Business Law II

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CH. 43: Q08

8. Emmick was a director and shareholder of Colonial Manors, Inc. (CM). He organized

another corporation named Oahe Enterprises, Inc. To obtain shares of the Oahe

stock, Emmick transferred CM shares arbitrarily valued by him at $19 per share to

Oahe. The CM shares had a book value of $.47 per share, but Emmick believed that

the stock would increase to a value of $19. The directors of Oahe approved Emmick's

payment with the valuation of $19 per share. Golden sued Emmick on the ground

that he had fraudulently deceived Oahe Corp. about the value of the CM shares and

thus had made a secret profit when he received the Oahe shares that had a much

greater value than the CM shares he gave in exchange. Emmick contended that his

firm opinion was that the future potential value of CM shares would surely reach

$19 per share. Decide. [Golden v. Oahe Enterprises, Inc., 295 N.W.2d 160 (S.D.)]

CH. 43: Q10

10. The Seabrook Island Property Owners Association, Inc., is a nonprofit corporation

organized under state law to maintain streets and open spaces owned by property

owners of Seabrook Island. Seabrook Island Co. is the developer of Seabrook Island

and has majority control of the board of directors of the association. The

association's bylaws empower the board of directors to levy an annual maintenance

charge. Neither the association's charter nor its bylaws authorize the board to assess

any other charges. When the board levied, in addition to the annual maintenance

charge, an emergency budget assessment on all members to rebuild certain bridges

and to revitalize the beach, the Loverings and other property owners challenged in

court the association's power to impose the assessment. Decide. [Lovering v.

Seabrook Island Property Owners Ass'n, 344 S.E.2d 862 (S.C. App.)]

CH. 43: Q06

6. Richard Ramlall was hired by CloseCall (MD) Inc. to negotiate a billing dispute with

Verizon involving some $2 million in asserted overcharges. CloseCall (MD) agreed to

a contingent fee "bonus" for its negotiators of 10 percent ofthe refund. The

negotiations were successful. However, before he could collect his fee CloseCall (MD)

merged with MVCC Acquisition Corp., a wholly owned subsidiary of MobilePro Corp.,

which was created for the express purpose of merging with CloseCall (MD). MVCC

survived and CloseCall (MD) dissolved. MVCC then changed its name to CloseCall

(DE). The merger agreement between CloseCall and MVCC referenced the 10 percent

bonus due on the Verizon billing dispute. The surviving Delaware corporation

created by the merger of CloseCall (MD) into MVCC is CloseCall (DE). Ramlall sued

CloseCall (DE) for the bonus as the successor corporation of CloseCall (MD). CloseCall

(DE) contends that after the merger CloseCall (DE) did not owe any money to Ramlall.

Is CloseCall (DE) a successor corporation? Is it liable to Ramlall for the "bonus fee"?

[Ramlall v. Mobile Pro Corp., 30 A.2d 1003 (Md. App.)]