Hugo Black

Name: Young v. Higbee Company — Opinion of the Court
Author: Hugo Black

Young v. Higbee Company — Opinion of the Court

Summary

“Young v. Higbee Company — Opinion of the Court”, is a work by Hugo Black. It explores elements such as Boag, stockholders and Potts.

Quotes from Young v. Higbee Company — Opinion of the Court (Hugo Black)

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ But, historically one of the prime purposes of the bankruptcy law has been to bring about a ratable distribution among creditors of a bankrupt's assets; to protect the creditors from one another. [8] And the corporate reorganization statutes look to a ratable distribution of assets among classes of stockholders as well as creditors. There would be no ratable distribution of this bankrupt estate if Potts and Boag could utilize their statutory right of appeal to get for their preferred stock.$7.00 for every $1.00 paid to other preferred stockholders. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ So far as the issues raised by the appeal are concerned, the rights of Potts and Boag and the other preferred stockholders were inseparable. Thus, even though their objection to confirmation contained no formal class suit allegations, the success or failure of the appeal was bound to have a substantial effect on the interests of all other preferred stockholders. The liability of one who assumes a determining position over the rights of thers must turn on something more substantial than mere formal allegations in a complaint. [6] Equity looks to the substance and not merely to the form. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ The statute neither compels them to appeal nor to prosecute an appeal already taken contrary to their own interests; it does impose upon them the duty of good faith to all other stockholders whose interests they temporarily control because they are necessarily involved in the appeal. This control of the common rights of all the preferred stockholders imposed on Potts and Boag a duty fairly to represent those common rights. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ This case presents the question of the accountability of stockholders who objected to the confirmation of a plan of reorganization under the Bankruptcy Act, [1] and abandoned their appeal for a consideration to themselves, where the basis of the appeal was that, if successful, it would benefit the entire class.
The Higbee Company, a department store with assets of more than six million dollars, filed a voluntary petition for reorganization. It had three types of stocks, common, and first and second preferred. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ They cannot avail themselves of the statutory privilege of litigating for the interest of a class and then shake off their self-assumed responsibilities to others by a simple announcement that henceforth they will trade in the rights of others for their own aggrandizement. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ Had their appeal succeeded, the District Court would have been required to reduce the value of junior claims asserted by Bradley and Murphy, thereby increasing the value of the claims of the preferred stockholders as a class. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ Nor can we sustain the contention that relief should be denied on the allegations that Young's motive in bringing the proceeding is an unworthy one. His petition sought relief for the benefit of all the stockholders. The rights of these stockholders are not to be ignored because of some motive attributable to Young. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ Furthermore, the right of appeal granted by a statute should not be interpreted in such way as to defeat rights clearly granted in other parts of the same Act. Peck v. Jennes et al., 7 How. 612, 623, 12 L.Ed. 841. ”

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Source: Wikisource

Hugo Black, Young v. Higbee Company — Opinion of the Court

“ The hearings make clear the purpose of the Committee to pass legislation which would bar creditors from a vote who were prompted by such a purpose. To this end they adopted the 'good faith' provisions of Sec. ”

Hugo Black

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Quotes from Young v. Higbee Company — Opinion of the Court (Hugo Black)

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