Appeal, No. 12, March T., 1957, from decree of Court of Common Pleas of Allegheny County, April T., 1955, No. 2906, in case of Bart J. Scott v. Stanton Heights Corporation et al. Decree affirmed.
John A. Metz, Jr., with him Metz, McClure & MacAlister, for appellant.
Walter T. McGough, with him Leonard L. Scheinholtz, and Reed, Smith, Shaw & McClay, for appellees.
V. C. Short, with him John J. Dougherty, for appellees.
Before Jones, C.j., Bell, Chidsey, Musmanno, Arnold, Jones and Cohen, JJ.
OPINION BY MR. JUSTICE CHIDSEY
This is an action in equity wherein appellant, a minority shareholder of the defendant corporation which was being dissolved, sought to enjoin the sale of the principal asset of the corporation to a purchasing group.
The Stanton Heights Corporation was organized as a Pennsylvania business corporation in 1947 and acquired
the 45 acre parcel of land upon which the Stanton Heights Golf Club was located. The shareholders were largely members of the golf club, and the property was leased to the club at a rental which was to cover the fixed charges and expenses of the corporation. The board of directors of the corporation, seven in number, were all shareholders in the corporation and members of the golf club.
By 1954 the golf club, its only source of income, owed the corporation unpaid rent in the amount of $21,450.92, and on November 1, 1954, the board of directors recommended to the shareholders that the assets be sold and the corporation be dissolved. At their annual meeting on December 8, 1954, the shareholders voted to dissolve the corporation, liquidate its assets and make distribution. At the time of the meeting, V. C. Short, attorney for the corporation, advised that a substantial tax saving would be realized if the plan of liquidation were carried out within one year, thus avoiding a recognition of gain as provided in § 337(a) of the 1954 Internal Revenue Code, 68 A Stat. 106, c736, 26 U.S.C.A. § 337(a).
The directors accordingly contacted several prospective purchasers, but were unable to secure an acceptable offer for the property, which had been appraised at $120,000. Thereupon they solicited sealed bids to be presented on or before February 15, 1955. On February 17, 1955, the board met and considered the four bids which had been received. It voted to accept the highest bid which was an offer of $165,000, submitted by Sauers, the president and a director of the corporation; Totten, a real estate man; and Dodds, an attorney. On February 24, 1955, the corporate officers ...