Earl

This is an appeal from a judgment entered in favor of respondent after his demurrer to appellants’ amended complaint was sustained and the latter declined to amend. Although the defendant R. W. Nuttall is now deceased and substitution has been made, he is referred to herein as respondent.

The action is representative in character, being brought by appellants as shareholders on behalf of the defendant Lopez Canyon Oil Company, a corporation, its directors refusing to bring suit. It is based upon fraud and seeks the recovery to the corporation of certain real property in the possession of respondent alleged to have been fraudulently obtained by him from the corporation, the reasonable value of other real property allegedly obtained by the same means and under the same circumstances, but since disposed of, and the rents received from the properties by respondent.

In substance it is alleged that respondent, a director and secretary of the corporation, which he dominated, falsely and with the fraudulent intent to defraud the corporation and to induce its directors to make the conveyances complained of, represented to the other directors that the corporation was heavily indebted and…