Frank v. Wedderin

• Decision Date: 21 May 1895
• Docket Number: 352.
• Citation: 68 F. 818
• Parties: FRANK v. WEDDERIN et al.
• Court: U.S. Court of Appeals — Fifth Circuit

68 F. 818

FRANK v. WEDDERIN et al.

No. 352.

United States Court of Appeals, Fifth Circuit.

May 21, 1895

For decision in a former litigation involving the same controversy, see 54 F. 82.

On the 6th day of December, 1892, suits at law were commenced in the circuit court of the United States, Eastern district of Louisiana, by the Prentiss Tool & Supply Company and the Niles Tool Works, and on the 7th day of December by the Cleveland Forge & Iron Company, against the Taylor Brothers Iron Works Company, Limited, a business corporation chartered under the laws of the state of Louisiana. Attachments and sequestrations issued, under which the marshal seized and took possession of the defendant's property on said dates, and the defendant was cited in each case on the 7th day of December, 1892, by domicile service on the secretary and subsequently by service of process on the president in person, December 19th. On the 14th day of December, 1892 Carl Wedderin, W. A. Taylor, and John C. Finney, Jr. defendants in error in the present case, appeared in said court, and filed in each case a motion and exception in the following words: 'Now come Carl Wedderin, Walter A Taylor, and John C. Finney, Jr., liquidating commissioners of the Taylor Brothers Iron Works Company, Limited, and for the sole purpose of protecting their possession and control of the assets and property of said company, and not intending to make themselves parties thereto, they bring to the notice of the court the following fact: That the Taylor Brothers Iron Works Company, Limited, sued and cited as defendant herein, was dissolved and lost its corporate existence on November 16, 1892, by resolution of a general meeting of its stockholders held on said date, in accordance with law and section 7 of the charter of said company, evidenced by act before J. D. Taylor, N.P., April 7, 1891, which said company thereby lost its capacity to sue or to be sued as a corporation or in its corporate name; that at said general meeting of the stockholders of said company, which dissolved the corporation, your appearers were appointed liquidating commissioners of said company, likewise in accordance with law and said section 7 of said charter. Now your appearers appointed liquidating commissioners under the resolution aforesaid move that they be allowed by the court to appear solely for the conservatory purpose of moving to dissolve the attachment herein issued, on the ground that the Taylor Brothers Iron Works Company, Limited, had been dissolved and ceased to exist at the time the attachment in this cause issued, and prior thereto. Now come Carl Wedderin, Walter A. Taylor, and John C. Finney, liquidating commissioners of the Taylor Brothers Iron Works Company, Limited, and suggest to the court the following facts: That the Taylor Brothers Iron Works Company, Limited, sued and cited as defendant herein, was dissolved and lost its corporate existence on November 16, 1892, by resolution of a general meeting of its stockholders held on said date, in accordance with law and section 7 of the charter of said company, evidenced by authentic act before J. D. Taylor, notary public, April 7, 1891. Wherefore appearers pray that this suit may be dismissed, with costs, and for general relief.'

The cases were heard by the late Judge Billings upon these pleadings; and the motion to dissolve the attachments, and for the delivery of the property and dismissal of the suit, were denied on the 13th day of February, 1893, after a full trial on the merits. Judgments were rendered against the corporation in each of the cases on the same day for the amounts sued for, with recognition of the attachments. Executions issued upon these judgments in due course, and the property claimed in the case was sold thereunder by the marshal to Michael Frank on the 31st of May, 1893, for the price and sum of $42,000. The plaintiffs below (defendants in error here), after February 13, 1893, remained silent until April 2, 1894, when the present suit was brought against Mr. Frank to recover the property. As grounds of recovery, the plaintiffs allege in their petition that the Taylor Brothers Iron Works Company, Limited, was dissolved on the 16th day of November, 1892, by a resolution of its stockholders, convened for that purpose, and that they were appointed liquidators by the same resolution, and that the resolution was recorded in the mortgage office on the 6th day of January, 1893; that on the 7th day of December, 1892, they filed a petition in the civil district court, setting up the resolution of dissolution, and praying for a judicial recognition of the appointment as liquidators, which was granted on the same day; that on December 6th said suits were instituted against the company in the United States circuit court, and citation served on the president and secretary; that the liquidators, on December 14th, without making themselves parties, appeared in said circuit court, and called the fact of the dissolution of the corporation to the attention of the court; that the court disregarded these facts, and rendered final judgment against the corporation on the 16th day of February, 1893, under which the seized property was sold to Michael Frank; that such sale was absolutely void; that the liquidators took possession of the property under the order of court of December 7th, which related back to November 16th, and that the marshal unlawfully deprived them of this possession; that no legal citation was ever served on the said company; and that the judgments against it were void, because the corporation had been dissolved, and they were not at the time officers; and, finally, that, even if said proceedings of the United States circuit court were otherwise valid, that could not interfere with the jurisdiction of the state court, which was acquired prior to said seizure. The petition closes with a prayer for a decree annulling the sale to Frank, and for the possession of the property. The defendant filed a general demurrer to this petition. Upon the same being overruled, he filed an answer and plea, denying the alleged invalidity of the sale for any of the reasons set forth in the petition, and setting up the judgment of Judge Billings in the attachment cases, on the exceptions and motions of the liquidators as an estoppel.

Upon the trial of the case in the circuit court upon these issues, the plaintiffs offered in evidence (1) a copy of the opinion of Judge Billings on the exception and motion to dissolve the attachment in the three cases; (2) the stipulation signed by all the parties adopting the statement of facts contained in that opinion, as the facts upon which the judgment on the exception and motion of the liquidators was rendered; (3) the resolution of November 16th, purporting to dissolve the corporation; (4) the appearance of the liquidators, of which copies are hereinabove set out in full; (5) the deposition of Carl Wedderin, in which he testifies that the three liquidators were in possession of the property when taken by the marshal under the writs of attachment, and that no notice of the meeting for the dissolution was ever published, as required by the charter. The defendant offered in evidence (1) the exception and motion of the liquidators to dissolve the attachments in the three suits, which had also been offered by plaintiffs, (2) copies of the exceptions and motions of the liquidators and the order of court setting them down for trial; (3) a copy of the opinion of Judge Billings, and the agreed statement of facts already offered by the plaintiffs, as above stated; (4) copy of the charter of the Taylor Brothers Iron Works Company, Limited; (5) a copy of the judgment of Judge Billings denying the motion of the liquidators to dissolve the attachments.

The following admissions were mutually made to save costs: (1) that the Taylor Brothers Iron Works Company, Limited, owned the property in dispute on the 16th of November, 1892, the date of the alleged dissolution of the corporation; (2) that the attachments were levied and property taken possession of by the marshal December 6, 1892; (3) that the property was sold to Michael Frank May 31, 1892, under executions issued on final judgments rendered in the three attachment suits on the 13th day of February, 1893; (4) that the alleged resolution dissolving the corporation was recorded in the mortgage office January 6, 1893; (5) that the liquidators filed a petition in the civil district court December 7, 1892, praying for a judicial confirmation of their appointment, which was granted on that day, and that an inventory of the property was subsequently taken under an order of that court, and filed January 9, 1893.

This being the entire evidence in the cause, and there being no disputed fact, the circuit court directed a verdict in favor of the plaintiff, refusing a request to charge for the defendant upon the same facts, to which action defendant excepted, making the whole evidence part of the bill. From the final judgment of the circuit court against him, the case is brought here for review, upon the following assignment of errors: (1) The circuit court erred in directing the jury to find a verdict in favor of the plaintiffs, and in refusing to instruct the jury to render a verdict in favor of the defendant, as requested, upon the entire evidence and the law applicable thereto. (2) The circuit court erred in not maintaining the estoppel pleaded in the defendant's answer upon the undisputed facts in the case. (3) The circuit court erred in not holding that the judgment of Judge E. C. Billings, denying the motions of said alleged liquidators to dissolve the attachments in the suits at law of the Prentiss Tool & Supply Company and of the Niles Tool Works Company...