in Out of the the "(5) The bill does not set the original or amended certificate of incorporation, or any of the company's by-laws, nor does it allege that none of these contain any provision regulating the matter reserving working capital from net profits; and one is left dark concerning whether the incor porators, in the original certificate, or the stockholders, in the amended certificate or by-laws, have formu lated any policy in regard to ing capital. For aught that pears the directors, in declining declare dividends out of the pose of their holdings or become stockholders of the Securities Company; that in several instances in recent years the directors' failure to declare dividends on the preferred stock was due in part to the desire of the majority of the common stockholders to apply the profits, sufficient to pay such dividends, but not on both common and preferred, to repairs and improvements for their general benefit, rather than to the payment of dividends on the preferred stock; that it would be useless to apply to the stockholders or directors of the defendant company to take action to declare dividends upon such stock, for the reason that the majority of each of the stockholders and directors are opposed to such declaration, and that the majority of the stockholders and directors who now control the affairs of such company have refrained from declaring any dividends for the last ten years, except as stated; that the complainant has demanded of such directors that dividends on such stock be declared, and has frequently demanded declaration and payment of dividends on his preferred stock, and that such demands have never been complied with, except as stated, though meetings of the stockholders and directors have been held since such demands; that the complainant has never consented to any by-law permitting the directors to desist from declaring dividends on the common or preferred stock. "The bill thereupon prays for a decree enjoining the defendant company to pay a dividend of 20 per cent. on the outstanding preferred stock, and for discovery, ac work ap to profits in question, acted in strict accord such the of ance with the provisions in certificates and by-laws, and in that respect were only carrying out duly authorized business policy the corporation. This alone, in my judgment, is The presumption is that the tors' action in Omission fatal. direc that respect is authorized, and it is not overcome by mere general allegations such as: "There are accumulated profits which are not reserved for working capital.' 'At least three-fourths are of of said accumulated earnings not required in the prosecution the business.' 'Company is amply able to declare and pay large por Tangible facts to sustain such averments must be pleaded.88 It has been said that as much certainty is required in a bill by a stockholder to enforce a corporate right as in a bill by a corporation for the same purpose.89 A motion for a bill of particulars may in a proper case be granted, if the bill is deficient in certainty.90 It has been said that the allegations required by the rule are jurisdictional and cannot be supplied by amendment; 91 but the question as to the sufficiency of a bill, under this rule, cannot be certified directly from the District Court to the Supreme Court of the United States,92 and it has been held that it is waived unless specifically raised by a motion to dismiss.93 An allegation that complainant is the bona fide and lawful owner "of record" of a specified number of shares of the stock of the corporation, is a sufficient averment that the complainant is a stockholder. It was held that an omission of the date upon which the complainants became shareholders was not a cause for dismissing the bill but justified a motion for further and better particulars.95 It has been held: that such a bill must contain an allegation that the complainant and his predecessors in title, since the transaction which he seeks to set aside, have not acquiesced in the same; 96 that a stockholder cannot, in the same suit, seek, on his tions of all due and unpaid divi- 88 Schell v. Alston Mfg. Co., 149 Fed. 439; Smith v. Chase & Baker Piano Mfg. Co., 197 Fed. 466; Continental & C. Tr. & S. Bank v. AllisChalmers Co., 200 Fed. 600, 611. See supra, § 137. 89 Whitney v. Fairbanks, 54 Fed. 985. 90 Whitaker V. Whitaker Iron Co., 238 Fed. 980; Krouse v. Brevard Tannin Co., 249 Fed. 538. 91 Dickinson v. Consol. Traction Co., 114 Fed. 232, 242. 92 Venner v. Great Northern Railway Co., 209 U. S. 24, 52 L. ed. 666. 93 Granite Brick Co. v. Titus, Č C. A., 226 Fed. 557. 94 Continental Securities Co. V. Interborough R. T. Co., 165 Fed. 945, 963. 95 Krouse v. Brevard Tannin Co, C. C. A., 249 Fed. 538. 98 own behalf, to cancel stock which he holds, and also, on behalf of all the stockholders, to set aside corporate transactions, but that he can pray in the same bill for a cancellation of an illegal issue of stock to others, an injunction restraining the transferee from voting upon the same and a receiver of the corporation or for an injunction against an illegal issue of bonds and when the corporation is insolvent also for a public sale of its assets and their distribution among the creditors.99 Under the former rules there were rulings that an equitable owner of stock, whose title was contested, could not maintain such a suit.100 But the soundness of these decisions may be doubted. Under the new rules, the doctrine that equity having once obtained jurisdic tion will afford relief, may be enforced; and there can be little doubt that the holder of a certificate of stock, endorsed blank, may bring such a suit before the stock has been transferred to him upon the books of the corporation, although out of abundant caution it might be prudent to join as a party the person in whose name the stock is registered.101 in The maxim that he who seeks equity must do equity 102 is applied to stockholders' bills 103 and it has been held that when it is sought to set aside a mortgage securing bonds an offer to return the money received from the bondholders is required 104 but that every tender or offer need not be made or alleged, which might be necessary if the suit were brought by the corporat i on. 105 v. American Sugar Refining Co., 61 N. J. Eq. 340. See Church v. Citizens' St. R. Co., 78 Fed. 526. Contra, Brazil v. Isham, 12 N. Y. 9, 17; Pollitz v. Gould, 202 N. Y. 11, 38 L.R.A. (N.S.) 988, Ann. Cas. 1912D, 1098; Coatsworth v. Lehigh Valley Ry. Co., 115 App. Div. (N. Y.) 7; Continental Securities Co. v. Belmont, 75 Misc. (N. Y.) 234, 250. 97 Church v. Citizens' St. R. Co., 78 Fed. 526. 98 Howard v. National Telephone Co., 182 Fed. 215. 99 Granite Brick Co. v. Titus, C. C. A., 226 Fed. 557, 561, 564. 100 Inman v. New York Interurban * 999; Div. Cor Water Co., 131 Fed. 997, Weber v. Wallerstein, No. 1, 111 App. Div. (N. Y.) 693; Brown v. Duluth & N. Ry. Co., 53 Fed. 889, 894 101 See §§ 113, 120, supra. 102 See supra, § 79a. 103 Collins v. Penn-Wyoming per Co., 203 Fed. 726. 104 Ibid. 105 Edwards v. Mercantile Cop Trust Co., 124 Fed. 381, 391; Citizens' It has been said that the maxim that he who seeks equity must come with clean hands 106 does not apply to such a suit unless it would have been applicable to a suit by the corporation.107 It has been held that where the cause of action is one which the corporation might enforce at common law, the statute of limitations applicable to such suits at common law must be applied thereto.108 A delay of twelve years to recover for injuries from the negligence of the directors was held to be such laches as to prevent recovery, 100 but when the transaction sought to be set aside had been concealed, it was held that there could be no laches by delay before its discovery.110 A stockholder who had failed to intervene in a former stockholders' bill of which he had knowledge was held to be bound by the judgment therein rendered.111 The suit must be brought in equity, even when it is brought to recover damages for an injury through violations of the Anti-Trust Laws.112 Unless a receiver has been appointed, the corporation is an indispensable party to the suit.113 When the joinder of some of the directors would oust the jurisdiction, they are not indispensable parties, although the bill seeks relief because of transactions in which they took part with other directors who are made defendants.114 In a stockholder's suit, a corporation, if it is not alleged to be under the control of the defendant or to resist the relief sought should be aligned as a complainant for the purpose of ascertaining the diversity of citizenship which determines the jurisdiction.115 In a stockholder's suit to enforce a right of his corporation, where it is shown that the corporation is under the control of the other. defendants, it will be treated as upon the same side of the controversy that they are, for the purpose of determining the juris 106 Supra, § 79b. 107 Luther v. Garnsey, N. Y. Sun. Ct. Sp. Tm., N. Y. L. J. Feb. 28, 1914. 108 Kelly v. Dolan, C. C. A., 233 Fed. 635. 109 Kelly v. Dolan, C. C. A., 233 Fed. 635. 110 Elder v. Western Min. Co., C. C. A., 237 Fed. 966. 111 Dana v. Morgan, 219 Fed. 313. See supra, § 114-116, infra, § 186. 112 United Copper Securities Co. v. Amalgamated Copper Co., 244 U. S. 261. See Kelly v. Dolan, C. C. A., 233 Fed. 635. 113 Porter v. Sabin, 149 U. S. 473, 37 L. ed. 815, supra, § 120. 114 Krouse v. Brevard Tannin Co., C. C. A., 249 Fed. 558. 115 Iron Moulders' Union v. NilesBement-Pond Co., C. C. A., 258 Fed. 408, reversing 246 Fed. 851. See § 41 supra. diction.116 In one to prevent the majority of the stockholders from causing the deportation to act in fraud of the minority, the corporation is to be aligned on the same side as the majority stockholders.117 It has been held: that in a stockholders suit, where the plaintiff has failed to comply with the equity rules by showing efforts to secure action by the other stockholders on an excuse for such failure, the corporation is to be treated as upon the same side of the controversy as the complainants.118 Where the controversy for the control of the corporation transcends the rivalry of those claiming to be members of its board of control and the corporation itself is a mere instrumentality or holder of the title, it is properly made a party defendant and should not be aligned as a plaintiff merely because the plaintiffs belong to the faction that claims the power to appoint the members of the board.119 In such a case, it has been held that trustees corporation, although in sympathy with the complainant should be aligned with the defendant.120 In a stockholder's suit to recover assets of a corporation it was held that a statutory 116 Doctor v. Harrington, 196 U. S 579, 49 L. ed. 606, overruling a number of decisions of the lower courts to the contrary. Hyams v. Calumet & Hecla Min. Co., 221 Fed. 529; Whitaker v. Whitaker Iron Co., 238 Fed. 980; Cutting v. Woodward, C. C. A., 255 Fed. 632. See Woolsey v. Dodge Fed. Cas. No. 18,032, 6 'McLean, 142; s. c., as Dodge v. Woolsey, 18 How. 331, 15 L. ed. 401; De Neufville v. New York & N. R. Co., C. C. A., 81 Fed. 10; MacGinniss v. Boston & M. Consol. Copper & Silver Min Co., 119 Fed. 96, 55 C. C. A. 648; Redfield v. Baltimore & O. R. R. Co., 124 Fed. 929; Mills v. City of Chicago, 127 Fed. 731; Groel v. United Electric Co. of New Jersey, 132 Fed. 252; Howard v. Nat. Telephone Co., 182 Fed. 215; Crawford v. Seattle, R. & S. Ry. Co., 198 Fed. 920. Before the decision of Doctor v. Harrington, 196 U. S. 579, 49 L. ed. 606, it was held: that of the |