Can directors of a railway company obtain an injunction to prevent the issue of shares?
Saskatchewan, Canada
The following excerpt is from Smith v. Hanson Tire Company Ltd., 1927 CanLII 162 (SK CA):
In Fraser v Whalley; Gartside v. Whalley (1864) 2 H. & M. 10, 11 L.T. 175 (71 E.R. 361) it was held that directors of a railway company were not justified in issuing shares for the express purpose of creating votes to influence a coming general meeting, and that an injunction will be issued to restrain the issue of such shares; it not being a question of the internal management of the company but an attempt on the part of the directors to prevent such management from being legitimately carried on.
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