Cox v. Hardee
| Decision Date | 12 August 1910 |
| Citation | 68 S.E. 932,135 Ga. 80 |
| Parties | COX v. HARDEE. |
| Court | Georgia Supreme Court |
Rehearing Denied Sept. 20, 1910.
Syllabus by the Court.
Suit was brought by a receiver of a corporation against stockholders thereof to recover against each the amount alleged to be still due upon his subscription; it appearing from the petition that the debts due by the corporation and which it was unable to pay were more than the sum of the separate amounts alleged to be due by the defendants respectively, so as to necessitate the recovery against each defendant of the whole amount alleged to be due by him. Several of the defendants separately demurred to the petition, each demurrer being overruled; and each of the demurrants separately excepted. Held, that it furnished no ground for a motion to dismiss the several writs of error that each demurrant separately excepted, and did not join the other defendants in the case in his bill of exceptions, or serve them therewith.
(a) In such a case, no question of contribution between the defendants appeared from the face of the petition to exist nor any reason requiring that all of the defendants be made parties to each bill of exceptions.
The fact that it appeared from the petition that another corporation subscribed for a number of shares of stock in the corporation of which the plaintiff is receiver, and that without this subscription the amount of capital stock necessary, under the subscription agreement, to make the subscriptions binding upon the subscribers would not be complete, did not render the other subscriptions invalid.
(a) There was nothing in the petition which even indicated that the subscribing corporation was not authorized by its charter to make the subscription, and, moreover, there was nothing to show that it had not paid for the stock for which it subscribed.
(b) One who subscribed for stock in a proposed corporation, with knowledge that a portion of the capital stock thereof had already been subscribed for by another corporation, was not when sued for the amount of his subscription, in a position to question the validity of the subscription made by the corporation.
Certain persons became subscribers to the stock of a proposed corporation by signing a written agreement which provided that its capital stock should be a given sum, that the subscriptions thereto should be payable in four equal installments at designated times, and that they were made upon the express condition that the first installment should not be called for until the entire amount of the capital stock had been subscribed. The capital stock, as provided for in the agreement, was fully subscribed. The corporation was organized and became insolvent, and its assets were placed in the hands of a receiver, who, under authority conferred upon him by the court, brought suit against a number of the subscribers to recover against each the amount alleged to be due upon his subscription: Held that, although a subscriber had paid no part of his subscription, no notice to him that the full amount of the capital stock had been subscribed was necessary in order to render him liable for the amount of his subscription, nor was such notice required before the receiver could lawfully institute suit against him to recover the same.
No provision having been made for an apportionment of the stock among the subscribers in the event of oversubscription subscriptions made after the full amount thereof had been subscribed were void.
While a decision overruling a demurrer to a petition may be brought to this court for review, without waiting for the final termination of the case in the court below, when the "judgment complained of, if it had been rendered as claimed by the plaintiff in error, would have been a final disposition of the cause," the plaintiff in error in such a case cannot in his bill of exceptions properly also except to a decision striking his answer or a portion thereof.
Error from Superior Court, Chatham County; W. G. Charlton, Judge.
Action by W. P. Hardee, receiver of the Savannah Sand Lime Brick Company, against Charles A. Cox, A. H. Entelman, J. N Knight, W. E. Norton, and nine other persons. Judgment for plaintiff, and defendants named prosecuted separate writs of error. Affirmed as to Cox and Entelman, and reversed as to Knight and Norton.
Jacob Gazan, O'Byrne, Hartridge & Wright, Hitch & Denmark, Osborne & Lawrence, and Edmund H. Abrahams, for plaintiffs in error.
Edward S. Elliott, for defendant in error.
W. P. Hardee, as receiver of the Savannah Sand Lime Brick Company, brought an equitable petition against Charles A. Cox, A. H. Entelman, W. E. Norton, J. N. Knight, and nine other persons to recover against each of the defendants, severally and separately, the amount alleged to be due by him as a subscriber to the capital stock of the company. The substance of the petition, after certain amendments thereto were allowed, so far as now material, was as follows: The Savannah Sand Lime Brick Company was duly incorporated by the superior court of Chatham county on July 22, 1905, a copy of the charter being attached to plaintiff's petition and made a part thereof. The incorporators of the company were Charles A. Cox, A. H. Entelman, and other named persons. The minimum amount of the capital stock authorized by the charter was $30,000, each share of stock being of the par value of $100. On or about July 22, 1905, the defendants severally subscribed for various amounts of the capital stock; the amount subscribed for and the sum still due upon the subscription by each defendant being stated. Charles A. Cox and J. N. Knight each subscribed for five shares of the capital stock of the company, and A. H. Entelman for two shares, and neither of these defendants has paid anything upon his subscription. W. E. Norton subscribed for 10 shares for $1,000 and paid only $500. There were also allegations as to the number of shares subscribed for by each of the other defendants, and as to amounts paid by some of them upon their respective subscriptions. The corporation is insolvent, the debts which it is unable to pay amounting to not less than $20,000 or other large sum. It owes the Commercial Bank of Savannah $20,935, and the American Sand Lime Brick Company $3,615.64. On November 24, 1908, petitioner, as receiver, was directed to collect any amount that might be due to the company, and to bring suit therefor if necessary; a copy of the order of the court in this respect being attached to the petition. Petitioner has demanded of each of the defendants the sum due by him, and each of them has failed and refused to pay such sum or any part thereof. The company accepted the charter and organized on August 1, 1905. Petitioner is without an adequate remedy at law, and brings this petition to avoid a multiplicity of suits, and in order that complete equity may be done. Attached to the petition and made a part thereof was a copy of the subscription agreement, which was as follows: Then followed the names of the subscribers, with the number of shares subscribed for by each placed opposite his name. It appeared from this copy of the subscription agreement that Charles A. Cox and J. N. Knight each subscribed for 5 shares, W. E. Norton for 10 shares, and A. H. Entelman for 2 shares, and that the "Empire Investment Company" subscribed for 50 shares. It was alleged that the conditions set forth in this agreement were fulfilled as follows:
The prayers were that petitioner have judgment against the several defendants for the amount due by each, with interest, that the corporation be made a party defendant to the suit, that process issue, etc., and for such other and further relief as might be meet and proper in the premises.
Cox demurred to the petition upon various general and special grounds, and, subject to the demurrer, filed his answer. The plaintiff demurred to this answer, and moved to strike it specially demurring to certain paragraphs thereof. The court overruled the demurrer to the petition, and sustained the plaintiff's demurrer as to certain paragraphs of defendant's answer, and struck these paragraphs. Defendant Cox excepted to the judgment overruling his de...
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