## Facts

- Salgo was the president of General Electrodynamics Corporation and served as chairman of the corporation’s annual stockholders’ meeting.
- Meer served as the election inspector at the meeting and was responsible for receiving proxies, determining their validity, and tabulating and certifying the vote.
- Pioneer Casualty Company was the record (registered) owner of shares in General Electrodynamics.
- Beneficial ownership of Pioneer Casualty’s shares had been transferred to Don Shepherd, who was in bankruptcy.
- At the meeting, Matthews and Thorp presented Meer with four documents that they claimed established their authority to vote Pioneer Casualty’s shares:
  - Two proxy documents signed on behalf of Pioneer Casualty by Don Shepherd.
  - A Texas district court order directing Pioneer Casualty’s receiver, McFarling, to provide Shepherd a proxy so Shepherd could vote Pioneer’s shares by issuing further proxies to Matthews and Thorp.
  - A proxy document signed by McFarling, the receiver.
- Meer refused to accept the presented proxies and therefore did not count votes purportedly cast under them.
- Matthews and Thorp immediately filed suit seeking injunctive relief requiring Salgo and Meer to accept the proxies, count the votes under them, and declare the candidates supported by Matthews and Thorp elected as directors.
- The trial court granted the requested injunctive relief.

## Issues

1. May a court issue a mandatory injunction requiring a corporate meeting chairman and election inspector to accept disputed proxies, count the resulting votes, and declare a particular slate of directors elected?
2. Does a separate court order directing a receiver to furnish a proxy eliminate the election inspector’s role in judging proxy validity, making acceptance of the proxy a ministerial act enforceable by injunction?

## Decision

- The appellate court reversed the injunctive relief granted by the trial court.
- The court held that deciding whether tendered proxies are valid is a judgment-based function committed to the election inspector in the first instance, not a purely ministerial act that a court can compel by mandatory injunction.
- The court further concluded that the district court order directed at the receiver did not require the election inspector to treat the disputed proxies as automatically valid for purposes of the shareholder vote.

## Legal Principles

- A mandatory injunction is generally unavailable to control or substitute judicial decision-making for an officer’s discretionary, judgment-based duties.
- Determinations about proxy authenticity, authority, and validity at a shareholders’ meeting are not purely mechanical; they call for evaluation and decision by the designated election official.
- A court order governing a receiver’s conduct with respect to issuing a proxy may bind the receiver, but it does not by itself convert the election inspector’s proxy-review task into a nondiscretionary duty.
- Courts will not use injunctive relief to decide, in real time, disputed proxy questions and then direct certification of a particular election result absent a clear showing that the election officials refused to perform their role or acted with fraud or bad faith.

## Conclusion

Salgo v. Matthews holds that a trial court may not use a mandatory injunction to force a corporate meeting chairman and election inspector to accept contested proxies, count votes under those proxies, and declare a specified slate elected, because proxy validity determinations involve judgment entrusted to the election inspector, and a separate receivership-related order did not remove that responsibility or make acceptance of the proxies a purely ministerial duty.


Salgo v. Matthews, 497 S.W.2d 620 (1973)