Morrison v. St. Anthony Hotel, San Antonio

W. O. MURRAY, Chief Justice

(dissenting) .

I do not concur in the opinion of the majority. The suit as originally brought seemed to raise three main issues: (1) The right of Pan American Hotel Company to exercise its option to purchase the stock of the Class B stockholders, (2) the right of the Class B stockholders to recover dividends which they alleged should have been declared prior to the time Pan American Hotel Company exercised its option to purchase their stock, and (3) a claim for damages allegedly caused by breaches of fiduciary duties and mismanagement of the corporation. Apparently the trial court severed the issue of the right of Pan American Hotel Company to exercise its option to purchase the stock held by the Class B stockholders from the other issues in the case and then rendered a summary judgment holding that the option had been properly exercised and that appellees were the owners “of the legal and equitable title to the 1200 shares of Class ‘B’ stock in the St. Anthony Hotel, San Antonio, Texas.” Appeal was taken from this summary judgment and it was affirmed, with certain amendments, by the Austin Court of Civil Appeals. Morrison v. St. Anthony Hotel, 274 S.W.2d 556, 558, writ refused N.R.E. Concerning this appeal, the Austin Court had this to say: “The trial court severed the issues relating to ownership of the stock from other issues in the case and tried only the stock ownership issues. This action of the trial court is unquestioned.”

Ordinarily, a partial summary judgment is an interlocutory order and not appeala-ble. City of San Antonio v. Castillo (City of San Antonio v. Kneupper), Tex.Civ.App., 285 S.W.2d 835; Myers v. Smitherman, Tex.Civ.App., 279 S.W.2d 173. The appeal to the Austin Court can only be upheld upon a theory that there was a complete severance of the cause of action as to who were the legal owners of the Class B stock. Richards v. Smith, Tex.Civ.App., 239 S.W.2d 724; Biggins v. Oltmer Iron Works, 7 Cir., 154 F.2d 214; Zarati Steamship Co. v. Park Bridge Corp., 2 Cir., 154 F.2d 377.

When the first appeal of this case is considered in the above light, we must accept as fully adjudicated, the question of the right of appellees to exercise their option and purchase the Class B stock, and thus the former owners of the Class B stock are no longer stockholders of any kind in the St. Anthony Hotel Company. Having arrived at this conclusion, it is my opinion that an ex-stockholder of the corporation has no right to maintain a suit for recovery of profits made by a corporation which should have been but were not declared to be dividends, nor may he maintain a suit for damages in lieu of such undeclared dividends. Blooming Grove Cotton Oil Co. v. First National Bank, Tex.Civ.App., 56 S.W. 552; Boardman v. Lake Shore & M. S. R. Co., 84 N.Y. 157; Jermain v. Lake Shore & M. S. R. Co., 91 N.Y. 483; Phelps v. Farmers’ & Mechanics’ Bank, 26 Conn. 269; March v. Eastern R. Co., 43 N.H. 515; Gemmell v. Davis, 75 Md. 546, 23 A. 1032, 32 Am.St.Rep. 412.

Likewise, I am of the opinion that appellant’s suit for damages for alleged breaches of fiduciary duties and mismanagement cannot be maintained by appellant since he is not a stockholder, but an ex-stockholder of the corporation. Stinnett v. Paramount-Famous Laskey Corp., Tex.Com.App., 37 S.W.2d 145; Pollitz v. Gould, 202 N.Y. 11, 94 N.E. 1088, 38 A.L.R.,N.S., 988. Schmidt v. Schmidt, Tex.Civ.App., 52 S.W.2d 778; Bacon v. National Bank of Commerce, Tex.Civ.App., 259 S.W. 244.

I respectfully enter my dissent from the opinion of the majority.