Ball v. Peper Cotton Press Co.

• Decision Date: 22 June 1909
• Parties: BALL v. PEPER COTTON PRESS CO. et al.
• Court: Missouri Court of Appeals

121 S.W. 798

141 Mo. App. 26

BALL v. PEPER COTTON PRESS CO. et al.

St. Louis Court of Appeals. Missouri.

June 22, 1909.

Rehearing Denied October 19, 1909.

1. CORPORATIONS (§ 153)—DIVIDENDS—RIGHT TO DECLARE.

All the stockholders of a corporation, except plaintiff and another, were directors, and, as such, participated in declaring a dividend, and all but plaintiff accepted their share. The only real stockholders at the time were plaintiff and such other person, and, subsequently, plaintiff and the transferee of such other, who were also the only creditors. No creditors of the corporation complained of the dividend, and it did not appear that there were any at the time. Held, that the corporation had no right to make the defense, in behalf of either plaintiff or the transferee, that its financial condition did not warrant the declaration of the dividend, since the former's interest was opposed to it, and the latter, being a defendant, could have made it for herself had she desired to do so.

2. LIMITATION OF ACTIONS (§ 25) —"PROMISE IN WRITING TO PAY MONEY."

To be a "promise in writing to pay money," within the 10-year limitation of Rev. St. 1899, § 4272 (Ann. St. 1906, p. 2347), the writing must contain words either expressing a promise to pay, or from which it may be implied.

3. LIMITATION OF ACTIONS (§ 25) — PROMISE IN WRITING TO PAY MONEY — RESOLUTION DECLARING DIVIDEND.

A resolution by corporate directors, entered in the record of their meeting, directing that there be paid to stockholders, out of the net proceeds, a certain sum pro rata according to the number of shares held, accompanied by a credit on the ledger in favor of a stockholder, is a promise in writing to pay money within Rev. St. 1899, § 4272 (Ann. St. 1906, p. 2347), permitting an action on such a promise to be brought within 10 years.

4. APPEAL AND ERROR (§ 880) — REVIEW — POINT MADE BY PARTY NOT AFFECTED.

A point made in the appellate court, by a party other than the sole party affected, will be overruled without deciding whether it would be good if raised by the right party.

5. CREDITORS' SUIT (§ 5) — PROPERTY OR RIGHTS WHICH MAY BE SUBJECTED — INTEREST OF PLEDGOR.

The interest of pledgor of a certificate of deposit in the hands of pledgee, to indemnify it as surety for pledgor, is not subject to levy or garnishment on legal process, but is such an interest as is properly reached by a creditors' bill.

6. CREDITORS' SUIT (§ 8) — PROPERTY OR RIGHTS WHICH MAY BE SUBJECTED.

A creditors' bill is not an improper remedy to reach assets, though the debtor originally held the legal title thereto, where they have been incumbered, so to make his present interest an equitable one, or are such as are not leviable or garnishable, even though his interest is still legal.

7. CREDITORS' SUIT (§ 5) — PROPERTY OR RIGHTS WHICH MAY BE SUBJECTED.

A creditors' bill will reach such assets of the debtor as are not subject to levy and garnishment, without reference to fraud or other ground of equity jurisdiction.

8. JUDGMENT (§ 193) — POWER TO HOLD CASE OPEN AFTER JUDGMENT.

A court of equity cannot, any more than a court of law, hold a case open after judgment for further adjudication on the merits, though it may retain it for administrative purposes, and make orders to carry a decree into effect.

9. CORPORATIONS (§ 123)—INTERESTS WHICH MAY BE ASSIGNED—CONTINGENT INTEREST.

The contingent interest of pledgor of a certificate of stock in the hands of pledgee, to indemnify it as surety for pledgor, is assignable in equity.

10. INJUNCTION (§ 44)—GROUNDS OF RELIEF —FRAUDULENT TRANSFERS.

Where the judgment of a creditor may be rendered unavailable by a transfer of equitable assets, equity will grant an injunction.

Appeal from St. Louis Circuit Court; Chas. C. Allen, Judge.

Action by David C. Ball against the Peper Cotton Press Company and others. Judgment for plaintiff, and defendants appeal. Reversed and remanded, with directions.

Judson & Green, John H. Overall, and Robt. L. McLaran, for appellants. Stewart, Eliot, Chaplin & Blayney, for respondent.

GOODE, J.

On the 17th of September, 1895, the directors of the Peper Cotton Press declared a dividend to their stockholders of record September 16, 1895, in the sum of $6,000, to be paid pro rata on the number of shares held by them. The resolution declaring the dividend was duly entered upon the minute books of the company, along with the report of the proceedings of the directors of that date. The plaintiff appearing to be the owner of 443 shares of the stock of the company, his account on the ledger of the company was credited with $1,500, that being his proportionate part of the declared dividend, and, down to the date of the filing of the suit, that amount stood on the books of the company to his credit. It is stated in the petition, and admitted in the agreed statement of facts on which the case was tried, that the defendant Peper Cotton Press is utterly insolvent. It is alleged in the petition and admitted in the agreed statement that, at the time of the filing of the petition herein, the only property which defendant company owned and possessed, subject to execution, was a leasehold running from June 15, 1901, to June 15, 1905, with the privilege of four renewals of 10 years each, the lease being executed by the board of education of the city of St. Louis to the Peper Cotton Press of a lot of ground in the city of St. Louis upon which the Peper Cotton Press had made improvements. On this leasehold, as well as the rents reserved in the sublease, which the Peper Cotton Press had made of the leasehold, the Peper Cotton Press had given three deeds of trust, two of them securing an indebtedness of some $60,000 to Russell E. Gardner, the third securing a note of $24,422.76 to George Taylor Commission Company. The latter deed of trust, with the note secured thereby, was later transferred to the defendant, Annie Taylor Jones. After the institution of this suit one of the deeds of trust given to Gardner's trustee had been foreclosed, and, at the foreclosure sale, the property purchased by Annie Taylor Jones. In addition to the property leased from the board of education the defendant, Peper Cotton Press Company, had also a leasehold of an unimproved part of the city wharf, the lease running for a term of 10 years, from the 5th of July, 1903, at an annual rental of $900, this lease not being transferable without the written consent of the harbor and wharf commissioner, the right being reserved to the city of St. Louis to alter, amend, or repeal the ordinance and lease at any time. It is averred in the petition in the case that in addition to these leaseholds, "the defendant, Peper Cotton Press, had also another asset, which was not known by plaintiff at the time he filed said suit, being a contract entered into by defendant, Peper Cotton Press, and the St. Louis Cotton Compress Company, wherein said St. Louis Cotton Compress Company agreed to pay to the Peper Cotton Press the sum of $1,000 per year, beginning in 1901, and continuing for 12 years, provided the Peper Cotton Press would not engage in the business of storing and compressing cotton for the term of 50 years, the first five of said $1,000 payments having been already paid." It is further averred in the petition that the defendant, Peper Cotton Press, had another asset as follows: "One of the conditions of said ordinance" (referring to the city ordinance before noted) "leasing to the Peper Cotton Press a portion of the unimproved wharf of the city was that the Peper Cotton Press should file with the city of St. Louis a penal bond in the sum of $2,000, with good and sufficient securities, to secure the faithful performance of the terms, conditions, covenants, and stipulations of the said lease." The bond was filed by the Peper Cotton Press with the defendant Fidelity & Deposit Company of Maryland as surety. The latter company required the Peper Cotton Press to deposit with it as indemnity against any loss which it might suffer or incur as surety on said bond as aforesaid, the sum of $2,000, that sum being represented by a certificate of deposit of the Boatmen's Bank of the city of St. Louis, Mo., bearing 3 per cent. interest, it being agreed among other things, between the defendant, Peper Cotton Press, and the Fidelity & Deposit Company of Maryland, that whenever the bond should expire, or whenever the defendant, Fidelity & Deposit Company, was absolved from further liability as surety on the bond, the latter company was to return to the Peper Cotton Press the sum of $2,000, or the certificate of the bank for that amount, subject to whatever offsets, expenses, and deductions might have been incurred by the Fidelity & Deposit Company as surety on the bond. It is averred in the petition that after the institution of the suit the board of directors of the Peper Cotton Press, at a meeting duly held, and for consideration of $100, had transferred and assigned by quitclaim to Annie Taylor Jones' trustee, all the right, title, and interest of the Peper Cotton Press in the lease of the wharf, it being recited in the resolution making the transfer that the Peper Cotton Press was indebted to Mrs. Jones in the sum of $24,422.76, and accrued interest, evidenced by a promissory note of the company of date September 15, 1902, the note bearing 6 per cent. interest per annum, and the $100 indorsed as a credit on the back of the note, the note now being the property of Mrs. Jones and wholly unpaid except the $100, and it being recited in the resolution by which this was done that, as the corporation has no money, property, or assets of any kind, except a certain certificate of deposit issued by the Boatmen's Bank of St. Louis, Mo., for the sum of $2,000, and a certain contract between the corporation and the St. Louis Cotton Compress Company, by which contract the Cotton Press Company agreed to pay to the Peper Cotton Press the sum of $1,000 each year...