Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

FOX v. JOHNSON & WIMSATT

January 24, 1940

FOX
v.
JOHNSON & WIMSATT et al.



The opinion of the court was delivered by: LUHRING

This is a motion to strike the affidavit of the plaintiff, E. Margery Fox, filed herein on the 9th day of December, 1939, in support of her counter motion for summary judgment.

The plaintiff, as she alleges in her amended complaint, is the owner of part of the preferred stock of the defendant corporation, as well as, until January, 1939, the beneficial owner of a part of the common stock therein, she being now the legal owner thereof.

 The defendant corporation was organized under the laws of the State of Delaware February 24th, 1923, with a total authorized capital of $3,000,000 divided into 20,000 shares of preferred stock and 10,000 shares of common stock with a par value of $100 each. 7,500 shares of the preferred stock were issued to the late William A. Wimsatt. All of the preferred stock now outstanding is part of this original issue and is held by the plaintiff and other children of Mr. Wimsatt. The balance of the preferred stock authorized has never been issued.

 The law of Delaware under which the defendant corporation was organized provides in part (Chap. 65, § 27 [section 2059]) that a corporation may redeem all or any part of its preferred shares, if subject to redemption, at such time of times, at such price or prices, and otherwise as shall be stated or expressed in its certificate of incorporation. Pursuant to the authority thus granted, the certificate of incorporation of the defendant, in Article 4, Paragraph 3, provides: "Said preferred stock shall be subject to redemption at One Hundred Dollars ($100.00) per share at any time after five years from the date of the issue thereof, at such time and place and in such manner as to Board of Directors shall determine."

 The amended complaint discloses and it is admitted by the answer that on September 6, 1929, proceedings were instituted by the District of Columbia for the purpose of acquiring by condemnation certain real estate owned by the defendant in Squares 415 and 439 in the District of Columbia.Subsequently, on the 8th day of November, 1930, and during the pendency of the condemnation proceeding, the board of directors of the defendant corporation unanimously adopted the following resolution: "Resolved that when payment has been received by the Company for Squares 415 and 439, being the property condemned by the District Government, an amount of preferred stock be paid off equal to the net proceeds received from this property."

 It is alleged and not denied that at the time the resolution was adopted, the plaintiff and all the other holders of the then outstanding preferred stock were members of the board of directors of the defendant corportion.

 The condemnation proceeding was discontinued and abandoned by the District of Columbia December 10th, 1931, and their right to so discontinue and abandon was upheld by the Court of Appeals in Johnson & Wimsatt, Inc. v. Reicheldefer, 62 App. D.C. 237, 66 F.2d 217. So it appears that the corporate defendant received no "payment" for "Squares 415 and 439" in the condemnation proceeding.

 The amended complaint further alleges and the answer does not deny that on August 23, 1938, approximately seven years after the condemnation proceeding was discontinued and abandoned, the defendant corporation sold the property to the District of Columbia for $192,000.

 On August 31, 1983, the plaintiff tendered her preferred stock to the defendant corporation and demanded redemption of her prorata share thereof on the theory that the resolution of the board of directors November 8, 1930, was an exercise of the option to redeem the preferred stock and, therefore, a contract between the defendant and the holders of its preferred stock, which the latter are entitled to have specifically enforced.

 The answer of the defendant recites various other resolutions adopted by the board of directors and also makes reference to the annual report of the treasurer which was presented to the board of directors April 30, 1938.

 In this state of the record, and defendant corporation, on November 21, 1939, filed its motion for summary judgment, supported by the affidavit of G. P. Lohr, its secretary and custodian of the corporate books and records, wherein copies of the minutes of the meetings of the board of directors are set out.

 It is the contention of the defendant corporation that the resolution of November 8, 1930, was but a declaration of policy to be pursued and not the exercise of an option to redeem the preferred stock.

 The plaintiff, on December 9, 1939, filed a counter motion for summary judgment supported by the ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.