Doe v. Northwest Coal & Transportation Co.

• Decision Date: 17 December 1894
• Docket Number: 2,156.
• Citation: 64 F. 928
• Parties: DOE v. NORTHWEST COAL & TRANSPORTATION CO. et al.
• Court: U.S. District Court — District of Oregon

64 F. 928

DOE v. NORTHWEST COAL & TRANSPORTATION CO. et al.

No. 2,156.

United States Circuit Court, D. Oregon.

December 17, 1894

Wirt Minor, for complainant.

Thomas H. Strong, for defendants Samuel Coulter, Sylvester Farrell and James Humphreys.

Alex. Mernstein, for defendant A. J. Knott.

J. W Whalley, in pro per.

BELLINGER District Judge.

This is a suit by a creditor of the defendant corporation for the appointment of a receiver to take possession of and administer its assets as a trust fund for the benefit of its creditors. The defendant corporation is organized under the laws of Oregon. It appears from the bill of complaint that the plaintiff at different times, at the company's instance, advanced money to pay its taxes and other liabilities, and to take up indebtedness of the company which it was unable to pay, and upon which it was threatened with legal proceedings, to an aggregate amount of about $6,800 that the company owes other overdue indebtedness, exceeding $50,000, all of which it is unable to pay, and that it is insolvent; that the defendant Coulter is president of the corporation, and his son Al. Coulter and the defendant Farrell are directors therein. The complaint alleges that the defendants Farrell and Coulter, claiming to act as a majority of the company's board of directors, authorized the making of a note and mortgage to secure the same by the company to Farrell for $7,992.60; that said note and mortgage were executed in pursuance of such authority, Coulter being at the time president of the company; that such note and mortgage were without consideration, and were fraudulently contrived between such president and Farrell for the purpose of defrauding the creditors of the company; that Farrell claims to hold, as a purchaser, other notes of the company made by Coulter as its president, for sums aggregating about $6,000, all of which notes are without consideration and were fraudulently issued, which facts were known to Farrell when he pretended to purchase them; that all of said last-mentioned notes were made payable to the order of Samuel Coulter, and were authorized by the votes of said Samuel Coulter and his son Al. Coulter, claiming to comprise a majority of the board of the company's directors, Samuel Coulter being at the time president of the company. It is also alleged that Farrell threatens to foreclose his mortgage for $7,992.60, obtained as described; that Samuel Coulter, by the authority of his own vote and that of his son, on said board, caused a note for $400 to be executed by the company, payable to his order, which note is without consideration; that said note for $400 was transferred by the said Coulter to the defendant Knott, who took the same with knowledge of its fraudulent character; that, through collusion between Knott and said Coulter, Knott has obtained a judgment on said note against the company in the state circuit court; that Samuel Coulter, acting upon the authority of a resolution passed by his own vote and that of his son, executed to himself, and without consideration, a note of the corporation for $1,000, which he assigned to the defendant Whalley, who took with notice of the fraudulent character of said note and of the...