Armour Bros. Banking Co. v. Smith

• Decision Date: 13 December 1892
• Citation: 20 S.W. 690,113 Mo. 12
• Parties: ARMOUR BROS. BANKING CO. v. SMITH et al., (CAIRNS, Intervener.)
• Court: Missouri Supreme Court

20 S.W. 690

113 Mo. 12

ARMOUR BROS. BANKING CO. v. SMITH et al., (CAIRNS, Intervener.)

Supreme Court of Missouri, Division No. 2.

December 13, 1892.

FOREIGN CORPORATIONS — ATTACHMENT OF CORPORATE STOCK — GARNISHMENT.

1. Rev. St. 1889, § 540, provides that shares of stock in any corporation may be attached in the same manner as the same may be levied upon under execution. Sections 4915, 4924, 4925, 4953, provide that, when execution issues against an owner of stock in a corporation, an officer thereof shall furnish the sheriff a certificate of the number of shares held by defendant, and the levy shall be made by leaving a copy of the writ with the secretary or

other officer, with a certificate from the sheriff that he levies on the shares to satisfy the execution; and, when such shares are sold, the officer shall execute to the purchaser a bill of sale conveying the same, and give the secretary of the corporation a copy of the execution, with his return thereon. Held, that the statutes apply to domestic corporations only, and that, notice to the corporation being essential thereunder, a simple seizure under attachment, and sale of the paper certificate of a foreign corporation, convey no title to the stock.

2. In the absence of any statutory provision, certificates of stock in a foreign corporation are not subject, as choses in action, to garnishment process under a writ of attachment.

Appeal from St. Louis circuit court, L. B. VALLIANT, Judge.

Action by the Armour Bros. Banking Company against Charles R. Smith and the St. Louis National Bank as garnishee, with L. G. Cairns, the claimant of the property attached, interpleaded. From a judgment sustaining the interpleader, plaintiff appeals. Affirmed.

Horatio D. Wood, for appellant. Fisse & Allen and P. Taylor Bryan, for respondents.

THOMAS, J.

On the 23d of October, 1887, the plaintiff company commenced an action of attachment against Charles R. Smith, a nonresident of this state, upon two promissory notes, amounting to over $41,000. A writ of attachment was issued, and on the same day the sheriff summoned the St. Louis National Bank, as garnishee, which, in its answer to interrogations, stated that it had in its custody three certificates of stock, numbered 151, 152, and 153, issued to Charles R. Smith by the Colorado, Chicago & Texas Land, Cattle & Improvement Company, a corporation organized under the laws of Texas, the certificates being for 500 shares of stock in the aggregate of the par value of $100 each; that these certificates had been deposited with the garnishee as collateral security for a note signed by Smith, payable to J. J. Fisher, for $7,000, and by the latter indorsed to the bank; that on December 2, 1889, L. G. Cairns, by his agent, paid said note of $7,000, but at the same time notified said bank that the amount of the note was tendered and paid by Cairns as the owner of the shares of said stock, and not for the benefit or for account of said Smith; and the garnishee prayed that Cairns be permitted to interplead in the cause, and asked leave of the court to deposit the said certificates of stock with the clerk, to be held and disposed of in pursuance of the order of the court. The certificates were thus deposited, the garnishee discharged, and an order made on Cairns to appear and sustain his claim. Smith made default, but Cairns appeared, and filed a plea to the jurisdiction of the court, as also a motion to quash the return of the sheriff on the writ of attachment, on the ground, among others, that the said certificates of stock were not subject to the process of garnishment. The plea and motion were both sustained, the garnishment proceeding dismissed, and plaintiff has appealed.

1. It is a well-settled principle of law that stock in a corporation cannot be attached or subjected to a garnishee process unless authorized by express statute. Drake, Attachm. § 244; Foster v. Potter, 37 Mo. 526; Plimpton v. Bigelow, 93 N. Y. 593. And the question presented by this record for decision involves the construction of the several sections of our statute on the subject of the seizure and sale of shares of stock in a corporation under execution and attachment. Section 540, Rev. St. 1889, provides that "shares of stock in any bank, association, joint-stock company, or corporation, belonging to any defendant in any writ of attachment, may be attached in the same manner as the same may be levied upon under execution." Turning to the statute in regard to executions we find that sections 4915, 4924, 4925, and 4953 in substance provide that shares of stock in corporations may be sold under execution; that, when an execution is issued against a person owning shares of stock in any corporation, it shall be the duty of the secretary or other officer to furnish to the sheriff a certificate of the number of shares held by the defendant, with the incumbrance thereon; that the levy shall be made by leaving a copy of the writ with the secretary or other officer, with a certificate, attested by the officer, that he levies upon and takes such shares to satisfy the execution; and that, when such shares are sold, the officer shall execute and deliver to the purchaser a bill of sale conveying the same, and leave with the secretary of the corporation a copy of...