Stuparich v. Harbor Furniture Mfg., Inc.
California Court of Appeal
83 Cal.App.4th 1268 (2000)
Sisters Ann Stuparich and Candi Tuttleton (plaintiffs) each owned 19.05 percent of the voting shares and one-third of the non-voting shares in Harbor Furniture Manufacturing, Inc., while their brother Malcolm owned 51.56 percent of the voting shares. Frustrated with what they saw as management's failure to observe corporate formalities, the sisters proposed formally separating the corporation's profitable mobile-home-park operation from its money-losing furniture-manufacturing business to protect the profits, but Malcolm refused to discuss the proposal or buy them out; the sisters stopped attending annual meetings but continued receiving monthly dividends throughout, and eventually sued seeking involuntary dissolution. The trial court granted Harbor Furniture summary judgment, and the sisters appealed.
Whether involuntary dissolution is appropriate when the group seeking the dissolution is comprised of minority shareholders and they have continued to receive significant dividends from the corporation.