18 D.C. 69 (D.C.D.C. 1888), 10,296, Meloy v. Central Nat. Bank

Docket Nº:In Equity. 10,296.
Citation:18 D.C. 69
Opinion Judge:Mr. Justice BINGHAM:
Party Name:WILLIAM A. MELOY, ASSIGNEE, v. THE CENTRAL NATIONAL BANK ET AL.
Attorney:Mr. WILLIAM A. MELOY for plaintiff: Messrs. EDWARDS & BARNARD for defendant:
Case Date:November 26, 1888
Court:Supreme Court of District of Columbia
 
FREE EXCERPT

Page 69

18 D.C. 69 (D.C.D.C. 1888)

WILLIAM A. MELOY, ASSIGNEE,

v.

THE CENTRAL NATIONAL BANK ET AL.

In Equity. No. 10,296.

Supreme Court, District of Columbia.

November 26, 1888

The president of a corporation organized under Section 554 of the Revised Statutes relating to the District of Columbia executed without the authority or direction of the stockholders an assignment of all its assets for the benefit of creditors. Held , That the assignment was void not only because not made by authority of the stockholders, but it would seem also because a corporation has no power to make an assignment for the benefit of creditors.

APPEAL from a decree in equity dismissing a bill to obtain a discovery and account.

THE FACTS are stated in the opinion.

Mr. WILLIAM A. MELOY for plaintiff:

The plea rests the defendants' case upon this single ground, viz:

That the deed of general assignment, though regularly executed and in due and sufficient legal form, " was not [previously] authorized by the said company by any vote of its stockholders or of its trustees or board of directors."

Than this one point the bank sets up no defense.

The bank, by its plea, admits that it was the agent, trustee, and depositary of the company.

That a balance of " from $1,200 to $1,500 moneys of said company were remaining on deposit" with it, besides commercial paper in its possession for collection.

That the deed of conveyance to the complainant was actually made, as set forth in the bill, in the name of the company, executed by its genuine corporate seal, duly delivered and the transfer accepted.

We need go no further in the record.

Equity Rule 28 says: If upon issue the facts pleaded be determined for the defendant, they shall avail him as far as in law and equity they ought to avail him, i. e. , only so far.

Under this rule our point is in the nature of a demurrer to the plea, as if it were formally set down for hearing under this rule and we only say this plea states no valid defense of which the bank can in law and equity avail itself .

1. It is not valid . The defense rests on Section 544, R. S.D. C. This declares the persons named in a certificate of incorporation and their successors " by their corporate name capable of purchasing and conveying any real or personal estate whatever," " but [they] shall not mortgage such estate or give any lien thereon, except in pursuance of a vote of the stockholders of the company."

To this we reply, first, the conveyance in question is not a mortgage.

Second. It is an objection which the defendant bank cannot make. The provision of the statute is exclusively for the benefit of the stockholders of the company.

A mortgage is the conveyance of...

To continue reading

FREE SIGN UP