State v. Pan American Co.

61 A. 398, 21 Del. 391, 5 Penne. 391, 1905 Del. LEXIS 31
CourtSuperior Court of Delaware
DecidedJuly 17, 1905
DocketNo. 132
StatusPublished
Cited by9 cases

This text of 61 A. 398 (State v. Pan American Co.) is published on Counsel Stack Legal Research, covering Superior Court of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State v. Pan American Co., 61 A. 398, 21 Del. 391, 5 Penne. 391, 1905 Del. LEXIS 31 (Del. Ct. App. 1905).

Opinion

Pennewill, J.:

The State of Delaware upon the relation of Count Henri Courcier de Julvecourt, upon March 8 last, filed in this Court a petition for a rule to show cause why a writ of peremptory mandamus should not be issued requiring the Pan American Company, a corporation of the State of Delaware, and. Ralph C. Lupton, its resident director, to permit the petitioner to inspect and make copies of sundry books, papers and records of said company. A writ of alternative mandamus was subsequently issued and a motion to quash the same refused. Whereupon the respondents filed their separate returns to the alternative writ. A motion has been made by the relator to quash the returns, on the ground that they are uncertain, argumentative, ambiguous, evasive, inconsistent, immaterial and insufficient. The question now before the Court, therefore, goes to the sufficiency of said returns.

Certain material allegations of the alternative writ are admitted by the returns; and certain others, while not expressly admitted, are not specifically denied.

The relator contends that the respondents have failed to deny specifically any of the material allegations of the alternative writ, and for that reason the returns should be quashed.

It is contended by Ralph C. Lupton, one of the respondents, that the peremptory writ should not issue against him because he has distinctly denied in his return that the books and papers demanded are now, or have ever been, in his possession, custody or control.

It is a well settled rule in the law of mandamus that the peremptory writ should be issued against the person or persons who have the power to perform the duty commanded, but it is also well settled, and in this State, that the joining of some other party will not invalidate the writ.

Bay State Gas Co. and Addicks vs. Content & Co., 4 Pennewill, 238; Swift vs. Richardson, 7 Houst., 338; State vs. Leon, 66 Wis., 199; People ex. rel. Muyr. vs. Throop, 12 Wend. (N. Y.), 185.

Ralph C. Lupton may not be the custodian of the books and papers in question, and may not be a necessary party in this action, [393]*393but the fact that he is joined will not prevent the issuance of the writ. He is the resident director of the defendant company, and the only representative of the company in this State. He has not expressly denied his power to perform the duty prayed for, and it does not seem impossible, that if the peremptory writ should be issued, he would then be able to comply with its requirements.

The Pan American Company, the other respondent, contends that the writ should not be issued, against it because (1), under the charter and by-laws of the company, a stockholder has no right to examine its.books and papers unless he is the owner of five thousand shares of capital stock; and it appears from the petition that the relator is not the owner of so many shares; and (2), because the undenied allegations of the alternative writ do not establish such a case as would warrant the Court in issuing the peremptory writ.

It may be a sufficient answer to the first objection to say that under a by-law of the company, in existence at the time of the issuance of the alternative writ, a stockholder having one hundred shares of stock had the right to examine the books, and although the by-law may have been since amended, we are not compelled to determine the effect of the amendment upon the rights of the relator because the defendant company has not in its return specifically denied the existence of the earlier by-law. There is no more well settled principle of law than this : That an argumentative

return in mandamus, like any other argumentative pleading, is bad. The existence of the by-law set out in the alternative writ is- at most denied only argumentatively or inferentially, by alleging the existence of an apparently inconsistent by-law at the time of the filing of the return, but of the time of the adoption of which we are not informed.

We now come to the consideration of the broader and more serious objection to the issuance of the peremptory writ, namely, the alleged insufficiency of the undenied averments of the altenative writ:

It is admitted by the respondents in their return that the defendant company is a corporation of this State, created under the [394]*394general corporation law of 1901; that the relator is a large stockholder therein, holding some three thousand shares; that there was a proper demand made for the books, papers, etc., and a refusal on the part of the company to comply therewith. The only essentially material allegations of the alternative writ not admitted by the return seem to be what may be termed the false and fraudulent representations alleged to have been made by the president of the company to the relator whereby he was induced to transfer to the defendant corporation certain asphalt properties of great value.

The relator avers that he was the owner of valuable asphalt properties in the state of Vera Cruz in the Republic of Mexico, and that Ambrosius H. Garner, the President of said Pan American Company, induced him to transfer said properties to the company by representing to him that the company would be so strong that it would control the asphalt markets of the world, and if the relator did not sell he would not be able to compete in the market for . the sale of his product; that said company owned large and valuable asphalt properties in Cuba and in the Republic of Venezuela, and that by transferring his property and taking stock of the company in exchange therefor the relator would be immensely benefited; that the company would expend large sums of money in developing all the properties, which would produce large dividends for the stockholders; that all of the five millions of the capital stock of the company would be issued for cash or for property at its true value in money, and that the relator would be made a director in the company. The relator alleges that all of said representations were false, and that a large part of the capital stock of the company has been issued to Garner the president and to others, without any sufficient or adequate consideration therefor.

It is not denied by the respondent that the said representations were made by Garner, substantially as alleged, but it is averred in the return that he had not then been elected president of the company, and that therefore the said representations were made by Garner individually and not as president.

[395]*395It is perfectly manifest however, even from the return, that Garner, at the time he made the representations complained of, was acting for the company and not individually, because at the time he entered into the agreement with the relator in respect to the trans- ■ fer of the properties of the latter, it was stipulated that the relator should transfer his said asphalt properties to such company as Garner would designate; and in pursuance of such agreement he did sell and transfer the same to the said Pan American Company.

In refusing to quash the alternative writ this Court decided that the allegations therein contained were sufficient to entitle the relator to the issuance of the peremptory writ, although we were in some doubt whether the object for which he demanded an inspection of the books and papers was such a one as would entitle him to the extraordinary remedy prayed for.

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Cite This Page — Counsel Stack

Bluebook (online)
61 A. 398, 21 Del. 391, 5 Penne. 391, 1905 Del. LEXIS 31, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-v-pan-american-co-delsuperct-1905.