Toklan Royalty Corporation v. Tiffany

1943 OK 301, 141 P.2d 571, 193 Okla. 120, 1943 Okla. LEXIS 326
CourtSupreme Court of Oklahoma
DecidedSeptember 28, 1943
DocketNo. 30977.
StatusPublished
Cited by2 cases

This text of 1943 OK 301 (Toklan Royalty Corporation v. Tiffany) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Toklan Royalty Corporation v. Tiffany, 1943 OK 301, 141 P.2d 571, 193 Okla. 120, 1943 Okla. LEXIS 326 (Okla. 1943).

Opinion

RILEY, J.

This is an appeal from an order awarding a peremptory writ of mandamus to the defendants in error herein, directing plaintiffs in error, Toklan Royalty Corporation and Curtiss F. Bryan, to permit defendants in error, as stockholders, to inspect and examine the books and records of said corporation. Hereinafter the parties will be re *121 ferred to as in the trial court. Plaintiffs filed their motion and petition for a writ of mandamus, alleging in substance that Toklan Royalty Corporation is a corporation organized and existing by virtue of the laws of the State of Delaware, and authorized to do business in the State of Oklahoma, and having its principal place of business in Tulsa, Okla., at 410 Beacon Building; that defendant Curtis F. Bryan is its president and in charge of its office in Tulsa; that plaintiffs are stockholders in said defendant corporation to the extent of 2,016 shares, and that all shares are paid up; that by the laws of the state it is made the duty of the officers and directors of companies and corporations to keep all the records of said organization open to inspection of any director, member, stockholder, or creditor and to permit such inspection at all reasonable times; that plaintiffs made a request for permission to examine the books and records of the corporation and that defendants refused and still refuse to permit such examination. A peremptory writ of mandamus was awarded on the petition, but thereafter an order was made amending the writ so as to make it operate only as an alternative writ of mandamus; whereupon defendants filed their return to alternative writ. Therein they admit that the Toklan Royalty Corporation is organized and existing under and by virtue of the laws of the State of Delaware, and that it is authorized to do business in the State of Oklahoma, and that Curtis F. Bryan is its president; that Toklan Royalty Corporation, being created under the laws of the State of Delaware, is governed by the laws of that state in respect to all of its corporate affairs, and particularly its internal corporate affairs, as said laws are contained in the statutes of the State of Delaware and in the decisions of the Delaware courts. That under said statute and decisions a stockholder has no right to inspect the records of a corporation for an'improper purpose, such as to annoy the corporation and its officers, or for the purpose of bringing a harassing lawsuit, or for speculative purposes, or for the purpose of satisfying idle curiosity of the stockholder, or for any purpose that may be hostile to the interests of the corporation and to other stockholders. That plaintiffs, or some of them, had been in the past directly or indirectly connected with meddlesome litigation, which had cost the shareholders and stockholders of Toklan Royalty Corporation and its predecessor in interest, Imperial Royalties Company, large sums of money; and that by reason of the acts and conduct of the plaintiffs in connection with such former litigation, plaintiffs have not shown themselves entitled to inspect the books and records of the corporation.

Hearing was had before the court, resulting in a finding and order to the effect that plaintiffs were entitled to the writ under the statutory provisions of this state, and defendants appeal.

The first contention is that the Oklahoma statute relied upon by plaintiffs is not applicable and has been erroneously applied.

It appears from the record that the Toklan Royalty Corporation was organized under the laws of the State of Delaware, and that its charter provided that its principal place of business was to be in Tulsa, Okla.; that it was organized pursuant to a plan for the reorganization or continuation in business of the Imperial Royalties Company, which was a statutory trust until the 1st day of December,, 1940, at which time it became dissolved and terminated by reason of the expiration of the term for which it was created; that plaintiffs were shareholders in the Imperial Royalties Company, and in the reorganization or continuation of business by the Toklan Royalty Corporation they acquired and are owners of approximately 1,900 shares of stock in the Toklan Royalty Corporation.

Title 18, section 141, O. S. 1941, as far as pertinent, provides:'

“All corporations for profit are required to keep a record of all their business transactions; a journal of all meetings of their directors, members or *122 stockholders, with the time and place of holding the same, whether regular or special, and, if special, its object, how authorized, and the notice thereof given ... all such records to be open to the inspection of any director, member, stockholder, or creditor of the corporation.”

Defendants contend that said statutory provision does not apply to a foreign corporation, but was intended to apply only to corporations organized under and by virtue of the laws of the State of Oklahoma.

Toklan Royalty Corporation, under the admitted facts, is not, strictly speaking, a foreign corporation with respect to the question of examination and inspection of its books and records by its stockholders.

In 20 C.J.S. Corporations, § 1793, it is stated that:

“Organizations composed of persons who have incorporated under the laws of a state other than that of their residence for the purpose of doing all or the greater part of their business in the state of the residence of such persons, or in another state than that of the creation of the corporation, are known as migratory or ‘tramp’ corporations.”
“A migratory or tramp corporation organized under the laws of a foreign state for the purpose of doing business in the domestic state where its property is situated and all its business is transacted has been held to be a resident of the domestic state.” 20 C.J.S. Corporations, § 1794.
“A corporation which seeks to establish a business domicile in a state other than that of its creation must take that domicile as individuals are always understood to do, subject to the responsibilities and burdens imposed by the laws which it finds in force there.” 14-A.C.J. 1240.
“Whether or not the term ‘corporation’ when used in a statute applies to foreign corporations operating within the state depends largely upon the subject matter of the statute, its policy, and the context in which the terms is employed. The word generally applies to a foreign corporation, when there is nothing in the words of the statute itself which would indicate an intention on the part of the Legislature to limit its effect to domestic corporations, or where there are no sufficient considerations of local or state policy from which there can be inferred a motive on the part of the Legislature to restrict the operation of the statute to domestic corporations.” 14-A.C.J. 1241.

Section 44, art. 9, of the Constitution of this state provides:

“No foreign corporation shall ... be relieved from compliance with any of the requirements made of a similar domestic corporation by the Constitution or laws of the state.” "

From the foregoing, it clearly appears that the defendant corporation is subjéct to the statutory provisions of. this state with respect to the question here involved.

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Bluebook (online)
1943 OK 301, 141 P.2d 571, 193 Okla. 120, 1943 Okla. LEXIS 326, Counsel Stack Legal Research, https://law.counselstack.com/opinion/toklan-royalty-corporation-v-tiffany-okla-1943.