Zidell v. Zidell case brief

Zidell v. Zidell case brief summary
560 P.2d 1086 (1977)

CASE SYNOPSIS

Defendants, corporations and individual directors, sought review of decrees from Circuit Court, Multnomah County (Oregon), which ordered each of the corporations to declare additional dividends. The decrees also directed the payment of plaintiff minority shareholder's attorney fees out of those dividends.

CASE FACTS
The minority shareholder, who held stock in four related, closely held corporations, sought to compel the directors of those corporations to declare dividends. He alleged that the corporations could afford to pay additional dividends, that he had left the corporate payroll, that those shareholders who were working for the corporations were receiving generous salaries and bonuses, and that there was hostility between himself and the other major shareholders.

DISCUSSION

• The court held that the evidence in support of these allegations was insufficient to meet the minority shareholder's burden of proof to show bad faith. 
• The court found that a considerable amount of credible evidence had been introduced to explain the conservative dividend policy. 
• The court further found that the minority shareholder had left his corporate employment voluntarily and was not forced out.

CONCLUSION
The court reversed and remanded the judgments for the minority shareholder with directions to enter decrees of dismissal.

Recommended Supplements for Corporations and Business Associations Law