Hames v. Spokane-Benton County Natural Gas Co.

• Decision Date: 03 January 1922
• Docket Number: 16578.
• Parties: HAMES et ux. v. SPOKANE-BENTON COUNTY NATURAL GAS CO. et al.
• Court: Washington Supreme Court

203 P. 18

118 Wash. 156

HAMES et ux. v. SPOKANE-BENTON COUNTY NATURAL GAS CO. et al.

No. 16578.

Supreme Court of Washington

January 3, 1922

Department 1.

Appeal from Superior Court, Benton Coundty; John Truax, Judge.

Action by George Hames and wife against the Spokane-Benton County Natural Gas Company and others. Judgment of dismissal, and plaintiffs appeal. Affirmed.

Mulligan & Bardsley, of Spokane, for appellants.

TOLMAN J.

Appellants plaintiffs below, after a demurrer had been sustained to their complaint, refused to plead further, and elected to stand upon their complaint, whereupon a judgment of dismissal was entered against them, from which they have appealed.

The complaint purports to set up two causes of action. The first cause of action is set forth in five paragraphs, alleging respectively, the corporate existence of the defendant corporation; that the individual defendants are officers and trustees and in full control of the affairs of the defendant corporation; that plaintiffs are stockholders in the defendant corporation, and bring this action in their own behalf as such stockholders, and on behalf of all other stockholders who may join in the action. The fourth paragraph sets out the objects and purposes for which the defendant corporation was organized, and alleges that since its incorporation it has been engaged in carrying on the business for which it was incorporated, and has acquired property and property rights. The fifth paragraph disregarding conclusions and liberally construing it with reference to such facts as are meagerly stated, pleads that the individual defendants, while acting as officers and trustees of the corporation, caused the corporation to enter into contracts with themselves for the payment to them of unreasonable expenses, salaries, and commissions on the sale of stock, which they have caused to be paid to themselves from the funds of the corporation.

The second cause of action consists of three paragraphs. By the first the plaintiffs adopt the allegation in the first four paragraphs of the first cause of action, and the remaining two, in substance, plead that the individual defendants, through misrepresentations, procured plaintiffs to loan to the corporation $3,450, and take its treasury stock as collateral security therefor, and then caused the transaction to be entered and shown on the books of the corporation as a sale of treasury stock, and paid to themselves a commission on such sale of $1,380, placing in the treasury of the corporation only the remainder of the sum loaned. Interwoven therewith are allegations of a wrongful disposition of the property purchased with the borrowed money, which have no relation to plaintiffs' individual cause of action for the money loaned, and which could give rise only to a cause of action by the corporation or its stockholders.

A judgment is demanded against all of the defendants for the amount loaned, with interest, for the foreclosure of the collateral security, and also for the appointment of a receiver for the corporation, and for other and general...