Owen v. Campbell

• Decision Date: 10 April 1894
• Citation: 58 N.W. 603,100 Mich. 34
• Court: Michigan Supreme Court
• Parties: OWEN v. CAMPBELL et al.

58 N.W. 603

100 Mich. 34

OWEN v. CAMPBELL et al.

Supreme Court of Michigan

April 10, 1894

Appeal from circuit court, Wayne county, in chancery; George Gartner, Judge.

In the matter of John Owen against Mary A. Campbell and others. Petition of Alexander McVittie for discharge as trustee for defendants. Decree for petitioner. Defendants appeal. Affirmed.

Edwin F. Conely and Orla B. Taylor, for appellants.

William H. Wells and George W. Radford, for appellee.

HOOKER J.

One Gordon Campbell died leaving a will, by the terms of which John Owen was appointed trustee to manage the property of the estate until testator's youngest child should reach the age of 21 years. Subsequently, Owen filed a bill in chancery tendering his resignation, and asking that he be discharged. Such order was made, and Alexander McVittie and William Gray were appointed trustees in his place. At this time most of testator's children had attained their majority. The youngest did so on May 11, 1891. The estate was large, amounting to $200,000 or more, and a part of it consisted of 2,400 shares of the stock of the Detroit Dry-Dock Company, a concern in which both Owen and McVittie held stock; the latter being the manager, and the former a director. On January 12, 1887, McVittie and Gray, with the consent of some of the Campbell heirs, sold the 2,400 shares of stock to James McMillan; and on May 11, 1891, the estate was distributed by Gray (McVittie being in California), who took a receipt from the Campbell heirs embodying an inventory of the property on hand, and the following: "We hereby acknowledge the receipt from Alexander McVittie and William J. Gray trustees of the estate of Gordon Campbell, deceased, the securities above described; the trust having terminated upon the majority this day of the youngest child of Gordon Campbell, and the children procuring a release of the trustees by Mary Campbell and Ann Campbell. Detroit, May 11 1891." On June 16, 1891, McVittie filed a petition in the circuit court, in chancery, praying for his discharge. An answer was filed by the Campbells opposing such discharge, alleging fraud by McVittie in the sale of the dry-dock stock, and asking a decree against him for a large sum on account thereof.

The testimony taken shows that the concern had been in existence for quite a long period, and had, in the main, been successful; large dividends having been declared some years while others had passed without any. It had not escaped embarrassment, however; a strike having been inaugurated early in 1886 which was not satisfactorily adjusted until late in the year, and brisk competition having arisen in the building of vessels. As late as October, 1886, some stock changed hands at par, and one stockholder asked McVittie to find him a purchaser for his stock at 30 cents. Another offered him a commission of $1 a share if he would sell his stock at $28 per share. Frank Kirby, the master mechanic, who had long been with the company, was anxious to get out of the concern, and there were indications of unrest and dissatisfaction on the part of others. Again, there was a suspicion that one Darling, who was the largest stockholder, might desire to obtain a controlling interest; and the feeling was shared by most of the members that this would be disastrous, and would depreciate the stock. A proposition was discussed, looking to the sale of a majority of the stock to James McMillan, and a number of the stockholders consented to let their stock go to him at that price, viz. $30 per share. They were as follows: Owen, 2,704 shares; Peck, 1,100 shares; McVittie, 800 shares; Frank Kirby, 1,068 shares; Campbell heirs, 2,400 shares; total, 8,072. The offer was made to Mr. McMillan, who, after the lapse of some weeks, declined it, but subsequently accepted the offer as to the Campbell stock; and it was assigned to him, and paid for. Before he would purchase this, he required an agreement from Kirby and McVittie that they would remain with the company. Subsequently, at his suggestion, McVittie bought the 1,100 shares belonging to Peck at $30 per share, the money to pay for the same being loaned him by the company. An agreement was then made by McMillan, Owen, McVittie, and Kirby, with a view to preventing the concern from getting into unfriendly hands, and business was successfully prosecuted. Large orders for vessels were given to the company by concerns with which Mr. McMillan was connected, through his influence, and the business proved very...