Noah Haynes Swayne

“ The net earnings from which the preferred dividends were to be paid must have been earned 'in the current year.' Whether the business of such year were large or small, or of what it consisted, is immaterial. The corporation never agreed to be limited in the exercise of its faculties and franchises, and the complainant must abide the result. If errors wee committed, and a loss ensued, a court of equity cannot relieve him. ”

“ Railroad Company, very lately decided by this court, [3] the State of Maryland was, by a contract with the Baltimore and Ohio Railroad Company, entitled to have and receive a perpetual dividend of six per cent. per annum (upon $3,000,000 which the State lent to the company) , out of the profits of the road. Does any one doubt that this made a debt from the company to the State in case any profits were made? And that calling the money to be paid a dividend was nothing?
Nor is there anything in the expression 'net earnings' which impairs our argument. ”

“ They are in part creditors and in part stockholders, and not technically either. They have the rights which their contract gives them, and a name will not make those rights greater or less. Modern business and legislation have created relations which, according to the narrow views of the old laws and decisions, would be anomalous, and in them a person may be in some sense and at the same time a creditor and a stockholder. ”

“ The complainant insists that the net earnings must be the net earnings of things as they were when the preferred stock was issued. We find nothing in the case, express or implied, to warrant this view. ”

“ An ancillary road may be short and yield but little income, yet by reason of its reaching to coalfields, or from other local causes, its contributions to other roads of the series may be very large and profitable. ”