Boyce v. Mont Auk Gas Coal Co..

• Decision Date: 07 June 1892
• Parties: Boyce v. Mont auk Gas Coal Co. et al.
• Court: West Virginia Supreme Court

37 W.Va. 73

Boyce

v.Mont auk Gas Coal Co. et al.

Supreme Court of Appeals of West Virginia.

Submitted June 7, 1892 . Decided November 26, 1892.

1. (corporations foreclosure ultra vlres contract Agent Seal.

Where a bill is filed by a party representing himself to be a mortgagee of real estate, for the purpose of enforcing a mortgage which purports to have been regularly signed, sealed and acknowledged by the president and treasurer of a corporation chartered under the laws of the State of New York, which real estate is situated in this State, objection to the validity of said mortgage can not be made by the company on the ground that it is ultra vires, but must be made by a stockholder or by stockholders of said company, (p. 84.)

2. Corporations Seal Contract Agent.

If a deed or contract purport to be sealed with the seal of a corporation, and it is proven to be signed by the proper agents of the corporation, the presumption is that the seal was regularly affixed by the proper authority; and a contract under seal, executed by an agent within the scope of his appointed power, will be held valid and binding upon the corporation until evidence to the contrary has been introduced, (p. 90, 91.)

3. Corporations Stockholders Laches.

While a minority of the stockholders of a corporation may.maintain a bill in equity, in behalf of themselves and other stockholders, for fraud, conspiracy, or acts ultra vires, against a corporation, its officers, or others who participated therein, when the minority stockholders have been injured by said act, they must act promptly and not wait an unreasonable time. If they postpone their complaint for an unreasonable time, they forfeit their right to equitable relief. Nothing will call a court of equity into activity but conscience, good faith and reasonable diligence. When these are wanting, the court is passive and does nothing, (p. so, 88.)

4. Corporations Stockholders Laches Contract.

Where a stockholder has notice or the means at hand of becoming acquainted with the contracts made by the corporation in which he is such stockholder, a court of equity will not allow him to remain quiet an unreasonable length of time, with a view" of ascertaining whether the contract will result in profit to him, and then repudiate the contract if it has resulted in loss. (p. 91.)

F. Woods, B. F. Martin and W. I. Fisher for appellant:

I. Plaintiff's mortgage lacks no essential of validity, even under thelites of New York. 122 X. Y. 177; 25 W. Va 184.

II. The mortgage is valid in West Virginia. Burr. Assign.

$ 304; 7 G. & J. 480; 1 II. & J. 622, 710; 2 Beach Priv. Corp. § 742; Add. Cont.-194; Whar. Conn. L. § 372; 9 All. 78; 7 Cr. 115; 9 Wheat. 565; 10 Wheat. 202; 1 Dev. Deeds 837; Sto. Conf. L. (8th Ed.) 424, 463; Bish. Cont. § 1395; 2 Par. Cont. (7th Ed.)-572; Sto. Conf. L. §§ 428, 447, 435; Whar. Conf. L.

372, 676; Aug. Am. Corp. § 221; 101 IT. S. 625; 1 Jones Mort. § 124; Kyd Corp. 69, 76, 78, 108; 2 Kent Comm. 281; 93 111. 153; 14 All. 381; 1 Wat. Corp. § 124; 1 Dev. Deeds § 388; 1 Mor. Corp. §§ 510, 513; 2 Beach Corp. § 743; 5 Watts & S. 223; 30 W. Va. 123; Id. 444; 3 Gratt. 215; Id. 236; 75 Va. 701; 20 W. Va. 450; Acts (1881) p. 428. III,-The October cont ract. linn. Cont. 189; 2 Add. Cont. (8th Ed.) *1169; 10 Pet. 360; 1 Wall. 221; 2 Beach Priv. Corp. §§ 424, 425; Cook Stock k Stockhol. § 682; Sedg. Constr. L. 73; 1 Wat. Corp. § 161; 98 17. S. 629; 2 Mor. Corp. §§ 688, 689; Green Uit. Vir. (2d Ed.) 717; 96 U. S. 341; 63 X. Y. 70; 57 Md. 129; 29 Md. 524; 22 X. Y. 508; 106 K Y. 473; 93 X. Y. 609; 97 N Y. 378.

IV. Davis Land Purchases. Big. Estop. 365, 366; 2 Herm.

Estop. 585, 606, 607, 613; 1 Dev. Deeds § 992; 11 How. 325; 21 How. 240; 2 Dev. Deeds § 944.

V. Vendor's Lieu. 2 Sto. Eq. § 1217; Id. § 1218; 4 Kent Comm.-152; 23 W.Va. 122; 8 Gratt. 148; 11 G. & J. 245; 29 Md. 119; 59 N. Y. 541; 80 X. Y. 345; 33 W. Va, 761; 21 W.Va.516; 30 W. Ya. 790; 2 Min. 296, 297; 3 Pom. Eq. § 1235; 1 Lom. Dig. 317.

VI. Future Advanees. U W. Va. 531; 29 Gratt. 483; 99 X. Y. 547; 101 IT. S. 622, 626; Sto. Conf. L. § 280; Greenh. Pub. Pol. 48; Whar. Conf. L. 401; Bish. Cont, § 1390; 2 Par. Cont. *583.

Replying to appellees' brief counsel cited the following additional authorities: 69 X. Y. 333; 96 X. V. 473; 28 Fed. Rep. 169; 104 111. 463; 45 Mich. 103; Cook Stock &e. 839; 26 Hun 643; 2 Beach Priv. Corp. § 744; 110 U. S. 209; 80 111. 267; 55 111. 413; 69 Tex. 625; Green. Ult. Vir. 783; 81 Ga. 536; 59 N. Y. 541; 90 X. Y. 607; 78 X. Y. 159; 23 Atl. Rep. 846; 128 Pa. St. 119; 2 Beach Corp. §§431, 433; 33 Beav. 602; 88 Mass. 52; 1 Jones Moil. §127.

J. W. Mason for appellees:

I. The mortgage is void. Laws of X. Y. (1871) c. 481, s. 2;

69 X. Y. 328; 96 X. Y. 472; 85 X. Y. 456 et seq.

II. Is it a West Virginia mortgage? 13 Pet, 588; Mora.

Corp. § 1047; Id. § 318.

English, Judge:

This was a suit in equity brought in the Circuit Court of Taylor county by James Boyce against the Montauk Gas Coal Company, Henry G. Davis, Thomas Edward Hambleton, John A. Hambleton, Thomas Edward Hambleton, executor of Augustus McLaughlin, deceased, John T. White and David F. Hotchkiss, for the purpose of foreclosing a mortgage and obtaining a decree for the sale of certain lands, coal and coal privileges situated in said county.

The plaintiff in his bill alleged that on the 21st day of December, 1880, the defendant the Montauk Gas Coal Company, a corporation duly organized under the laws of the state of Xew York, by deed of mortgage of that date conveyed to him certain tracts of land, coal land and coal rights and privileges situate at or near Flemington, in Taylor county, in the State of West Virginia, which were conveyed to the said company by John White and Cornelia L. White, his wife, by deed dated the 6th day of November, 1879, a copy of which deed is exhibited; that said Montauk Gas Coal Company also conveyed to him a certain other tract of land, coal land, and coal rights and privileges, also situate near Flemiugton, in said county and State, which were conveyed to said company by said John White and Cornelia L. White, his wife, by deed dated the 16th day of July,

1880, a copy of which deed was also exhibited.; that said company also conveyed to him by said deed a certain other tract of land near Elemington, in said county and State, together with all coal and coal privileges which were conveyed by Henry G. Davis and others to the said John White by deed dated the 5th day of May, 1880, being the; same land, coal and coal privileges subsequently conveyed to the plaintiff by said John White and others by deed dated the 21st day of December, 1880, and being the same land, coal and coal privileges which the plaintiff sold to said the Montauk Gas Coal Company on the 21st day of December, 1880, at the price of sixty five thousand dollars, as set forth in said deed of mortgage; that the lien reserved in said deed dated the 5th (lay of May, 1880, in favor of Henry G. Davis, Thomas Edward Hambleton, John A, Hambleton and Augustus McLaughlin, since deceased, has been paid and extinguished; that in addition to said several parcels of land, coal and coal privileges, the said defendant conveyed unto the plaintiff, by said mortgage deed, all and singular the tenements, hereditaments and appurtenances belonging to said lands, coal and coal privileges or in any manner thereto appertaining together with the reversion, remainder, rents, issues and profits, and all estate, right, title, interest, property, possession, claim and demand, in law and equity that is to say, the said company conveyed said lauds, coal and coal privileges to the said plaintiff as fully, and to the same extent, that said company owned the same, which is fully shown by said deed of mortgage, a copy of which was exhibited with said bill.

After describing said lands, coal lands and coal privileges more particularly, as to their locality etc., the plaintiff further alleged that said coal and land, with the right to mine and remove the same, as set forth in said several deeds, was the property of the said the Montauk Gas Coal Company, and the only property embraced in said mortgage1, and that no liens existed thereon in favor of any of said grantors or any other person except the plaintiff, who has an unpaid claim of one hundred and fifty thousand three hundred and sixty seven dollars and sixty six cents, with interest thereon from the 1st of September, 1885, until paid, which is a subsisting lien on said coal, coal rights and privileges, and land, by virtue of the said mortgage, and has long since been due from the said defendant the Montauk Gas Coal Company.

The plaintiff further alleged that on the 22nd day of October, 1880, said company entered into a written contract with him, by which he was to take charge of the coal mines and manage the mining operations and the business of the said company, situate in the county of Taylor, in the State of West Virginia; that he should have exclusive control and management of the business, mining and operations, together with the principal office of the said company, in the city and State of Xew York; that possession and full control thereof were given him by said company on the 22d day of October, 1880, in pursuance of said contract; that the mining, shipping and selling of coal should be carried on under the exclusive control of the plaintiff, and the coal mined and shipped from the said defendant's mines should be sold, billed and shipped in the name of the plaintiff, who should collect the proceeds of all sales, but in the shipping thereof said coal should be designated as "Montauk Gas Coal Company's Coal;" that among other things the plaintiff was to have for wharfage, labor and all expenses attending the receiving, shipping and billing of coal at the city of Baltimore, the sum of twenty five cents per ton on all coal shipped under said contract; that the payment of the indebtedness of said defendant then existing, or that might...