Foy v. Georgia-Alabama Power Co. , 159 Ga. 14 ( 1924 )

Atkinson, J.

1. The petition in this case, properly construed, is an action by individuals as owners of a minority of the capital stoek of the Georgia-Alabama Power Company, against Townsend Scott & Son as owners of the majority of the capital stock of that corporation, and the Georgia-Alabama Utilities Company, a corporation the entire capital stoek of which was owned by the Georgia-Alabama Power Company, and the South Georgia Public Service Company, a corporation the entire capital stoek of which was owned by Townsend Scott & Son; seeking redress from Townsend Scott & Son for acts of theirs injuriously affecting the Georgia-Alabama' Power Company and thereby lessening the value of the plaintiffs’ shares of stock in that corporation. By one of the acts Townsend Scott & Son undertake, by virtue of their ownership of a majority of the capital stoek and domination of the Georgia-Alabama Power Company, without authority to relieve themselves- from liability for the purchase of preferred stock from the Georgia-Alabama Power Company, the effect of which would be to reduce the assets of that company. The other >-act consists of exercise of a power of control over the Georgia-Alabama Utilities Company in virtue of-.their control over the Georgia-Alabama Power Company and that company’s ownership of the entire capital stock of the Georgia-Alabama Utilities Company, and exercising such power of control as to cause the Georgia-Alabama Utilities Company to permit a lapse of certain valuable franchises owned by it, the result of which was to lessen the value of the stock of the Georgia-Alabama Utilities Company owned by the Georgia-Alabama Power Company, and thus lessen the value of the stock of the plaintiffs in the Georgia-Alabama Power Company. The whole constitutes one indivisible controversy.

2. The plaintiffs are citizens of the State of Georgia. Townsend Scott & Son and the individual members of that firm are citizens of the State of Maryland. The - Georgia-Alabama Utilities Company is a corporation originally incorporated in the State of Georgia, with its principal office in this State. The Georgia-Alabama Power Company is a corporation originally incorporated in the State of North Carolina, the principal business and property of which are situated in Georgia and Alabama, and which was domesticated as a Georgia corporation under the act of 1920 (Ga. Laws 1920, p. 151; Park’s Code Supp. 1922, § 2207 (a)). Held, that the Georgia-Alabama Power Company and the Georgia-Alabama Utilities Company, the corporate assets of which were being injuriously affected by Townsend Scott & Son, were necessary parties to the suit with respect to the entire controversy indicated in the preceding division.

No. 4033. October 1, 1924.

3. As there was but one controversy between the plaintiffs and Townsend Scott & Son, in which the Georgia-Alabama Power Company and the Georgia-Alabama Utilities Company were both necessary parties, and the Georgia-Alabama Utilities Company was a citizen of Georgia, the controversy was not wholly between citizens of different States, which could be fully determined, without reference to any other party, and a case was not presented which could be properly removed under the act of March 3, 1875, c. 137 (as construed in Barney v. Latham, 103 U. S. 205, 26 L. ed. 514), which has since been included in section 28 of the Federal Judicial Code (5 Fed. Stat. Ann. (2d ed.) 16). Under this view it becomes unnecessary to decide whether the Georgia-Alabama Power Company became a citizen of Georgia within the meaning of section 28 of the Federal Judicial Code, by complying with the Georgia statute relating to the domestication of foreign corporations.

4. Applying the principles stated above, the trial judge erred in granting the order of removal.

Judgment reversed.

All the Justices concur. Alston, Alston, Foster & Moise, Lippilt & Burt, and Pope & Bonnet, for plaintiffs. Little, Powell, Smith & Goldstein and Milner & Farhas, for defendants.