CONSTITUTIONAL LAW - WAR CONTRACTS - EFFECT OF CONSTITUTIONAL ISSUES ON THE EXHAUSTION OF ADMINISTRATIVE REMEDIES DOCTRINE

Plaintiff, a manufacturer of war materials under subcontracts with government contractors, filed suit in the District Court for the District of Columbia requesting a declaratory judgment holding the First and Second Renegotiation Acts unconstitutional and, as a consequence thereof, injunctive relief from threatened action by the defendants to recover alleged excessive profits. The district court dismissed the complaint on the grounds (1) that the suit was premature, plaintiff having failed to exhaust the prescribed administrative procedure, and (2) that the available legal and administrative remedies were adequate, the right to equitable relief not being established either on the basis of irreparable injury or multiplicity of suits. On appeal, held, affirmed. Aircraft & Diesel Equipment Corp. v. Hirsch, 331 U.S. 752, 67 S.Ct. 1493 ( 1947 )

CORPORATIONS-SEPARATION OF THE VOTING POWER FROM LEGAL AND BENEFICIAL OWNERSHIP OF CORPORATE STOCK

The Supreme Court of Michigan recently decided the case of Ecclestone v. Indialantic, Inc., the important facts being as follows: in June, 1942, defendant Emmons, owner of 451 shares of the common stock of Indialantic, Inc., a Florida corporation, transferred his entire holding to the Detroit Orthopedic Clinic in payment of an antecedent debt, reserving to himself, however, the sole right to vote the stock until the assets of the corporation were substantially liquidated. In March, 1946, with notice of this reservation of the right to vote, the plaintiff purchased all of these shares from the Clinic and thereby acquired, when added to others previously purchased, ownership of a majority of the outstanding shares of the Indialantic corporation. Defendant Emmons having refused to cancel his right to vote and defendant Indialantic, Inc., having declined to transfer the stock without reservation of the voting power, plaintiff brought this suit in chancery for a declaration of his right to vote the stock in question. On appeal, the lower court\u27s dismissal of the plaintiff\u27s bill was affirmed on the following grounds: (1) that this separation of the voting power from stock ownership was justified by the presence of a property interest to be conserved and a definite policy of the corporation to be carried out; and (2) that the services rendered by defendant Emmons were so valuable and important to the welfare of the corporation, and their continuation so desirable, that the power to vote, being beneficial not only to Emmons but also to the corporation itself, was a power coupled with an interest which was not affected by the sale of the stock to the plaintiff

CORPORATIONS-SEPARATION OF THE VOTING POWER FROM LEGAL AND BENEFICIAL OWNERSHIP OF CORPORATE STOCK

The Supreme Court of Michigan recently decided the case of Ecclestone v. Indialantic, Inc., the important facts being as follows: in June, 1942, defendant Emmons, owner of 451 shares of the common stock of Indialantic, Inc., a Florida corporation, transferred his entire holding to the Detroit Orthopedic Clinic in payment of an antecedent debt, reserving to himself, however, the sole right to vote the stock until the assets of the corporation were substantially liquidated. In March, 1946, with notice of this reservation of the right to vote, the plaintiff purchased all of these shares from the Clinic and thereby acquired, when added to others previously purchased, ownership of a majority of the outstanding shares of the Indialantic corporation. Defendant Emmons having refused to cancel his right to vote and defendant Indialantic, Inc., having declined to transfer the stock without reservation of the voting power, plaintiff brought this suit in chancery for a declaration of his right to vote the stock in question. On appeal, the lower court\u27s dismissal of the plaintiff\u27s bill was affirmed on the following grounds: (1) that this separation of the voting power from stock ownership was justified by the presence of a property interest to be conserved and a definite policy of the corporation to be carried out; and (2) that the services rendered by defendant Emmons were so valuable and important to the welfare of the corporation, and their continuation so desirable, that the power to vote, being beneficial not only to Emmons but also to the corporation itself, was a power coupled with an interest which was not affected by the sale of the stock to the plaintiff