State ex rel. Mandelker v. Mandelker

• Decision Date: 08 January 1929
• Citation: 222 N.W. 786,197 Wis. 518
• Parties: STATE EX REL. MANDELKER v. MANDELKER.
• Court: Wisconsin Supreme Court

197 Wis. 518

222 N.W. 786

STATE EX REL. MANDELKER

v.MANDELKER.

Supreme Court of Wisconsin.

Jan. 8, 1929.

Appeal from an Order of the Circuit Court of Milwaukee county; August E. Braun, Judge.

Action by the State, on the relation of Martin Mandelker, against Harry J. Mandelker. From an order sustaining relator's demurrer to the return, respondent appeals. Affirmed.--[By Editorial Staff.]

Petition filed December 17, 1927; order sustaining relator's demurrer to the return of the respondent entered January 12, 1928. Right of a stockholder to inspect corporate records. The petition alleges that the relator is the owner of 112 1/2 shares of the capital stock of J. Mandelker & Son, a Wisconsin corporation, that Harry J. Mandelker is the owner of 611 1/2 shares, Adolph I. Mandelker, the owner of 112 1/2 shares, and Helen A. Mandelker, the wife of Harry J. Mandelker, the owner of 1 share. The corporation is engaged in the retail furniture business in the city of Milwaukee and keeps the corporate records and books of account ordinarily kept by such corporation.

The petition further alleges: “That in order to protect the rights and interests of the relator as a stockholder of said corporation, it is necessary for him to have an inspection and examination of the books of said corporation containing the stock subscriptions and accounts, including all of the corporate records of said corporation, its inventories, profit and loss statements, financial statements and bank books; that relator is not an accountant or bookkeeper nor capable personally of inspecting, examining or checking said records or books and papers, and that it is necessary for the protection of his rights and interest as such stockholder that such inspection and examination be made by a competent accountant; and that relator desires, and at all of the times herein mentioned has desired, to have such inspection and examination made by a competent and disinterested accountant and that he now desires to have such inspection and examination made by one Sydney W. Warner, a competent and disinterested public accountant who resides in said city of Milwaukee and is associated with the firm of Ernst & Ernst, accountants and auditors, with offices in the First Wisconsin National Bank Building in said city of Milwaukee.” That for that purpose he presented himself and the accountant at the office of the company on the 10th day of November, 1927; that Harry J. Mandelker, the president, treasurer, and general manager of the corporation, refused to permit the said Sydney W. Warner to make any inspection or examination of the books of account by any one other than himself.

There are further proper allegations but not necessary to be set out to disclose the questions raised here.

Upon the petition and affidavits an alternative writ was issued, in return to which the respondent set up the following matters: Admitted the corporate capacity of J. Mandelker & Son; the ownership of the shares of capital stock; that the corporation kept the corporate records and account books; that a demand for examination of the corporate records and account books had been made by the relator accompanied by Sydney W. Warner. Alleged that the relator may at any and all proper times make a personal examination of the corporate records and books of account. And he further alleges that the relator is 26 years of age; that he is credit man and office manager for the Bloch-Daneman Company, which company is also engaged in the retail furniture business in the city of Milwaukee, which is of the same general character as the business carried on by the J. Mandelker & Son corporation; that Bloch-Daneman Company does about twice as much business as the respondent corporation; and further alleged: “That as such manager of said Bloch-Daneman Company the relator has general charge and responsibility of keeping proper books and records for said corporation; that he is thoroughly familiar with books of account and accounting methods showing transactions of the retail furniture business, as that business is conducted by Bloch-Daneman Company and by respondent corporation. That the relator is fully competent and capable to personally conduct such examination and inspection of the books and records of respondent corporation as he may desire to make, and that it is wholly unnecessary for the protection of his rights as a stockholder for such examination and inspection to be made by an accountant for and on behalf of said relator.” And he further alleged that relator has declined to make a personal inspection and examination of the records of the corporation and books of account.

The relator demurred to the return and, from an order sustaining relator's demurrer to the return, the defendant appeals.

Edgar L. Wood, of Milwaukee, for appellant.

Churchill, Bennett & Churchill, of Milwaukee, for respondent.

ROSENBERRY, J.

The relator claims the right to examine the corporate records and books of account under the provisions of section 182.10 Wis. Stats.,...