Johnson v. C. Brigham Co.

• Citation: 136 A. 456
• Parties: JOHNSON et al. v. C. BRIGHAM CO.
• Decision Date: 02 March 1927
• Court: Maine Supreme Court

136 A. 456

JOHNSON et al.

v. C. BRIGHAM CO.

Supreme Judicial Court of Maine.

March 2, 1927.

On appeal from Supreme Judicial Court, Somerset County, at Law.

Petition by a minority stockholder, after whose death the cause was revived for his administrator, Charles B. Johnson, and trustees, to value his shares of stock in the C. Brigham Company. From a decree of dismissal, petitioners appeal. Appeal dismissed, and decree affirmed.

Argued before PHILBROOK, DUNN, DEASY, STURGIS, BARNES, and PATTANGALL, JJ.

Harry R. Virgin, of Portland, Edward N. Chase, of Boston, Mass., and Freeman & Freeman, or Portland, for plaintiffs.

Bradley, Linnell & Jones, of Portland, and John F. Cusick, of Boston, Mass., for defendant.

DUNN, J. An appeal from the decree which, by dismissing a petition under the Minority Stockholders Act (R. S. c. 51, § 60 et seq.), on the ground that no case had been made out, denied the valuing of certain shares of capital stock.

Conferring rights, the act provides in effect that, in the instance of a solvent going corporation, the majority stockholders whereof have voted to sell its entire property, otherwise than in the ordinary and usual course of business, any minority stockholder who voted in the negative on the proposition of selling may, after the filing of written dissent, if the corporation does not petition, himself petition for the corporation to pay the value of his shares, as the same shall be judicially determined. Time limitations are of unimportance on the present record.

Notwithstanding that he voted differently, the minority stockholder will be bound by the majority decision, unless he confirm his preference by writing. Section 65.

On petition and hearing, it is for the court to fix a valuation on the minority stock, and give judgment.

When the judgment is satisfied, the stock passes to the corporation, and the stockholder retires. Section 63.

The remedy rests wholly upon the statute, and is enforceable only on making evident that conditions precedent had been observed. First, it must be established that on the proposal to sell he who invokes relief voted in the negative. The minority stockholder, or his proxy, must have done the active, positive thing of recording a vote against selling.

That such vote was not recorded is the crux of this proceeding.

The corporation of C. Brigham Company was not insolvent or in failing condition. Of shares of stock, 3,000 were outstanding. At the meeting on May 1, 1922, no action was taken on whether the business be sold out and the assets...