Simms v. Garrett
| Decision Date | 03 August 1933 |
| Docket Number | 7681. |
| Parties | SIMMS et al. v. GARRETT et al. |
| Court | West Virginia Supreme Court |
Submitted July 26, 1933.
Rehearing Denied Sept. 5, 1933.
Syllabus by the Court.
Determination of right to possession and control of books, records, and funds of foreign corporation, all situated in state, between residents of state, held within jurisdiction of Supreme Judicial Court in mandamus proceeding.
Local court will refrain from exercising jurisdiction over proceeding involving right to possession and control of books, records, and funds of foreign corporation situated in state when court of corporation's domicile is clearly indicated as proper tribunal for determination of controversy.
1. Where residents of West Virginia contend among themselves for the possession and control of the books, records, and funds of a foreign corporation, all situated in this state jurisdiction exists in this court to determine s uch controversy in a proceeding in mandamus.
2. Notwithstanding the existence of such jurisdiction, this court will refrain from exercising it when the court of the corporation's domicile is clearly indicated as the proper tribunal for determination of the controversy.
Original proceeding in mandamus by J. A. Simms and others against P H. Garrett and others.
Petition dismissed, and writ of mandamus denied.
Blue Dayton & Campbell, of Charleston, and Dillon, Mahan & White and W. G. Thompson, all of Fayetteville, for respondents.
The relators herein show by their petition that they are the duly elected and qualified officers and directors of Lambie Oil Company, a corporation created under the laws of the state of Wyoming; that the respondents formerly were such officers and directors, and that respondents wrongfully withhold from the relators the possession and control of the books, records and funds of the corporation; that a majority of the stock of the corporation is owned by citizens of West Virginia, and that all the respondents are domiciled here, and all of the books, records, and funds of the corporation are situated in West Virginia. Upon this showing, a rule in mandamus was awarded. The return and answer denies on behalf of respondents that the relators are in fact the duly elected officers and directors of the corporation. It sets up the fact that the Lambie Oil Company is a foreign corporation not admitted to do business in the state of West Virginia. In addition to raising the issue as to the title to offices of directors, president, vice president and secretary-treasurer, by the return and answer, the respondents, by demurrer and by plea in abatement, question the jurisdiction of this court to decide that issue, and to that extent regulate the internal affairs of a foreign corporation. The respondents, in their return and answer, aver that the relators' claim to be entitled to the offices of directors, president, vice president and secretary-treasurer of the company by virtue of a pretended election held in the state of Wyoming on the 5th day of June, 1933, and assign reasons which they contend show the invalidity of such election. They aver that, because of such invalidity, they, who were theretofore regularly elected directors and officers of the Lambie Oil Company, hold their offices under the by-laws until their successors are regularly elected and qualified, and that, because there have been no regularly elected and qualified successors to them, they are lawfully entitled to the possession and control of the books, records, and funds of the corporation. Thus the regularity of the election of the relators as claimed in the petition is brought directly in issue and is the single question for decision, provided that the jurisdictional question is decided in favor of the petitioners' position.
There were 595 shares of the common stock of Lambie Oil Company issued and outstanding at the time of the election under which relators claim. All of this stock was entitled to vote at that election. Three hundred twenty-three and one-half shares of the total outstanding capital stock had on the 27th day of October, 1931, been placed in a voting trust by the owners thereof by an agreement entered into in the state of West Virginia. The trustees were C. B. Early, R. M. Lambie, and J. A. Simms. The agreement places the voting control of this stock in the majority of the trustees, and provides further that the trustees or any one or more of them shall have the right to present for decision any question concerning the control of the stock to the cestuis que trust under the agreement. The operation and effect under the laws of the state of Wyoming of this voting trust agreement will, in view of the circumstances hereinafter set out, determine the validity of the election held in the state of Wyoming on the 5th day of June, 1933.
On the 25th day of May, 1933, upon a bill exhibited against him and others in the circuit court of Kanawha county by substantially the same persons who are relators here, C. B. Early was temporarily enjoined and inhibited from acting as trustee in the voting trust agreement in carrying out the provisions thereof, and particularly in participating in the election of directors at the meeting of June 5, 1933. This left R. M. Lambie and J. A. Simms in control of the stock under the voting trust agreement. Lambie attended the meeting in Wyoming in his capacity as president of the company. Simms also attended. When the meeting convened, Lambie protested its validity, and caused the minutes to show that he and Simms were in disagreement as to how the stock under the voting trust agreement should be voted, that it was...
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