Guam Supreme Court Reverses Trial Court in Case of “Chamorro Equities v. Ulloa”

902

Guam – The Guam Supreme Court has reversed the judgment of the Superior Court of Guam in the case of  Chamorro Equities [CEI] v. Ulloa.

Ulloa, a stockholder in Chamorro Equities, argued that the trial court erred when it ordered that CEI’s directors be elected at the October 25 2011 annual meeting because the directors had already been elected at the special meeting on October 4.

In a decision authored by Chief Justice Philip Carbullido,  the Supreme Court concluded that:

* “a corporation may specify the means by which a meeting may be called”

* “that Guam law authorizes a corporation to formulate a by law provision that places discretion in a corporate officer to set the date of the annual election of directors.”

* “that if a bylaw provision directs election of directors to occur at an annual meeting, directors may be elected at a special meeting called for that purpose if no meeting is held on the day fixed by the bylaws. “

READ the Supreme Court Decision in Chamorro Equities v. Ulloa HERE  

READ the release from the Guam Judiciary below:

SUPREME COURT DECISION
In re Call of the Annual Meeting of Stockholders of Chamorro Equities, Inc. 2012 Guam 10

FOR IMMEDIATE RELEASE

(August 8, 2012)(Guam Judicial Center – Hagatna) – Today, the Supreme Court of Guam in an opinion authored by Chief Justice F. Philip Carbullido and joined by Associate Justice Katherine A. Maraman and Associate Justice Robert J. Torres, affirmed the judgment of the Superior Court of Guam in the case of In re Call of the Annual Meeting of Stockholders of Chamorro Equities, Inc., 2012 Guam 10.

Petitioner-Appellant Walter Ulloa, a stockholder of Chamorro Equities, Inc. (“CEI”), appeals from the trial court’s order vacating its previous order directing Walter to call the annual meeting of CEI, nullifying actions taken at the special meeting of CEI stockholders on October 4, 2011, and directing that the election of CEI directors will take place at the annual meeting of stockholders to be held on October 25, 2011. Walter argued that the trial court erred when it ordered that CEI’s directors be elected at the October 25 annual meeting because directors had already been elected at the special meeting on October 4. Walter also argued that the CEI bylaw provision vesting discretion in CEI’s president to select the date of the annual meeting is precluded by Guam law.

The Supreme Court held that Guam law authorizes a corporation to formulate a bylaw provision that places discretion in a corporate officer to set the date of the annual election of directors.

The court also held that, if a bylaw provision directs election of directors to occur at an annual meeting, directors may be elected at a special meeting called for that purpose if no meeting is held on the day fixed by the bylaws.

The court determined that a corporation may specify the means by which a meeting may be called. The Supreme Court reversed the trial court’s Order authorizing the October 25, 2011 annual meeting and invalidated the election of directors that occurred at both the annual meeting and the October 4, 2011 special meeting.

The matter was remanded back to the trial court to direct a stockholder or member of CEI to call an annual meeting pursuant to 18 GCA § 2210.