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Full-Text Articles in Law
Corporations - Officers And Directors - Acquistion Of Corporate Opportunity After Rejection By Board Of Directors, James M. Tobin
Corporations - Officers And Directors - Acquistion Of Corporate Opportunity After Rejection By Board Of Directors, James M. Tobin
Michigan Law Review
Defendant Odlum, president and director of Airfleets, Inc., was privately offered the opportunity to buy patents for a self-locking nut and the stock of the company which held an exclusive license to manufacture it. The board of directors, when offered the opportunity by Odlum, approved purchase of the stock but rejected the patent rights. Odlum then purchased these rights for himself and a minority stockholder brought a derivative suit for an accounting. Held, a director is absolutely disqualified from purchasing a corporate opportunity for himself, even after the opportunity has been rejected by a disinterested majority of the board …
Corporations-Stockholder's Suit To Compel Declaration Of Dividends- Necessity Of Directors As Parties, Daniel A. Isaacson S.Ed.
Corporations-Stockholder's Suit To Compel Declaration Of Dividends- Necessity Of Directors As Parties, Daniel A. Isaacson S.Ed.
Michigan Law Review
Plaintiff, a citizen of New York and the owner of some preferred stock in the defendant Delaware corporation, brought a class action against the corporation in a federal district court in Pennsylvania to compel the declaration and payment of dividends on the preferred stock, alleging that the directors had acted in had faith in violation of their duties as fiduciaries. Defendant's articles of incorporation provided that the preferred stock was entitled to receive dividends "when and as declared by the Board of Directors"; the by-laws permitted a majority of the hoard to constitute a quorum for purposes of transacting business. …
Corporations-Application Of Statutes Requiring That Corporate Business Be Managed By Board Of Directors, Bernard L. Trott
Corporations-Application Of Statutes Requiring That Corporate Business Be Managed By Board Of Directors, Bernard L. Trott
Michigan Law Review
In 1942, X corporation and its stockholders entered into an agreement whereby it was stipulated that the management of all theatres leased or operated by the X corporation, or any subsidiary thereof, would be placed in the hands of Y corporation, a large stockholder. This power of management was to include supervising and directing the buying and booking of all attractions, designating and changing the entertainment policy, hiring and discharging employees, and carrying out "such policies or projects as the Board of Directors of the Tenant or its subsidiaries may approve." This agreement was to be effective for a period …
Corporations--Section 10b Of The Securities Exchange Act--Rule X-10b-5--Duty Of Disclosure In Purchasing Shares, John E. Grosboll S.Ed.
Corporations--Section 10b Of The Securities Exchange Act--Rule X-10b-5--Duty Of Disclosure In Purchasing Shares, John E. Grosboll S.Ed.
Michigan Law Review
Plaintiffs (father and son) and defendants (two brothers) had owned all the capital stock of two corporations. The four constituted the entire board of directors. Defendants secretly entered into a contract with the National Gypsum Company agreeing to sell the latter the plant and equipment of one of the corporations and one third of the output of the other corporation over a three year period. Later the defendants purchased all of plaintiffs' stock in the two corporations. At that time plaintiffs knew nothing about the negotiations between defendants and National Gypsum, nor did defendants make any disclosures relative thereto. At …
Corporations--Amendment Of By-Laws By Custom, Cornelia Groefsema S.Ed.
Corporations--Amendment Of By-Laws By Custom, Cornelia Groefsema S.Ed.
Michigan Law Review
In an application for a preliminary injunction to prevent stockholders from exercising their rights of ownership until there had been a determination whether such stock should be cancelled because issued without corporate authorization, the success of the petitioner depended upon whether a quorum of the directors was present at the meeting authorizing its issuance. This in turn depended upon whether the by-law requiring a board of directors of ten members had been amended by custom to require only seven. For the four years preceeding the meeting at which the stock was authorized, during which time, however, there were neither directors' …
Corporations-Sale Of All Or Substantially All Of Corporate Assets-Effect Of Modern Statutes, P. F. Westbrook, Jr. S.Ed.
Corporations-Sale Of All Or Substantially All Of Corporate Assets-Effect Of Modern Statutes, P. F. Westbrook, Jr. S.Ed.
Michigan Law Review
Modern general corporation acts commonly provide that a sale of all or substantially all of the assets of a corporation organized thereunder may be authorized by the affirmative vote of a specified proportion of the outstanding shares and made upon such terms as the board of directors shall deem expedient and for the best interests of the corporation. Since this sale provision usually stands apart from the dissolution or winding-up process authorized in the same acts, a legislative intent to govern all voluntary sales, not actually incident to dissolution by the terms of the statute would seem to be clear. …
Corporations-The Executive Committee In Corporate Organization-Scope Of Powers, Dickson M. Saunders
Corporations-The Executive Committee In Corporate Organization-Scope Of Powers, Dickson M. Saunders
Michigan Law Review
From the very beginning of the use of the corporate structure as a device for carrying on the businesses and activities of man, it has been apparent that the nominal brain, the board of directors, could not feasibly run the affairs of the inanimate entity unless certain powers could be delegated to officers and agents. The early case of Hoyt v. Thompson's Executor illustrates the judicial recognition of delegated powers. The charter authorized all business of ordinary nature to be transacted by a board of directors of twenty-three.
Corporations - Voting Rights - Effect Of Sale Of Stock While Books Closed, Louis C. Andrews Jr.
Corporations - Voting Rights - Effect Of Sale Of Stock While Books Closed, Louis C. Andrews Jr.
Michigan Law Review
In a statutory action brought by a stockholder to determine the validity of an election of directors, it appeared that proxy votes of 6,856 shares had been accepted by the inspectors although these proxies were given by former owners who had sold the shares since the giving of the proxies and during the twenty days immediately preceding the election. During that twenty-day period, stock transfers registered with the corporation would have had the effect of disfranchising the stock, but none of the 6,856 shares had been offered for registration. By using these proxy votes the shareholders opposing the management were …
Administrative Law - President's Power To Remove, Rex B. Martin
Administrative Law - President's Power To Remove, Rex B. Martin
Michigan Law Review
Plaintiff had been appointed to the board of directors of the Tennessee Valley Authority by the President with the advice and consent of the Senate. The statute creating this public corporation gives the President power to remove any director who appoints or promotes lower officials on the basis of anything other than merit. Congress is authorized to remove a member of the board by a concurrent resolution of the two houses. Plaintiff was summarily removed by the President and sued to recover his salary for the whole of the prescribed nine-year term of office. Held, that the plaintiff, having …
Corporations - Restraints On Alienation Of Stock Stipulated In The Charter, Michigan Law Review
Corporations - Restraints On Alienation Of Stock Stipulated In The Charter, Michigan Law Review
Michigan Law Review
The charter of the defendant corporation provided that the board of directors had authority to purchase its common stock at any time when the holder thereof was not an employee, or the holder had not received his common stock by conversion of the preferred. In accordance with the authority granted by this provision, the directors of the defendant corporation adopted a resolution to purchase the common stock owned by the plaintiff, who was not an employee and had not received his common stock by conversion of preferred shares. Plaintiff asked that an injunction be issued restraining defendant from proceeding further. …
Corporations - Fiduciary Relation Of Directors - Purchase Of Stock For Company
Corporations - Fiduciary Relation Of Directors - Purchase Of Stock For Company
Michigan Law Review
A company needed a block of stock offered to it in order to acquire certain patent rights. The finances of the company were insufficient to effect the purchase. The board of directors accepted the offer for the company with the understanding that the directors would acquire the stock individually and turn over to the company the needed patent rights. After bankruptcy, the trustee of the company sued to recover profits realized by the directors from a sale of the stock. Held, the inability of the company to purchase the stock itself does not relieve the directors from liability for …