Appeal from Third District.

WEBER and THURMAN, JJ., concur.

FRICK, J.

I concur. In order to constitute a particular road or highway a public road and the traffic and travel thereon subject. to regulation and control by the Commission the question is not whether the county or the state has acquired an indefeasible title, easement, or right of way, but the question is whether the particular road or highway is being used by the public generally for travel and traffic and is claimed by the public as a public road or highway, and as such is being used for the purpose of hauling and transporting freight or passengers over it for hire or private gain by those owning and using the ordinary and usual vehicles used on public highways for such purposes. Any road or highway which is thus being used by the public generally is, in my judgment, a public road or highway within the purview of the law, over which the travel and traffic is subject to regulation by the Commission. It might just as well be contended that the Commission may not regulate the traffic over the railroads of a public service corporation because it has not acquired an indefeasible easement, right, or title to every portion of its right of way as to contend that the Commission may not regulate the traffic and travel over a public highway unless and until the Commission establishes an indefeasible title, easement, or right of way over the entire length of the highway or road on which the public travel and traffic is sought to be regulated. To so hold would, in most instances, defeat the very purpose of the Utilities Act.

In view of the foregoing, I cannot concur in the conclusion that an estoppel has been established. The principle upon which estoppels rest, in my judgment, has no application here.

GIDEON, J.

I concur in the order reversing the judgment of the district court granting a nonsuit. I do so, however, only for the rea

Beggs et al. v. Myton Canal & Irr. Co. et al., 54 Utah 120.

son that in my judgment the defendant, by his acts, is estopped to deny or question the jurisdiction of the Commission over the route or roadway in question.

BEGGS et al. v. MYTON CANAL & IRRIGATION CO.

No. 3328.

1.

2.

3.

4.

5.

et al.

Decided March 21, 1919. (179 Pac. 984.)

CORPORATIONS-DISPOSITION

OF CORPORATE PROPERTY-RATIFIED SALE BY DIRECTORS-STATUTE. Under Comp. Laws 1907, section 322 (Comp. Laws 1917, section 869), the proviso of which is not limited to mining companies, all corporations in Utah through their directors and on confirmation by a vote of a majority of stockholders may dispose of the corporation property, when such disposition is not provided for in the articles of incorporation; when the articles of incorporation provide the property may be sold by the directors or by the stockholders, sales so made will be binding on the corporation. (Page 124.) CORPORATIONS-FAILING CORPORATIONS-DISPOSITION OF PROPERTY. Failing or unsuccessful corporations may sell and dispose of their property, providing the transactions are not in fraud of the rights of creditors. (Page 124.)

A deed executed

CORPORATIONS-FAILING CORPORATIONS-DUTY OF DIRECTORS AND
STOCKHOLDERS-TRANSFER OF ASSETS. Where irrigation com-
pany was in failing condition and in danger of losing its water
filings and other rights, it was not only within power of di-
rectors and majority stockholders to make arrangement with
third person involving transfer of company's property to a cor-
poration organized by him, which would save something to the
stockholders, but it was their duty so to do. (Page 126.)
CORPORATIONS-DEED TO COMPANY NOT FORMED.
by one company to another before the incorporation of the
grantee company was not for that reason invalid. (Page 128.)
CORPORATIONS - STOCKHOLDERS' MEETING - FORM OF NOTICE -
WAIVER OF RIGHT TO OBJECT. Stockholders who, pursuant to
notice, were present in person or by proxies at a meeting called
to ratify a sale of the assets of the company by the directors,
are not in a position to object to the form of notice of the
meeting.2 (Page 128.)

1 Santaquin Mining Co. v. High Roller Mining Co., 25 Utah, 282, 71 Pac. 77.

2 Smith v. Knauss, 52 Utah, 614, 176 Pac. 621,

Appeal from Fourth District.

Appeal from the District Court of Duchesne County, Fourth District; Hon. A. B. Morgan, Judge.

Suit by C. T. Beggs and others against the Myton Canal & Irrigation Company and others.

Decree for defendants. Plaintiffs appeal.

AFFIRMED.

C. J. Wahlquist of Myton and Millard Fairlamb of Delta, Col., for appellants.

D. H. Thomas of Salt Lake City, for respondents.

WEBER, J.

Plaintiffs brought suit against the defendants for the purpose of annulling a contract entered into between defendant Myton Canal & Irrigation Company, a corporation, and S. Y. Taylor, another of the defendants, and for the purpose of setting aside a deed conveying certain water filings and other property to the defendant Uinta Basin Construction Company, a corporation.

The Myton Canal & Irrigation Company was incorporated in November, 1910, under the general incorporation laws of Utah, for the purpose of acquiring rights to the use of water from the Duchesne river, Wasatch county, Utah, to build and maintain reservoirs and canals, and to do all things necessary for the distribution to the stockholders of water acquired by the corporation, and to do other things incidental to the above-named purposes. At the time of incorporation it had no assets except certain water filings, some uncompleted ditches and plats and surveys, all of which were accepted in payment of the larger portion of the stock subscription. The original capitalization was $50,000, which was afterwards increased to $100,000, the par value of the stock being $10 per share, and the total number of outstanding shares being

Beggs et al. v. Myton Canal & Irr. Co. et al., 54 Utah 120.

6,3832/. After incorporation considerable work was done by the company, and about 6 miles of canal was completed, but practically no construction work has been done since 1914. In 1917 the company was about to lose its water filings because -the work required by law had not been done, and when, pursuant to the statutes of this state, an application for an extension was made to the state engineer, he granted such extension after being advised of a proposed contract with said S. Y. Taylor and of the fact that the property of the Myton Canal & Irrigation Company would be conveyed to the Uinta Basin Construction Company, a proposed corporation, and that the latter would be able to procure the necessary funds with which to proceed with the contemplated work. As a part of the canal system there was in contemplation the enlargement of the Gray Mountain ditch owned by the United States and used for carrying water for the Indians, the enlarged canal to be in part used for conveying water secured and covered by the water filings of the Myton Canal & Irrigation Company. The United States had given permission to the Myton Canal & Irrigation Company to carry water through that ditch after enlargement of same by the defendant corporation. The permission to enlarge the ditch imposed the condition that the work be done and completed during the years 1912, 1913, and 1914. The work was not being done because the Myton Canal & Irrigation Company had no money. Consequently the right of enlargement expired. An application made in 1916 for an extension of time to enlarge the ditch was denied because the Myton Canal & Irrigation Company was considered to be financially irresponsible. During 1917 another application was made by the Myton Canal & Irrigation Company to the government for permission to enlarge said ditch, and after an investigation the government granted permission upon assurance being given that the sale hereinafter mentioned would be made, and that the defendant Uinta Basin Construction Company would be able to procure the means with which to enlarge the government ditch. The permission was granted with the understanding that the Uinta Company would enlarge the ditch

Appeal from Fourth District.

and would procure the funds with which to carry on the work. During 1917 the directors of the Myton Canal & Irrigation Company entered into negotiations with Mr. S. Y. Taylor, one of the defendants herein, and an agreement was entered into on September 19th of that year by which the said company agreed to transfer its water filings and other rights to Taylor, who promised to organize a corporation, afterwards called the Uinta Basin Construction Company. He further agreed that he would cause the proposed corporation to commence and prosecute the work of enlarging the Gray Mountain Canal so that the canal could be used by December 31, 1918, and that the canal and irrigation system be extended across the South Myton Bench ready for delivery of water to land lying thereunder on or before December 31, 1919, and, further, that the project would be completed to the extent that it would deliver water to a minimum of 13,000 acres of land on or before December 31, 1921. It was further agreed between the parties that the corporation might pledge and mortgage the assets transferred to it to secure a bond issue of $250,000, that the bonds should be issued as rapidly as money was required for completion of the irrigation project, and that the contracts for water were to be delivered to the trustee, and that in payment for the rights by it transferred the Myton Canal & Irrigation Company would receive water contracts in good standing of such value that the aggregate amount of unpaid installments of principal, plus accrued and unpaid interest, should equal the sum of $58,275, plus the earned and unpaid 6 per cent. interest thereon, the interest to be payable annually. It was further agreed that, if the purchaser should fail to prosecute and complete the construction of the project within the time agreed upon, or should abandon the work, the properties and assets transferred should be reconveyed to the vendor or its assigns.

The foregoing contains the parts of the contract essential for an understanding of this case. After this contract was executed a meeting of the stockholders was called for October 6, 1917. The meeting was held pursuant to written notice. mailed to the stockholders and of the outstanding 6,3832/,