SCHAUER, J.

This case presents to this court for the first time the question as to whether section 834 of the Corporations Code (Stats. 1949, ch. 499, § 1) is validly applicable to a stockholder's derivative suit commenced after the effective date of the statute but concerning wrongs allegedly committed before that date and which suit is instituted by a shareholder who acquired his stock otherwise than by operation of law, and at a time subsequent to the commission of the wrongs complained of but prior to enactment of the statute. We conclude that the statute is procedural, that application of it here is prospective and does not divest the plaintiff of any substantive vested right, and that the order of the trial court dismissing the action for failure to furnish security for costs and expenses as required should be affirmed.

The legislation in question imposes two principal conditions on the institution and maintenance of stockholder's derivative suits: (1) The complaint must allege that plaintiff "was a registered shareholder . . . at the time of the transaction or any part thereof of which he complains" or that the shares devolved upon him by operation of law from one who was a registered shareholder at such time. (2) On motion (on the grounds specified in the statute and hereinafter epitomized) the court may require the plaintiff to furnish security for "the probable reasonable expenses, including attorney's fees, of the corporation and the moving party which will be incurred in the defense of the action." On failure to furnish the required security within a reasonable time to be fixed by the court "the action shall be dismissed."

The grounds upon which the motion for security may be based are: (a) That there is no reasonable probability that prosecution of the cause of action alleged against the moving party will benefit the corporation or its security holders; (b) That the moving party, if other than the corporation, did not participate in the transaction complained of in any capacity. The trial court in this proceeding concluded that ground (a) was established; its conclusion was amply supported if the statute is valid and applicable.

Plaintiff's complaint was filed on December 9, 1949; section 834 of the Corporations Code had become effective October 1, 1949; plaintiff became a stockholder not earlier than March, 1949, on conveyance to him by one Finnegan of 215 shares. All the transactions complained of, with one exception hereinafter noted, occurred prior to plaintiff's becoming a shareholder. The one transaction excepted (alleged leasing of property, with option to purchase at below its market value, to an organization controlled by defendants) assertedly took place on October 7, 1949, after plaintiff became a stockholder and after the effective date of the statute.

In material substance the complaint alleges: That plaintiff is the owner of 215 of a total of 1,235 outstanding shares of the Washington Holding Company, a corporation, and that the individual defendants concerned on this appeal own, or are registered as owning, shares in respectively stated numbers varying from 5 to 643, and aggregating 718; that the corporation, Washington Holding Company (hereinafter called Washington), has owned, since 1932, described real and personal property. Four individual defendants, Shoor, Ingold, Jenkins and Jesson control Washington and are the officers and directors thereof. Other defendants, Powell, Tanner and Hunt are officers of Washington. Since the organization of Washington in 1932, the four individual defendants have conspired to acquire all the property of Washington to the exclusion of the other shareholders, by issuing false financial statements of Washington, leasing its property to organizations under their control for less than its market rental value, failing to collect such rentals, representing that Mary Eloise Clark was a director when she was not, selling and acquiring stock for delinquent stock assessments unnecessarily levied during 1934-1939, and giving, in 1949, as heretofore mentioned, the lease with an option to purchase on improper terms. The individual defendants have concealed the foregoing from plaintiff. Since the action was commenced, plaintiff Hogan died and his executrix has been substituted in his place.

After the complaint was filed, defendants Ingold, Shoor, Tanner, Powell, Hunt and Jenkins moved, on the grounds stated in the statute, for an order requiring plaintiff to furnish security as therein provided. Supporting and opposition affidavits were filed and the matter heard. Pursuant to the motion, an order was made requiring security, and plaintiff having failed to furnish it within the time specified, the action was ordered dismissed as to the moving defendants. From the latter order this appeal is taken.

The affidavits presented on the motion raise various material issues of fact but, since it appears that the trial court based its order at least in part, and although indirectly, probably controllingly, on its finding, supported by ample evidence, that plaintiff (which term is used herein as indicating either the decedent who commenced the action or the present plaintiff) was, with the exception of the one transaction already noted, not the owner, registered or otherwise, of any stock at the time of any of the transactions or any part thereof complained of and did not acquire his stock by operation of law from one who was a stockholder at any such time, we treat the case on that basis.

Such finding, as above indicated, appears to have been substantially relied upon by the trial court in reaching its conclusion that there is no reasonable probability that prosecution of the cause of action alleged against the moving parties would benefit the corporation. It is to be noted, however, that the order dismissing the action is not based on a holding that the complaint fails to state a cause of action; rather, the court considered the facts as to the time and circumstances of plaintiff's acquirement of his stock, and the provisions of subdivision (a) (1) of section 834, and placed reliance thereon in reaching its conclusion that there was no reasonable probability that prosecution of the cause of action alleged would benefit the corporation, and hence, that it was proper to require plaintiff to furnish security for costs and attorney's fees in a reasonable amount. As previously mentioned, and now repeated for emphasis, it was for failure to furnish the security as ordered that the action was dismissed. Thus as applied here the statute did not operate to absolutely preclude plaintiff from maintaining the suit; it merely required him to furnish the security if he were to proceed further in his fiduciary capacity.

[1a] Plaintiff contends that her decedent as an incident of acquiring ownership of the stock by purchase acquired an unconditional vested property right to come into equity in a fiduciary capacity and in that role to institute and maintain this action on behalf of the corporation as to all wrongs complained of and that to impose the conditions prescribed by section 834 on the institution and maintenance of the action is to give the statute retroactive effect and illegally deprive decedent and this plaintiff of a valuable property right. This contention cannot be sustained; a person has no property right in being appointed or in acting on his own nomination as a guardian ad litem. He may nominate himself but he cannot compel the court to accept his nomination; he has no property right to be accepted by the court to institute and maintain an action in the right of another on terms beyond the control of the court or the Legislature.

[2] It should be observed that section 834 is not designed and does not operate to deprive a shareholder of any vested property right. By its very words the section relates solely to actions which may be "instituted or maintained in the right of any domestic or foreign corporation by the holder . . . of shares . . . of such corporation." (Italics added.) [3] Since the statute is directed only at actions instituted or maintained "in the right" of the corporation it has no application to actions or suits seeking directly to enforce personal rights of shareholders. Stockholders, if they have a personal cause of action, are still free to sue the corporation, the majority stockholders, or the directors of the corporation, and to recover for any cause they can establish. It becomes important therefore to clearly understand at once the precise nature of a stockholder's derivative action.

[4, 5] In Whitten v. Dabney (1915), 171 Cal. 621, 630-631 [ 154 P. 312], this court said: "And here again it becomes necessary to call attention to the fact that these plaintiffs have no personal wrongs for which they are entitled to seek redress in this action. `The stockholder does not bring such a suit because his rights have been directly violated, or because the cause of action is his or because he is entitled to the relief sought. He is permitted to sue in this manner simply in order to set in motion the judicial machinery of the court.' (3 Pomeroy's Equity, 3d ed., sec. 1095.) . . . What is the exact situation of a plaintiff in such an action? He is a trustee pure and simple, seeking in the name of another a recovery for wrongs that have been committed against that other. His position in the litigation is in every legal sense the precise equivalent of that of the guardian ad litem. The guardian ad litem stands as the representative of some person incompetent to sue or be sued directly. He is appointed by the court to represent that incompetent's interests; to prosecute or defend with the highest diligence and good faith. The stockholder beginning this action does not even occupy the position of a creditor suing on his own account and on account of his fellow-creditors. In the latter case the creditor plaintiff has a direct personal interest in the litigation, and within limitations not here necessary to discuss, may deal with that litigation as his own. But the stockholder acts in purely a representative capacity. He is a guardian ad litem by virtue of statutory authority, empowered to do precisely what a guardian ad litem appointed by a court may do. He has gone into equity seeking redress for a corporation under disability to obtain relief itself, precisely as the guardian ad litem goes into court to obtain like redress for a client under disability by reason of incompetency or nonage. The principles governing the conduct of a guardian ad litem are in full strictness applicable to the conduct of such a plaintiff stockholder. Not only should a plaintiff in such a fiduciary capacity be willing to take no act that did not first receive the sanction of the court of equity to which he has appealed, but, more than this, he is not permitted to take any act without such sanction. ( Waterman v. Lawrence, 19 Cal. 210 [79 Am.Dec. 212].) Where an action is prosecuted by a guardian ad litem, the infant is the real party. ( Bowers v. Kanaday, 94 Ga. 209 [21 S.E. 458].) And the guardian ad litem cannot even be considered a party to the cause. ( Thomason v. Gray, 84 Ala. 559 [4 So. 394]; Baltimore Ohio R.R. Co. v. Fitzpatrick, 36 Md. 619; Tate v. Mott, 96 N.C. 19 [ 2 S.E. 176]; Duffy v. Pinard, 41 Vt. 297; Ingram v. Little, L.R. 11 Q.B.Div. 251.) And what are the principles governing the conduct of a guardian ad litem? It is the right and duty of the court to protect the interests of the incompetent represented by the guardian ad litem and to exercise supervision over the conduct of that guardian." See, also, to like effect, Loeb v. Berman (1933), 217 Cal. 716, 720 [ 20 P.2d 685]; Russell v. Weyand (1935), 5 Cal.App.2d 259, 260, 266 [ 42 P.2d 381]; Spellacy v. Superior Court (1937), 23 Cal.App.2d 142, 147 [ 72 P.2d 262].

Speaking likewise of the character of such suits the United States Supreme Court in Cohen v. Beneficial Ind. Loan Corp. (1948), 337 U.S. 541, 549 [69 S.Ct. 1221, 93 L.Ed. 1528], said: "The very nature of the stockholder's derivative action makes it one in the regulation of which the legislature of a state has wide powers. Whatever theory one may hold as to the nature of the corporate entity, it remains a wholly artificial creation whose internal relations between management and stockholders are dependent upon state law and may be subject to most complete and penetrating regulation, either by public authority or by some form of stockholder action. Directors and managers, if not technically trustees, occupy positions of a fiduciary nature, and nothing in the Federal Constitution prohibits a state from imposing on them the strictest measure of responsibility, liability and accountability, either as a condition of assuming office or as a consequence of holding it.

"Likewise, a stockholder who brings suit on a cause of action derived from the corporation assumes a position, not technically as a trustee perhaps, but one of a fiduciary character. . . . He is a self-chosen representative and a volunteer champion. The Federal Constitution does not oblige the state to place its litigating and adjudicating processes at the disposal of such a representative, at least without imposing standards of responsibility, liability and accountability which it considers will protect the interests he elects himself to represent. . . . We conclude that the state has plenary power over this type of litigation. . . .

"[P. 552] A state may set the terms on which it will permit litigations in its courts. No type of litigation is more susceptible of regulation than that of a fiduciary nature . . . and we think . . . it is within the power of a state to close its courts to this type of litigation if the condition of reasonable security is not met."

[6a] If the power of the state over this type of fiduciary litigation is plenary, as the Cohen case states, then surely such litigation is subject to regulation of the type provided by section 834 [7] And if section 834 is applied only to actions instituted after its enactment it is neither substantive in character nor retroactive in operation. It does not in and of itself create any liability or deprive anyone of property or of any vested right either with or without due process nor does it impair the obligation of any contract. The stockholder will not incur any liability for costs if he does not essay to bring in equity a suit in the corporation's right. If he does bring such a suit he knows that he will be subject to the regulating provisions of the statute. [8] There is no more reason to doubt the applicability of the statute to a fiduciary action brought in respect to wrongs assertedly perpetrated before the statute than if it concerned wrongs happening after the statute as long as the action is brought after the effective date of the legislation. [9] In either case the operation of the statute is prospective and procedural because it does not deprive a person of any right which he had at the time of beginning the suit, but merely prescribes the conditions upon which the subsequently instituted equity suit may be brought and maintained. [10] Obviously, it is only in respect to a claimed unconditional right to institute and maintain the fiduciary action in the right of the corporation, and to be unconditionally accepted by the court in that capacity, that plaintiff's claim of impairment goes. This is the only claim he can make because it is the only type of action affected by the statute and the statute does not abolish stockholder's derivative suits but merely imposes regulatory conditions on their institution and maintenance. Plaintiff's stock is still his; any personal rights of action he may possess as attributes or incidents of the stock are still his and, as already noted, are completely unaffected by section 834

[1b] As already pointed out, by bringing a stockholder's derivative action the plaintiff nominates himself to act in a fiduciary capacity substantially as a guardian ad litem for the corporation, and he has no vested property right which compels the court to accept him unconditionally in that capacity. [6b] The formulation of regulations for that type of litigation including the determination of what qualifications shall be required of a plaintiff in order that he may institute and maintain a suit in equity "in the right" of another is a matter manifestly appropriate for state legislation, which must be upheld so long as no constitutional rights are invaded. In the light of the authorities already cited it is apparent that application of the statute under the circumstances shown here breaches no constitutional guaranty.

It may be further observed that even without the enactment of section 834 the plaintiff here would not have been permitted to maintain the suit (except possibly in relation to the one transaction alleged to have occurred after he acquired his stock) had it been brought in or transferred to (as upon showing a diversity of citizenship) a federal court, and that this court has never passed upon the question as to the capacity of a shareholder, who was not such at the time of the wrongs complained of, to maintain a derivative suit. Since Hawes v. Contra Costa Water Co. (sometimes cited as Hawes v. Oakland) (1881), 104 U.S. 450 [26 L.Ed. 827, 832], it has been the rule in the federal courts that a complaint in a derivative action must contain "an allegation that complainant was a shareholder at the time of the transactions of which he complains, or that his shares have devolved on him since by operation of law."

This rule is now embodied in the Federal Rules of Civil Procedure (rule 23(b), 28 U.S.C.A.) and is enforceable in the federal courts even in states which permit derivative suits without such a showing ( Venner v. Great Northern Ry. Co. (1907), 153 F. 408, 411; affirmed (1908), 209 U.S. 24 [28 S.Ct. 328, 52 L.Ed. 666]). Decisions of the courts of the several states are sharply conflicting and strong arguments can be found in support of either policy. (See anno. 148 A.L.R. 1091, 1097.) In California the only case substantially in point which has been cited to us or which our research has disclosed is Harvey v. Meigs (1911), 17 Cal.App. 353, 364 [ 119 P. 941]. The District Court of Appeal there took the view that the action could be maintained regardless of when and how ownership of the stock was acquired. However, in view of the fact that we regard section 834 as controlling on this appeal we express no opinion as to whether, in the absence of such statute, we should follow or disapprove Harvey v. Meigs. [11] Insofar as section 834 authorizes the court on motion and in the exercise of a reasonable discretion to require that a plaintiff in a derivative suit furnish security for "the probable reasonable expenses, including attorney's fees," of the defendants sued, "which will be incurred in the defense of the action," and requires dismissal of the action on failure of the plaintiff to comply with the order within a reasonable time fixed by the court, there is no serious question either as to validity or applicability of the legislation. It is almost universally held that such statutes are not regarded as being given retroactive effect even when applied to actions pending at the time of enactment. Certainly they are not retroactive when applied to actions subsequently commenced (and this must be understood as the only respect in which a question is before us or in which we express our view) even though the cause of action accrued before enactment. [12] The general rule is thus stated in 7 California Jurisprudence 305, § 43: "[C]osts are given only by statutory direction and their allowance depends on the terms of the statute in force at the time of the accrual of the right to have them taxed. This time, in regard to costs on appeal, is the time of the rendition of the judgment on appeal. It follows that the rule pertaining to the allowance of costs may be changed or modified by statute during the pendency of the proceeding." Directly supporting the above statement, see Turner v. East Side Canal Irr. Co. (1918), 177 Cal. 570, 571-572 [ 171 P. 299], and cases there cited; Wilson v. Nichols (1942), 55 Cal.App.2d 678, 682 [ 131 P.2d 596] (hearing denied).

[13] In 96 American Law Reports 1428 (annotation on "Statute relating to costs or attorneys' fees at commencement or at termination of action as controlling") the law is epitomized as follows: "It is well settled that the question whether costs may be allowed in an action or suit, as well as the determination of the method of their computation, is governed by the law as it exists at the time of the judgment which terminates the action or suit, rather than by the law as it existed at the time when the action or suit was commenced, — where there is no provision in connection with the new legislation which clearly saves or excepts therefrom costs in pending actions." The numerous illustrative cases which are cited show that statutes either increasing or decreasing the allowable costs, including attorney fees, are consistently applied to litigation pending when such statutes became effective, unless a contrary intent clearly appears from the statute.

It is noted that in Shielcrawt v. Moffett (1945), 294 N.Y. 180 [ 61 N.E.2d 435, 439, 159 A.L.R. 971], an attempt is made to distinguish between the recognized rule that "Liability for the payment of costs . . . is ordinarily measured in accordance with the statute in effect at the time when costs and expenses are fixed by order or by judgment of the court, even though the proceeding may have been initiated before the statute took effect," and the situation here presented of imposing a new requirement that security for such costs be furnished by plaintiff. Whether this attempted distinction is sound or unsound does not now concern us and we imply no view on it whatsoever. In either event the case does not support the conclusion that application of section 834 to actions filed after its enactment would constitute retroactive application. The holding (p. 438 of 61 N.E.) is merely that the New York statute permitting the corporation defendant to "require the plaintiff [in a derivative suit] . . . to give security for the reasonable expenses, including attorney's fees," did not apply to actions pending at the time the statute became effective. Our statute, in its application to the case before us, involves only its effect on subsequently instituted actions and the Shielcrawt opinion expressly distinguishes such cases. The court there says ( Shielcrawt v. Moffett (1945), supra, 294 N.Y. 180 [ 61 N.E.2d 435, 440, 159 A.L.R. 971]): "If the statute had been in effect when the plaintiffs instituted this action they might not have been able or willing to give the required security; if applied to pending actions it might prevent these plaintiffs from trying the action after they had spent time and money in preparing it for trial. Though the Legislature has found that the statute is a just and reasonable solution of a serious problem, it does not follow that it would decide that it would be just and reasonable to apply the statute to actions then pending. . . .

"It is said that, when the Legislature provided that the defendant is entitled to require the plaintiff or plaintiffs to give security `in any action instituted or maintained in the right of any foreign or domestic corporation,' it disclosed an intention that the statute should apply not only in actions thereafter instituted but also in actions previously `instituted' and thereafter `maintained'. The word `maintained' may be used in a context where it clearly denotes that it includes pending actions. ( Cf. George Moore Ice Cream Co. v. Rose, 289 U.S. 373, 53 S.Ct. 620, 77 L.Ed. 1265.) In other context it has frequently been given other construction. (See cases collated in 38 C.J., Maintain, §§ 2, 3, 4, 5.) In the statute we are now construing it is at most equivocal and does not, we think, disclose an intent of the Legislature that it should be applied in actions previously instituted."

[14] Lastly, we are of the view that section 4 of the Corporations Code is pertinent. It provides that "No action . . . commenced before this code takes effect, and no right accrued, is affected by the provisions of this code, but all procedure thereafter taken therein shall conform to the provisions of this code so far as possible." Certainly there is nothing in the quoted language which implies that section 834 shall not be applied to actions commenced after its effective date. [15] Since the power of the state over the institution and maintenance of fiduciary actions of this character is plenary ( Cohen v. Beneficial Ind. Loan Corp. (1948), supra, 337 U.S. 541, 550), there is no "right accrued" in the shareholder (to be accepted by the court as, in effect, a guardian ad litem for the corporation) to be affected and the declared policy of the state as to all procedure to be taken in derivative actions after the effective date of the statute should be given effect. (See Smallwood v. Gallardo (1927), 275 U.S. 56, 60-62 [48 S.Ct. 23, 72 L.Ed. 152].)

For the reasons above stated the order appealed from is affirmed.

Shenk, J., Edmonds, J., and Spence, J., concurred.