2 Thomas v. R. R., 101 U. S. 71; Hitchcock v. Galveston, 96 U. S. 341; Kent v. Mining Co., 78 N. Y. 159; Screven Hose Co. v. Philpot, 53 Ga. 625 ; Bank of Michigan v. Niles, Walker, Mich. 99.

3 New York, etc. R. R. v. Schuyler, 34 N. Y. 34.

4 Whitney Arms Co. v. Barlow, 63 N. Y. 68; Arnot v. R. R., 67 N. Y. 319 ; Bradley v. Ballard, 55 111. 413 ; Crutcher v. Bridge Co., 8 Humph. 403. In Hawes v. Water Works Co., Sup. Ct. U. S. 1882, we have the following from Miller, J.: " The principle involved in that case (Dodge v. Woolsey, 18 How. 331) permits the stockholder in one of these corporations to step in between that corporation and the party with whom it has been dealing, and institute and control a suit in which the rights involved are the rights of the corporation, and the controversy one really between that corporation, entirely capable of asserting its own rights, and the other party, who is equally so. This is a very different affair from a controversy between the shareholder of a corporation and that corporation itself, or its managing directors or trustees, or the other shareholders, who may be violating his rights or destroying the property in which he has an interest. Into such a contest the outsider, dealing with the corporation, through its managing agents, in a matter within their authority, cannot be dragged, except where it is necessary to prevent an absolute failure of justice in cases which have been recognized as exceptional in their character, and calling for the extraordinary powers of a court of equity. It is, therefore, always a question of equitable jurisprudence, and as such has, within the last forty years, received the repeated consideration of the highest courts of England and of this country. See Foss v. Harbottle, 2 Hare Ch. 488; Mozley v. Alston, 1 Phillip Ch. 790; Gray v. Lewis, L. R. 8 Ch. App. 1035.

"But perhaps the best assertion of the rule and of the exceptions to it are found in the opinion of the court by the the corporation which is beyond the authority conferred on them by their charter or other source of organization ; or such a fraudulent transaction completed or contemplated by the acting managers, in connection with some other party, or among themselves, or with other shareholders, as will result in serious injury to the corporation, or to the interests of the other shareholders ; or where the board of directors, or a majority them, are acting for their own interest, in a manner destructive of the corporation itself, or of the rights of the other shareholders ; or where the majority of shareholders themselves are oppressively and illegally pursuing a course, in the name of the corporation, which is in violation of the rights of the other shareholders, and which can only be restrained by the aid of a court of equity. Possibly other cases may arise in which, to prevent irremediable injury, or a total failure of justice, the court would be justified in exercising its powers, but the foregoing may be regarded as an outline of the principles which govern this class of cases.

When sec 140. It has been held in England, as well as contrflct is executed, in this country, that, when either party to consame learned justice in the case of Mac-Dougall v. Gardiner, in 1875, L. R. 1 Ch. Div. 21: 'I am of opinion,' he says, 'that this demurrer ought to be allowed. I think it is of the utmost importance in all these controversies that the rule which is well known in this court as the rule in Mozley v. Alston, supra, and Lord v. Copper Mining Co., and Foss v. Harbottle, supra, should always be adhered to; that is to say, that nothing connected with internal disputes between shareholders is to be made the subject of a bill by some one shareholder on behalf of himself and others, unless there be something illegal, oppressive, or fraudulent -unless there is something ultra vires on the part of the company qua company, or on the part of the majority of the company, so that they are not fit persons to determine it, but that every litigation must be in the name of the company, if the company really desire it. Because there may be a great many wrongs committed in a company, there may be claims against directors, there may be claims against officers, there may be claims against debtors, there may be a variety of things of which a company may well be entitled to complain, but which, as a matter of good sense, they do not think it right to make the subject of litigation, and it is the company, as a company, which has to determine whether it will make anything that is a wrong to the company a subject-matter of litigation, or whether it will take steps to prevent the wrong from being done.' In this country the cases outside of the federal courts are not numerous, and while they admit the right of a stockholder to sue in cases where the corporation is the proper party to bring the suit, they limit this right to cases where the directors are guilty of a fraud, or a breach of trust, or are proceeding ultra vires. See March v. Eastern R. R. Co., 40 N. H. 548; Peabody v. Flint, 6 Allen, 52 ; Brewer v. Boston Theatre, 104 Mass. 378, where the general doctrine and its limitations are very well stated. See, also, Hersey v. Veazie, 24 Me. 9 ; Samuel v. Holladay, 1 Wool. 400.

"The case of Dodge v. Woolsey, supra, is, however, the leading case on the subject in this country. And we do not believe, notwithstanding some expressions in the opinion, that it is justly chargeable with the abuses we have mentioned. It was manifestly well considered, and the opinion is unusually long, discussing the point now under consideration, with a full reference to the decisions then made in the courts of England. . . .

"The examination of the case of Dodge v. Woolsey, supra, satisfies us that it does not establish, nor was it intended to establish, a doctrine on this subject different in any material respect from that found in the cases in the English and in other American courts, and that the recent legislation of congress- referred to, leaves no reason for any expansion of the rule in that case beyond its fair interpretation. We understand that doctrine to be that to enable a stockholder in a corporation to sustain in a court of equity, in his own name, a suit founded on a right of action existing in the corporation itself, and in which the corporation itself is the appropriate plaintiff, there must exist, as a foundation of the suit, some action or threatened action of the managing board of directors or trustees of tracts of this character enjoys the fruits of the contract, he cannot afterwards, supposing there was no fraud, or notice to the other side, and supposing party benefiting by it cannot impeach it.