Mnnxma v. WINTHROP IRON co. 49
7 other advantages to the lessee {voted one of the brothers a salary of $3,000 a
year as president; and in pursuance of said action such a lease was executed
bytwo of the brothers, acting as president and secretary of the IV. Iron Co., and
by the other two acting as secretary and superintendent of the XV. Hematite
Co. Upon a bill fled by stockholders in behalf of themselves and all other
stockholders, held, that such a lease was inequitable, and a fraud upon the
rights of stockholders not concurring therein.
In Equity.
Morris e0 U/al, for complainants.
C. T. lValkcr and Mr. Crocker, for defendants.
B.\XTER, J. The defendants, the Winthrop Iron Company and the
Winthrop Hematite Company, are corporations organized under the
laws of Michigan. The capital stock of the former consists of an
iron ore mine rated at $500,000. In August, 1877, it made a lease
thereof to the St. Clair Brothers, a partnership composed of the four
defendants by that name sued herein. Soon after securing said lease
they organized the Winthrop Hematite Company, for the purpose of
working the mine thereunder. They continued thus to operate until
the summer of 1881, when they made an effort to obtain a renewal
thereof to the Winthrop Hematite Company. But failing to secure
it, they proceeded to purchase a majority of the capital stock of the
Winthrop Iron Company, and assume control of its business. At
their instance a stockholders' meeting was called for October, 1881.
The meeting was accordingly held by one of the St. Claire, (who acted
for himself and brothers,) assisted by W. S. Hollert, their attorney,
and one G. B. Breese. Neither Hollert nor Breese owned any stock
1n the company. Hollert was made president, and Breese secretary,
7 U of the meeting. Being thus organized they adopted certain resolu-
tions, in which, among other things, they removed two directors of
the company, and appointed three of the St. Clairs in their stead;
authorized the sinking of a shaft at the mine, and appropriated $50,-
000 of the company’s money to complete and equip it; authorized and
directed a. lease of the company’s mine for 18 years from and after De-
cember 1, 1882,-the time at which the former lease was to expire,—
to the Winthrop Hematite Company; and soon thereafter Eugene G.
St. Clair as president, and J. N. St. Clair as secretary, of the Winthrop
Iron Company; and Eugene G. St. Clair as secretary, and George
A. St. Clair as superintendent, of the Winthrop Hematite Company,
professing to act for and in behalf of their respective companies, en-
tered into a contract wherein and whereby it was agreed that said
first company should lease its mine, with all the improvements,
mficlilluery, etc., thereon, for 18 years to the Winthrop Hematite CUI11-
pany at a royalty of 25 cents per ton.
The relief sought by complainants, who sue as well for all other E
stockholders in the Winthrop Iron Company as for themselves, is a T
rescission of said lease and an account of rents and profits; and to
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