Thomas v. Dickson
| Decision Date | 26 May 1982 |
| Docket Number | No. 64038,64038 |
| Citation | 162 Ga.App. 569,291 S.E.2d 747 |
| Parties | THOMAS et al. v. DICKSON. |
| Court | Georgia Court of Appeals |
James E. Massey, Richard B. Herzog, Jr., Atlanta, for appellants.
Daniel M. Coursey, Jr., Atlanta, for appellee.
When E. T. Lloyd, Inc., went out of business, three employees (Dickson, Thomas and Akin) formed a new corporation, Trio Sales Agents, Inc., to continue Lloyd's business as sales representative for manufacturers of electrical products. The three men each paid $1,000 for 1,000 shares of stock in the corporation and each loaned it $9,000 in return for a promissory note that was payable on demand. All three became officers and directors of the corporation. (Akin was president, Dickson vice-president and Thomas secretary-treasurer.) Dickson died on March 18, 1977. His widow and sole heir was appointed executrix of his estate, and his 1,000 shares are now part of the undistributed estate.
When the corporation was formed, the three shareholders agreed that each would receive a salary of $1,000 a month and that they would distribute any profits equally as "bonuses" or "additional compensation" at the end of each quarter of the fiscal year. (Apparently employees of the corporation also received bonuses from the profits, but most of the profits were divided between the shareholders.) The amount of the distribution was agreed upon by Akin, Dickson and Thomas until Dickson's death. After that date, the decision was made by Thomas and Akin until Akin sold his stock to Thomas in 1979. Thereafter, the decision was made solely by Thomas although two employees of the corporation replaced Dickson and Akin as officers and directors. The corporation never declared a dividend and after Dickson's death his estate did not receive any part of the distribution of the profits.
After Dickson's death, Trio paid his salary through April 15, 1977, and later repaid the $9,000 loan. Akin and Thomas also approved a payment of an additional $5,000 to Mrs. Dickson as a "salary continuation" or "death benefit" which was apparently tied to an offer to let them individually purchase her husband's stock for $1,000. She refused to sell the stock for $1,000 because she believed it to be worth much more.
Mrs. Dickson, individually and as executrix of her husband's estate, brought an action against Akin, Thomas and Trio contending: (1) that since her husband's death, Akin and Thomas conspired to keep all profits of the corporation to themselves by raking off all the profits in the form of salary increases and bonuses and refusing to pay any profits to the estate, (2) that the bonuses and salary increases were actually dividends and that she was entitled to one-third of these amounts, (3) that Trio had not paid the $5,000 death benefit to her, (4) that financial information necessary to evaluate the $1,000 offer to purchase her husband's stock was wrongfully withheld from her, that substantial pressure was placed on her to sell the stock, that they reduced the book value of the corporation by paying out bonuses to themselves thereby intentionally misrepresenting the true value of Dickson's interest in an effort to purchase the stock for less than its fair value and sought $100,000 in punitive damages and reasonable attorney fees. Count 5 was a shareholder derivative action brought on behalf of Trio Sales. Akin and Thomas filed a motion to dismiss Counts 1, 2 and 4 contending that Mrs. Dickson could only bring a shareholder derivative suit and could not bring a suit against them individually as officers of the corporation. The trial court denied their motion and this court refused to review that decision on an interlocutory appeal.
The jury verdict found Akin and Thomas equally liable to Mrs. Dickson for the years 1976 through 1979. (Each was ordered to pay $9,333.33 for 1976-77, $11,666.66 for 1977-78, $10,666.66 for 1978-79.) In addition, Thomas was found liable for $5,333.33 for 1979-80 and $333.33 for 1980-81. On Count 4, they awarded her punitive damages of $25,000 plus $16,000 in legal fees from Akin and Thomas jointly. On Count 3 she was awarded $5,000 plus $1,400 interest and...
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Sax v. World Wide Press, Inc., 85-4306
...corporate treasury and therefore under the defendants' control. See Davis, 238 Ga. at 222, 232 S.E.2d at 56; Thomas v. Dickson, 162 Ga.App. 569, 571, 291 S.E.2d 747, 749 (1982), aff'd, 250 Ga. 772, 301 S.E.2d 49 (1983); W. Fletcher, supra p. 6, at Sec. 5911. Although some jurisdictions reco......
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Grizzard v. Petkas, 65471
...enumerations do not contend error in the verdict allowing appellee to recover directly against appellant (but see Thomas v. Dickson, 162 Ga.App. 569, 571, 291 S.E.2d 747 (1982), which allows a shareholder to recover directly where "to allow the corporation to retain the proceeds of the judg......
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Ely & Walker v. DUX-MIXTURE HARDWARE CO., INC., C81-1936A.
...cases, neither of which lends conclusive support to its want of consideration defense. The more recent case, Thomas v. Dickson, 162 Ga.App. 569, 291 S.E.2d 747 (1982), merely restates the well-established rule that "a gratuitous promise made without consideration ... has no binding effect o......