Birmingham News v. State Ex Rel. Dunston

93 So. 25, 207 Ala. 440, 1921 Ala. LEXIS 439

• Court: Supreme Court of Alabama
• Decided: December 22, 1921
• Docket: 6 Div. 568.
• Status: Published

Opinions

ANDERSON, C. J.

[1, 2] Section 3477 provides that:

“The stockholders * * * have the right of access to, and of inspection and examination of, the books, records, and papers of the corporation, at reasonable and proper times.”

This section has been several times considered by this court, and as we understand the rule laid down in the case of Foster v. White, 86 Ala. 467, 6 South. 88, said case being cited and approved in Nettles v. McConnell, 151 Ala. 538, 43 South. 838, Winter v. Baldwin, 89 Ala. 484, 7 South. 734, and Cobb v. Lagarde, 129 Ala. 488, 30 South. 326.

The stockholder has the right to examine the books at any and all reasonable times; that this is a general, continuous right, to be exercised as often as he may wist, provided that he makes the request at a reasonable time. When he shows that such a demand was made and refused, he is entitled to a mandamus, on the averments that he is a stockholder of the corporation, that he has demanded the right of inspection, that the time was reasonable and proper, and that the right was denied him. These averments being made, if there be any reason why the right should be denied him, this is matter of defense.

“The only express limitation is that the right shall be exercised at reasonable and proper times; the implied limitation is that it shall not be exercised from idle curiosity, or for improper or unlawful purposes.”

[3] It would therefore seem that each separate demand and refusal constitutes a distinct cause of action, and that the adjudication of one does not necessarily bar the other, and a judgment upon one demand and refusal is not res judicata as to another demand and refusal. Of course, the frequency of demands would no doubt be evidential facts as to the reasonableness of the last demand, and whether or not it was made for improper or unlawful purposes, especially when previous demands had been complied with; but the previous suits, set up in the respondents’ answer in the case at bar as res judicata, do not disclose the same cause of action as the one now under consideration. Indeed, this case seems to he based upon a demand and refusal of August 12, 1921, a date subsequent to the institution and final disposition of the previous proceedings.

- [4] The stockholder has the right to exercise this power ihrough an agent or attorney, but the respondent has the right to demand evidence of the agent’s authority, apart from his mere statement. It is insisted by this appellant, not that the attorney did not have authority to examine and inspect the books, but that his demand to inspect the papers and records also exceeded his authority. It is sufficient to say that, had the refusal been rested on this point, it may have been justifiable, at least as to the papers; hut it was not based on this ground, and the authority of the attorney was neither demanded nor questioned at or before the refusal, and said refusal cannot now be justified upon the theory that the agent included in his demand the right to inspect the papers, .when his authority only gave him the right to inspect the books. Foster v. White, supra, Brewer v. Watson, 71 Ala. 299, 46 Am. Rep. 318. Nor Is the order of judgment of the court broader than the demand and petition.

[5] Section 4864 of the Code of 1907, requires that all applications for mandamus • shall be commenced by a petition “verified by affidavit,” and we think that the affidavit can be made by an agent or attorney who is conversant with the facts. Prim v. Davis, 2 Ala. 24, McCoy v. Harrell, 40 Ala. 235. Rule 15 of the chancery court does not apply to this case, which is a proceeding at law, and not in equity.

The judgment of the circuit court is affirmed.

Affirmed.

SAYRE, GARDNER, and MILLER, JJ., concur.