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[Herring et al. v. Ricketts et al.]

probate, and that the same should be granted, if it appear that the applicant was entitled to notice, and none was given." Roy v. Segrist, 19 Ala. 810; Bradley v. Andress, 27 Ala. 596; Lovett v. Chisolm, 30 Ala. 88; Hall's Heirs v. Hall, 47 Ala. 290, 295; Dickey v. Vann, 81 Ala. 425, 8 So. Rep. 19).

This application does not proceed on the theory that the probate of the will was void, but that it was irregular, erroneous and voidable; and being a direct and not a collateral attack, the concession that the probate court is one of general jurisdiction in respect of the probate of wills, and that the usual presumptions of regularity and validity incident to the judgments of such courts are to be indulged in support of the order of probate here made, will not avail the appellee. It is no more competent to support the probate of this will by such presumptions on this proceeding, than it would be on appeal. The argument in this connection would be forceful if this were a collateral attack. Being direct, however, these considerations are of no importance.

Of course, when the probate of a will is set aside and vacated on the application of one who, being entitled to, had not notice of the proceeding to that end, the paper may again be propounded for probate, and probated; but the existence of this right affords no ground to deny the application for the vacation of the irregular probate. The two proceedings are entirely distinct; and, indeed, a second probate can not be had until the first, and merely avoidable one, has been vacated. When this has been done, the proceeding for probate is de novo, and must conform, of course, to statutory requirements, in all respects as if the original irregular probate had not been decreed.

Without going into the question as to the formality and regularity or sufficiency of the record in respect of the guardian ad litem, aside from the infirmity of his appointment resulting from a want of service upon infants, it is clear, we think, that the probate court erred in denying the application to vacate the probate, and its judgment must be reversed. The cause will be remanded. Reversed and remanded.

[Elliott v. Sibley, et al.]

101 344 143 543

Elliott v Sibley, et al.

Bill by Stockholder to enjoin a Corporation from the Sale of Stock, and to remove Directors from Office.

1 Bill to enjoin sale of stock; corporation necessary party. Where a bill is filed by a stockholder to enjoin the sale by a corporation of his stock to settle an indebtedness due to the corporation, upon the ground that the debt is not due, or has been paid, or that the corporation is indebted to the shareholder in an amount exceeding that claimed to be due the corporation, and which prays for a settlement of account, the corporation itself is an indispensable party.

2. Same; complainant must offer to do equity. In a bill, filed by a stockholder to enjoin the sale of his stock by a corporation, on the ground that the corporation is indebted to him in an amount exceeding his indebtedness, and which also prays for a settlement of account, the complainant must offer to do equity by averring in his bill a readiness and willingness to pay whatever amount may be ascertained to be due from him to the corporation.

3. Enforcement by a corporation of a lien under section 1674; no action by directors necessary. In order that a corporation may enforce the lien given it by statute, (Code, § 1674), against a stockholder to collect a past due indebtedness from him, there is, prima facie, no action necessary on the part of the directors; and the averment in the bill filed by a stockholder to enjoin the sale of his stock to collect a debt fixed by contract, that the directors of the corporation have taken no action to authorize the threatened sale, can not give the bill equity.

4. Regularity of election of officers of a corporation; inquiry by court of equity. A court of equity will inquire into the regularity of the election of the directors of a corporation only when the question arises incidentally or collaterally in a suit of which the court otherwise has jurisdiction, and the granting of the relief prayed for depends upon its decision.

5. Bill to remove directors of a corporation from office; want of equity. When, in a bill filed by a stockholder to enjoin the sale by the corporation of his stock, and which also prays for the removal from office of certain persons claiming to be directors of said corporation, there are no averments which show that complainant's defense to the claim of the corporation is in any way affected by acts of the alleged illegal directors of the corporation, the bill, while perhaps not multifarious, is wanting in equity, so far as it seeks to have the said directors removed from office.

6. Dissolution of injunction. When an answer to a bill seeking an injunction specifically denies the principal allegations of the bill, upon [Elliott v. Sibley et al.]

which rests the right of the relief asked, the temporary injunction is properly dissolved.

7. Bill to enjoin sale of stock; necessary averments. In a bill by a stockholder to enjoin the sale by the corporation of his stock, in payment of his debt to said corporation, on the ground that he has a claim against the corporation in excess of his alleged indebtedness, the complaint must aver some fact other than the existence of his demand, which is a proper subject of set-off in order to give his bill equity-such as the insolvency of the corporation, or any other fact respecting his alleged claim, which would justify the interposition of a court of equity.

APPEAL from the Chancery Court of Cherokee.
Heard before the Hon.S.K. McSPADDEN.

The bill in this case was filed by the appellant, J. М. Elliott, on November 21, 1891, against William C. Sibley as president of the Round Mountain Coal and Iron Company, J. W. Davis, J. M. Clark and Charles H. Phinize ; and prayed to have the defendant Sibiey, as president of the said corporation, enjoined from selling certain shares of stock alleged to have been owned by the complainant, and to have the other defendants removed from their respective offices, as directors of the Round Mountain Coal & Iron Co. The ground upon which the injunction was asked, as stated in the bill, was that the said corporation was indebted to the complainant in an amount in excess of the debt due from the complainant to said corporation ; and that the claims of complainant for the alleged amount were based upon a resolution adopted at a meeting of the directors of said corporation, among whom were the defendants sought to be removed from the directory. The bill also averred that the defendants J.W. Davis, J. M. Clark and Charles Phinize were not of the legal board of directors of said corporation, never having been legally elected. The Round Mountain Coal & Iron Company was not made a party to the bill.

In their answer the defendants denied the fact of any indebtedness from the corporation to the complainant, and also denied every material allegation of the bill, upon which the complainant seeks relief. The other necessary facts are sufficiently stated in the opinion. The defendants moved to dissolve the injunction on the denials of the answer, and to dismiss the bill for the want of equity, and also demurred to the bill, among others, upon the following grounds: 3. The Round

[Elliott v. Sibley et al.]

Mountain Coal & Iron Company is a necessary party to the suit. 4, 12 and 13. Said bill does not aver a readiness and willingness on the part of complainant to pay what may be due to said corporation. 7. No authority or order by the board of directors is necessary for the sale of stock of a corporation in payment of the debt of one of its stockholders. 8. The claim of the complainant for improvements upon the property of the Round Mountain Coal & Iron Company is not a proper charge against the present respondents. 9. The bill presents matters which are not proper subjects for adjustment and cognizance by a court of equity. 15 and 18. The bill is multifarious in that it seeks to enjoin the sale of stock, and at the same time remove from office members of the board of directors alleged to have been improperly elected. 17. There is a misjoinder of parties, in that William C. Sibley, the rightful president, is joined with those alleged to be illegal directors.

On the submission of the cause upon the motions and the demurrer, the chancellor sustained the grounds of demurrer stated above, and granted the motion to dissolve the injunction upon the denials of the answer, and overruled the motion to dismiss the bill for the want of equity. The complainant brings the present bill, and assigns as error this decree of the chancellor.

CARDEN & DANIEL and BILBRO & DORTCH, for appellants, cited Moses v. Tompkins, 84 Ala. 613, 4 So. Rep. 763; Perry v. Tuscaloosa Cotton Seed Oil Mill Co., 93 Ala. 364, 9 So. Rep. 217; Bliss v. Anderson, 31 Ala. 612.

J. L. BURNETT, contra, cited Cook on Stock & Stockholders, §§ 115, 134, 600, 746, n. 3; Moses v. Tompkins, 84 Ala. 613, 4. So. Rep. 763; Tutwiler v. Tuscaloosa Coal, Iron & Land Co., 89 Ala. 391,7. So. Rep. 398; M. & C. R. R. Co. v. Grayson, 88 Ala. 572, 7 So. Rep. 122; Nelson v. Hubbard, 96 Ala. 238, 11 So. Rep. 428; 23 N. J. Eq. 216; 20 N. J. Eq. 122.

COLEMAN, J.-The object of the present bill was to enjoin Sibley, the president of the Round Mountain Coal & Iron Co., a corporation, from selling certain shares of stock, belonging to complainant Elliott, and also to have removed from office certain persons claiming to be direc

[Elliott v. Sibley et al.]

The bill avers that Sibley advanced to complainant five hundred dollars in money, for which complainant executed his note, to be expended by complainant in the adjustment of a law-suit, in which the corporation was interested, and fifty shares of stock were placed in the hands of Sibley as collateral for the advance of the money; that the five hundred dollars were expended according to agreement, and afterwards Sibley transferred the note and shares to the corporation. The bill also avers that the corporation claimed an indebtedness from complainant on a rental contract of over three thousand dollars, and to pay this alleged indebtedness, Sibley the president, was proceeding to sell complainant's shares of stock; but that, in fact, on a settlement of accounts, there would be a balance due complainant, over and above the rental indebtedness, of more than four thousand dollars. A temporary injunction issued upon the filing of the bill. Respondents moved to dismiss the bill for want of equity, demurred to the bill, assigning various grounds of demurrer, and, upon the denials of the answer, moved to dissolve the injunction. At the hearing, the motion to dismiss the bill for want of equity was denied. Several grounds of demurrrer were held to be good, and the injunction was dissolved. From the rulings of the court, dissolving the injunction, and sustaining certain grounds of demurrer the complainant appealed.

It requires neither argument nor citation to show that where a bill is filed to enjoin the sale of stock of a shareholder to satisfy an indebtedness due the corporation, upon the grounds that the debt is not due, or has been paid, or that the corporation is indebted to the shareholder in an amount exceeding that claimed to be due the corporation, and which prays for a statement of account, the corporation itself is an indispensable party. It is also elementary, that in such a bill, mutual indebtedness existing, the complainants should offer to do equity, should aver a readiness to pay whatever may be found due from him, upon the statement of the account. It may be that to authorize a suit for an unpaid subscription for stock there should be some action on the part of the directors, as was declared in Moses v. Tompkins, 84 Ala. 613, 4 So. Rep. 763; though this would depend somewhat upon the character of the subscription and the charter or by-laws of the corporation.-Chapters VII,

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