Browne v. Hammett

• Citation: 131 S.E. 612
• Decision Date: 03 February 1926
• Docket Number: (No. 11915.)
• Court: United States State Supreme Court of South Carolina
• Parties: BROWNE et al. v. HAMMETT et al. SAME . v. BROWN et al.

131 S.E. 612

BROWNE et al.
v.
HAMMETT et al.
SAME .
v.
BROWN et al.

(No. 11915.)

Supreme Court of South Carolina.

Feb. 3, 1926.

[131 S.E. 612]

Appeal from Common Pleas Circuit Court of Anderson County; H. F. Rice, Judge.

Actions by S. N. Browne and others against J. D. Hammett and others and against Foster L. Brown and others. From an order overruling a demurrer to the complaint, defendants appeal. Affirmed.

The written demurrer of defendants was as follows:

The defendants jointly and severally demur to the complaint because it appears upon the face thereof:

(1) That the plaintiffs have no legal capacity to sue.

(2) That the suit could only be brought by the state bank examiner as plaintiff, and there is no showing of any attempt to have the state bank examiner bring the suit as plaintiff.

(3) That the suit should be brought by the corporation, to wit, the Farmers' & Merchants' Bank, as plaintiff, and there is no showing of any attempt to have the suit brought by the corporation or the stockholders, and there is no showing of any effort to have the stockholders or the corporation take any action.

(4) That there is a defect of parties in that the state bank examiner is not made a party.

(5) That there is a defect of parties, in that the corporation, the Farmers' & Merchants' Bank, is not made a party.

(6) That several causes of action have been improperly united, to wit: (a) a cause of action based on the liability of the defendants as directors of the Farmers' & Merchants' Bank to the said bank; (b) a cause of action based on the direct liability of the defendants to the plaintiff, S. N. Browne, and other stockholders of the said Farmers' & Merchants' Bank; (c) a cause of action based on the direct liability of the defendants to the plaintiffs and other depositors of the Farmers' & Merchants' Bank in inducing them by alleged deceit to deposit their funds with said bank; (d) a cause of action based on the direct liability of the defendants to the plaintiffs and other depositors and creditors for alleged intentional wrongs.

(7) That the complaint does not state facts sufficient to constitute a cause of action against the defendants or any of them, in that (a) it does not set forth any joint right or interest in all the plaintiffs which has been invaded by the defendants or any of them so as to create a liability of the defendants or any of them to the plaintiffs jointly, for the acts and transactions set forth in the complaint; (b) in that it contains no allegations showing or tending to show any attempt to have the state bank examiner bring the suit as plaintiff; (c) in that it contains no allegations showing or tending to show any attempt to have the Farmers' & Merchants' Bank bring said suit; (d) in that it contains no allegations showing or tending to

[131 S.E. 613]

show any attempt or effort to have the stockholders of said bank, or said bank itself, take any action whatsoever.

Watkins & Prince, Greene & Earle, and Sullivan & Cooley, all of Anderson, for appellants.

Dickson & Miller, of Anderson, and W. P. Greene, of Abbeville, for respondents.

COTHRAN, J. These two cases involving the same questions were tried in the circuit court and in this court together. For convenience we will consider the first case above entitled; the decision of the points at issue will be conclusive of the appeal in the second case.

The action is by the plaintiffs as depositors of the Farmers' & Merchants' Bank of Anderson, S. C, in behalf of themselves and of all others, stockholders, depositors, and creditors of said bank, who may come in and seek relief by, and contribute to, the expenses of the suit against the defendants, directors of said bank, liquidating trustees, for an accounting and for damages resulting from their alleged mismanagement and negligence in the supervision and conduct of the affairs of the bank.

The complaint contains a detailed statement of the various acts of alleged mismanagement and negligence on the part of the directors, resulting in losses to the bank, amounting to several hundred thousand dollars, and prays that the defendants be required to render an account of their management of the affairs of the bank during its active operation and since the bank was taken over by the bank examiner.

The defendants interposed a demurrer to the complaint upon the grounds stated in the written demurrer, which will be...