Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/796

 § 788.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. XV. Equal rights of share- holders. to receive in proportion to the amount which he has actually contributed for corporate purposes. 1 § 78S. Aside from considerations arising from the circum- stance that part of the shares are preferred, or that a part are more fully paid up than others, every shareholder is entitled, both in the distribution of profits and on the winding up of the corporation, to participate in proportion to the number of shares held by him. " Prima facie all stockholders at any particular period are equally interested in the property and business of a corpora- tion. They assume the same liabilities, are entitled to the same rights, and are equal owners of the property. When, therefore, the directors undertake to distribute among the stockholders any portion of the funds or property of a corpora- tion, whether it be called profits or not, all stockholders are entitled to an equal share in the fund, proportionate to their stock ; whether they have been stockholders for a longer or shorter period. Unless the charter give to the directors power to discriminate between stockholders at different periods in the distribution of profits, they are all entitled to share therein." 2 Accordingly, at the suit of a minority, a court will restrain the majority from appropriating to themselves the assets of the corporation, or from obtaining advantages not shared in by the minority. 3 Agreements, however, entered into by a group of shareholders who hold a majority of stock, whereby they agree to act together in influencing the corporate tion to the sums paid up on their respective shares, and not in propor- tion to the nominal values of such shares." 2 Lindley on Part., 797. See Somes v. Currie, 1 K. & J. 605; Inre Hodges Distillery Co., Ex parte Maude, L. R. 6 Ch. 51. 1 Hartman v. Insurance Co., 32 Gratt. (Va. ) 242. In proportion to his "in-put," as it is expressed in this case. 2 Jones v. Terre Haute, etc., R. R. Co., 29 Barb. 353, 357, per Ingraham, J.; S. C, affd 57 N. Y. 196. Ace. Jackson's Admr's v. Newark Plank Road Co., 31 N. J. L. 277. 776 3 Menier v. Hooper's Teleg'h Works, L. R. 9 Ch. 350. See §§ 558, 559. Compare Bailey v. Citizens' Gas Light Co., 27 N. J. Eq. 196. Certain parties, fraudulently repre- senting that the entire assets of a corporation belonged to them, pro- cured a decree of a court dissolving the corporation, and acquired pos- session of its assets. They were held as trustees ex maleficio for bona fide shareholders. Bailey's Appeals, 96 Pa. St. 253. When a corporation is be- ing wound up on the expiration of its charter, and its real estate is sold by decree of the court, one party of