Benson v. Keller

• Decision Date: 23 April 1900
• Parties: BENSON v. KELLER et al.
• Court: Oregon Supreme Court

60 P. 918

37 Or. 120

BENSON v. KELLER et al.

Supreme Court of Oregon

April 23, 1900

Appeal from circuit court, Multnomah county; John B. Cleland, Judge.

Suit by T.C. Benson against George Keller, The Dalles National Bank and others, for the cancellation of certain duebills. Decree for plaintiff, and the bank appeals. Affirmed.

The facts out of which this controversy arises may be briefly stated as follows: The Columbia Packing Company is a corporation organized with a capital stock of $15,000 divided into shares of $100 each, only 80 of which were subscribed,--A.A. Bonney taking 40; E.C. Phirman, 20; and George Keller, 20. A meeting of the stockholders was held September 16, 1890, at which they were all elected directors and on the same day the directors, at a regular meeting elected Bonney president, Keller secretary, and Phirman treasurer; but no regularly called meeting of the stockholders or directors was thereafter held until December 27, 1894. The corporation in the meantime engaged in the business for which it was organized. About November, 1890, Bonney pledged 20 shares of his stock to A.V. Anderson, to secure the payment of $1,500, and the balance of it in March, 1891, to B.S. Bonney, to secure the payment of $3,800. Thereafter Anderson and B.S. Bonney assigned their evidence of indebtedness, together with the stock pledged for its security, to C.W. Rice; and later, but prior to December 7, 1894, Rice began proceedings for the foreclosure of his lien upon the stock, and on March 15, 1895, became the owner thereof by purchase at sheriff's sale. On September 25, 1890, Phirman and Keller pledged their stock to A.A. Bonney to secure the payment of certain sums advanced,--$1,800 to Phirman, and $1,703 to Keller. In October following, Bonney transferred his evidence of indebtedness, together with the stock pledged, to one S.W.R. Jones, to secure his indebtedness to Jones. On May 2, 1892, Bonney, Phirman, and Keller entered into an agreement whereby they mutually stipulated and agreed that each should receive an equal share of the profits earned by said company subsequent to September 2, 1891, notwithstanding the inequality in the number of shares of capital stock appearing to the credit of each upon the company's books, and that, as soon as the certificates of stock theretofore issued and pledged should be redeemed, the same should be canceled, and a certificate issued to each of the parties for an equal number of shares, and that the parties should thereafter be equal owners of the capital stock of the company. On December 7, 1894, Keller entered into a written agreement with one R.H. Guthrie, whereby, for a consideration named, he sold, assigned, and transferred to Guthrie all his interest in and to 26 2/3 shares of the capital stock of the company, reserving to himself all the accrued profits of said company's business represented by the uncollected book accounts, notes, and demands due to said company on November 16, 1894, which should thereafter become dividends upon said shares of stock. The document then recites the aggregate of the outstanding accounts, the amount of present indebtedness, the manner in which the outstanding stock of the company was then held, and the agreement of the stockholders concerning the same. The 20 shares of capital stock theretofore pledged by Keller to A.A. Bonney were accordingly assigned to Guthrie, who on December 27, 1894, was duly recognized as a stockholder of the company at a regularly called meeting of the stockholders and directors. On the said 7th day of December Keller attempted to secure from the company an agreement containing a stipulation upon its part to collect as soon as practicable sufficient of its outstanding accounts, notes, and demands to satisfy the indebtedness incurred prior to said November 16, 1894, amounting to $2,011.83, and transfer one-third of the remainder thereof, to wit, $11,657.42, or $3,885.80, to Keller, and thenceforth hold him harmless from said indebtedness; Keller agreeing upon his part that upon the assignment to him of the said one-third of the accounts, notes, and demands, he would release the company from all liability to him for dividends. This agreement purports to be signed by R.H. Guthrie, president pro tem., and George Keller, and has the corporate seal attached. At this time T.C. Benson, the plaintiff herein, was indebted to the company in a sum largely in excess of $3,000, and J.G. & I.N. Day were indebted to Benson in a sum much larger than that amount. Thereafter, on the 24th and 27th days of December, 1894, Keller, by representing to Benson that he was authorized to collect of the amount due from him to the company the sum of $3,000, and that he would procure from the company a receipt and release for that amount, induced him to procure from J.G. & I.N. Day their 16 duebills, payable to the order of Keller, 8 of which, aggregating $1,500, were to mature January 15, 1895, and the others, amounting to $1,500, to mature February 15, 1895. Keller transferred the duebills falling due January 15th to The Dalles National Bank, as collateral security for future advances, and the others to Bissinger & Co., of Portland, Or. Benson brings this suit to have the duebills surrendered up and canceled, and joins with The Dalles National Bank, as defendants, George Keller, Bissinger & Co., J.G. & I.N. Day, and the Columbia Packing Company. The decree of the court below, in so far as it concerns the controversy here, was in favor of the plaintiff and against The Dalles National Bank, and the bank appeals.

Wallace McCamant, for appellant.

F.P. Mays, for respondents.

WOLVERTON C.J. (after stating the facts).

Objection is made, through the interposition of a demurrer to the complaint, that several causes of suit have been improperly united, in that it states a cause of suit against Bissinger & Co., of Portland, and one against The Dalles National Bank, of The Dalles, and that neither of these parties has any interest in the cause stated against the other. Hence, it is claimed that the complaint is multifarious. Objections on account of multifariousness seem to be divided primarily into two classes: (1) Those which go to a misjoinder of two or more independent and incompatible causes of suit; and (2) where several matters of a distinct nature are stated and demanded against different parties. The two kinds of objections are well illustrated by Lord Chancellor Cottenham in Campbell v. Mackay, 1 Mylne & C. 603, wherein the distinction is clearly stated. He says: "Frequently the objection raised, though termed 'multifariousness,' is in fact more properly misjoinder; that is to say, the cases or claims united in the bill are of so different a character that the court will not permit them to be litigated in one record. It may be that the plaintiffs and defendants are parties to the whole of the transactions which form the subject of the suit, and nevertheless those transactions may be so dissimilar that the court will not allow them to be joined together, but will require distinct records. But what is more familiarly understood by the term 'multifariousness,' as applied to a bill, is where a party is able to say he is brought as a defendant upon a record, with a large portion of which, and of the case made by which, he has no connection whatever." See, also, Gartland v. Dunn, 11 Ark. 720. It is said in Alexander v. Alexander, 85 Va. 353, 363, 7 S.E. 335, 339, 1 L.R.A. 125, 127, "that a bill will always be deemed multifarious where several matters joined in the bill against one defendant are so entirely distinct and independent of each other that the defendant will be compelled to unite in his answer and defense different matters wholly unconnected with each other, and as a consequence the proofs applicable to each would be apt to be confounded with each other, and great delays might be occasioned respecting matters ripe for hearing by waiting for proofs as to some other matter not ready for hearing; or, again, where there is a demand of several matters of a distinct and independent nature in the same bill, rendering the proceeding oppressive because it would tend to load each defendant with an unnecessary burden of costs, by swelling the pleadings with the statement of the several claims of the other defendants, with which he has no connection." A cardinal evil which the objection is designed to obviate is that of putting the parties to great and useless expense, and this has relation as it may affect either party to the suit. In Attorney General v. Cradock, 3 Mylne & C. 85, it was said: "The object of the rule against multifariousness is to protect a defendant from unnecessary expense, but it would be a great perversion of that rule if it were to impose upon the plaintiffs and all the other defendants the expenses of two suits instead of one."

It is here insisted that by suing Bissinger & Co. in Portland, and making The Dalles National Bank, and the other defendants residing at the Cascades and The Dalles, parties, and causing them to make their defenses in Portland, the plaintiff is putting them to an unwarranted and needless expense. No doubt, it has been more expensive for them to litigate in Portland than it would have been at The Dalles, and this emphasizes the pertinency of the reason assigned for the objection. The difficulty of laying down any rule of universal application, as it respects the subject of multifariousness, is suggested by many of the authorities. The cases upon the subject are extremely various, and the courts, in deciding them, seem to have considered "what was convenient in particular circumstances, rather than to have attempted to lay down any absolute rule." Gartland v. Dunn, supra. The objection does not go to the...