Bedenbaugh v. Lawrence

• Decision Date: 12 January 1940
• Citation: 141 Fla. 341,193 So. 74
• Court: Florida Supreme Court
• Parties: BEDENBAUGH v. LAWRENCE et al.

193 So. 74

141 Fla. 341

BEDENBAUGH v. LAWRENCE et al.

Florida Supreme Court, Division B.

January 12, 1940

Suit by W. B. Bedenbaugh, as liquidator of Merchants & Planters Bank of Sneads, Fla., against Edna Earle Lawrence and others to recover a bank stock assessment and to impress a lien on realty descended to defendants. From an order dismissing the amended bill of complaint, plaintiff appeals.

Affirmed. Appeal from Circuit Court, Jackson County; E C. Welch, Judge.

COUNSEL

James H. Finch, of Marianna, for appellant.

Carter & Pierce and B. L. Solomon, all of Marianna, for appellee.

OPINION

BROWN Justice.

This is an appeal from an order dismissing an amended bill of complaint.

On November 21, 1921, W. H. Whiddon died intestate in Jackson County, Florida, leaving an estate consisting of described real estate, various articles of personal property and 15 shares of the capital stock of the Merchants and Planters Bank of Sneads, Florida, of the par value of $100 each. On December 21, 1921, decedent's widow, Mrs Tennie Whiddon (later by remarriage Mrs. Tennie Whiddon Mercer) was appointed and qualified as administratrix of the estate; proceeded to administer the estate by paying the debts and obligations that were then due and owing and payable against the estate; and on September 6, 1927, was duly discharged as administratrix by the County Judge's Court of Jackson County. There has been no transfer, or request or offer for transfer of the ownership of said bank stock on the books and records of the Merchants and Planters Bank of Sneads, and there has been no sale or division thereof among the heirs. The decedent left as his heirs at law, his widow, Mrs. Tennie Whiddon, and his three children Edna Earle Lawrence, Mildred Mercer and Nellie Wade Whiddon. Some twelve years later, the Bank failed, and on June 12, 1936, fifteen years after the death of W. H. Whiddon, an assessment of 60 per cent was made against all stockholders. An assessment of $900 was made by the Comptroller against 'the estate' of W. H. Whiddon, deceased. Notice thereof was given to Mrs. Tennie Whiddon Mercer, and just prior to institution of the suit notice was given to the other heirs of W. H. Whiddon. The Liquidator of the Bank sought to have an administrator appointed for the estate, so that suit could be brought against him, but the County Judge of Jackson County refused to appoint one.

Plaintiff, Liquidator of the Merchants & Planters Bank of Sneads, some eleven years after W. H. Whiddon's estate had been administered and closed, filed his amended bill of complaint, on August 23, 1938, against the widow and the daughters of decedent, and the respective husbands of those that were married, praying: (1) That the amount of the assessment ($900 with interest from June 13, 1936) be adjudged a debt or liability of the estate of W. H. Whiddon, deceased, and a debt and liability of the defendants, each to the extent of a one-fourth share thereof, by reason of their ownership of said bank stock, vested in them by virtue of the law of descent. (2) That a lien be impressed in favor of plaintiff upon the described lands for the amount of the unpaid assessment, with interest since the date thereof. (3) That plaintiff's right to subject said lands to payment of said assessment with interest be adjudged superior to any right of defendants, or any of them, therein. (4) That a receiver be appointed to take charge of the lands and enforce payment of said assessment, and that said lands, or so much thereof as may be required, be sold by and under the direction of the court, to pay said stock assessment. (5) And that during pendency of this suit, the defendants be enjoined from making any division, partition or sale of said lands, and be also enjoined from further prosecuting the partition suit which had been instituted by the defendants.

Lis pendens notice was filed as to all of the lands involved.

Defendants filed a motion to dismiss the amended bill of complaint substantially on these grounds: (1) There is no equity in the bill. (2) When the bank suspended operations and the assessment was made, the record owner of the stock, W. H. Whiddon, was dead, the administratrix of his estate had been duly discharged, there had been no transfer of said stock on the books of the bank, the estate is not liable for said assessment and neither is the property that has passed into the hands of his heirs. (3) Liability for an assessment on bank stock is limited against stockholders, or the executor, administrator, guardian or trustee thereof to the extent of the funds in their hands, and the law does not provide for enforcement of such assessment against lands of such stockholder descended to his heirs. (4) After an estate has been administered, the administratrix duly discharged, and the estate closed, lands descended to the heirs cannot be charged for payment of said bank stock assessment. (5) Neither since decedent's death nor since discharge of administratrix have any of defendants exercised any control or ownership over said shares of stock. (6) The debt or demand represented by said bank stock assessment was not presented to the administratrix or filed in the office of the County Judge within the time provided by law for presentation of claims against estates, it not being alleged that the administratrix failed to publish notice to creditors. (7) The laws of Florida in effect at the time of the death of W. H. Whiddon prescribed the only and exclusive procedure for charging decedent's real estate for such debts, and such method has not been and cannot now be invoked. (8) It is contrary to the public policy of this State that real estate of a decedent descended to his heirs, after administration of his estate has been duly closed, be charged and sold for payment of assessment on bank stock standing in name of decedent, more than sixteen years after his death, in absence of showing that his heirs ever exercised any control or ownership over said stock. (9) After lapse of more than sixteen years from death of a stockholder in a bank, equity will not lend its aid to reach real estate descended to heirs for payment of assessment on said stock, where there has been no transfer of said stock on the books of the bank, and it is not alleged that any of the heirs exercised any control or ownership over said stock, and the administratrix was duly discharged more than eight years before the assessment was made, and the bank operated as a going concern for more than ten years after decedent's death.

The court entered its order granting the motion to dismiss the amended bill of complaint.

From this order, the plaintiff took this appeal.

The question to be determined is whether or not the amended bill contained equity, and in order to determine this, it is necessary to determine whether or not real estate that had descended to heirs of an intestate could be reached to pay for an assessment on bank stock still standing in the name of the decedent, when deceased died in 1921, the estate was administered and the administratrix duly discharged in 1927, and the bank assessment was made, not against the heirs, but against 'the estate' of the decedent, in 1936.

Section 6059 (4128), C.G.L. 1927, relating to liability of stockholders in banks provides:

'Stockholders of every banking company shall be held individually responsible equally and ratably and not for one another for all contracts, debts and engagements of such company to the extent of the amount of their stock therein at the par value thereof in addition to the amount invested in such shares. Persons holding stock as executors, administrators, guardians or trustees shall not be personally subject to any liability as stockholders, but the estates and funds in their hands shall be liable in like manner and to the same extent as the testator, intestate, ward or person interested in trust funds would be, if living and competent to hold the stock in his own name.'

The first part of this statute, Sec. 6059 (4128), C.G.L., is similar to the language found in 12 U.S.C.A. § 64, which is in part as follows:

'The stockholders of every national banking association shall be held individually responsible for all contracts, debts, and engagements of such association, each to the amount of his stock therein, at the par value thereof in addition to the amount invested in such stock. * * *'

The latter part of our statute, Sec. 6059 (4128), C.G.L., contains almost the identical language found in 12 U.S.C.A § 66, which is as follows:

Persons holding stock as executors, administrators, guardians or trustees, shall not be personally subject to any liabilities as stockholders; but the estates and funds in their hands shall be liable in like manner and to the same extent as the testator, intestate, ward, or person interested in such trust funds would be, if living and competent to act and hold the stock in his own name.'

The construction placed upon these federal statutes, 12 U.S.C.A. § 64, though not binding upon this Court, will be considered as persuasive authority.

The liability of stockholders in a banking company for its obligations is primarily contractual and acquisition of the stock implies assent of the owner to the statutory conditions under which the corporation is organized. See Tunnicliffe v. Noyes, 101 Fla. 794, 135 So. 505; Chavous v. Gornto, 89 Fla. 12, 102 So. 754; McNeill v. Pace, 69 Fla. 349, 68 So. 177; Bryan v. Bullock, 84 Fla. 179, 93 So. 182; Richmond v. Irons, 121 U.S. 27, 7 S.Ct. 788, 30 L.Ed. 864.

The purchase by W. H. Whiddon, in his lifetime, of the stock in the Merchants & Planters Bank of Sneads, implied, therefore his assent to the onerous burden of double liability imposed on stockholders in...