Davis v. Mitchell

• Decision Date: 27 November 1920
• Docket Number: (No. 8733.)
• Citation: 225 S.W. 1117
• Parties: DAVIS v. MITCHELL.
• Court: Texas Court of Appeals

225 S.W. 1117

DAVIS v. MITCHELL.

(No. 8733.)

Court of Civil Appeals of Texas. Ft. Worth.

November 27, 1920.

Appeal from District Court, Tarrant County; Ben M. Terrell, Judge.

Suit by J. W. Mitchell, as receiver of the Commonwealth Bonding & Casualty Company, against D. C. Davis. From a judgment for plaintiff, defendant appeals. Affirmed.

Clendenen & Simmons and Alexander, Baldwin & Ridgway, all of Ft. Worth, and Crudgington & Works, and Kimbrough, Underwood & Jackson, all of Amarillo, for appellant.

Ocie Sper, of Ft. Worth, for appellee.

DUNKLIN, J.

D. C. Davis subscribed for $5,000 of the capital stock in the Commonwealth Bonding & Casualty Insurance Company. At the time of his subscription he paid cash $625 and executed his promissory note for the remainder of his subscription in the sum of $4,375. Later J. W. Mitchell was appointed receiver of the property of the insurance company; the appointment being made by the district court of Tarrant county. This suit was instituted by the receiver to recover of Davis the amount due upon the note mentioned, and from a judgment in favor of the plaintiff the defendant has appealed.

The case was tried before a jury, and the judgment rendered was upon an instructed verdict by the court.

One of the defenses urged by Davis was that the suit should be abated because the appointment of the receiver was collusively and fraudulently instituted against the company by its officers and some of its stockholders for the purpose of enabling the company to thereby evade and avoid the legal effect of the frauds and misrepresentations which had been practiced upon the stockholders, including the defendant, by the promoters who had secured subscriptions for stock prior to the organization of the company and for the purposes of such organization; the facts constituting such fraud being alleged in connection with that plea.

By several assignments appellant insists that evidence was introduced which tended to support said plea, and that the court erred in excluding that issue by his peremptory instruction to the jury to return a verdict in plaintiff's favor.

The receiver was appointed in another and different suit from the present one, and clearly the attack now made upon the order appointing the receiver is collateral. Under such circumstances it is well settled that the defendant is in no position to attack the validity of the order appointing the receiver. Murchison v. White, 54 Tex. 78, Mikeska v. Blum, 63 Tex. 44; Holland v. Preston, 41 S. W. 374; New Britain Mach. Co. v. Watt, 180 S. W. 624.

The authorities cited by appellant to support this assignment do not announce a different rule from that held in the decisions noted above, and by many others which might be added. In many of appellant's authorities, such as Lord v. Veazie, 8 How. 251, 12 L. Ed. 1067, and Ward v. Alsup, 100 Tenn. 619, 46 S. W. 574, it was held, in effect, that a collusive suit merely to decide some question that would...