Andrew v. Commercial State Bank
| Decision Date | 13 November 1928 |
| Docket Number | 39113 |
| Citation | 221 N.W. 809,206 Iowa 1070 |
| Parties | L. A. ANDREW, State Superintendent of Banking, Appellee, v. COMMERCIAL STATE BANK et al., Appellees; MILTON REMLEY, Appellant |
| Court | Iowa Supreme Court |
Appeal from Johnson District Court.--RALPH OTTO, Judge.
Action in equity by the superintendent of banking of the state of Iowa, as receiver for the Commercial State Bank of Iowa City Iowa, insolvent, to recover judgment against the stockholders of said bank on their statutory liability, as defined and prescribed by Section 9251 et seq., Code of 1924. The defendant Milton Remley, one of the stockholders of said bank, appeals from a ruling denying to him the prayed relief in his motion in arrest of judgment.
Affirmed.
Milton Remley, for appellant.
Dutcher Walker & Ries, for appellee.
DE GRAFF, J.
The propositions relied upon by appellant will be stated in interrogative form, and answered.
1. Did the defendant have his day in court? In the first instance, on April 24, 1925, the plaintiff-receiver commenced an action in equity, naming 22 persons as defendants. These persons were stockholders of the Commercial State Bank of Iowa City. The bank was then insolvent, and adjudged to be insolvent in a decree entered of record on the 18th day of February, 1925, by the district court. Subsequently, to wit, September 10, 1925, an amendment to the petition was filed, making Milton Remley (appellant herein) a party defendant, and alleging his ownership of stock in said bank. The defendant-appellant filed a motion to dismiss the action. This motion was overruled, and defendant was given 10 days to plead. A motion was then made to transfer the action to the law docket. This motion was overruled, and the defendant was given 10 days to further plead. On January 24, 1927, default was entered against the appellant Remley for want of pleading, and on June 12, 1927, judgment and decree was entered in this cause, determining that an assessment against the stockholders should be made, and fixing the assessment as against each stockholder in an amount equal to the par value of the total number of shares of capital stock held by each stockholder, in conformity to statutory provision and the prayer of plaintiff's petition. This resulted in a judgment against the appellant Remley for $ 1,500, with interest from date of judgment. Fourteen days after the judgment entry, the appellant filed his motion in arrest of judgment, which was overruled. This is the provocation for the instant appeal.
It is quite apparent from this brief recital that the defendant Remley was in court.
2. Did the court err in holding that this appellant could be joined as defendant with other stockholders in a suit in equity? The statute, Sections 9252 and 9253, Code of 1924, is a sufficient answer to this question. Furthermore, the interpretation of the statutory provisions as made in Williams v. McCord, 204 Iowa 851, 214 N.W. 702, is controlling. We will not quote the statute in this particular. It is obvious that the general assembly of Iowa, in the enactment of Section 9251 et seq., recognized that in many jurisdictions a concurrent remedy in law and in equity existed, and, to pet the question at rest in this jurisdiction, it was provided that one action could be commenced by the receiver in equity against all stockholders, to enforce the double liability created and imposed by statute for and on behalf of the creditors of an insolvent bank. See, also, 3 Ruling Case Law 412, Section 40; 1 Cook on Corporations (6th Ed.), Section 218.
Counsel for appellant in his brief presents decisions from other jurisdictions, and cites, inter alia, Zander v. Affeldt, 173 Minn. 496 (217 N.W. 595). It is sufficient to state that a reading of that case discloses a different statutory provision from the one under consideration in the case at bar. The principle of remedial procedure therein declared is not in harmony with the statute of Iowa.
3. Did the court err in rendering a personal judgment against the appellant, who contends that, where a statute gives a right, and provides means of enforcing it, that means is exclusive? The legislative intent is plain. The action contemplated by the statute involves the determination of the question of the assets and the liabilities of the bank, the personnel of the stockholders, the amount of stock held by them, the necessity of levying an assessment against the stockholders on their statutory liability, and the amount of said assessment. Williams v. McCord, supra. These things in this action the instant receiver sought to do, and by a decree of court, in conformity to the prayer of the plaintiff, these things were done.
There is an apparent confusion in argument on behalf of the appellant, due to the failure to distinguish between the meaning and function of the statutory provisions contained in Section 9251 and Section 9246. The instant action was commenced in equity, as contemplated by Section 9251. It was not commenced and prosecuted on behalf of the bank, nor was its purpose to restore an impairment of its capital, under Section 9246. The receiver instituted the action to enforce the double liability created and imposed by Section 9251 for and on behalf of the creditors of the bank. This matter finds discussion and clarification in Andrew v. Farmers Tr. & Sav. Bank of Charles City, 204 Iowa 243, 213 N.W. 925, and in Leach v. Arthur Sav. Bank, 203 Iowa 1052, 213 N.W. 772. We deem further comment unnecessary.
4. Did the court err in holding that an action could be maintained against the appellant...
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