Hunt v. Ketell

• Decision Date: 04 February 1953
• Parties: HUNT et al. v. KETELL.
• Court: Oregon Supreme Court

Page 272

253 P.2d 272

197 Or. 659

HUNT et al. v. KETELL.

Supreme Court of Oregon.

Argued Dec. 19, 1952.

Decided Feb. 4, 1953.

William B. Murray, of Portland (Maurice V. Engelgau, of Portland, on the briefs), for appellant.

Arno H. Denecke, of Portland (Wilbur, Mautz, Souther & Spaulding, of Portland, on the brief), for respondents.

Before BRAND, C. J., and ROSSMAN, LUSK and WARNER, JJ.

WARNER, Justice.

This is a proceeding in mandamus brought by the petitioners to compel the delivery of certain corporate records in the possession of the defendant, a former president of the corporate petitioner. From a judgment of the circuit court directing the issuance of a peremptory writ, defendant appeals.

The alternative writ reveals that the petitioner Roseburg Homes, Inc., hereinafter called the corporation, is an Oregon corporation engaged in the acquisition of lands upon which it constructs residential buildings for rental and sale; that its business is carried on largely in the vicinity of Roseburg, Oregon; that on November 5, 1948, the petitioner C. N. Souther was appointed secretary of the corporation and was acting in that capacity at the time of the issuance of the writ; that the petitioner Frank D. Hunt, Jr., on November 15, 1950, was appointed general manager of the corporation, pursuant to a resolution of its board of directors, reading in part as follows:

'That Frank Hunt be employed as general manager of this corporation at a salary of $300.00 per month commencing as of this date and that he be authorized and directed to take over the books and records of this corporation, including among other things, all contracts, mortgages, stock, notes and other evidences of indebtedness and all other records or documents pertaining to the business of this corporation and that he be authorized and directed, if necessary, to take such action as may be necessary to recover possession of them';

that prior to June 26, 1951, the defendant Ketell was acting as the corporation president and on that date he was displaced and is not now an officer of the corporate petitioner; that the corporation built residential units on lands which it acquired and is engaged in the sale, rental and maintenance of the same, and in order to properly operate the business of the corporation, it is necessary that its officers and representatives have possession and control of all the corporate records and books; that the defendant Ketell prior to June 26, 1951, came into possession of such books and records and has ever since retained them; and that notwithstanding the repeated demands of the corporation for the return of the corporate records retained by its former president, he refuses to heed its requests and the corporation is thereby prevented from carrying on its business. The alternative writ further alleges that petitioners have no plain, speedy and adequate remedy at law.

The defendant demurred to the writ on two grounds to which we will hereinafter refer. When this was overruled, defendant filed an answer generally denying the allegations of the writ and pleading three affirmative defenses: (1) that the employment of Hunt was unlawful and constituted a wrongful delegation of authority by the directors; (2) that under the issues raised, the court must necessarily determine the validity of the election of the several corporate officers and the petitioners have an adequate remedy at law for that purpose in the nature of quo warranto; and (3) that the petitioners have a plain, speedy and adequate remedy at law in the nature of claim and delivery. To this answer, petitioners filed a reply in denial.

The court's adverse ruling on appellant's demurrer is made one of his three assignments of error. The first ground was that there was a defect of parties. 'Defect of parties', we are told by defendant, rests upon the presence in this matter of too many petitioners and not too few. That is tantamount to a misjoinder of parties plaintiff. Section 1-705, O.C.L.A. which gives the grounds for demurrer, provides: 'The defendant may demur to the complaint * * * when it appears upon the face thereof * * * (4) That there is a defect of parties, plaintiff or defendant'. In Tieman v. Sachs, 52 Or. 560, 564, 98 P. 163, 164, we said:

'* * * The first assignment in support of the demurrer is that there is a defect of parties plaintiff, but that, as a ground of demurrer, means too few, and not too many. A demurrer alleging this particular objection can be interposed, therefore, only in case of a nonjoinder of necessary plaintiffs or defendants, and never in case of misjoinder. Pomeroy's Code Remedies (4th Ed.) § 123; Paulson v. City of Portland, 16 Or. 450, 19 P. 450, 1 L.R.A. 673.'

The pronouncement in the Tieman case is settled law in this state. Porter Const. Co. v. Berry, 136 Or. 80, 87, 298 P. 179; Lowell v. Pendleton Auto Co., 123 Or. 383, 392, 261 P. 415; Williamson v. Hurlburt, 99 Or. 336, 337, 195 P. 562.

We think the challenged ruling of the court was correct. Our reasons for so holding with respect to the second ground follow.

This appeal tenders only two matters which compel special attention, i. e., the adequacy of replevin as a remedy and the official authority of the secretary of the corporation.

Defendant predicates the second ground of his demurrer upon that part of § 11-302, O.C.L.A. reading: '* * * The writ [of mandamus] shall not be issued in any case where there is a plain, speedy, and adequate remedy in the ordinary course of the law.'

From this premise he argues that the petitioners are required to plead and prove that their action comes within the statute. He thereby brings to the fore the cardinal point of his appeal, i. e., his contention that replevin is an adequate remedy at law for the accomplishment of what the petitioners seek to obtain by mandamus. The same proposition is the basis of his third affirmative defense and is likewise raised by his requested findings of fact.

At the outset he is confounded by our holding in Beard v. Beard, 66 Or. 512, at page 520, 133 P. 797, at page 800, 134 P. 1196, where the court said:

'It is contended by the defendant that the plaintiff has a plain, speedy, and adequate remedy at law by an action for possession of the personal property. High, Extraordinary Remedies, § 306, states: 'And the rule is well established, both upon principle and authority, that mandamus will lie to compel the surrender and delivery of corporate books and records to the officers properly entitled thereto. And where the term of office has expired, either by removal, or by lapse of time, and the officer refuses to surrender the corporate records and documents to his successor duly elected and entitled to their custody and control, mandamus will go to compel the delivery.' See, also, Cook on Corporations, § 515.'

In an attempt to offset the impact of what was thus said in the Beard case, defendant argues that the demurrer to the writ in that case was overruled 'because part of the property was out of the jurisdiction of the court.' Evidently in so saying, he relies on that part of the opinion following the above quotation which reads:

'It is apparent that an action of replevin would not be an adequate remedy, for the reason that only a portion of the property is situate in one jurisdiction. * * *'

Defendant's argument in this respect is, in essence, that Beard v. Beard, supra, is authority for the proposition that replevin is an adequate remedy at law when all the property belonging to the corporation is within the jurisdiction of the court. In this we cannot agree.

Reference in the Beard case to the fact that part of the corporate property was in...