Gabbert v. Union Gas & Traction Co.

• Decision Date: 06 December 1909
• Citation: 123 S.W. 1024
• Court: Missouri Court of Appeals
• Parties: GABBERT v. UNION GAS & TRACTION CO. et al.

123 S.W. 1024

GABBERT v. UNION GAS & TRACTION CO. et al.

Kansas City Court of Appeals. Missouri.

December 6, 1909.

Rehearing Denied January 10, 1910.

1. CORPORATIONS (§ 542) — INSOLVENCY OF CORPORATION — RIGHTS OF CREDITORS.

The insolvency of a corporation, or the execution of an illegal trust deed, does not give to a mere creditor any lien on the property of the corporation, nor charge it with a direct trust, and, in the absence of such a lien, the corporation has the same right to sell or mortgage its property or otherwise dispose of it as a private citizen.

2. CORPORATIONS (§§ 547, 548) — INSOLVENCY — RIGHTS OF CREDITORS — CREDITOR'S BILL.

A creditor in order to reach the property of a corporation conveyed or otherwise disposed of in fraud of creditors, or before he can maintain a creditor's bill, must show that he has exhausted his remedy at law, or that he has no adequate remedy at law.

3. CORPORATIONS (§ 553) — INSOLVENCY — APPOINTMENT OF RECEIVER — GROUNDS — ADEQUACY OF LEGAL REMEDY.

A receiver for a corporation will not be appointed on a showing made by a creditor that it has disposed of all of its property to another corporation under the foreclosure of a mortgage on the property given to a third corporation, there being no showing that plaintiff has no adequate remedy at law, although the corporation to whom the mortgage was made is a foreign corporation with no place of business in the state and cannot be served with process, where the property which plaintiff seeks to subject to his demand can be reached by attachment and the interest of the foreign corporation therein could be fully determined, and plaintiff's claim is unliquidated, and he may never be able to obtain a judgment.

Appeal from Circuit Court, Platte County; A. D. Burns, Judge.

Action by Benton Gabbert against the Union Gas & Traction Company and others. From a judgment for defendants on sustaining a demurrer to the petition, plaintiff appeals. Affirmed.

Leach, Day & Green, for appellant. Sutton & Sutton and Harkless & Jisted, for respondents.

BROADDUS, P. J.

All the parties appeared and filed demurrers to the original petition, which were sustained, and plaintiff filed an amended petition to which defendants filed demurrers, the grounds of which were that the pleading did not state a cause of action, and that there was a misjoinder of parties defendants. The court sustained the demurrers, and plaintiff stood on his petition as amended, whereupon the court rendered judgment in favor of defendants, and plaintiff appealed.

The petition is of great length, the substance of which is that the Union Gas Company, a corporation, on the 18th day of May, 1907, agreed with plaintiff to sell him a bond and some shares of its common stock, and as a consideration in part agreed with him to bring a supply of natural gas to the town of Dearborn, in Platte county, Mo., on or before May 15, 1908; that he paid for said bond and shares the sum of $1,000; that, if said company should fail to bring the supply of gas to Dearborn, then it would repurchase from plaintiff said bond and stock at the price he had paid for it; that no contract in fact was really made, because, while the agent with whom he dealt had authority to sell the bond and stock and receive the money therefor, he had no authority to bind the said company; that it would supply natural gas to said town or repurchase the bond and stock as stated; that in October, 1907, while ignorant of the want of authority in said agent to make said contract, he received from said defendant the Union Gas Company the semiannual installment of interest due October the 1st of that year on the aforesaid bond, the sum of $30; that, as no natural gas had been brought to Dearborn within the time mentioned, the plaintiff applied to the last aforesaid company to repurchase said bond and stock, at which time plaintiff learned for the first time of the want of authority to make a contract to that effect; that in the meantime said company had defaulted payment on the interest due on its bond aforesaid, the total issue of which was $350,000, and had become insolvent; and that it refused to repurchase said bond and stock, although plaintiff tendered to it the $30 in interest he had received.

It is alleged that said Union Gas Company has the means to supply and is supplying natural gas to the town of Weston, and that its income from that source is about $1,000 per month; that it is permitting the defendant the Weston Gas Company to hold the legal title to its said property, and to receive the income from the business; that the officers of each are one and the same; that, in order to aid and...