Higgins v. Illinois Trust & Sav. Bank

• Decision Date: 18 December 1901
• Citation: 61 N.E. 1024,193 Ill. 394
• Parties: HIGGINS v. ILLINOIS TRUST & SAVINGS BANK et al.
• Court: Illinois Supreme Court

193 Ill. 394

61 N.E. 1024

HIGGINS

v.ILLINOIS TRUST & SAVINGS BANK et al.

Supreme Court of Illinois.

Dec. 18, 1901.

Error to appellate court, First district.

Suit by the Illinois Trust & Savings Bank and others against George W. Higgins. From a judgment of the appellate court (96 Ill. App. 29) affirming a decree in favor of the complainants, the defendant brings error. Affirmed.Paddock & Billings, for plaintiff in error.

Walker & Payne, for defendant in error Illinois Trust & Savings Bank.

Edwin Burritt Smith and Clayton R. Taylor, for defendants in error Charles L. Raymond and others.

HAND, J.

A bill in chancery was filed on January 19, 1891, by Charles F. Morse, a judgment creditor of the Pacific Railway Company, in the circuit court of Cook county, in behalf of himself and all other creditors of said company, under section 25 of the corporation act (Hurd's St. c. 32), against said company and its stockholders, to enforce the statutory liability of said stockholders for any unpaid balance upon their stock. The Pacific Railway Company, an Illinois corporation, was organized in 1889 to acquire the street railway properties in Los Angeles, Cal., then owned by the Los Angeles Cable Railway Company. This court heretofore held (Sprague v. Bank, 172 Ill. 149, 50 N. E. 19,42 L. R. A. 606, 64 Am. St. Rep. 17) that the stock of the Pacific Railway Company was not fully paid up by the transfer therefor of the stock of the Los Angeles Cable Railway Company, and remanded this cause to the circuit court, with directions to that court ‘to enter a decree charging the appellants [stockholders] who obtained stock in the Pacific Railway Companyin exchange for stock in the Los Angeles Railway Company, and those, if any, who obtained stock in the Pacific Railway Company by assignment from former owners, having at the time notice that such stock was issued by the Pacific Railway Company in exchange for such stock in the Los Angeles Cable Railway Company, or notice that it was not in fact paid in full by the subscribers, respectively, with their pro rata share of such debts of the company to the extent of the unpaid, if any, portion of their stock, respectively.’ In accordance with such direction the circuit court on July 1, 1898, entered a decree fixing the unpaid liability upon the stock of the Pacific Railway Company at $68 per share, and as to the assigned stock provided: ‘The question of whether assignor or assignee is, or both are, liable, and, where both are liable, whether the assignor or assignee, as between themselves, is liable, * * * the court doth order shall now be referred to Jeremiah Leaming, Esq., master in chancery of this court, to take evidence and report his conclusions thereon. The master is directed, when he shall have determined which of said defendants is liable to contribute, to fix the amount of such liability at the rate of $68 per share.’ The master found and reported that the plaintiff in error in the month of September, 1889, became the owner and holder of 262 shares of the capital stock of the Pacific Railway Company, of the par value of $100 a share; that he acquired the said shares of stock by exchanging therefor a like number of shares which he held of the capital stock of the Los Angeles Cable Railway Company, of the par value of $100 a share, for which he paid $32 a share; that on or about December 12, 1889, he purchased of James C. King 375 shares of the capital stock of the said Pacific Railway Company, and paid him therefor $32 a share; that said King acquired the said stock by exchanging therefor a like number of shares of the Los Angeles Cable Railway Company stock, for which he paid $32 a share; that on or about January 11, 1890, he purchased of Charles L. Raymond 50 shares of the capital stock of said Pacific Railway Company, and paid him therefor $25 a share; that said Raymond acquired said stock by exchanging therefor a like number of shares of the Los Angeles Cable Railway Company stock, for which he paid $32 a share, and that the plaintiff in error, prior to and at the time of the purchase of said stock from King and Raymond, respectively, had knowledge of the object and purpose for which the Pacific Railway Company was organized; that he is liable to the creditors of the Pacific Railway Company on the 262 shares of said capital stock which he acquired from said company direct in the sum of $68 per share, amounting to $17,816, and that he is primarily liable to the creditors of said company upon the 375 shares of said capital stock purchased of King in the sum of $68 per share, amounting to $25,500; and that he is primarily liable to the creditors of said company on the 50 shares of said...