State ex rel. Haeusler v. German Mutual Life Insurance Company of St. Louis
| Decision Date | 31 December 1912 |
| Citation | 152 S.W. 618,169 Mo.App. 354 |
| Parties | STATE ex rel. HERMAN A. HAEUSLER et al., Appellants, v. GERMAN MUTUAL LIFE INSURANCE COMPANY OF ST. LOUIS et al., Respondents |
| Court | Missouri Court of Appeals |
Appeal from St. Louis City Circuit Court.--Hon. Moses N. Sale Judge.
AFFIRMED.
Judgment affirmed.
Wagner & Miller for appellants.
(1) Each stockholder of a corporation is entitled, under the general rule of the common law (which has not been abridged by statute), to inspect its books, papers and records and to make extracts and copies therefrom, including a list of its stockholders' names and addresses; and if such right be wrongfully denied him, it may be enforced by mandamus; the writ being granted, in the sound discretion of the court, to protect his interest as such stockholder, where it is sought in good faith and for a proper purpose. State ex rel. v Railroad, 29 Mo.App. 301; State ex rel. v. Park Assn., 29 Mo.App. 326; State ex rel. v Laughlin, 53 Mo.App. 542; State ex rel. v. Transit Co., 124 Mo.App. 111; State ex rel. v. Lazarus, 127 Mo.App. 401; State ex rel. v. Donnell, 129 Mo.App. 206; Huyler v. Cattle Co., 40 N.J.Eq. 392; State ex rel. v. Oil Works Co., 28 La. Ann. 204; In re Steinway, 159 N.Y.S. 250; Kuhbach v. Cut Glass Co., 220 Pa. St.; (2) This right may be exercised by the stockholder in person, or through his agent or attorney; and with the assistance of an expert accountant and a stenographer if the books and records are voluminous or complicated. State ex rel. v. Park Assn., supra; State ex rel. v. Transit Co., supra; Volksblatt Co. v. Hoffmeister, 62 Ohio St. 189; Clawson v. Clayton, 33 Utah 266; State ex rel. v. Oil Works Co., supra; Ellsworth v. Dorwart, 95 Iowa 108; People ex rel. v. Ferry Co., 33 N.Y.S. 244; 10 Cyc. 958. (3) The relators, as policyholders and members of respondent, a mutual life insurance company, and entitled to vote at its elections of trustees and to share in its profits and assets are, in effect, stockholders of the corporation, with the right of such inspection of and copies from its books and records, within the general rule of the common law as above stated. People ex rel. v. Life Insurance Co., 97 N.Y.S. 465; McClintock v. Republicans, 210 Pa. St. 115, 68 L. R. A. 459; State ex rel. v. Oil Works Co., supra. (4) The relators, as such policyholders and members, demanding the right to such inspection and copies in good faith and for proper purposes, it is no defense to the writ and no justification or excuse for the denial of such relief: (a) That some of relators may be engaged, as competitors of the company, in certain lines of its business. State ex rel. v. Laughlin, supra; State ex rel. v. Lazarus, supra; Cobb v. Lagarde, 129 Ala. 588; Kubach v. Cut Glass Co., supra; Hodder v. Hogg Co., 72 A. 553. (b) Or that some or all of the relators may be on unfriendly relations with the trustees or officers of the company. State ex rel. v. Lazarus, supra; Cobb v. Lagarde, supra. (c) Or that the books and records sought to be inspected may contain matter of a confidential nature, between the company and its policyholders or others. State ex rel. v. Laughlin, supra. (d) Or that relators could have inspected the company's general balance statement book, or its annual reports to the State Insurance Department, or the report (in 1908) of an examining actuary to said department; or that they could have sent out communications to the policyholders, under the supervision or censorship of the company's attorney; or that an appointment or election to fill a vacancy upon the board of trustees may have been tendered one or more of them; or that their former request for the list of names and addresses, not the basis of this suit, was not pressed at that time. State ex rel. v. Railroad, supra, People ex rel. v. Goldstein, 56 N.Y.S. 306; Huyler v. Cattle Co., supra. (5) The demurrer for misjoinder of parties relator and causes of action (the second count of the return, is without merit. (a) Two or more relators may be properly joined in mandamus; and the interests of the present relators in the subject-matter of this proceeding are not of such separate character as to prevent their joinder herein. State ex rel. v. Fraker, 166 Mo. 130, 142; Merrill v. Suffa, 42 Colo. 195. (b) The demurrer was waived by pleading to the merits in the same return. State ex rel. v. Moss, 35 Mo.App. 441; Long v. Towl, 41 Mo. 398; Donahue v. Bragg, 49 Mo.App. 273; Taber v. Wilson, 34 Mo.App. 89.
Schnurmacher & Rassieur for respondents.
(1) The right of a stockholder to examine the books of a domestic stock corporation is an absolute right conferred on the stockholder by statute. But the right of a member of a mutual insurance company, having no capital stock, to examine its books, is not a right created by statute. Such a member has only such rights as are possessed by members or stock-holders of corporations at common law. It is not an absolute right, and the request must be addressed to the sound discretion of the court. People ex rel. v. Life Ins. Co., 111 A.D. 183; State ex rel. v. Lazarus, 127 Mo.App. 401. (2) The rights of the several relators being separate and not joint, a joint action cannot be maintained by them. State ex rel. v. Fraker, 166 Mo. 130; Goodwin v. Sherer, 145 Ala. 501; State v. Simmons, 50 A. 213; Wright v. Comrs., 6 Mont. 29; High. Extra. Leg. Rem., secs. 434, 439. This defense was not waived by pleading it in the return along with other defenses. State ex rel. v. Railroad, 114 Mo. 289. Even in ordinary civil actions a plea in abatement is not waived by pleading to the merits in the same answer. Trust Co. v. Railroad, 195 Mo. 682. (3) The evidence on the issues of fact arising in the case is conflicting, and therefore the appellate court, in this action at law, is bound by the findings of the trial court.
--This is a proceeding in mandamus. The application was made to the circuit court, which issued an alternative writ, but on hearing the evidence, declined to make it peremptory. From this judgment relators prosecute the appeal.
Respondent German Mutual Life Insurance Company of St. Louis is a corporation organized under the provisions of a special act of the Legislature of Missouri, approved November 23, 1857. .] This act of the Legislature authorized the organization of the company as a mutual life insurance company and the statute referred to constitutes its charter. Respondent Edwin J. Meyer is secretary of the insurance company and one of its trustees. The several relators are policyholders in the company.
By virtue of the provisions of the charter, the board of trustees consists of sixteen members who are policyholders in the company. These trustees hold their term for four years each and eight of their number are to be elected every two years. By section 9 of the act of incorporation, it is provided that all persons who shall thereafter insure with the corporation shall be members thereof and entitled to vote at all elections of trustees so long as they shall respectively remain insured therein. Each person holding a policy in force at the time of election is entitled to one vote at elections of trustees in person or by written proxy. The board of trustees are authorized to select from their number the officers of the corporation, and such officers and board are given power and authority to direct the affairs of the company. Other provisions of the charter require that the funds of the corporation shall be invested in real estate loans, bonds, mortgages, etc. By section 20 of the charter, it is provided that the officers of the company shall, every five years, cause a balance to be struck and credit each member with an equitable share of the profits of the business.
It appears that relators, for various reasons, became dissatisfied with the management of the company and organized themselves into a voluntary association which they denominated as the Policy Holders' Protective Association, with a view of placing some of their members on the board of trustees of the company and of investigating into its affairs. Several demands were made upon the respondent company and its secretary to permit relators to investigate the books and records of the company, to copy therefrom a list of all its policyholders, together with the post-office address of each, and a list of all of the loans which the company had then outstanding on real estate and other investments. Upon these requests being denied, relators sued out the alternative writ of mandamus, and made numerous charges against the management of the company. In due time, a proper return was made to the alternative writ, and a hearing had in the circuit court. The record is voluminous and discloses that many witnesses were examined touching the matter. At the conclusion of the hearing the circuit court declined a peremptory writ of mandamus, and from this judgment relators prosecute the appeal.
It is conceded here that relators are without the aid of a statute declaring an absolute right in them as policyholders and members of the corporation to investigate its affairs or make copies from its books. They, therefore, rely exclusively upon the common law right of a stockholder in respect of such matters. No one can doubt that a stockholder of a corporation has the right at common law to inspect and examine the books and records of his corporation at a proper time and place and for a proper purpose. However, while the statute frequently gives an absolute right in such cases, the right of inspection at common law is not such, but can only be exercised for a definite and proper purpose, and its enforcement...
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