Danforth v. National Chemical Company

• Decision Date: 21 May 1897
• Docket Number: 10,601--(118)
• Citation: 71 N.W. 274,68 Minn. 308
• Parties: C. E. DANFORTH v. NATIONAL CHEMICAL COMPANY and Others
• Court: Minnesota Supreme Court

71 N.W. 274

68 Minn. 308

C. E. DANFORTH v. NATIONAL CHEMICAL COMPANY and Others

Nos. 10,601--(118)

Supreme Court of Minnesota

May 21, 1897

Action by C. E. Danforth against the National Chemical Company and others. F. B. Hart intervened. There was judgment on the pleadings against intervenor, and from an order of the district court for Ramsey county, Otis, J., denying his motion for a new trial, intervenor appealed. Affirmed.

Order denying a new trial affirmed.

F. B Hart, in pro. per.

E. M Card, for respondents.

OPINION

COLLINS, J.

There is no dispute over the facts in this case. Danforth, as a judgment creditor of the defendant corporation, an alleged insolvent, instituted an action in the month of February, 1894, under the provisions of G. S 1894, c. 76, § 5897, making several alleged stockholders defendants with the corporation. Such proceedings were had as resulted in the entry of a judgment April 28, 1894, sequestrating the property, effects, and assets of the defendant corporation as an insolvent, and within the provisions of said chapter, and appointing one Dobner receiver of all of the property, effects, and assets of said corporation of every nature and description. The further contents or effect of the judgment are of no importance here. Dobner duly qualified as receiver about May 1st, thereupon becoming invested with the title to all of the property, effects, and assets of the corporation. November 16th he obtained an order from the court in which the proceedings were pending, directing and requiring all creditors of the corporation to exhibit their claims, and become parties to the sequestration proceedings within six months from the first publication of the order in a designated newspaper. The first publication was made immediately.

Meantime, and shortly before the order was made, but in the month of November, 1894, the intervenor herein, Hart, had commenced an action against the corporation to recover the sum of $ 2,150, alleged to be due to him. On November 28, 1894, a judgment was entered on default for want of answer in said action against the corporation and in favor of Hart for the amount alleged to be due, and within the time fixed by the order for the filing of claims, said Hart filed his complaint in intervention in these proceedings, in which he alleged that in the years 1893 and 1894 the corporation "became and was indebted to this plaintiff on open account in a sum in excess of" $ 2,150; that thereupon he instituted suit against the company in the district court in due form; that said court had full and complete jurisdiction of the parties; and that upon November 28, 1894, judgment was entered against the corporation, and for the amount hereinbefore stated; that the judgment was wholly unsatisfied, and that the full amount thereof was due and unpaid; judgment being demanded for such amount, interest, and costs.

To this complaint in intervention the receiver answered. We need not state the defense which was interposed, for it is immaterial. When the cause was brought on for trial, the court below granted a motion for judgment on the pleadings made by counsel for the receiver. The intervening plaintiff then moved for a new trial upon a bill of exceptions, and, the motion being denied, an appeal was taken. The legal effect of the order appealed from was to hold that the intervenor had not stated facts sufficient to show that he had a claim against the estate in the hands of the receiver, and in the order the court gave leave to the intervenor to amend his complaint setting up the original cause of action on which the judgment was based.

The question is whether a judgment entered against a corporation on default for want of answer in an action brought to recover on a contract for the payment of money only, which action was instituted after the corporate property had been sequestrated, and a receiver appointed, under the provisions of chapter 76, for the benefit of all of its creditors, is entitled to be exhibited and allowed as a claim against the estate, without any further proof of the existence and bona fide character of the claim upon which the alleged judgment was based. This question is not affirmatively answered by determining that the right of a creditor to bring an action against the corporation after its property has been sequestrated still...