Blades v. Billings Mercantile Co.

• Decision Date: 06 February 1911
• Parties: BLADES et al. v. BILLINGS MERCANTILE CO.
• Court: Missouri Court of Appeals

134 S.W. 579

154 Mo. A. 350

BLADES et al. v. BILLINGS MERCANTILE CO.

Springfield Court of Appeals. Missouri.

February 6, 1911.

1. CORPORATIONS (§ 553)—DISSOLUTION—RECEIVER—GROUNDS—ALLEGATIONS.

A complaint by a stockholder which alleges merely that a resolution was passed at a stockholder's meeting for the dissolution of the corporation, and for the appointment of an agent to collect and distribute the assets, and that the agent is paying out the assets to unauthorized persons, alleges no ground for the appointment of a receiver for the corporation, the improper acts charged being merely that the agent is acting in excess of his authority, presumably without the consent of the corporation and its directors.

2. RECEIVERS (§ 1)—APPOINTMENT.

The power to appoint a receiver is a delicate one, especially when invoked upon an ex parte application, and should be exercised with extreme caution, and only under circumstances requiring summary relief, or where the court is satisfied that there is imminent danger of loss, and should never be exercised in a doubtful case.

3. RECEIVERS (§ 6) — APPOINTMENT — EXISTENCE OF OTHER REMEDY.

One of the grounds upon which a receiver may be appointed is that there is no other adequate remedy, and an appointment will never be made where there is another safe or expedient remedy, or where the court can find another and less stringent means for protecting the rights of the parties.

4. CORPORATIONS (§ 553)—DISSOLUTION—RECEIVED—APPOINTMENT—RIGHTS OF STOCKHOLDER.

Before a court of equity will hear a single stockholder in a controversy over the management of the corporation, he must show that he has no remedy within the corporation itself, and hence where a corporation has voted to dissolve and has appointed an agent to collect and distribute the assets, a single stockholder cannot have a receiver appointed on the ground that the agent is wasting the assets by payments to unauthorized persons, until he has exhausted his remedy by application to the directors, and, if there is time, to the stockholders, to remedy the wrong.

Appeal from Circuit Court, Christian County; John T. Moore, Judge.

Action by S. B. Blades and others against the Billings Mercantile Company, a corporation. From an order appointing a receiver, defendant appeals. Reversed and remanded, with directions.

J. T. White, W. T. Lamkin, and W. H. Horine, for appellant. G. A. Watson and W. P. Sullivan, for respondents.

NIXON, P. J.

This appeal is from an order overruling a motion of the defendant, Billings Mercantile Company, to vacate an order appointing a receiver to take charge of the said defendant's property, said order having been made in vacation by the judge of the circuit court of Christian county on the 8th day of October, 1910, the day the petition was filed. The petition upon which said order was made is as follows (caption omitted):

"Plaintiffs state that the Billings Mercantile Company is a corporation, duly organized under the laws of the state of Missouri, and until about the 1st day of August, 1910, was engaged in the mercantile business, at Billings, in Christian county, Mo.; that recently before said last-mentioned date, at a meeting of the stockholders of said corporation, at which there were present stockholders holding more than two-thirds in value of all the stock of said corporation, there was introduced and passed by said stockholders a resolution favoring a dissolution of said Billings Mercantile Company; that immediately thereafter the directors of said corporation, assuming to act for and in behalf of its stockholders, proceeded to sell and dispose of its stock of merchandise, furniture, and fixtures, at retail and in bulk, and to close up the business of said corporation; that pursuant to the purposes aforesaid the directors of said corporation appointed and selected Joseph Meyer as the manager and agent of said corporation to collect the debts and accounts due and owing to it and to pay out and disburse the moneys of said corporation; that the said Joseph Meyer is proceeding to collect the assets of said corporation and is paying out such assets to persons wholly unauthorized to receive the same, by reason whereof the assets of said corporation are rapidly becoming depleted, squandered and wasted.

"Plaintiffs further state that in his life-time R. D. Blades was the owner of twenty shares of the capital stock of said corporation, of the par value of one hundred dollars per share; that the said R. D. Blades shortly before his death and during his last sickness, while mentally irresponsible on account of the infirmities of extreme age and from the influence of strong opiates administered at frequent intervals for weeks prior thereto, one Joseph Meyer, the then manager and principal stockholder in the defendant company, without solicitation, or invitation so to do, from any person interested therein, secretly and fraudulently wrote out and caused to be signed, by mark, the name of R. D. Blades, the owner thereof, on the back of the certificates of stock of the quantity and value aforesaid, transferring to his then wife, Mary E. Blades, the earnings of said stock during her natural life; that the said Joseph Meyer after procuring the signature of said R. D. Blades in the manner aforesaid kept and carried away and retained said certificates of stock until after the death of the said R. D. Blades after which he delivered them to the said Mary E. Blades, the defendant. Plaintiffs say that said pretended transfer of the earnings of said stock as aforesaid was fraudulent, invalid, and conveys to the transferee, Mary E. Blades, no interest whatsoever, for the reason that the said R. D. Blades was at the time of the alleged assignment of the earnings of said stock to the said Mary E. Blades wholly incapacitated by reason of his age, sickness, and opiates to him administered and under the influence of which he was at the time, and on account of his being at the time of unsound mind and entirely unable to comprehend or know the kind or nature of his acts or to comprehend in the slightest degree the simplest kind of a contract or business transaction.

"Plaintiffs further state that they are the heirs at law of R. D. Blades, who died intestate about December ___, 1901; that the estate of the said R. D. Blades has been fully administered and that...