granting shareholder limited right to compel dividends if he can demonstrate that directors abused their discretion and violated business judgment rule in failing to declare them
How later courts described this case
- granting shareholder limited right to compel dividends if he can demonstrate that directors abused their discretion and violated business judgment rule in failing to declare them
Written by the judges who cited it.
The opinion
On Rehearing.
BROWN, J.
Notwithstanding the defendants, appellants here, grounded their several motions to dissolve the temporary injunction on the want of equity in the bill and the denials in their several answers, and by so doing narrowed the issues of law and fact to be considered by the trial court, they now insist that this court, in view of the provisions of section 8311 of the Code of 1923, should have extended its consideration to the affirmative defenses as well. A mere statement of the questions answers the appellants’ contention.
As we have heretofore held the statute abrogated the rule theretofore existing, which limited the right of the defendant to move a dissolution, for want of equity in the bill, and on the denials of the sworn answer, and enlarged his right to ground the motion on the sworn denials of the answer and its allegations setting up affirmative matter of defense, but the statute does not restrict the movant’s right' to limit his motion to the denials in the answer, and, when he does, he limits the scope of the court’s consideration. In Saxon v. Parson, 206 Ala. 491 , 90 So. 904 , the “submission, on motion to dissolve, was on ‘bill, sworn answer of respondent, affidavits introduced by complainant (appellant), and oral testimony of respondent.’ ”
In Daniel v. Birmingham Dental Mfg. Co., 207 Ala. 659 , 93 So. 652 , the submission was on the motion to dissolve for want of equity, sworn answer, and proof. In Toney v. Bur
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gess, 208 Ala. 55 , 93 So. 850 , the motion to dissolve was “upon the coming in of the sworn answer of the respondent” without proof. The motion was there denied. In Nelson et al. v. Hammonds, 173 Ala. 14 , 55 So. 301 , the submission was on the motion to dissolve on sworn answers and proof.
The question as to whether the defendant Holcomb, who is actively managing the affairs of the corporation should be allowed reasonable compensation, pendente lite, is a matter not presented on this appeal, but within the discretion of the trial court, and application in this respect should first be made there. The other questions have been fully considered in the original opinion.
Application overruled.