Case 2V un. Mall Landholdings Ltd. owned a, strip mall Which AWas; located at a busy intersection in a small city The corporas tion wished to sell the mall, and in order to make the property more attractive, decided to purchase a competing strip mall located on the opposite side of the street at the same intersection. The directors of Mall landholdings Ltd. made inquires as to the possibility of purchasing the second mall and was advised that it could be purchased for $600,000. A sub- sidiary corporation was incorporated to purchase the sec- ond mall, and the corporation was to be a wholly owned subsidiary of Mall Landholdings Ltd. The bank, however,. would only lend the corporation $450,000 on its assets, and the corporation was "short" of $150,000 to make up the $600,000 purchase price. In order to make the purchase possible, two of the directors each agreed to invest $50,000 in the purchase, and a lawyer, who frequently acted for the corporation, agreed to invest a similar amount to make up the required $600,000. The subsidiary corporation then issued 600,000. shares: 450,000 to Mall .Landholdings Ltd. and 50,000 to each of the three other investors in retum for their. invest- ment. The subsidiary corporation then proceeded with the purchase of the second strip mall for $600,000. The two malls were put up for sale as a " package," and eventually, a purchaser was found. The purchaser, however, wished to acquire the second mall by way of a purchase of : the shares at a purchase price of $1.50 per share, and Mall Landholdings Lid, and the other shareholders of the sub-"- sidiary corporation agreed to the sale. Mall Landholdings Ltd. was satisfied with the sale of the two malls, but later, some of the shareholders of Mall. Landholdings Lid. discovered the details of the share sale of the subsidiary corporation and concluded that while Mall Landholdings Ltd. eamed a profit of $225,000 on the sale: :of it's shares in the subsidiary, each of the directors and the lawyer had made a $25,000 profit on their share sale. The shareholders demanded that the two directors and "the lawyer pay over their profits on the sale of the shares to Mall Landholdings'Ltd. When the two directors and the lawyer refused to do so, the shareholders of Mall .Landholdings Lid. instituted legal proceedings against them. Discuss the nature of the shareholder's claim and the : arguments that might be raised by each party. Render a decision