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Keywords

statutecorporationrespondentwrit of mandamus
statutecorporationrespondent

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Chas. A. Day & Co. v. Booth, 123 Me. 443, 123 A. 557, 43 A.L.R. 780

Facts

Chas. A. Day & Co., Inc. filed petitions for writs of mandamus against the clerks of three corporations to inspect their stock books. The petitioner held one share of stock in each corporation, which was acquired solely to demand stockholder lists. The corporations had significant market values and numerous stockholders, but the petitioner’s ownership was deemed insufficient to establish a legitimate interest in the corporations' affairs.

I find that the petitioner is the owner of only 1 share of stock in each of the corporations concerned; that each of these shares was acquired for the sole purpose of laying a foundation to demand a list of stockholders in each company… that the purpose of the petitioner in obtaining the lists of stockholders in the three corporations here concerned is to trade in the stocks of those corporations.

Issue

Did the petitioner demonstrate that it was a 'person interested' entitled to inspect the corporate records and stock books under R. S. 1916, c. 51, § 22?

Has the petitioner shown itself ‘interested’ in the affairs of the several corporations, within the meaning of the statute? I think that this question must be answered in the negative.

Rule

Under R. S. 1916, c. 51, § 22, corporate records and stock books must be open to inspection by persons interested, who may take copies and minutes of parts concerning their interests.

R. S. 1916, c. 51, § 22, which provides that the corporate records and stock books ‘shall be open at all reasonable hours to the inspection of persons interested, who may take copies and minutes therefrom of such parts as concern their interests,’ etc.

Analysis

The court analyzed whether the petitioner, holding only one share of stock in each corporation, could be considered a 'person interested' under the statute. It concluded that the petitioner’s stock ownership was merely colorable, intended solely to facilitate the acquisition of stockholder lists, and therefore did not qualify as a legitimate interest in the corporations.

But where it is shown that such stockholding is only colorable, or solely for the purpose of maintaining proceedings of this kind, I fail to see how the petitioner can be said to be a ‘person interested,’ entitled as of right to inspect the records and stock books of a corporation, and to take copies and minutes therefrom, of such parts as concern his interest.

Conclusion

The court denied the peremptory writ of mandamus in each case, ruling that the petitioner failed to show it was a person interested entitled to inspect the records.

I therefore rule that upon the facts appearing in these cases the petitioner has failed to show that it is a person interested within the meaning of R. S. 1916, c. 51, § 22, entitled to inspect the records and stock books of the respondent.

Who won?

The respondents prevailed in the case because the court found that the petitioner did not have a legitimate interest in the corporations, as its stock ownership was solely for the purpose of obtaining stockholder lists.

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