Page:Federal Reporter, 1st Series, Volume 9.djvu/377

 362 FEDERAL REPORTER. �of the bond, less than |21,000, and no purchaser could be found. Warmoth testiiies that he regarded the long notes of Holbrook for $27,500 as worth searcely more than 25 per cent, of their face. The estimate of witnesses cannot outweigh these facts, and the question before the court is as to the wisdom of the sale with reference to a corporation situated in its internai relations precisely as this was ; that is, rent and paralyzed by serions and unabating animosities and differences on the part of those vho were its directors and sources of chief energy. �Under the circumstances, the sale on the part of the stookholders was justifiable and judicious. It would have been utter ruin to have continued the publication of a paper so situated — ruin for all con- cerned. The language of the supreme court of Massachusetts in Treadwell v. Salisbury Manufg Co. 7 Gray, 405, may with propriety be adopted as decisive of this question. The court say: "Upon the facts found in the case before us, we see no reason to doubt that the vote of the majority of the stockholders for the sale of the corporate property and the closing of the business of the corporation was jus- tified by the condition of their affairs. Without available capital, and without the meana of procuring it, the further proseoution of their business would be unprofitable, if not impracticable." �But, it is urged by the solicitor of the complainant, Holbrook was aoting as and with the responsibilities of a trustee, and when he repurchased the property he held it in trust for the complainant to the extent of his former proportionate interest in the corporation. Holbrook had undertaken to pay the 12-months' bond, and he failed to perform his undertaking. True, he did fail in carrying out that undertaking, and the property of the corporation was applied to pay a debt which, as between it and Holbrook, belonged to him to pay. But it is established that Holbrook's inability to pay the bond, and the inability of the corporation to prosecute profitably its corporate business, resulted largely from the continued refusai on the part of the complainant to acquiesce in the charter, and from discordant views and action in which complainant largely participated. Incon- sequence of this an enterprise, which the testimony shows might have been advantageous both to complainant and Holbrook, was rendered a failure, and Holbrook, wjio had received nothing but the 65 sbares of stock, allowed that to pass, with that of the other holders, to Her- nandez, in payment of a debt which existed prier to his acquisition of the stock. The business of the corporation had become a failure, and the court finds that the defection and withdrawal pf the com- ��� �