FOOTE v. CUNARD MINING CO. 47
poration. _The 'substance of the allegation is that certain property,
which in equity belonged to the Amulet Mining Company, was fraud·
ulently conveyed to the Cunard Mining Company, and the relief sought
is that the title be transferred from the one corporation to the other;
It is, therefore, a suit which ought to be brought by the Amulet Min-
ing Company, unless there is some reason set forth in the bill why it
should be brought by the complainants as stockholders in that com-
pany. There are no sufiicient allegations in the bill upon this sub#
ject. The rule which obtains now in such cases is laid down in the
ease of Hawes v. Oakland, 104 U. S. 450, in which, after having
stated the circumstances under which a bill may be brought by a
stockholder against the corporation of which he is a member, the
court adds:
"But in addition to the existence of grievances which call for this kind of
relief, it is equally important that, before the shareholder is permitted in his
own name to institute and conduct a litigation which usually belongs to the
corporation, he should show, to the satisfaction of the court, that he has ex-
hausted all the means within his reach to obtain, within the corporation itself,
the redress of his grievances, or action in conformity to his wishes. He must
make an earnest, not a simulated, effort with the managing body of the cor— E
poration to induce remedial action on their part; and this must be made ap—
parent to the court. If time permits, or has permitted, he must show, if he .
fails with the directors, that he has marie an honest eifort to obtain action by _
the stockholders as a body in the matter of which he complains; and he must 4
show a case, if this is not done, where it could not be done, or it was not rea- `
sonable to require it.
‘* The efforts to induce such action as complainant desires on the part of
the directors, and of the shareholders, when that is necessary, and the cause V
of failure in these efforts, should be stated with particularity, and an allega-
" ` tion that complainant was a shareholder at the time of the transactions of
which he complains. or that his shares have devolved upon him since by oper-
ation of law, and that the suit was not a collusive one to confer on a court of
# the United States jurisdiction in a case of which it could otherwise have no
cognizance, should be in the bill, which should be verified by allidavit."
Upon the announcement of that opinion the supreme court adopted
an additional rule in equity, to which I think, perhaps, the attention
of counsel in this case has not been called. It is rule 94, and will
be found in the l04th volume of the United States Reports, and is
as follows:
` "Every bill brought by one or more stockholders in a corporation against
» the corporation and other parties, founded on rights which may properly be
asserted by the corporation, must be verilied by oath, and must contain an
- allegation that the plaintiff was a shareholder at the time of the transaction
of which he complains, or that his share had devolved on him since by opera-
tion of law ; and that the su.t is not a collusive one to confer on a court of
the United States jurisdiction of a case of which it would not otherwise have
cognizance. It must also set forth with particularity the efforts of the
plaintiff to secure such action as he dcsires_on._the part of the managing dig
reetors or trustees, and, if necessary, of the shareholders, and the causes of
his failure to obtain such action."