Dodge v. Pyrolusite Manganese Co.

• Decision Date: 19 December 1882
• Citation: 69 Ga. 665
• Parties: DODGE et al. v. THE PYROLUSITE MANGANESE COMPANY et al.
• Court: Georgia Supreme Court

69 Ga. 665

DODGE et al. v. THE PYROLUSITE MANGANESE COMPANY et al.

Supreme Court of Georgia.

December 19, 1882

September Term, 1882.

1. As a general rule, creditors who have not reduced their claims to judgment, and who have no lien, title or interest attaching to the property of their debtor, have no right to invoke interference therewith by injunction and the appointment of a receiver. Even after judgment, there must be some special circumstances to authorize equitable interference in behalf of a creditor seeking to collect his debt.

( a. ) The creditors in this case, being mere general creditors, show nothing to take themselves without the rule.

( b. ) A Georgia court has no jurisdiction to dissolve a New York corporation. While unwise and improper management of the affairs of a corporation might furnish ground for complaint by its stockholders, it does not furnish any reason for equitable interference at the instance of general creditors who have not reduced their claims to judgment, and who do not allege any fraud or concealment.

( c. ) After the creditors have reduced their claims to judgment, if equitable relief should be necessary, it may then be sought.

Equity. Debtor and Creditor. Injunction and Receiver. Corporation. Jurisdiction. Before Judge FAIN. Bartow Superior Court. January Adjourned Term, 1882.

Reported in the decision.

R. K HINES, for plaintiffs in error.

AKIN & AKIN; GRAHAM & FOUTE; JOHN L. HOPKINS, for defendants.

SPEER Justice.

This was a bill filed by the plaintiffs in error against the defendants, in Bartow superior court, for relief, injunction and the appointment of a receiver, and in which the following facts are alleged:

That the Pyrolusite Manganese Company is a New York corporation and under its charter the stockholders are not liable for its debts; that the company has all its property in Georgia, save its office books. The property here was originally valued at $100.000, and the property in New York at $300; that it owes debts to the amount of $60,000 or $70,000, and that its property is now worth about $55,000; that its affairs are wastefully managed, and that it has no credit to borrow money; that its president and treasurer are at war as to its management, each supported by an equal number of trustees and an equal amount of stock; that three attachments have been levied on its property here, aggregating, principal and interest, $55,000: that its mules are in the hands of the sheriff awaiting an order for sale; that its expenditures during 1881 were $67,683.90; receipts from sale and advances on ores $16,421.84; that complainants loaned the respondent $52,625.89; that the excess of its expenditures over its receipts one year was over $50,000.00; that the officers' salaries and other debts due were from $10,000 to $20,000 per annum, all which, it is alleged, clearly show the company is insolvent and can never pay its debts. It is further alleged that the company was a mining company, and for that purpose had acquired 10,000 acres or more of mineral lands, besides wagons, mules, machinery, etc., at a cost of $120,000, and mostly paid for from complainants' money; that on an accounting had, the company admitted an indebtedness to complainants in the above sums, aggregating $52,625.89; that the company has purchased and leased over 5,000 acres of land in Bartow and adjoining counties; that the sum of from $50,000 to $75,000 has passed through the hands of E. H Woodward, one of the defendants, during 1879, 188O, 1881, for which he has made no satisfactory showing; that under the act of 1847, no corporation created by the laws of another state can own over 5,000 acres of land in Georgia, except they become incorporated by the laws of this state, and this casts a cloud upon the title upon the lands held by the company which a court of equity alone can relieve by decreeing that the defendants hold these lands as trustees to pay the debts of said company, and a decree is sought to sell said lands, and that a good title be made to the purchasers at said sale. It is further alleged, that the defendants, Woodward and C. C. Dodge, bound themselves to convey to said company all the lands owned by them in said counties of Bartow, Floyd, Cherokee and Polk (in which the other lands of the company lie), the titles of which were taken in their own name, and likewise agreed not to buy or hold mineral lands individually in said territory; but it is averred that Woodward now holds, in his individual name, lands which had been paid for by the company, and which are subject to the debts of the company. It is further alleged, that under this state of facts as to the management and conduct of the company, and its pecuniary condition in the state of New York, where it was created, the courts there would be authorized to dissolve the corporation and appoint a receiver.

The company, Woodward and C. C. Dodge, being non-residents, the complainants, on the 4th of March, 1882, took out attachments returnable to the July term, 1882, of Bartow superior court and each have been levied by the sheriff of said county upon the mules, wagons, etc., and all the lands of said company which complainants can point out; that the lands lie in Bartow, Cherokee, Polk and Floyd counties; that under the proceedings, all of said...