First Nat. Bank of Winona v. Winona Plow Co.

• Decision Date: 11 July 1894
• Citation: 59 N.W. 997,58 Minn. 167
• Parties: FIRST NAT. BANK OF WINONA ET AL. v. WINONA PLOW CO. ET AL. SAME v. MUNCK.
• Court: Minnesota Supreme Court

58 Minn. 167

59 N.W. 997

FIRST NAT. BANK OF WINONA ET AL.

v.WINONA PLOW CO. ET AL.

SAME

v.MUNCK.

Supreme Court of Minnesota.

July 11, 1894.

(Syllabus by the Court.)

1. The articles of incorporation of the defendant corporation construed, and held it was not organized for the purpose of carrying on an exclusively manufacturing business, and its stockholders are liable for its debts to the amount of their stock.

2. Held, further, the court cannot by construction limit this liability by holding that each stockholder is liable only ratably, when some of the stockholders are insolvent, or beyond the jurisdiction of the court.

3. Held, further, all those who are stockholders at the time the action is commenced are liable, although some of them were not stockholders at the time the corporate liability was incurred.

Appeal from district court, Winona county; Charles M. Start, Judge.

Actions by the First National Bank of Winona and others against the Winona Plow Company and others. Judgment for plaintiffs, and defendants appeal. Affirmed.

Wm. Gale, H. M. Lamberton, and O. B. Gould, for appellants.

Wilson & Bowers and M. B. Webber, for respondents.

CANTY, J.

This is an action brought under Gen. St. 1878, c. 76, by plaintiff in behalf of itself and all other creditors, to sequester the property and effects of the defendant the Winona Plow Company, and apply the same to the payment of its debts, and also to enforce the constitutional liability of its stockholders for the purpose of paying any balance of indebtedness existing after exhausting such corporate assets. After all the corporate assets were thus applied, final judgment was entered against the appellants N. C. A. Munck and O. B. Gould and others, stockholders in the defendant corporation, for such balance of indebtedness.

1. The principal point urged by appellants is that the stockholders of the defendant corporation are not liable, because it is exclusively a manufacturing corporation. It was organized under title 2, c. 34, Gen. St. 1878, and the purposes for which it was incorporated are expressed in its articles of incorporation as follows: “The general nature of its business shall be the manufacture, purchase, repair, and sale of plows, cultivators, and other farming and agricultural implements of all kinds, the purchase and sale of all materials necessary or convenient in the prosecution of said business, and to take own, hold, mortgage, lease, and convey any and all real estate necessary or useful therein.” One of the findings of fact made by the court below on the trial is as follows: “That in fact the actual business carried on by said plow company at all times since its organization, and intended by its incorporators to be carried on by it, was exclusively that of manufacturing plows and other agricultural implements, and the disposing of the product of its manufacture, except that for a limited time it handled and sold on commission goods manufactured by other persons and corporations, in connection with, and for the...