L

even within the scope of corporate authority, if such acts when done, would. under the particular circumstances, amount to a breach of the trust upon which the authority was conferred. Where the majority of a company propose to benefit themselves at the expense of the minority, the court may interfere to protect the minority. If the directors refuse to comply with the vote of a majority of the stockholders, a court of equity will compel them to do so. If, upon their issuing new stock to stockholders generally, the directors refuse to issue to particular stockholders their due proportions, a suit in equity to compel the proper issue is maintainable against the corporation, provided the company still own stock applica ble to the purpose. And a suit in equity may be maintained to annul the forfeiture of shares. 10 So, a court of equity will entertain jurisdiction to restrain a corpora tion, and those having the control and management thereof, from acts amounting to a breach of trust,11 although the case may involve, as an incidental question, the inquiry which of two boards of directors is the legal one.12 But in cases involving no breach of trust, but only error or mistake of judgment upon the part of those who represent the company, the courts will not interfere, even where such error may result in loss to the stockholders. 13 Generally, a court of equity will decree the specific performance of a contract against a corporation in cases where it would do so if the contract was that of an ordinary individual.44 Thus, in a proper case, specific performance of a contract to take land and pay a stipulated price, will be enforced in equity against a corporation.15 So, of a contract by the company to sell some of its land.16 But specific performance of a contract of directors of a company, which is grossly improvident, will not be enforced. Nor is a contract to build a railroad one which will be compelled by specific performance in equity.18 An agreement by the directors to take a lease was enforced against them personally, although the agreement

showed that they were trustees for the company.19 A court of equity may entertain jurisdiction of a suit to reform the contract of a corporation, for mistake,20 or to avoid a contract of a corporation which it had no power to make.21

1 See Treadwell r. Salisbury Manuf. Co.7 Gray, 393; Richmond etc. R. R. Co. v. Richmond, 26 Gratt. 3; Phillips v. Commonw. 44 Pa. St. 197; Stratford v. Sanford, 9 Conu. 274; Reg. v. Birmingham Railw. Co. 3 Q. B. 223; Newby v. Oregon Cent. R. R. Co. 1 Sawy. 63.

2 Smith v. Bangs. 15 Ill. 399; Robinson r. Smith, 3 Paige, 222; Scofield v. Eighth School District, 27 Conn. 499; Hodges r. New England Screw Co. 1 R. I. 312; Bagshaw v. Eastern Counties Railw. Co. 7 Hare, 114.

3 Cunningham v. Pell, 5 Paige, 607; Bayless v. Orne, 1 Freem. Ch. 161; Spering's Appeal, 71 Pa. St. 1; Dodge v. Woolsey, 18 How. 331; Brown v. Moumouthshire ktailw. Co. 13 Beav. 32.

4 Dodge v. Woolsey, 18 How. 331; Gravenstine's Appeal, 49 Pa. St. 310; Memer v. Hooper's Tel. Works, Law R. 9 Ch. 350.

5 Dodge v. Woolsey, 18 How. 31; Bliss v. Anderson, 31 Ald. 612; Laumane. Lebanon Valley R. R. Co. 30 Pa. St. 46; March v. Eastern R. R. Co. 40 N. II. 548; and compare Gray . Lewis, Law 1.8 Eq. 526; Gregory r. Patchett, 33 Beav. 55; Keut v. Jackson, 2 De Gex M. & G. 49; McMurray v. North. Railw. Co. 22 Grant Up. Can. 476; Heath v. Erie Railw. Co. 8 Blatchf. 398.

6 Wright r. Oroville etc. Min. Co. 40 Cal. 20; and see Rogers v. Lafayette Agr. Works, 52 Ind. 296.

7 Menier r. Hooper's Tel. Works. Law R. 9 Ch. 350; March v. Eastern R. R. Co. 40 N. II. 548; Pratt v. Pratt, 33 Conn. 446.

8 Exeter etc. Railw. Co. v. Buller, 5 Eng. Railw. Cas. 211.

9

Doushman v. Wisconsin etc. Smelting Co. 40 Wis. 418.

10 Sweny v. Smith, Law R. 7 Eq 024.

11 Kimmel v. Stoner, 18 Pa. St. 155; Conro v. Port Henry Iron Co. 12 Barb. 27; French v. Gifford, 30 Iowa, 143; Craig v. Gregg, b3 Pa. St. 19.

12 Pond r. Vt. Valley R. R. Co. 12 Blatchf. 280; and see Johnston v. Jones. Green C. L. 216.

13 Dudley v. Kentucky High School, 9 Bush, 576; Hedges v. Pa quett. 3 Oreg. 77; and see Joslyn v. Mail Steamship Co. 1 Abb. Pr. N. S. 329; Foss v. Harbottle, 2 Hare, 461; Inderwick v. Snell, 2 Macn. & G. 216.

14 See Trenton Water Power Co. r. Chambers, 1 Stockt. Ch. 471; N. Y. etc. R. R. Co. r. Pixley, 15 Barb. 423; Maxwelt. Dulwich College, 7 Sim. 222; Stevens' Hospital v. Dyas, 15 Ir. Ch. 405; Marshall v. Corp. of Queenborough, 1 Simm. & St. 520; Wilmot v. Corp. of Coventry, 1 Younge & C. 518. Compare Port Royal R. R. Co. v. Hammond, 58 Ga.

523.

15 Inge v. Birmingham etc. Railw. Co. 23 Eng. L. & Eq. 601.

16 Wilson r. West Hartlepool Harbor ete. Co. 2 De Gox J. & S. 475; and see Lomiuster Caual Co. v. Shrewsonry.ctc. Railw. Co. 3 Kay & J. 654; Crampton v. Varna Railw. Co. Law R. 7 Ch. 562.

17 Shrewsbury etc. Railw. Co. v. London etc. Railw. Co. 6 H. L. Cas.

18 Danforth v. Railroad Co. 30 N. J. Eq. 12; Heathcote r. North Staffordshire Railw. Co. 6 Eng. Railw. Cas. 353; Russ v. Un. Pacif. Railw. Co. I Woonw. 26; Fallo. e. Railw. Co. 1 Dill. 11.

19 Kay r. Johnson. 2 Hem. & M. 118. See Пaddon v. Ayres, 1 El. & E. 118; Pickering's Claim, Law R. 6 Ch. 525; Datron e. Marsh, Law R. 6 Q. B. 301; Leo v. M. E. Church, 52 Baro. 113; Olcott v. Tioga R. R. Co. 27 N. Y. 543.

20 Menomonee etc. Manuf. Co. v. Langworthy, 18 Wis. 444; West v. Madison County Agr. Board, 82 Ill. 265.

21 Auburn Academy v. Strong, Hopk. Ch. 317.

2

§ 140. Injunction.—An injunction is the proj er remedy to restrain a corporation from a gross abuse of its powers, when the acts proposed involve irreparable injury to the party complaining. The remedy may be had to restrain the corporation from doing an unconscionable thing outside of as well as within its ordinary business sphere. In a proper case, a corporation may be restrained by injunction from applying the corporate property to unauthorized purposes; or from constructing works not needed for the corporate business; or from carrying its assets out of the state of its creation; or from pressing proceedings for its own dissolution; or from fouling a stream; or, an injunction may be granted, in a proper case, to restrain the consolidation of two rival steamboat companies; or to restrain corporate officers from the continued commission of acts which are contrary to law, and may endanger the existence of the charter; and where two conflicting bodies of men claim to hold one and the same office under a corporation, at one and the same time, either body may apply for an injunction to restrain the other from usurping powers to which it has no legal title.10 So, an injunction may be had by one corporation having a vested right, to restrain interference with them by another corporation, if the exigency of the case require it. So, if disputes arise between different members of the governing body of a com pany, which prevent its affairs from being properly carried on, it is a ground for interference by injunction, and the appointment of a receiver. 12 In a proper case, an injunction may be granted to restrain the negligent exer

cise of the corporate powers in erecting works, and in carrying on the corporate business.18 Generally, unless it is otherwise provided, a corporation occupies the same footing and is subject to the same control, under the police power of a State, as individuals, in respect to the use of its property, the exercise of its powers, and the transaction of its business.14 But injunction is a preventive remedy merely, and application for it must be made promptly, without undue delay, or it will not be granted;15 it will not do for a party to wait until the mischief of which he complains is accomplished.16 Thus, it cannot be obtained to secure the restoration of a member who has been improperly expelled by proceedings contrary to the constitution and by-laws.17 Nor is an injunction a proper remedy where there is a plain and adequate remedy at law. 18 Thus, it does not lie to restrain city authorities from arresting and fining a person for violating a city ordinance; 19 and it is presumably proper to refuse an injunction to restrain the collection of town or city taxes.20 Nor will relief by injunction be granted against the proceedings of the governing body of a corporation, unless it be shown that all the means of compulsion in the power of the corporation have been resorted to in vain. An injunction, although addressed exclusively to a corporate body, is binding upon all individuals acting for, the corporation, to whose knowledge the injunction comes.22 If an injunction against a corporation is served on its president, and he conceals the fact from the other officers, who ignorantly perform acts in violation of it, he will be held liable for a breach of the injunction on his part.23

1 Mayor etc. v. Groshon, 30 Md. 436; Sandford v. Catawissa etc. R. R. Co. 24 Pa. St. 378; Black v. Del. etc. Canal Co. 9 Green C. E. 455; Att.Gen. v. Great North. Railw. Co. 6 Jur. N. S. 1006; Att.-Gen. v. Mayor, etc. Mylne & C. 171; Spencer v. London etc. Railw. Co. 8 Sim. 193; i Eng. Railw. Cas. 159.

2 Big Mt. Improvement Co.'s Appeal, 54 Pa. St. 361; and see Bonaparte v. Camden etc. R. R. Co. Daldw. 231; 4 Green C. E. 546.

3 Binney's Case, 2 Bland, 99; Middlesex Turnp. Co. v. Locke, 8 Mass. 268; Colles v. Trow City Direc. Co. 11 Hun, 397. Compare Bailey v.

Hollister, 26 N. Y. 112; New Haven etc. R. R. Co. v. Chapman, 38 Conn. 56; Wilson v. Wills Valley R. R. Co. 33 Ga. 466; Hawkins v. Miss. etc. R. R. Co. 35 Miss. 688.

4 Newark Plank R. Co. v. Elmer, 1 Stockt. 754.

5 Matthews v. Trustees etc. 7 Phila. 270; 2 Brews. 541.

6 Singer Sewing Mach. Co. v. Union Button Hole etc. Co. 1 Holmes, 253.

7 Clowes v. Staffordshire etc. Water Works Co. Law R. 8 Ch. App. 125; Holsman v. Boiling Spring Bleach. Co. 14 N. J. Eq 335; and see Att.-Gen. v. Boston Wharf Co. 12 Gray, 553; Mohawk Bridge Co. v. Utica etc. R. R. Co. 6 Paige, 554; Dickenson r. Grand Junction Canal Co. 15 Beav. 260.

8 Watson v. Harlem etc. Nav. Co. 52 How. Pr. 348.

9 Manderson e. Commercial Bank, 23 Pa. St. 379; Dodge v. Woolsey, 18 How. 3; Neall v. Hill, 15 Cal. 145. But an injunction will not be granted against a corporate officer merely on the ground of past misfeasance: People v. Conklin, 5 Hun. 452; nor to prevent the board of directors from merely allowing as correct a fraudulent account against the corporation: Rogers v. Lafayette Agr. Works. 52 Ind. 296. And compare Hedges v. Paquett, 3 Oreg. 77.

10 Kerr v. Trego, 47 Pa. St. 292.

11 Florida etc. R. R. Co. v. Pensacola etc. R. R. Co. 10 Fla. 145; Osborner. Bank of U.S.9 Wheat. 788; and see Thompsone. N. Y. etc. R. R. Co. 3 Sand. Ch. 625; Gates v. McDaniel, 2 Stewt. 211; 19 Am. Dec. 49.

12 Featherstone v. Cooke, Law R. 16 Eq. 208. Compare Samuel v. Holladay, Woolw. 400; Johuston v. Jones, 8 Green C. E. 216. In this country, the mode of settling such disputes is mainly regulated by statute: see People r. Albany etc. R. R. Co. 57 N. Y. 161; Schonarie R. R. Case, 12 Abb. Pr. N. S. 394; Brewster v. Hartley, 37 Cal. 15; Webb v. Ridgely, 33 Md. 364.

13 Biscoe v. Great East. Railw. Co. Law R. 16 Eq. 636; Prime v. Twenty-third Street R. R. Co. 1 Abb. N. C. 63; and see St. Louis v. Weber, 44 Mo. 547.

14 Richmond etc. R. R. Co. v. Richmond, 26 Gratt. 83.

15 Van Ranst v. College of Veterinary Surgeons, 4 Iun, 620; Lattimer v. Livermore, 72 N. Y. 174; Peabody v. Flint, 6 Allen, 52; Chapman . Mad River R. R. Co. 6 Ohio St. 119; Thorpe v. Hughes, 3 Myine & C.

742.

16 Chapman v. Mad River R. R. Co. 6 Ohio St. 119; People v. Clark, 70 N. Y. 518.

17 Fisher v Chicago Board of Trade, 80 Ill. 85.

18 Howe v. Rochester etc. Manuf. Co. 66 Barb. 592; Troth v. Troth, 4 Halst. Ch. 237; Brown v. Concord, 56 N. H. 375; and see State v. Wolf enden, 74 No. Car. 103; Chesapeake etc. R. R. Co. v. Bobbett, 5 Wash. (Va.) 138.

19 Cohen v. Comm'rs of Goldsboro, 77 No. Car. 2.

20 Brown v. Concord, 56 N. H. 375; Wayne v. Mayor etc. 56 Ga. 448.

21 Foss v. Harbottle, 2 Hare, 461; and see Mozley v. Alston, 1 Phill. Ch. 790.

22 People v. Sturtevant, 9 N. Y. 263; and see Brown v. Pacific Mall Steamship Co. 5 Blatchf. 525; State v. Cutler, 13 Kan. 131.

23 Bank Comm'rs v. City Bank, cited in 9 N. Y. 277.