copper Company in and to a certain contract of sale and purchase of said property determined and adjudged; and that said action was brought in aid of the efforts of the said Cobre Grande Copper Company to recover said property, and to have the right of the Cobre Grande Copper Company, after the restoration of the possession of said mines, to make a payment of thirty-seven thousand five hundred dollars due under said agreement for the purchase declared to be an existing right, and that said contract of purchase be declared to be in full force and effect, and for an accounting by Greene. That on December 12, 1900, for the purpose of controlling the suits brought by the Cobre Grande Copper Company as aforesaid, said Greene and the Greene Consolidated Copper Company entered into fraudulent and corrupt contract and conspiracy with the defendant E. B. Gage and other directors of the Cobre Grande Copper Company, wherein it was agreed between the said Greene and the said Greene Consolidated Copper Company on the one side and the defendant E. B. Gage and the Cobre Grande Copper Company, by said E. B. Gage, president, on the other side, substantially as follows: That the said Greene and the Greene Consolidated Copper Company agreed to buy from the defendant Gage 115,049 shares of stock of the Cobre Grande Copper Company, held by him as trustee for certain stockholders of said company, at the price of $2.50 per share; and that upon the purchase of said stock being made the defendants Adamson, Costello, Wood, and O'Keefe, as a part of said transaction, would resign as directors of said Cobre Grande Copper Company; and that said Greene and the Greene Consolidated Copper Company should thereupon be allowed to elect and appoint the officers and directors of the Cobre Grande Copper Company in their own interests; and that, further, the suits, actions, and proceedings brought by the Cobre Grande Copper Company for the protection of its rights against the said Greene, Mitchell, and the Greene Consolidated Copper Company should be dismissed. That as a further consideration of said agreement it was agreed that said Gage should receive for himself five thousand shares of the stock of the Greene Consolidated Copper Company, alleged to be at the time of the market value of ten dollars per share; and, further, that the defendant Costello, a director of said Cobre Grande Copper Company, should have large personal benefits to himself, -- to wit, that his note for twenty-three thousand dollars to the Cobre Grande Copper Company should be surrendered to him. That the other directors, Adamson, Wood, and O'Keefe, by a secret compact and arrangement between them and the said Greene and the said Greene Consolidated Copper Company, were to receive additional gains and advantages, either by way of stock in the Greene Consolidated Copper Company, or in some other way. That said agreement, and the whole thereof, was and is illegal and fraudulent as to the plaintiffs, and as to all other persons, creditors, and stockholders similarly situated; and that the object and effect thereof is to transfer to the enemies of the Cobre Grande Copper Company the management and control of the corporation with the intent and design that such management and control should be used to prevent the said Cobre Grande Copper Company from enforcing its rights as against said Greene and said Greene Consolidated Copper Company to obtain possession of said property and to complete its contract for the purchase thereof. That the Cobre Grande Copper Company is possessed of no property or...