
    ACTION FOR. RECOVERY OF DIVIDEND DECLARED.
    [Common Pleas Court of Montgomery County.]
    Lee Mitchell v. The Bookwalter Wheel Company.
    
    Decided, 1905.
    
      Corporations — Powers of Boards of Directors — Dividends Declared are a Debt of the Company — Whether Legally Declared is for a Cotort to Determine — Special Meetings of Directors — Notice of Meeting— Suspicions of Fraud — Sections 3269-1-2-3 — Minutes—By-laws.
    1. Under the law of Ohio the board of directors of a corporation for ' profit control, exercise and conduct the business and powers of the corporation.
    2. When in the exercise of such authority a dividend is legally declared, it becomes a debt of the company to the stockholder as an individual to be paid within a reasonable time, and as such is beyond the control of both the stockholders and directors.
    3. Whether or not the directors have acted within the scope of their powers in such declaration is for a court to determine in a proper case.
    
      
       Affirmed by the circuit court without report; affirmed by the Supreme Court without report, January 29, 1907 (76 Ohio State).
    
   Snediker, J.

In this case the jury was waived, and it was by consent of all parties heard by the court. Plaintiff’s petition states that the defendant is an Ohio corporation for profit, with a páid up capital stock of seventy-five thousand dollars; that on the 8th day of September, plaintiff was the owner and holder of ninety shares, of one hundred dollars each, and that on said date defendant declared a dividend of forty per cent., whereby plaintiff was entitled to receive the sum of thirty-six hundred dollars; that of that amount he has been paid three thousand dollars, and that there yet remains due him unpaid six hundred dollars, which defendant refuses to pay, and he asks judgment in that amount with interest from January .19, 1903.

Defendant by amended answer admits its incorporation, the ownership by plaintiff of the number of shares claimed of the value alleged; that plaintiff was paid three thousand dollars; that he has demanded six hundred dollars and has been refused, and denies each and every other allegation in the petition.

As a second defense, defendant denies that there was a meeting of the board of directors on September 8, 1902, denies the declaration of the dividend, and says further that if there was a dividend of forty per cent, lawfully declared, it was understood and agreed, and was a condition of the declaration, that only thirty-three and one-third per cent, of the same should be paid until there should be further action of the board of directors providing for the payment of the other six and two-thirds per cent., such action to be at such future time as the board could find said sum could be paid without embarrassing the corporation; that said time had not arrived when the suit 'was brought; that the board had so declared, which action of the board was approved by the stockholders, who also declared it was not prudent to pay the additional dividend. Plaintiff has received the same dividend as all of the stockholders.

By way of amendment to the answer, the defendant further says that there was an alleged meeting of the board of directors of the defendant company on the 18th day of September, 1902, at which time there was an attempt made by certain directors, of which the plaintiff was one, to declare a dividend of forty per cent, upon the paid up capital stock of the said company; that the plaintiff, who was the secretary, called the said meeting, knowing that the president of the company was absent from the county and state, although he well knew he would return in time for a meeting at the same time the meeting for a declaration of dividend was held the year before; that the president was not notified in any manner whatsoever of said meeting, neither did the secretary make any attempt to notify him, although the meeting -was called as a special meeting — the day of the regular meeting in said month being on the 2d day of September; and the said secretary called said meeting for the sole purpose of receiving the inventory of the property and effects of said corporation; that if said meeting had been lawfully convened, that -was the only business which could have been properly transacted. The defendant denies that there was any power in the alleged meeting to declare a dividend of any kind; that prior to this time and while plaintiff and one W. A. Mays were directors in this company, and the plaintiff was its secretary and manager, receiving a large salary for what should have been honest and faithful service, the said parties entered into a conspiracy with another stockholder, N. J. Catrow, to depreciate the property of the company, allowed the machinery to run down, the stock to be reduced, failed to renew the contracts for stock, and otherwise impaired the value of the plant in order to make a showing of large earnings and cripple the plant for further use; that C. L. Bookwalter, who made the resolution for the declaration of the dividend at the meeting of the board, was induced thereto by the wrongful and fraudulent conduct of the plaintiffs and Mays, and that it was only because plaintiff and Mays deceived Bookwalter and the other directors by representing that the financial condition warranted a dividend, that the Bookwalters did not oppose a dividend of forty per cent, or any other dividend at the time in excess of twenty-five per cent., as the finan-' cial condition of the company did not justify in excess of that amount.

Defendant further says that the minutes of the meeting were never approved by the board, and that the directors subsequently voted to rescind the action of the board in declaring a dividend, and that the stockholders duly assembled, duly approved the action of the board in rescinding the dividend; that the plaintiff was unfaithful to his trust as an officer because he had already planned in connection with said Mays and Catrow, to establish a competing wheel company (and afterwards did establish such company), in the same city, to-wit, Miamisburg, where the defendant company is situated and used his position as an officer of the company to leave it in a condition, if possible, where it could not continue its business successfully.

Fcr reply, the plaintiff avers that there was a meeting of the board of directors of the defendant company on September 8, 1902, and that a dividend of forty per cent, was declared by said board at this meeting on said date, and denies each and every other allegation in the second defense of the answer contained.

Plaintiff further says that whatever alleged action, if any, was taken by the board of directors of defendant company after September 8, 1902, in reference to the time of payment- or in any way affecting the payment of the unpaid balance of six and two-thirds per cent, of said dividend or otherwise, was taken and done'without the consent or approval of the plaintiff, and that the alleged subsequent action of the stockholders approving the said alleged action of the board of directors was taken long after the filing of the petition herein,.to-wit, March 20, 1903, and that whatever action, if any, was taken at said alleged meeting of the stockholders in reference to the payment of or in any way affecting said dividend or the unpaid balance of six and two-thirds per cent, thereof, or in approving the said alleged action of said board, was taken and done without the consent or approval of this plaintiff. Plaintiff further says that he never received any notice of the object and purpose of said meeting of stockholders on March 20, 1903, or of the business to be transacted thereat. Wherefore, he asks judgment as prayed for in his petition.

For a reply to the amendment to the amended answer, plaintiff says, after averring as to the declaration of the dividend and the meeting of the board of directors, that at that date he was secretary of the company and called the meeting. He admits that he knew the president of the company was absent from the county and state, but avers that he did not- know his address or suppose his presence necessary, and admits that September 8, 1902, was the regular meeting of the board of directors, and denies each and every other allegation in the amendment to the amended answer contained.

The evidence in 'this case shows that the Bookwalter Wheel Company is an Ohio corporation, with a paid up capital stock of seventy-five thousand dollars; that on September 8, 1902, it had a directorate composed of five members, William Gamble, William A. Mays, Charles L. Bookwalter, W. L. Bookwalter and Lee Mitchell — William Gamble being president, and Lee Mitchell (the plaintiff), secretary and treasurer; that on September 2, 1902, such board of directors met at the office of the company in Miamisburg, Ohio, the minutes of which meeting are as follows:

“Miamisburg, Ohio, September 2, 1902. Board called to order by Y.-P. Bookwalter. Minutes of last meeting read and approved. Secretary reported inventory under way but not completed. Signed, Lee Mitchell, Secretary; W. S. Bookwalter, Y.-P.; present: W. S. Bookwalter, C. L. Bookwalter, Lee Mitchell.

This meeting was pursuant to Section 5 of the by-laws of the company, which reads as follows:

“It shall be the duty of the board of directors to meet the first Tuesday of each month to transact such business as may come before it. A majority of said board shall constitute a quorum to transact business. Special meetings may be called by president or secretary at any time.”

The testimony further shows that the end of the company's fiscal year was August 31, and that it had been the custom of the company to have an inventory taken during the latter part of August of each year, and to have report of the same made at the September meeting of the board, and thereupon to declare such dividend as the condition of the company seemed to warrant, the dividend for 1896 having been declared on September 21; for 1897, September 4th; for 1898, September 6th; for 1899, September 8th; for 1900, September 10th; for 1901, September 21st.

The testimony further shows that subsequent to the meeting of September 2, 1902, the board held another meeting on September 8, 1902, the minutes of which are as follows:

“Miamisburg, September 8, 1902. Board of directors met at the call of the secretary for the purpose of making report of inventory taken September 1st, Y.-P. Bookwalter presiding. Present: AY. A. Mays, Dr. Bookwalter, C. L. Bookwalter and Lee Mitchell. A summary statement of the condition of the company was read, a copy of which will be found on the following page. On motion of C. L. Bookwalter and seconded by AY. A. Mays, a dividend of forty per cent, was declared upon the capital stock paid in, making $30,000. The treasurer stated it would not be convenient to pay in full at once but to pay thirty-three and one-third per cent, now and six and two-thirds per cent, later. No further business coming before the board, it adjourned. W. S. Bookwalter, Y.-P. Lee Mitchell, secretary.”

The following is the summary statement referred to:

“Summary statement after taking inventory September 1, 1902. Assets — Real estate, $15,500.42; machinery, $15,525.00; team; $150.00; cash in bank and on hand, $21,946.28; insurance prepaid, $432.80; bills receivable, $9,619.28; personal accounts receivable, $12,672.73;- tire, tirebolts, etc., $4,018.58; flanges, rivets, etc., $5,855.80; supplies, $558.70; merchandise on hand, $33,890.72; total, $120,170.31. Liabilities — Capital stock, $75,-000.00; surplus fund, $13,787.85; total, $88,787.85. The net earnings for year, $31,387.46.”

This, it will be noticed, shows no bills payable. The testimony further shows that after 'said meeting of September 8, checks were mailed by the secretary of that date for thirty-three and one-third per cent, of the dividend, and that accompanying letters read as follows:

“At a meeting of the board of directors held this day a dividend of forty per cent, was declared upon the paid up capital stock. We enclose check to your order for thirty-three and one-third per cent, of this, balance of six and two-thirds per cent, will be paid later. Respectfully, The Book-waiter Wheel Co., per Lee Mitchell, secretary and treasurer.”

The plaintiff in this case was on said date a stockholder owning ninety shares and would be entitled under such a dividend legally declared to $3,600. He did receive $3,000, but the $600 is still unpaid.

The testimony further shows that on page 106 of the company’s ledger this plaintiff was on September 8, 1902, credited with $3,600, and that the surplus fund in the ledger was charged with the same amount. Similar entries were made as to the dividend of each stockholder.

The testimony further shows that William Gamble, who was ihe president of the company, was absent from both the meeting of September 2 and September 8; that at that time of the year it was his custom to be in Now Hampshire, or at least out of this state, where he went because of hay fever with which he is afflicted.

Mr. Mitchell testified that he notified the other members of 'the board personally of the meeting of September 8, but not knowing Mr. Gamble’s address and not considering it necessary, he had not mailed him a notice.

The testimony further show's that the following dividends have been declared by this company: 1899, on net earnings, $26,299.70, twenty-five per cent., twelve and one-half being paid September 8, and tw'elve and one-half paid September 25. 1900, on net earnings of $26,290.24, thirty-three and one-third per cent, paid on September 21. 1901, on net earnings, $26,180.-28, thirty-three and one-third per cent. 1902, on net earnings of $31,382.46, forty per cent., and that William Gamble was president in the year 1901 only, and that said dividends were paid without any complaint heretofore because of his absence.

The testimony further show's that regular and called meetings of the board of directors were afterwards held in 1902, on September 24th (w'hen the resignation of Mr. Mitchell, the secretary and treasurer, was accepted, to take effect October 1st); on October 1, October 27, 1902, January 6, 1903, and on the last mentioned date the minutes are as follows:

“Dr. W. S. Bookw'alter offered the following — ‘Whereas, at a meeting of the board of directors held on September 8, 1902, a motion was adopted declaring a dividend of forty per cent, upon the capital stock paid in, thirty-three and one-third per cent, of w'hich be paid at once and six and two-thirds per cent, paid later, when it would be convenient to pay it — Resolved, That the board of directors rescind their action taken on above date as to payment of the six and two-thirds per cent, and that the action of the board as to such six and two-thirds per cent, be hereby declared null and void for the reason that there are necessary repairs to he made to the plant of the compmvy and the installation of atitomatic sprinkler equipment and other good reasons why such six and iioo-thirds per cent, dividend can not he paid. A vote was taken unanimously adopting this resolution.’ ”

The minutes of the corporation further show that pursuant to the regulations and the by-laws and notice, the annual stockholders’ meeting was held at the office of the company on January 19, 1903, at which no action was taken relative to this dividend; that afterwards, and after this suit had been, brought in January, on March 20, 1903, another stockholders’ meeting was held, at which the following resolution was offered by Dr. Bookwalter:

“Whereas, at an alleged meeting of the board of directors of this corporation held on the 8th day of September, 1902, there was an attempt made to declare a dividend of forty per cent, upon the paid up capital stock of this corporation, and whereas said attempt was made because the stockholders then present were misled by the then secretary and manager of said corporation for the fiscal year then closing, and whereas, said alleged meeting of directors of this corporation was unlawfully convened and said dividend not legally declared, and whereas, the same dividend, to-wit, thirty-three and one-third per cent, has been paid to all the stockholders and no more to any, Therefore, be it Resolved, first, that said dividend of forty per cent, was not legally declared; second, that there 'was no intention on the p,art of those present at said alleged meeting to declare a dividend of forty per cent, to be paid at once, and that it was not intended that the six and two-tliirds per cent., which has not been paid, should be paid until the beard of directors should fix a .date therefor; third, that the stockholders of said corporation hereby ratify the action of the board of directors held on January 6, 1903, in rescinding the attempted declaration of a forty per cent, dividend or any dividend in excess of thirty-three and one-third per cent, which had been paid.”

This resolution was adopted, 501% shares voting in favor of the resolution, and 90 shares against it. The other shares were silent.

This suit was filed January 21, 1903. These are the main points in the evidence. Other matters testified to may be referred to in the opinion.

In this case The first question which presents itself for solution is, whether a valid dividend was declared by the board of directors of the Bookwalter Wheel Company on September 8, 1902.

This is an ■ Ohio corporation for profit and its board of directors who, under the statute, control, exercise and conduct the property business and powers of the corporation, would be governed in their declaration of a dividend by any provision found relative thereto in the Revised Statutes of Ohio, and in any by-law passed by the corporation not inconsistent therewith.

Section 3269-1 of the Revised Statutes provides as follows:

[Corporate dividends to be paid from surplus profits only.] Be it enacted by the General Assembly of the ■ State of Ohio, That it shall not be lawful for the directors of any corporation organized under the laws of this state to make dividends except from the surplus profits arising from the business of the corporation.”

Section 3269-2 provides:

[Unpaid interest due corporation not to be included in profits.] In the calculation of the profits of any corporation previous to a dividend, interest then unpaid, although due, on debts owing to the company, shall not be included.”

Section 3269-3 provides^

[Surplus profits; how ascertained; prohibiting advertisement of capital not subscribed and paid in.\ In order to ascertain the surplus profits, from which alone a dividend can be made, there shall be charged in the account of profit and loss, and deducted from the actual profits—
“1. All the expenses paid or incurred, both ordinary and extraordinary, attending the management of the affairs and the transaction of the business of the corporation.
“2. Interest paid, or then due or accrued 'on debts owing by the corporation.
“3. All losses sustained by the corporation, and in the computation of such losses, all debts owing to the corporation shall be included which shall have remained due without prosecution, and no interest having been paid thereon for more than one year, or on which judgment shall have been recovered, and shall have remained for more than two years unsatisfied, and on which no interest shall have been paid during that period.”

So far as these sections of the Revised.Statutes are concernea, we find from the evidence that the directors substantially complied with them in declaring this dividend. The company was at the time in a splendid financial condition, without indebtedness, with visible assets of $120,170.31, and had a surplus fund of over $13,000 — the net earnings for the year 1901-2 being $31,382.46.

Under the statutory law of Ohio, a corporation may provide for the time, place and manner of calling and conducting its meetings, and for the duties of its officers, etc.

Section 5 of the by-laws of this corporation, provides that it shall be the duty of the board of directors to meet the first Tuesday of each month to transact such business as may come before it. A majority of said board shall constitute a quorum to transact business. Special meetings may be called by president or secretary at any time.

Section 6 provides it shall be the duty of the president to preside at all meetings of the stockholders and directors, to sigE the records thereof, etc.

Section 7 provides that it shall be the duty of the vice-president to perform the duties of the president during his absence from the office of the company or inability. .

The meeting of September 2d was a regular and stated meeting of the board, being on the first Tuesday of the month. At this meeting, being the first after the termination of the fiscal year of the company, it was customary for the secretary to present for the consideration of the board the annual inventory.

The minutes of this board meeting show that the secretary announced that the inventory was under way, but not complete. No adjournment is shown.

On September 8th, the board came together again, the testimony showing that the secretary had notified them — except Mr. Gamble — that he was now ready with his inventory. The inventory was read, and after informal discussion, the dividend in question, on motion of C. L. Bookwalter and seconded by W. A. Mays, was declared. The board then adjourned.

The objections of the defendant as to the legality of this meeting are, first, that it was a special meeting called solely for the purpose of receiving the inventory of the property and the effects of the corporation, and that that was the only business which could be lawfully conducted thereat; second, that notice was not served on all the directors of the calling of such meeting, and especially upon Mr. Gamble.

If this had been a special meeting solely for the purpose alleged, the contention of the defendant would carry some weight, but looking at the minutes of both meetings and considering the oral testimony in the case, with reference to that, we can not come to that conclusion. The fact is, the meeting of September 2d disbanded without formal adjournment, and the business which would have been conducted on that day was conducted on September 8th, at which time the secretary notified them severally and personally that he would be ready with the inventory.

There is nothing illegal about this, nor about their conducting such other legal business as it was their custom to do at the September meeting in each year. Common sense and the law are never very far removed from each other, and it seems to us that this is the common sense way of looking at this situation. No notice, of course, was necessary to be given the directors for the regular and stated meeting of the board on September 2d, which was consistent with the by-laws. Bach director was presumed to know that on that day at that time such meeting would be held, and the by-laws do not provide for any notice. Notice is required when a director or stockholder would be ignorant of the occasion without it, but when he knows without notice, or when the time and place of meeting is so fixed that he is presumed to know, no notice is required, and if our view of this matter is eerreet, and the meeting of September 8th was but an adjournment of the meeting of September 2d, and was intended to, and did accomplish what would have been done at the meeting of September 2d, had the inventory been ready, the business done at the meeting of September 8th being entirely proper to be done at that meeting of September 2d, no notice would be necessary to the several directors, of the meeting of September 8th. See 35 O. S., p. 10; 14 O. S., p. 31.

So that the failure to notify Mr. Gamble would not be important in this ease, nor in any sense render either meeting invalid, nor the things done there futile and void.

Suppose, however, that the meeting of September 8th was a special and irregular one because of the failure to notify Mr. Gamble. No objection, so far as the records of the corporation show, has ever been made to it on that ground by any director, nor has the legality of the dividend .since been questioned by the old or new boards because of that fact. A new board was elected January 19, 1903. Since then other boards have annually been elected, and by none of these to the present time has any action been taken rescinding the declaration of September 8th because of the alleged irregularity of the meeting, and it seems to us that the objection, if made, should come from this source. The board of directors under the statute have control of the corporation and its affairs, with full power to declare a dividend consistent with the statute, and while the stockholders might by resolution advise them that action ■ looking to the rescission of an illegal and invalid declaration of dividend should be taken, we doubt if they could, by resolution, in a general stockholders’ meeting, rescind all or any part of a dividend.

In the language of the Supreme Court of Ohio, in the case of Simms v. City Railway Co., 37 O. S., 565

“They (the directors) represent the corporation in all its business affairs, and were authorized to transact all the corporate business within the scope of its authority. In the exercise of these powers, the directors are at all times subject to the equity jurisdiction of the courts on the application of a stockholder or minority of stockholders, to restrain all breaches of trust, or the exercise of powers not delegated to them, to the injury of stockholders.
“if, however, the directors, who are presumed to represent the will of the majority, act within the scope of their powers, their will must govern in the absence of fraud or breach of trust.” (Citing 18 Howard [U. S.], 342; 2 Russ. & M., 470; 10 New Jersey Equity, 171; 29 Vt., 545; 22 N. Y., 258; Field on Corporations, Sections 141-142.)

And whether the directors in the case at bar did or did not act within the scope of their powers is for a court to determine in a proper case. The action taken, by the stockholders in their attempt to rescind the dividend we do not, therefore, consider as conclusive.

Further objection is made to the declaration of this dividend on the ground that it was fraudulently brought about by Messrs. Catrow and Mitchell, and was intended, together with other alleged acts of these gentlemen, to cripple the company to the benefit of a similar concern which Mitchell is' claimed, to have had it in mind to start, prior to and at that time. Reference is made to the Mitchell Wheel Company, which Mr. Mitchell did .promote after his resignation from the secretaryship on.

As to these charges, the court has only to say that we find them wholly unfounded and unwarranted so far as any testimony in this case showed. Suspicions are not facts, nor can facts always be built about them so skillfully as to give them the appearance of solidity necessary to convince. The splendid success of this company for years, and especially for the years 1899, 1900, 1901 and 1902 shows that not only the gentlemen referred to, but everyone interested in the concern, were acting honestly and harmoniously for its best interest.

In 1899, as we have said, the net earnings were $26,299.70; in 1900, $26,390.24; in 1901, 26,180.28, and in 1902, the year.in question, $31,382.46. In other words, in four years, with a capita] stock of $75,000, the company’s net earnings were $110,-252.68, during all of which time Mr. Mitchell was the company’s secretary and manager. Nor was the dividend for 1902 extraordinary when compared to dividends of former years to which I have already referred.

We are of the opinion that this dividend was lawfully declared without ulterior motive on the part of the directors of the company, and that its declaration did not constitute either a fraud on the company or a breach of trust on the part of the directors.

Having found the dividend lawfully declared, what was. the effect of the action of the board of directors on January 6, 1903, rescinding six and two-thirds per cent, of said dividend?

We must remember, of course, that the dividend declared was in its entirety forty per cent.; that the separation of six and two-thirds per cent., to be paid at a later date, did not individualize that' and make it a thing to be considered apart from the other thirty-three and one-third per cent. Whatever rights accrued, to the stockholders at the declaration of the dividend would pertain to the whole dividend, so that any subsequent action of the board would be subject to these rights.

As the evidence shows, the dividend was declared, notice of the same with check was sent to each stockholder, the amount of his dividend was credited to each on the ledger of the company, and the surplus fund charged with it. .

The net earnings of a corporation are the property of the corporation only until such time as a dividend is declared. 17 C. C., p. 129.

“When a corporation declares a dividend, the earnings represented by the dividend are no longer represented by the stock, but become a debt due to the owner of the stock at the time of the declaration. ® * * That the dividend is payable at a future date does not affect the stockholders’ right. The moment a dividend is declared by a joint stock company, the company becomes a debtor and the stockholder creditor for the amount payable on demand.” (Wheeler v. N. W. Sleigh Co., 39 Fed. Rep., p. 347.) Also, Chase’s Decisions, p. 168.

In the 42 Conn., p. 24, the case of Beers v. The Bridgeport Spring Co., the court passing on the case say:

“When the defendant corporation, by the legal votes of its directora, declared the dividends in question from profits theretofore earned and received, made the same payable without interest at such time as might be directed by the board, and ordered the amount to be placed pro rata to the credit of the stockholders on its books, the share of each stockholder in the several amounts was thereby severed from the common funds of the corporation and became his individual property. Thenceforth the company owed him a debt, payment of which at a proper time he might demand, and upon refusal enforce by the aid of a court of equity (King v. Patterson & Hudson River R. R. Co., 29 N. Jer. Law, 504; Redfield on Railways [1st Ed.], 240, 597; Leroy v. Globe Ins. Co., 2 Edwards’ Cha. R., 657). The proviso as to the time of payment does not absolve-the company from all obligation to him; there remain all the essential elements of a debt, certain in amount, and certain to be paid upon a day not yet appointed, but which it is the duty of the debtor at some time to name. The legal effect of the vote is that the debt is t,o be paid within a reasonable time. The corporation having declared that it had received for and owed to each stockholder a certain sum of money, and having set the same apart from its own funds for his sole and separate use, can not thereafter nullify its votes or repudiate its obligations by declining to pay the dividend or to name any time when it would pay it. ’ ’

W. A. Reiter, McMahon & McMahon, for plaintiff.

Van Demwi, Burkhart (& Shea, for defendant.

When, therefore, this dividend was declared, it became a debt of the company to the stockholder as an individual to be paid within a reasonable time, and as such debt was beyond the control of both the stockholders and directors.

What was the condition of the company in the months following this declaration? The cash book balance once a month shows that they had on hand September 30, $2,482.47; October 31, $7,037.42; November 31, $8,292.50; necessary to pay this six and two-thirds per cent., $4,550. So that this six and two-thirds per cent, ought to at least have been payable November 31, 1902, and was due and payable when this suit was brought in January, 1903.

The resolution passed by the board of directors was a recognition of the validity of the act of the board on September 8th, and as we have said we do not believe that the stockholders assembled in general meeting had authority to nullify the act of the board as they attempted to do in March of 1903. If the board did act legally, as we have found, no such resolution was necessary, and even if illegally, how can the stockholders be heard to complain who have received and are enjoying the benefit of thirty-three and one-third per cent, of the dividend? This of itself is plainly an acquiescence in the board’s act, and if so, would be another reason why it should be carried into effect, for as I said in the beginning of the discussion of this point, the dividend is an entirety and must always be so regarded by the court.

From the foregoing, I am persuaded to find for the plaintiff and against the defendant in the sum of six hundred ($600) dollars, with interest from January 19, 1903.  