Talley v. Dadds

Sloan, J., delivered the opinion of the Court. This appeal comes here from a decree overruling a demurrer to the appellees’ bill. The bill was filed by several policyholders of the Home Friendly Insurance Company (of Baltimore), a Maryland corporation, claiming to have been regularly elected directors, of the company, at the annual meeting of its policyholders held May 4th, 1931, and seeking an injunction to restrain a rival board of directors, who were their own successors, from exercising any of the duties, of directors of the corporation, on the charge that the latter were holding their offices by virtue of an illegal and void election. The bill alleges that the annual meeting of policyholders was duly advertised to be held at the principal office of the company at 10 o’clock on the morning of May 4th, 1931; that the appellees were on hand a few minutes before the hour advertised; that at 9.53 o’clock the door of the room in which the election was to be held was opened, and, when the appellees were admitted, they were advised that the annual meeting was over, and that the appellants had been elected to serve as directors for another year.

Nothing daunted, the appellees then and there, as the hour of ten arrived, proceeded to hold an election, and they, as a result of the ballot taken, were, as alleged, duly elected. Demand was then made by the appellees for the books, records, etc., of the insurance company, and, because of their refusal of the appellees’ demands and the continuance in office of the appellants, the bill was filed. The bill alleged that the appellees, Charles C. Dadds, John W. Beet or, Louis Bokel, Charles T. Johnson, and Victor W. ⁵⁶⁰ Morawski, have been for several years district agents of the insurance company and that they have been given notice of their dismissal by the board of directors so alleged to have been illegally elected. The bill then prays: “(®) That the action of the defendants in holding such annual meeting of policyholders in the manner herein alleged on Monday, May 4th, 1931, and that the election of the defendants as directors at said alleged annual meeting on May 4th, 1931, may be declared illegal and void. “(b) That the annual meeting of policyholders held by your orators on May 4th, 1931, and the election of the directors at said meeting as hereinbefore recited may be declared legal and valid. “(c) That the Board of Directors elected at said meeting • held by your orators on May 4th, 1931, may be declared to be entitled to the books, papers, business, property and assets • of the Home Eriendly Insurance Company; and that the defendants may be ordered and directed to turn over said books, papers, business, property and assets of said corporation to said Board of Directors so* elected. “(d) That the defendants and each of them may be enjoined and restrained from in any manner dismissing your orators, Charles C. Dadds, John W. Rector, Louis Rokel, Charles T. Johnson and Victor W. Morawski, from their offices as district agents and from interfering with them in the discharge of their duties as such agents, until the rights of your orators are herein determined. “(e) And that your orators may have such other and further relief as their case may require and as may appear to be necessary and appropriate.” The bill was amended by striking out prayers (b) and (c), leaving (a), (d), and (e).

An order for the writ of injunction was passed. The appellants demurred to each and every allegation of the bill, and to each prayer for relief, giving fifteen reasons why the bill should not be entertained, but, as they all raise the question of the jurisdiction of a court of equity to- grant relief for the wrongs alleged, and as that is ⁵⁶¹ the only question involved and argued on this appeal, it is not necessary to set out in detail the grounds of demurrer. Counsel on both sides rely on decisions of this court to support their respective contentions; the appellants, that such a contest is only cognizable by a court of law; the appellees, that equity has jurisdiction to oust directors illegally elected or wrongfully holding office. In the case of Shryock v. Morris, 75 Md. 72, 76, 23 A. 68, 70 , it is said: “Exception to the jurisdiction, whether taken by demurrer, plea, answer, or by way of special exception to the