predicated. And whether the stockholders, constituting the board of directors when this letter was written, were the same persons composing that body when Van Hoose appeared before them and informed them of his agreement with the respondent with reference to postponing the foreclosure sale is not shown. It may be, and we have the right to assume, that the board was composed of entirely different stockholders, who knew absolutely nothing of the agreement between Van Hoose and the respondent and of the other facts alleged. But be this as it may, it is not shown that any governing body of the company were erer informed of the conspiracy alleged between the respondent and the president of the company. It is true that. there is an exhibit to the bill (“H”), an unsigned letter of date January 20, 1900, purporting to have been addressed to "Director Woodlawn Cemetery Co.," demanding that a bill be filed, etc., also saying that "the chancery court has practically held that L. W. Johns and E. Erswell were guilty of such fraud in the sale ..., as to invalidate the same, and it is absolutely necessary that this bill be filed in order to protect the interests of the company," but it is nowhere averred that this letter ever reached the director or the board of directors. This being true, it is not necessary to here decide its sufficiency or insufficiency as a demand. The grounds of the demurrer challenging the arerments of the bill in these respects should have been sustained.

Reversed and remanded.

ACTIONS BY STOCKHOLDERS ON BEHALF OF CORPORATIONS,

I. Corporation Must Sue Generally:
II. When Stockholder may Sue,

a. Must Exhaust Corporate Remedies.
b. Demand on and Refusal to Act by Corporation Must

be Alleged.
C. On Whom It Should be Made,
d. Where a Receiver is in Charge.
e. Excuses for Failure to Request Corporate Action.

1. Futility of Demand Must be Alleged.
2. Where the Officers are the Wrongdoers.
3. Common Directors of Two Corporations.
4. Where the Corporation has Abandoned Business

-No Managing Body.
5. Relationship as Giving Rise to Presumption of

Refusal. 6. Miscellaneous Instances. 7. Presumption as to the Continuance in Office of

the Same Directors,

a.

e.

III. Suits in the Federal Courts.

a. Importance of Equity Rule 94.
b. Conflict as to whether Demand may be Dispensed

With.

C. Effect in State Courts.
IV. What Wrong Must be Inflicted on the Corporation.

Generally.
b. Fraud.

Voidable Contracts. d. Ultra Vires Acts.

Acts Involving the Use of Discretion.

f. Specific Performance of Contracts. V. Good Faith in Bringing Suit Necessary. VI. Parties.

a. Corporation a Necessary Party.
b. Stockholders and Directors as Parties.

c. Plaintiff's Authority to Sue Must Appear.
VII. Misjoinder of Corporate and Individual Causes of Action.
VIII. Acquiescence and Laches.

a. Participation in Wrong by Complaining Stockholder.

b. Laches.
IX. If Corporation is Barred, Stockholder is also.
X. Who is a Stockholder for Purposes of Suit.

a. Must be so in Fact.
b. Subscriber.
c. Importance of Time of Becoming Stockholder,
d. Insignificant Stockholder.

I. Corporation Must Sue Generally, It is an elementary proposition of law, needing the citation of no authority to support it, that a corporation is an entity distinct and apart from the members who compose it, and that, generally speak. ing, all duties and obligations owing it can be enforced only by suits brought in its own name. So the right of action for a wrongful con. version of corporate property cannot be brought by stockholders in their individual names, but is in the corporation: Steele Lumber Co. v. Laurens Lumber Co., 98 Ga. 329, 24 S. E. 755; Tomlinson v. Bricklayers' Union, 87 Ind. 308. Nor can they sue for goods sold by the corporation, although they are the sole stockholders: Cutshaw v. Fargo, 8 Ind. App. 691, 54 N. E. 376, 36 N. E. 650. In such a case, the sole stockholder's succession to its interest must be averred and proved, so as to show that the defendant had promised the plaintiff, understanding that he had succeeded to all the interests of the corporation: Randall v. Dudley, 111 Mich. 437, 69 N. W. 729. A stockholder cannot sue to restrain slander of title of property belonging to the corporation: Langdon v. Hillside Coal etc. Co., 41 Fed. 609. Where an action was brought against an officer for unlawfully withe holding corporate funds, they should be accounted for to the corporation, and a decree ordering payment of the amount to the com. plaining stockholders in proportion to their stock is Chicago etc. Mfg. Co. v. Boggiano, 202 Ill. 312, 67 N. E. 17, modify ing Boggiano v. Chicago Macaroni Mfg. Co., 99 Ill. App. 509.

erroneous:

ider.

A stockholder individually cannot maintain a bill in equity to compel the execution of a trust by a person holding corporate prop erty, who undertook to pay off its debts: Heath v. Ellis, 66 Mass. (12 Cush.) 601.

In Smith v. Hurd, 53 Mass. (12 Met.) 371, 46 Am. Dec. 690, it was held that a stockholder of a bank could not successfully sue its directors for so negligently conducting its affairs that its whole capi. tal was lost, rendering the shares worthless. Chief Justice Shaw, in the course of his opinion, said: “The individual members of the corporation, whether they should all join, or each act severally, have no right or power to intermeddle with the property or concerns of the bank, or call any officer, agent or servant to account, or discharge them from any liability. Should all the stockholders join in

power of attorney to anyone, he could not take possession of any real or personal estate, any security or chose in action; could not collect a debt, or discharge a claim, or release damage arising from any default, simply because they are not the legal owners of. the property, and damage done to such property is not an injury to them." Nor can a stockholder sue out a writ of error in the name of the corporation without its consent: Chicago etc. R. Co. v. Northen Trust Co., 90 III. App. 460. That be may not bring a certiorari in the name of the corporation, without the consent of a majority of the stockholders, see Silk Mfg. Co, v. Campbell, 27 N. J. L. 539.

The principle that a stockholder, as such, cannot maintain a suit on his own behalf for an injury to the corporation does not apply, however, where the wrongful acts are not only wrongs against the corporation, but are also violations of a duty owing directly by the wrongdoer to the stockholders: Eldred y. Ripley, 97 IN. App. 503, citing Ritchie v. McMullen, 79 Fed. 522. See, also, Nathan v. Tomkins, 82 Ala. 457, 2 South. 747; Meyers v. Scott, 50 Hun, 603, 2 N. 1. Supp. 753,

II. When Stockholder may Sue. & Must Exhaust Corporate Remedies.-While a stockholder can. not sue individually to enforce a duty or obligation owing the body corporate, he may, upon a proper showing, maintain a suit on its be. half: Metcalf v. American etc. Furniture Co., 122 Fed. 115. It therefore becomes necessary to determine what are the necessary conditions precedent to this right. The leading case on this subject is that of Hawes v. Oakland, 104 V. &. 450, where it is said: “Before the shareholder is permitted in his own name to institute and conduct litigation which usually belongs to the corporation, he should show to the satisfaction of the court that he has exhausted all the means within his reach to obtain, within the corporation itself, the redress of his grievances, or action in conformity to his wishes. He must make an earnest, not a simulated, effort, with the managing body of the corporation, to induce remedial action on their part, and this must be made apparent to the court. If time permits or has permitted, he must

e.

III. Suits in the Federal Courts,

a. Importance of Equity Rule 94.
b. Conflict as to whether Demand may be Dispensed

With.

C. Effect in State Courts.
IV. What Wrong Must be Inflicted on the Corporation.

a. Generally.
b. Fraud.
c. Voidable Contracts.
d. Ultra Vires Acts.

Acts Involving the Use of Discretion.

f. Specific Performance of Contracts. V. Good Faith in Bringing Suit Necessary. VI. Parties.

a. Corporation a Necessary Party.
b. Stockholders and Directors as Parties.

Plaintiff's Authority to Sue Must Appear.
VII. Misjoinder of Corporate and Individual Causes of Action.
VIII. Acquiescence and Laches.

Participation in Wrong by Complaining Stockholder.

b. Laches.
IX. If Corporation is Barred, Stockholder is also.
X. Who is a Stockholder for Purposes of Suit.

Must be so in Fact.
b. Subscriber.
c. Importance of Time of Becoming Stockholder.
d. Insignificant Stockholder.

a.

I. Corporation Must Sue Generally. It is an elementary proposition of law, needing the citation of no authority to support it, that a corporation is an entity distinct and apart from the members who compose it, and that, generally speaking, all duties and obligations owing it can be enforced only by suits brought in its own name. So the right of action for a wrongful con version of corporate property cannot be brought by stockholders in their individual names, but is in the corporation: Steele Lumber Co. v. Laurens Lumber Co., 98 Ga. 329, 24 S. E. 755; Tomlinson v. Bricklayers' Union, 87 Ind. 308. Nor can they sue for goods sold by the corporation, although they are the sole stockholders: Cutshaw v. Fargo, 8 Ind. App. 691, 54 N. E. 376, 36 N. E. 650. In such a case, the sole stockholder's succession to its interest must be averred and proved, so as to show that the defendant had promised the plaintiff, understanding that he had succeeded to all the interests of the corporation: Randall v. Dudley, 111 Mich. 437, 69 N. W. 729. A stockholder cannot sue to restrain slander of title of property belonging to the corporation: Langdon v. Hillside Coal etc. Co., 41 Fed. 609. Where an action was brought against an officer for unlawfully withholding corporate funds, they should be accounted for to the cor. poration, and a decree ordering payment of the amount to the complaining stockholders in proportion to their stock is erroneous: Chicago etc. Mfg. Co. v. Boggiano, 202 [11. 312, 67 N. E. 17, modify. ing Boggiano v. Chicago Macaroni Mfg. Co., 99 Ill. App. 509.

A stockholder individually cannot maintain a bill in equity to compel the execution of a trust by a person holding corporate property, who undertook to pay off its debts: Heath v. Ellis, 66 Mass. (12 Cush.) 601.

In Smith v. Hurd, 53 Mass. (12 Met.) 371, 46 Am. Dec. 690, it was held that a stockholder of a bank could not successfully sue its directors for so negligently conducting its affairs that its whole capi. tal was lost, rendering the shares worthless. Chief Justice Shaw, in the course of his opinion, said: “The individual members of the corporation, whether they should all join, or each act severally, have 10 right or power to intermeddle with the property or concerns of the bank, or call any officer, agent or servant to account, or dig. charge them from any liability. Should all the stockholders join in a power of attorney to anyone, he could not take possession of any real or personal estate, any security or chose in action; could not collect a debt, or discharge a claim, or release damage arising from any default, simply because they are not the legal owners of. the property, and damage done to such property is not an injury to them." Nor can a stockholder gue out a writ of error in the name of the corporation without its consent: Chicago etc. R. Co. v. Northern Trust Co., 90 III. App. 460. That he may not bring a certiorari in the name of the corporation, without the consent of a majority of the stockholders, see Silk Mfg. Co. v. Campbell, 27 N. J. L. 539.

The principle that a stockholder, as such, cannot maintain a suit on his own behalf for an injury to the corporation does not apply, however, where the wrongful acts are not only wrongs against the corporation, but are also violations of a duty owing directly by the wrongdoer to the stockholders: Eldred v. Ripley, 97 Ill. App. 503, citing Kitchie v. McMullen, 79 Fed. 522. See, also, Nathan v. Tomkins, 82 Ala. 437, 2 South. 747; Meyers v. Scott, 50 Hun, 603, 2 N. Y, Supp. 753.

II. When Stockholder may Sue. in Must Exhaust Corporate Remedies.—While a stockholder cannot sue individually to enforce a duty or obligation owing the body corporate, he may, upon a proper showing, maintain a suit on its be. half: Metcalf v. American etc. Furniture Co., 122 Fed. 115. It therefore becomes necessary to determine what are the necessary conditions precedent to this right.

The leading case on this subject is that of Hawes v. Oakland, 104 V. 8. 450, where it is said: "Before the shareholder is permitted in his own name to institute and conduct a litigation which usually belongs to the corporation, he should show to the satisfaction of the court that he has exhausted all the means within his reach to ohtain, within the corporation itself, the redress of his grievances, or action in conformity to his wishes. He must make an earnest, not a simulated, effort, with the managing body of the corporation, to induce remedial action on their part, and this must be made apparent to the court. If time permits or has permitted, he must