Page:Federal Reporter, 1st Series, Volume 10.djvu/425

FLAGU V. MANHATTAN SY. 00. 413 �Flagg and others v. Manhattan Et. Co. and others.* {Oireuit Court, 8. B. Neva York. December 21, 1881.) �1. Corporations— GtJARANTT dp Dividend — Powbk ov Dibectoiis. �An agreement between two corporations, whereby one guaranties the other a certain specifled annual dividend on its capital stock, is not a guaranty to its stockholders severally, but to the corporation, and the power to modify the terms of such guaranty is in the directors of such corporations, not in the Btockliolders. Where such power is lairly exercised by the directors, in view of all the circumstances, and in good faith, a court will not interfere, even though, on the same facts, it might have arrived at a different conclusion. �In Equity. �S. P. Nash, for plaintiffs. �D. D. Field, for defendants. �Blatchfoed, g. J. This suit is bronght by three persons as indi- viduals and two persons as copartners, who claim to be owners of shares of the capital stock of the Metropolitan Elevated Eailway Company, 155, 10, 150, and 75 in number, of the par value of $100 each, there being 65,000 shares in all. The three companies defend- ants are railroad corporations organized under the laws of the state of New York, and will be called the Manhattan, the Metropolitan, and the New York. The first company had no lines of railway. The second and third companies had elevated railways in the city of New York. On the twentieth of May, 1879, the three companies entered into a written agreement known as the "triparte" agreement. It recites that the agreement is made "for the purpose of avoiding the danger of crossihg elevated railway traoks upon the same level, and otherwise securing to the people of New York the advantages of safer and more rapid transit through the action of one directing body." It provides for the execution of the leases hereinafter mentioned, and contains other provisions which it is not important at this point to notice. On the same day the Metropolitan and the Manhattan exe- cuted an agreement of lease in writing. It recites that the Metro- politan ia authorized to construct and operate a Une of elevated railway in the city of New York, a portion of which, specifying it, is complete (1 and in operation by it, and is engaged in constructing other parts ; that the New York is the owner of and engaged in operating certain lines of elevated railway in said city over routes heretofore establislied by law for it, "which railways and routes at various places unite with the railways and routes" of the Metropolitan, "and �♦Reported by 8. Nelson White, Esq., of the New York bar. ��� �