The transaction of which complaint is here | stock did not pass to the treasury of the New made may be briefly characterized as an at- Jersey corporation; it was ordered issued tempt of the New Jersey corporation to abandon its New Jersey charter and to operate in the future under a Delaware charter in order to escape the burden of the New Jersey annual franchise tax. The method adopted was simple but unscientific. A Delaware corporation was formed of the some name and capitalization as the New Jersey corporation and the directors of the New Jersey corporation by resolution then authorized a transfer of the entire assets of the New Jersey corporation to the Delaware corporation in consideration of the Delaware corporation assuming the debts of the New Jersey corporation and issuing its capital stock to the several stockholders of the New Jersey corporation upon such stockholders surrendering their New Jersey stock. stockholders' meeting then approved the plan

A

and the transfer of assets was made and all stockholders of the New Jersey corporation except two surrendered their New Jersey stock and accepted an equal number of shares in the Delaware corporation. The former board of directors of the New Jersey corporation were made directors of the Delaware corporation, and that corporation has since operated without change or disturbance of the business or its methods.

Complainant, a large stockholder and also a large creditor of the New Jersey corporation, has at no time consented to these proceedings. His bill seeks a decree declaring proceedings unlawful and void and setting aside the transfer of the assets, and, in the event of this being found impracticable or impossible in this suit, praying for the appointment of a receiver to conserve the assets and rights of the New Jersey corporation and its creditors.

to the several stockholders of the New Jersey corporation. The contemplation of the transaction as in general effect a delivery of the stock of the Delaware corporation to the New Jersey corporation and a distribution of that stock to the several stockholders of the New Jersey corporation contributes nothing to its vitality. Our statutes touching dividends to stockholders from profits and distribution of capital to stockholders after payment of debts clearly render the entire transaction unlawful. In fact no consideration passed, or was intended to pass, to the New Jersey corporation; that corporation was intended to be abandoned and set adrift without assets or stockholders, and its creditors were left to look to the obligation of the Delaware corporation to pay the debts of the New Jersey corporation under the contract of assumption.

[2] It is apparent, however, that no relief can be administered in this suit through a decree setting aside the transfer of assets or declaring the transaction void or holding the directors responsible for misconduct of official duties, for the legal title to these assets is in the Delaware corporation, which corporation is not subject to the jurisdiction of this court in this suit, and the several directors are nonresidents and have not appeared in this suit, and few, if any, of the assets in question are within this jurisdiction. It seems clear, therefore, that the only practicable relief which can be afforded is the appointment of a receiver of the New Jersey corporation, which is now in an insolvent condition, to the end that the receiver may pursue such remedies as are open to him to restore to the New Jersey corporation for the benefit of its creditors and stockholders the property and property rights which have been unlawfully withdrawn from it.

The New Jersey corporation and the Delaware corporation and all the directors of the Delaware corporation are made defendants. The New Jersey corporation has answered; all the other defendants, except one director, are nonresidents, and have refused to sub-plainant had notice of the stockholders' meetmit themselves to this jurisdiction.

[1] It is obvious that no legal justification can be found to support the proceedings which have been taken. It has been urged in behalf of defendant that the transfer of assets is authorized by the following provision of the articles of incorporation of the New Jersey corporation:

"With the consent in writing and pursuant to the vote of the holders of a majority of the stock issued and outstanding, the directors shall have power and authority to sell, assign, transfer or otherwise dispose of the whole property of this corporation."

But this provision cannot be understood as authorizing a transfer of the assets without an adequate consideration moving to the New Jersey corporation. The capital stock of the Delaware corporation was the primary consideration of the transfer or sale of the

[3, 4] It is urged that complainant should be denied relief by reason of laches. Com

ing at which the action of the directors authorizing the transfer of assets was approved, and failed to attend that meeting and thereafter learned of the action which had been taken, and for a considerable time failed to protest or make known his dissent. There can be no doubt that in some circumstances laches can be attributed to a stockholder, and remedies to which he would be entitled but for his laches denied. A stockholder's bill in behalf of his corporation, to set aside a contract which has been made by a board of directors with its members, must be promptly filed or it cannot be maintained. But in the present case there is brought before this court an insolvent corporation which has been unlawfully deprived of the legal title of its assets, and a stockholder and creditor of that corporation asks for the ap

FORT v. COURT OF COMMON PLEAS OF cation for a license for an inn and tavern con

taining less than 50 spare rooms and beds, such licenses must be taken into consideration and counted on the basis of population. This 462-LICENSES-contention is asserted to be founded upon NUMBER-STATUTE-ADDITIONAL LICENSE- a provision in the act on page 576, which LICENSED PREMISES.

Certiorari to Court of Common Pleas, Mon- censes" and "licensed premises" in the act mouth County.

puted as of the 1st day of August in any number of rooms, or to picnic or recreation year, Spring Lake, which borders on the grounds of certain dimensions, or to regularAtlantic Ocean, and which has a transiently organized clubs occupying entire buildpopulation of 4,000, therefore is entitled, ings. It may very well be that in making obviously, to more than three licenses, on these places exempt from the operation of the basis of one license for every 500 of pop- the provision in the act relating to the population. ulation basis the Legislature had in view the fact that, at least as to summer hotels and clubs, the use of the license privilege would be of a temporary character. That it was the intention of the Legislature to put a check upon the increase in the number of inns and taverns of less than 50 spare rooms and beds and on saloons in cities is manifest. The number of such latter places is regulated by the ratio of population, as stated, to the number of licenses granted. The licensed premises or places, therefore, which the Legislature intended to limit were not 50-room hotels, picnic grounds, and clubs of the character above described, but inns and taverns of less than 50 spare rooms and beds, and saloons. This being so, it becomes clear that the terms "additional licenses" and "the number of licensed premises" cannot, in the very nature of the provisions of the act, refer to hotels having 50 spare rooms and beds, picnic and recreation grounds and clubs of the character mentioned, but the language used obviously refers to inns and taverns of less than 50 spare rooms and beds, or saloons which were lawfully carried on at some time within a year immediately preceding the passage of the act of 1913, and provided such business was not abandoned at the place licensed during that year. Such places meeting these conditions were entitled to be licensed irrespective of the ratio of population to the licenses granted. In order, however, to put a check upon the increase of the number of inns and taverns having less than 50 spare rooms and beds and saloons, it was the clear legislative design that licenses granted to inns and taverns or saloons which met with the above statutory requirements were to be counted on the basis of ratio of population, as fixed by the statute, whenever an application was made for a license for a new place. It is not pretended in the present case that there was any other license granted by the court than those granted to the three hotels mentioned, when the licensee applied for and obtained his license to keep an inn and tavern having less than 50 spare rooms and beds, and, that. therefore, the granting of such license was not in violation of the statute.

The facts in this case are undisputed. It is stipulated between counsel that Spring Lake is a borough bordering on the Atlantic Ocean, having at the census of 1910 a population of 853 inhabitants and a transient population of 4,000 August 1, 1914; that the prosecutor and objector to the granting of the license is a resident real estate owner and taxpayer of Spring Lake; that three licenses to keep inns and taverns, being the three hotels mentioned, each of which contains upwards of 50 spare rooms and beds, were granted by the court of common pleas of Monmouth county; that the license applied for and granted in the present case was for a new place, and not a hotel having at least 50 sleeping rooms, nor a picnic ground or recreation place comprising at least one acre, nor was it a building entirely occupied by a regularly organized club or association; that though the three hotel licenses were each granted for one year, it was with the knowledge that the hotels would be open only during the summer months, and that they have in fact only operated during the summer months, and that there are no licensed hotels in Spring Lake where the people are accommodated during the entire year. It is obvious from a plain reading of the act that in so far as inns and taverns are concerned, or places where liquors are sold in quantities less than one quart, it was the intention of the Legislature to regulate and fix the number of such places by a ratio of population to the number of licenses granted to places coming within that description. For the act provides that no license to keep an inn or tavern, or to sell spirituous, vinous, malt, or brewed liquors in quantities less than one quart, in any city, town, township, borough, or village, shall be granted by any court, etc., unless or until the ratio of population therein to the number of licenses issued shall be greater than 500 to one, and then only pursuant to the act now being considered. The act then excepts from the operation of this provision: (1) Premises in which the business of selling liquors was lawfully carried on at some time within a year preceding the passage of the act of 1913, provided that such business was not abandoned at any time during the year; (2) hotels having at least 50 spare rooms and beds for the accommodation of boarders, transients and travelers; (3) picnic or recreation grounds comprising at least one acre; (4) a building entirely occupied by a regularly organized club or association.

It is to be observed that the act places no limitation on the number of licenses that

Counsel for the prosecutor cite Gundrum v. South Amboy, 86 N. J. Law, 450, 92 Atl. 271, to support their contention that all li censes count on the number limited, to one in 500, but an examination of that case shows that the precise question raised here was not there considered. This appears from what Mr. Justice Trenchard, who delivered the opinion of this court, says, on page 452 of 86 N. J. Law, on page 272 of 92

firmed.

Argued before BROWN, C. J., and MESTREZAT, POTTER, STEWART, FRAZER, and WALLING, JJ.

"Now, the depositions show that, when the li- for plaintiff for $1,620, plaintiff appeals. Afcense in question was granted, the city of South Amboy had, exclusive of the one in question, 30 places licensed for the sale of spirituous, vinous, malt, or brewed liquors in quantities less than one quart. From the depositions it also appears that the population of the city then was 7,007. Since, therefore, the ratio of population to the number of licensed places was not greater than 500 to one, the license was prohibited by the statute unless it is within some one of the provisos or exceptions contained therein."

Latimer P. Smith, of Philadelphia, for appellant. John Arthur Brown and Henry P. Brown, both of Philadelphia, for appellee.

POTTER, J. [1] From the evidence in this case it appears that defendant agreed to pay to plaintiff a commission upon all subscriptions which plaintiff should get to the capital stock of the Wallace Automobile Company. Plaintiff suggested the name of George W. Bremer as a possible purchaser, but the record shows that he did not begin negotiations with him upon the subject, nor did he first bring the matter to the attention of Mr. Bremer, nor did he make the sale of the stock to him. That was accomplished by the defendant. Mr. Bremer testified that he subscribed for the stock as a result of meeting Mr. Wallace, the defendant; that he then

The views expressed by the learned justice are not in conflict with the views expressed here, but rather in harmony with the general idea that the ratio of population re quirement is strictly limited to the ordinary inn and tavern and saloon class. See, also, Blake v. Pleasantville, 87 N. J. Law, 430, 431, 95 Atl. 113. Counsel for defendant have urged upon us that it was stipulated in this case that the transient population of Spring Lake in the contemplation of the statute, on August 1, 1914, was upwards of 4,000, and that there were at that time only three hotels in the borough, and that if they are to be counted and the license based on the pop-made an investigation and decided to purulation of August 1, 1914, the license was properly granted, because the licenses issued were not greater than one to each 500 of such population.

chase. Nowhere in the record does it appear that the plaintiff was the efficient, moving cause of the sale, and, unless he was, he did not earn a commission. There was nothing

As we have reached a conclusion sustain-in the agreement giving plaintiff an excluing the validity of the license on another ground, we do not deem it necessary to express any opinion on the soundness of this contention, except to point out that the act refers exclusively to cities bordering on the Atlantic Ocean, and Spring Lake is a borough.

The writ will be dismissed and the proceedings of the court of common pleas affirmed, without costs.

(252 Pa. 323)

MACNEIR v. WALLACE. (Supreme Court of Pennsylvania. Feb. 14,

1916.)

sive right to control the sale of the stock within any specified time. The mere suggestion of the name of a possible purchaser, without more, was not enough. had plaintiff brought the parties together, for the purpose of effecting a sale, and if his introduction or his opening of negotiations had resulted in a sale, his commission would have been earned; but there is nothing in the evidence to justify that conclusion. The established principle that, where an agent has commenced negotiations with a purchaser, the principal cannot, pending the negotiation, take the matter into his own hands and complete it, has no application here. No negotia1. BROKERS 53-COMPENSATION-PERFORM- tions were pending when defendant broachANCE OF CONTRACT. Plaintiff was not entitled to recover com-ed the subject to Bremer, nor did plaintiff missions on the sale of stock at the request of first bring the matter to his attention. As a defendant, where it did not appear that plaintiff matter of fact, the evidence tends to show was the efficient moving cause of the sale, and it that the inducing cause of the purchase by did appear that defendant had negotiated the sale himself. Bremer was largely the promise of a salaried position with the company, rather than the merits of the stock as an investment. We agree with the court below that there was nothing in the testimony from which the jury could fairly find that plaintiff brought the parties together, or was in any way the immediate and effective cause in procuring Bremer's subscription. On the contrary, the uncontradicted evidence shows that defendant, meeting Bremer accidentally, presented the subject, gave him full details the next day, had other meetings with him thereafter, and finally induced Bremer to subscribe upon condition that he should have a salaried position with the company. Under these circum

[Ed. Note. For other cases, see Brokers, Cent. Dig. § 74; Dec. Dig. 53.] 2. JUDGMENT 199(3) — NOTWITHSTANDING VERDICT.

Where a verdict plainly indicates that the jury indulged in a capricious disbelief of the testimony, a judgment notwithstanding the verdict was proper.

[Ed. Note.-For other cases, see Judgment, Cent. Dig. § 367; Dec. Dig. 199(3).]

Appeal from Court of Common Pleas, Philadelphia County.

Action of assumpsit by Edwin Macneir against Robert Wallace for commissions on the sale of stock. From a judgment for defendant non obstante veredicto after verdict

stances the court below was right in entering | 5. PERPETUITIES ~~9(5) — ACCUMULATIONS judgment for the defendant non obstante VALIDITY. veredicto.

[2] A verdict which plainly indicates that the jury indulged in a capricious disbelief of the testimony, should not be permitted to stand. Walters v. American Bridge Co., 234 Pa. 7, 82 Atl. 1103; Lonzer v. Lehigh Valley R. R. Co., 196 Pa. 610, 46 Atl. 937.

The assignments of error are overruled, and the judgment is affirmed.