English v. Rosenkrantz

105 S.E. 729, 26 Ga. App. 234, 1921 Ga. App. LEXIS 84
Court of Appeals of Georgia·Decided January 28, 1921·No. 10528·Published·Cited by 1 cases

Opinions

Bloodworth, J.

Mrs. Rebie Rosenkrantz on April 16, 1918, filed a suit for damages against James W. English, Harry L. English, individually and as administrator of James W. English Jr., John K. Ottley, and others, for an alleged breach of contract. Her petition contains substantially the following allegations: In the year 1885 her father, W. B. Lowe Sr., with others, organized the Chattahoochee Brick Company, a corporation engaged in general contract work and the manufacture and sale of brick. Its capital stock was 2000 shares, $200,000. At the time of his death in 1900 the stock was held as follows: The Lowe estate 807 shares; James W. English Sr. 813 shares; A. B." Steele 380 shares. Her father’s estate was controlled by the three executors of his will, namely his widow, Rebecca D. Lowe, his son, W. B. Lowe Jr., and the petitioner. The petitioner had intermarried with James W. English Jr., a son of James W. English Sr., in 1896. She and her co-workers differed as to the voting of the stock. The other two were opposed to the management of the company by the Englishes and were unwilling to re-elect James W. English Sr. as its president. She offered to vote one third of the said estate stock for him, but was advised that she could not, and that the other executors, being a majority, could vote the stock. The estate stock with Steele’s stock was a clear majority. Steele encouraged Mrs. Lowe to stand for the office of president, and she was favorably considering it. In this connection the petitioner’s former husband, James W. English Jr., had an interview with Steele and made a contract, in the name of James W. English Sr., to purchase the Steele stock. On information the petitioner [236]*236states that the agreement between James W. English Sr. and James W. English Jr. was that the purchase should be in the senior’s name, but that she should receive one third of the said 380 shares, James W. English Jr. one third, and James W. English Sr. one third. Her attitude had estranged her from her own family, and her relations with her husband’s family were then close and friendly. After the purchase James W. English Sr. refused to recognize the agreement mentioned above and insisted on having for himself 220 shares of the stock that had been -acquired from Steele. This would give him a majority of this stock in his own name. Of the remaining 160 shares the petitioner was allotted 80 and James W. English Jr. 80. James W. English Jr., for himself and for his wife, the petitioner, protested against this arrangement, which violated the agreement as to the division of the Steele stock and which gave James W. English Sr. a majority of the Stock in his own name. The consent of the petitioner and of James W. English Jr. was finally obtained, by the agreement to enter into the contract attached to the petition, which fixed the rights of the parties and sought to protect them against the power of the majority of the stock which thus went to James W. English Sr.

The contract, “ Exhibit A ” of the petition, was entered into and agreed to by the persons owning all the stock of the Chattahoochee Brick Company except that held by the executors of W. B. Lowe, deceased. The petitioner then had an undivided one-third interest in the shares. James W. English Sr., for reasons of his own, caused seven shares of his total of 1,033 shares to be apportioned, one share each, among the members of his family, and one share to John 3L Ottley, his associate in the banking business. Of the signers of the said agreement all except John IL Ottley were of the immediate family of James W. English Sr. The agreement recited that it was made because unity of action was necessary to promote the interest of all stockholders and of the corporation and to continue the existing wise, conservative, honest, and economical management of its affairs, and to protect it from the manipulations of speculators and wreckers. The contract was executed on July 11, 1900, and it was agreed that until June 22, 1915, the stock now held, or any stock thereafter bought or acquired by any of the parties thereto should be [237]*237voted at all corporate meetings as a unit, and to that end the owners of the said stock constitute and irrevocably appointed James W. English Sr. and his successors, as provided in the agreement, their lawful agent and attorney to vote the said shares of stock at all corporate meetings, subject to the conditions and limitations expressed in the agreement. If James W. English Sr. died, or became unable to discharge the duties imposed upon him, such agency was' to devolve upon his heirs, together with the petitioner, and they were jointly authorized to represent the said shareholders and vote the stock as fully as James "W. English Sr. might. In the event of disagreement between the petitioners and the heirs at law of James W. English Sr. as to any vote, the disagreement was to be settled by an arbitration, as provided in the agreement. The limitatisns and conditions expressed were as follows : During his life James W. English Sr. could designate the president of the company and cast the vote for him. In the event of his death the stock should be voted for James W. English Jr., and should he die, then for Harry L. English. During the lifetime of James W. English Sr., James W. English Jr. should be elected vice-president, but should he die, the stock was to be voted for the petitioner. If James W. English Jr. became the president as above, Harry L. English was to be elected vice-president, but if each died, the shares of stock should be voted, in the election of a president, for such stockholder of the corporation as might be designated by the heirs at law of James W. English Sr. A provision was made for arbitration between the heirs at law of James W. English Sr. in case of disagreement among them. In the event of the death of James W. English Jr. the authority conferred upon James W. English Sr. and his successors, to vote the stock for a vice-president, was to be vested in the petitioner alone, and should she so desire she was authorized to vote the entire stock (both that owned or held and that which might thereafter be owned or acquired by any of the signers) annually for such stockholder of the company as she might designate for the office of vice-president, and she was expressly authorized to cast such vote for herself, it being contracted and admitted that she was, in the opinion of each of the parties, in all respects well qualified and fully competent to discharge the duties of such office. It was further contracted that in the event of her death the stock [238]*238owned- or held by her might on demand be delivered to her heirs at law, provided that they should be persons other than J ames W. English Jr. or descendants of James W. English Jr. and the petitioner, and that in the event that the heirs should be other than the said James W. English Jr. or such descendants, all relations of the petitioners and'her heirs at law with the other parties to this agreement should cease and determine, and her stock and any stock to which she would have been entitled should be withdrawn from the operation of this agreement and delivered to the representatives of her estate. Provision was then made for the election of certain persons annually as directors of the corporation, if then in life and competent to discharge the duties of the office.

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English v. Rosenkrantz, 105 S.E. 729, 26 Ga. App. 234, 1921 Ga. App. LEXIS 84 (Ga. Ct. App. 1921).

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