Galler v. Galler, 203 N.E.2d 577 (1964) p.354
distributing corporate control
Agreed that the corporation would pay a certain dividend provided the funds were available. If one of the brothers died, the surviving spouse would get the payments. Action for specific performance of shareholders' agreement and for accounting.
The Superior Court, Cook County, Walker Butler, J., entered a decree adverse to defendants, and they appealed. The Appellate Court for the First District reversed in part and affirmed in part and remanded, 45 Ill.App.2d 452, 196 N.E.2d 5. Further appeal was taken.
Whether the agreement between shareholders was valid.
The Supreme Court, Underwood, J., held that where the agreement was not a voting trust but a straight contractual voting control agreement which did not divorce voting rights from ownership of stock in a close corporation, the duration of the agreement, which was interpreted as continuing so long as one of the two majority stockholders lived, did not offend public policy and did not render the agreement unenforceable. Affirmed in part, reversed in part and remanded with directions.
1. must have 100% of the shareholders agreeing; if all the shareholders want it to be enforced, then the court will do it, even if contrary to the statutory provisions. Where stockholders' agreement was not voting trust but straight contractual voting control agreement which did not divorce voting rights from ownership of stock in close corporation, duration of agreement, which was interpreted as continuing so long as either of two majority stockholders lived, did not offend public policy and did not render agreement unenforceable.
Created on: Monday, October 18, 1999 at 12:01:36 (PDT)