Oglesby v. Attrill

• Decision Date: 01 October 1881
• Citation: 105 U.S. 605,26 L.Ed. 1186
• Parties: OGLESBY v. ATTRILL
• Court: U.S. Supreme Court

105 U.S. 605

105 U.S. 605

26 L.Ed. 1186

OGLESBY v. ATTRILL.

October Term, 1881

ERROR to the Circuit Court of the United States for the District of Louisiana.

The petition of the plaintiff alleges that he had become the sole owner of all the capital stock of the Crescent City Gas-Light Company, a corporation created by an act of the legislature of Louisiana, approved April 20, 1870; that the stock was divided into 30,000 shares, of $100 each; that, in March, 1875, he enterd into negotiations with the New Orleans Gas-Light Company, another corporation created under the laws of that State, for an amalgamation of the two companies, pursuant to an act of the legislature of the previous year; that the negotiations resulted in an agreement for amalgamation between the two companies, through their responsible boards of directors; that the agreement was ratified by the requisite number of stockholders on the 9th of April following; that on the ensuing day the agreement was deposited with the secretary of state, as required by law; that, under the agreement, the consolidated company retained the name of the New Orleans Gas-Light Company, and its full-paid stock was divided into 37,500 shares, of $100 each,—of which 12,500 shares were allotted to the plaintiff as owner of all the stock of the Crescent City Gas-Light Company, and the residue, 25,000 shares, were allotted to the owners of the stock of the original New Orleans Gas-Light Company.

The petition further alleges that on the 10th of April, 1875, about the time of the consummation of the agreement of consolidation, the defendants Oglesby and Cassard, the former representing himself as entitled to 3,550 shares, and the latter to 1,150 shares, of the stock of the Crescent City Gas-Light Company, united with one Hernandez in a letter addressed to the president of the New Orleans Gas-Light Company, which was as follows:——

'NEW ORLEANS, April 10th, 1875.

'JAMES JACKSON, President Gas Company.

'By the newspapers we noticed that you are about to make an adjustment of your contest with the Crescent City Gas Company. We, the undersigned, hereby notify you that, at the commencement of the litigation with your company, we were the owners of the shares in the Crescent City Gas Company attached to our undersigned names; that we were defrauded of said stock by the fraud and machinations of the officers of said company; and that we intend to prosecute our claim to the same, and hereby notify you that any compromise or adjustment you may make with the said Crescent City Gas Company will be subject to our rights, to the extent above stated, and that legal proceedings will be instituted to enforce our said rights.

'J. H. OGLESBY, 3,550 shares.

'JULES CASSARD, 1,150 do.

'J. HERNANDEZ, 400 do.'

The petition avers that this letter was written with the malicious intent to embarrass the plaintiff in the exercise of his rights under the agreement to consolidate; that the claim made was groundless; that, on the 7th of April, 1873, the directors of the Crescent City Gas-Light Company had levied an assessment on the stock of the company of one and one-half per cent; and, under it, the defendant Oglesby was bound to pay $6,075, as owner of 4,050 shares, and the defendant Cassard was bound to pay $1,725, as owner of 1,150 shares; that they refused to pay this assessment, and on the 6th of May, 1873, instituted suit in conjunction with other shareholders to enjoin the directors from proceeding to enforce its payment, and set up as grounds therefor 'frauds and machinations of the officers of the said company;' that, on the 14th of that month, the company brought suits against Oglesby and Cassard to enforce payment of the assessment; and that, on the following day, May 15, Cassard transferred his shares to one Phipps, and on the 22d of the month Oglesby transferred to him 3,550 shares of his stock and disposed of the residue to other parties; that these transfers were made in settlement and compromise of the rights of the respective parties, in pursuance of which an indorsement was made on them to the effect that the company assented thereto, although only fifty cents per share had been paid, and released Oglesby and Cassard from all past, present, and future assessments thereon; and that thereupon the respective suits were dismissed, those by the company against Cassard and Oglesby, and the one by them against the company.

The petition further avers that the notification above mentioned has operated to impair the absolute control of the pli ntiff of a large amount of stock in the consolidated company; and that the claim set up by the defendants throws a cloud over the title of a large portion of the shares allotted to him, and, from the nature of the claim, causes a confusion which impairs and depreciates the value of the entire number of his shares to his damage of $200,000. He, therefore, prays that the defendants may be severally cited, and, after due proceedings, be condemned in solido to pay to him that sum, with interest and costs.

The petition was filed in the Fourth District Court of the Parish of Orleans, of Louisiana, but, on application of the defendants, was removed to the Circuit Court of the United States. They then filed an answer, and a petition in reconvention, making what is termed a reconventional demand or counterclaim. The substance of this petition is, that the assessment levied upon the stock of the Crescent City Gas-Light Company was unnecessary; that the directors of the company had made no arrangement to purchase property or to build gas-works, or to lay pipes for gas, and had no serious design of doing so; that the charter...