Bourne v. Baer

• Citation: 185 N.W. 408,107 Neb. 255
• Decision Date: 26 November 1921
• Docket Number: 21634
• Parties: WILBUR S. BOURNE, RECEIVER, APPELLANT, v. HIRAM F. BAER ET AL., APPELLEES
• Court: Supreme Court of Nebraska

185 N.W. 408

107 Neb. 255

WILBUR S. BOURNE, RECEIVER, APPELLANT, v. HIRAM F. BAER ET AL., APPELLEES

No. 21634

Supreme Court of Nebraska

November 26, 1921

APPEAL from the district court for Gage county: LEANDER M PEMBERTON, JUDGE. Affirmed in part, and reversed in part.

Judgment affirmed in part and reversed in part and cause remanded.

Hazlett Jack & Laughlin, for appellant.

Kretsinger & Kretsinger and Sackett & Brewster, contra.

Heard before MORRISSEY, C. J., ROSE, ALDRICH and FLANSBURG, JJ GRAVES and WELCH, District Judges.

OPINION

WELCH, District Judge.

Appellant, in September, 1919, commenced this action against all of the owners of stock in the Cortland Creamery Company, a corporation organized under the laws of the state of Nebraska, to recover from said stockholders their liability as such stockholders imposed by section 577, Rev. St. 1913, for failure of the corporation to publish notice annually of all its indebtedness.

The petition alleged that said corporation was organized in January, 1912, and from that date to March 4, 1915, transacted business as a corporation; that on the latter date it became insolvent and ceased doing business; that on March 18, 1916, said corporation was, by order of court, dissolved, the plaintiff herein appointed receiver to take charge of the assets of said corporation, sell the same, and distribute the funds of the corporation under the order of the court; that thereupon plaintiff qualified as such receiver and ever since has been so acting.

The petition also sets forth the names of all persons who ever owned stock in said corporation, with the respective amount of stock owned by each, and makes all stockholders then living, and the legal representatives of such as were deceased, defendants.

The petition also alleged that there were unpaid subscriptions for stock of the corporation by the defendant C. F. Luthey, in the sum of $ 100, by the defendant Rudolph A. Boesinger, $ 100, and by the defendant Sylvester Bonebright, $ 50.

The petition also alleges facts showing that on January 31, 1917, the court allowed all claims against said corporation, and entered judgment decreeing the several sums due from it to its several creditors, amounting in the aggregate to the sum of $ 4,397.25, which amount was all the obligations of the corporation, and that by September 17, 1917, all of the assets of said corporation had been sold under orders of the court; that the debts against said corporation, so allowed and decreed by the court, exhausted all of the proceeds of the sale of the assets of said corporation, and would leave a large amount of said indebtedness, to wit, more than $ 3,500, unpaid.

The petition further alleged that said corporation never at any time during its existence gave notice by publication of its existing indebtedness, and alleged all other facts necessary to state a cause of action based upon said section 577, Rev. St. 1913; provided, however, the facts above set forth, as alleged therein, do not show that the action is barred by the statute of limitations.

The defendant Klaas Slote answered, alleging, among other things, that plaintiff's cause of action did not accrue within one year next before filing said petition, and that said petition did not state facts sufficient to constitute a cause of action. All other defendants, except Henry Poppe, Sr., who was served with summons, and James A. Shell, summons for whom was returned "not found," demurred to the petition by general demurrers, and for defect of parties defendant.

The court found for the defendant Slote and dismissed the action as to him. The court sustained the demurrers by the other defendants, and plaintiff elected to stand upon his petition. Thereupon the court dismissed the action as to all defendants thereto.

By this petition two causes of action were sought to be stated: First. To recover from all the stockholders of said corporation their liability to the amount of capital stock owned, as provided by section 577, Rev. St. 1913, for failure of the corporation to give annual notice of its indebtedness. Second. To recover also from the defendants C. F. Luthey, Rudolph A. Boesinger, and Sylvester Bonebright their liability for unpaid subscriptions to the capital stock of said corporation.

In support of their demurrers, the appellees herein contend that the liability imposed by section 577, Rev. St. 1913, is a statutory penalty imposed on the stockholders of the corporation for failure of the corporation to perform a duty required by that section of the statute, and that therefore the action is barred by section 7570, Rev. St. 1913, at the expiration of one year from the time the indebtedness of said corporation is judicially determined and assets thereof exhausted. This court held in Globe Publishing Co. v. State Bank, 41 Neb. 175, 59 N.W. 683, that the liability imposed by the statute upon stockholders of a corporation for failure to give annual notice of its indebtedness was a penalty, and overruled Howell v. Roberts, 29 Neb. 483, 45 N.W. 923, and Coy v. Jones, 30 Neb. 798, 47 N.W. 208, holding otherwise. The plaintiff contends that by reason of the amendment of 1891, being our present section 577, Rev. St. 1913, the decision in Globe Publishing Company v. State Bank, supra, is not applicable, and that by this amendment the liability is made contractual in its nature. The amendment of 1891 in no manner changed the character of the liability imposed therein. The only changes made by the amendment are simply a limitation of the liability, to the amount of unpaid subscriptions for stock, and, in addition thereto, the amount of capital stock owned by such individuals, and postponement of the liability until the assets of the corporation were exhausted.

"A liability which is created by statute to follow as a consequence of the doing or omission of some act and the extent of which is not measured or limited by the damage caused by the act or omission, is in the nature of a penalty and the statute penal in its character." ...