Buist v. The Citizens' Savings Bank of Concordia

• Decision Date: 01 October 1896
• Docket Number: 101
• Citation: 46 P. 718,4 Kan.App. 700
• Parties: GEORGE BUIST v. THE CITIZENS' SAVINGS BANK OF CONCORDIA, KANSAS
• Court: Kansas Court of Appeals

46 P. 718

4 Kan.App. 700

GEORGE BUIST v. THE CITIZENS' SAVINGS BANK OF CONCORDIA, KANSAS

No. 101

Court of Appeals of Kansas, Northern Department, Central Division

October 1, 1896

Opinion Filed October 17, 1896.

MEMORANDUM. -- Error from Mitchell district court; CYRUS HEREN, judge. Action by The Citizens' Savings Bank of Concordia, Kansas, against George Buist to enforce the liability of a stockholder. From an order directing the issuance of an execution defendant brings the case to this court. Affirmed. The opinion herein, filed October 17, 1896 states the material facts.

Order affirmed.

Clark A. Smith, for plaintiff in error.

Caldwell & Ellis, for defendant in error.

CLARK J. All the Judges concurring.

OPINION

CLARK, J.:

This is a proceeding to enforce the individual liability of a stockholder of the Cawker City State Bank, a corporation organized under the laws of Kansas. On October 7, 1891, the Citizens' Savings Bank of Concordia recovered a judgment in the district court of Mitchell county against the said Cawker City State Bank for $ 1,274. On October 9 an execution was issued on said judgment, which was on October 20 thereafter returned by the sheriff unsatisfied, for the reason, as shown by his return, that after diligent search and inquiry he could find no goods, chattels, real estate lands or tenements of the defendant upon which to levy the execution. On December 2, 1891, this execution was withdrawn from the office of the clerk and on December 9 thereafter was again filed, bearing a similar return to the one previously entered upon it.

On October 6, 1891, the National Bank of Lebanon recovered a judgment in said court against the same defendant corporation for $ 2,070, and on October 12 an execution was issued thereon, which was returned unsatisfied on October 15 thereafter, the return of the sheriff showing that no property, either real or personal, could be found whereon to levy the execution.

George Buist was at the date of the rendition of these judgments, and for more than a year prior thereto had been, and at the dates hereinafter mentioned still remained, the owner of 20 shares of the capital stock of the said Cawker City State Bank, each share being of the face value of $ 100. On October 24, 1891, the Bank of Lebanon caused a notice in due form to be served upon Buist that an application would be made, upon the first day of the January term, 1892, of the district court of Mitchell county, for an order directing an execution against him, as a stockholder of the said Cawker City State Bank. Such application was thereafter made, agreeably to said notice, and a hearing was had thereon. After the plaintiff had introduced its evidence, Buist demurred thereto, on the ground that "the same does not prove facts sufficient to entitle the plaintiff to any remedy against the defendant, Buist, but does show that plaintiff is not entitled to the remedy asked." This demurrer was sustained, a motion for a new trial was overruled, and a judgment entered that the plaintiff pay the costs of the proceeding. Whether or not the court erred in sustaining the demurrer we are unable to determine, as the evidence introduced upon the hearing of that application is not before us. Proper exceptions were saved to the rulings of the court, and an extension of time was allowed in which to make and serve a case for the supreme court, which time had not elapsed when the order complained of herein was entered.

On November 14, 1891, and again on December 31 thereafter, the Citizens' Savings Bank of Concordia caused to be served on Buist a written notice that on January 11, 1892, an application would be made to the court for an order directing that an execution issue against his property for the amount of its judgment against the Cawker City State Bank. A hearing was had upon the motion which was subsequently filed. The court found the facts to be as above recited, and held that "the plaintiff being the first judgment creditor to proceed under the statute for execution against the Said stockholders after the return day of the execution, he is entitled to preference over all other creditors to the amount of his judgment," and ordered the issuance of an execution as prayed for. Buist seeks a reversal of that order.

Section 2, article 12 of the constitution, provides that:

"Dues from corporations shall be secured by individual liability of the stockholders to an additional amount equal to the stock owned by each stockholder, and such other means as shall be provided by law; but such individual liabilities shall not apply to railroad corporations, nor corporations for religious or charitable purposes."

Under this provision of the constitution, the legislature enacted paragraph 1192, General Statutes 1889, which reads as follows:

"If any execution shall have been issued against the property or effects of a corporation, except a railway or a religious or charitable corporation, and there cannot be found any property whereon to levy such execution, then execution may be issued against any of the stockholders, to an extent equal in amount to the amount of stock by him or her owned, together with any amount unpaid thereon; but no execution shall issue against any stockholder, except upon an order of the court in which the action, suit or other proceeding shall have been brought or instituted, made upon motion in open court, after reasonable notice in writing to the person or persons sought to be charged; and, upon such motion, such court may order execution to issue accordingly; or the plaintiff in the execution may proceed by action to charge the stockholder with the amount of his judgment."

The statute under which the execution against the Cawker City State Bank was issued provides:

"The sheriff or other officer, to whom any writ of execution shall be directed, shall return such writ to the court to which the same is returnable within 60 days from the date thereof." (Gen. Stat. 1889,P 4567.)

The plaintiff in error contends that...