Page:Federal Reporter, 1st Series, Volume 9.djvu/370

HANCOCK V. HOLBROOK. 355 �ac, follows: A. M. Holbrook, 63 shares; Peter St. Armand, 1 share; E. W. Holbrook, 1 share; E. C. Hancock, 15 shares; and A. W. Walker, 10 shares. �The persons who held the remaining shares were nanled in the charter, tu jugh all the certificates do net seem by the stock-book to have been issued. The eomplainant subsequently derived title to two shares by purchase, — one from D. P. Penn, and one from the estate of William P. Harper, — and th "ee were donated to him by holders who were personal friends. The charter bears date December 19, 1873. There seemg to have been an under- standing on the part of the eomplainant and Judge Walker, which is eorrobo- rated by Warmoth, that Walker was to be chief editor and eomplainant the managing editor, and A. M. Holbrook the business manager. But, unfortu- nately, this understanding was merely verbal, and was not recognized by the terms of the charter, which placed all these matters under the control of the directors ; and, on December 26, 1873, a set of by-laws was enacted, all of the direetors being present, and all voting in favor of their adoption except the eomplainant, which clothed the president (A. M. Holbrook) with authority to " organize the various departments of the paper, and employ and discharge all editors and employes, and flx their salaries,, and to have the general super- vision of all the operations and transactions of the corporation." This action^ of the directory diselosed how wide was the misunderstanding between eom- plainant and Walker on the one part, and A. M. Holbrook, who was sustained by the charter, on the other part. �On the sixteehth day of December, 1874, the 12-months' bond for $20,100 - was to mature. Shortly before this time A. M. Holbrook announeed to all concemed his inability to pay the bond, and his determination that the prop- erty purchased with the bond should be used in the payment of the bond. Through Warmoth offers were made from Holbrook to Mr. Walker that if he or any of his friends would pay the bond, they should have the Picayune. This Mr. Walker was unable to do. Mr. Aroni, as the counsel of some one, at one time ofCered to make the payment and take the property, but subse- quently withdrew the offer. �On December 14, 1874, the majority of the board of directors, the eom- plainant not being present, and Mr. Walker voting nay and protesting, passed a resolution to the effect that if Mr. Hernandez would pay the bond he should have conveyed to him the Picayune establishment. On the following day Warmoth, through Hernandez, paid the bond and received the conveyance. The amount paid was $20,211. �On the twenty-secoud of December, 1874, a special meeting of the stock- holders, called by the directory, passed resolutions ratifying the action of the directors in making the conveyance to Hernandez in payment and settlement of the 12-months' bond, and dissolving the corporation. Shortly after such dissolution, Hernandez, acting for Warmoth. sold and conveyed the entire Picayune establishment to A. M. Holbrook for his promissoiy notes, amount- ing to $27,500, falling due in monthly instalments, the last not maturing for several years, and bearing interest at the rate of 6 per cent, per annum. �Two promissory notes had been'given by A. M. Holbrook to Wannoth for debts due from the Herald Company to him, and for his services in connec- tion with the paper. These notes were giveu at the time of the formation of ��� �