International State Bank v. McGlashan

• Decision Date: 06 February 1922
• Docket Number: 9761.
• Court: Colorado Supreme Court
• Parties: INTERNATIONAL STATE BANK v. McGLASHAN et al.

204 P. 480

71 Colo. 72

INTERNATIONAL STATE BANK v. McGLASHAN et al.

No. 9761.

Supreme Court of Colorado, En Banc.

February 6, 1922

Error to District Court, Las Animas County; A. C. McChesney, Judge.

Action by the International State Bank against A. E. McGlashan and others. Judgment for defendants, and plaintiff brings error.

Reversed and remanded.

Jesse G. Northcutt, of Denver, and A. W. McHendrie of Trinidad, for plaintiff in error.

Henry Hunter, James McKeough, and J. J. Hendrick, all of Trinidad and A. E. McGlashan and Horace N. Hawkins, both of Denver for defendants in error.

WHITFORD J.

Plaintiff in error brought suit against the defendants in error, seeking to recover from the defendants personally, as officers and directors of the Trinidad Garage Company, certain debts of the corporation because of the failure of the corporation to file, within 60 days next after the 1st day of January, 1918, an annual report as required by chapter 102, Session Laws 1911. The act requires every corporation to file an annual report with the Secretary of State within 60 days next after the 1st day of January in each year, and prescribes what such report shall show, as follows:

'First. The names of its officers and their several places of residence, together with the street or business address of such officer.

'Second. The names of its directors or trustees and their several places of residence, together with the street or business address of such director or trustee.

'Third. The amount of its capital stock as fixed and determined by its articles of incorporation and amendments thereto. * * *

'Fourth. The proportion of said capital stock actually paid in.

'Fifth. Setting forth how the same was paid, whether in cash, by the purchase of property, or otherwise.

'Sixth. The amount of the indebtedness of said corporation at the date of filing said report.

'Seventh. Setting forth whether or not it is engaged in the active operation of its business within the state of Colorado.

'Eighth. Such other information as will show with reasonable fullness and certainty the condition of its real and personal property, and the financial condition of such corporation, joint-stock company or association at the date of filing such report.'

The law further provides that, if any such corporation neglects to file an annual report within the time prescribed, the officers and directors of such corporation shall be jointly, severally, and individually liable for all of its debts contracted during the year next preceding the time when the report should have been filed, and until such report is filed.

At the trial there was received in evidence, without objection, a certified copy of the purported annual report of the Trinidad Garage Company, filed in the office of the Secretary of State February 23, 1918, which was made out on a blank form provided by the Secretary of State for such reports, which form follows numerically and almost literally the language of the subdivisions of the statute.

The sixth, seventh and eighth subdivisions of the purported annual report as filed are as follows:

Sixth. Amount of indebtedness at date of filing this report.

Seventh. State whether or not engaged in actual operation within the state of Colorado.

Eighth. Such other information as will show with reasonable fullness and certainty the condition of real and personal property, and the financial condition of your company at the date of filing this report.

Assets. Capital stock .................. $10,000 00 Used cars ........................ 3,700 00 New cars ........................ 10,382 73 A-C's Rec......................... 6,248 45 Stock ........................... 22,660 00 Fixtures, Mach.................... 3,500 00 $56,491 18 ---------- Liabilities. Bills payable .................. $23,000 00 Bills payable secured by cars ... 19,545 33 A-C's payable .................... 4,762 38 $47,307 71 ----------

At the conclusion of the plaintiff's testimony the trial court granted a nonsuit, and dismissed the cause upon the ground that the report was a substantial compliance with the requirements of the statute.

Judgment was rendered November 14, 1919, and 60 days allowed for a bill of exceptions. On the sixty-first day thereafter, counsel for defendants in error, with no intimation of protestation, approved the bill of exceptions and delivered it to counsel for plaintiff in error, and on the same day the trial judge, without objection, signed and sealed the same. It was moved in this court on behalf of defendants in error to strike the bill of exceptions, for the reason that it was signed and sealed one day too late, which motion was granted.

In the brief and oral argument of plaintiff in error we are asked to reconsider the motion to strike and reinstate the bill of exceptions. Since the granting of the motion to strike, this court said, in Mogote-Northeastern Consolidated Ditch Co. v. Gallegos, 69 Colo, 221, 193 P. 670:

'If the plaintiff's attorney desired to object to the signing of the bill, he should have added to his memorandum the statement that he objected to the signing because it was too late, as in Bell v. Murray, 13 Colo.App. 217, or have gone before the court with his opponent and objected there. * * * We think that whenever an attorney approves a bill of exceptions and permits it to be allowed without making the objection that it is too late, he should be regarded as waiving that objection and consenting to the allowance. * * * Such a rule is fair to all parties, tends to prevent disaster to litigants through fraud or misunderstanding and is the reasonable interpretation of the approval or the statement that the bill correctly states the proceedings.'

See Rose v. Agricultural Ditch & Reservoir Co., 69 Colo. 232, 193 P. 671; R. G. S. R. Co. v. C. F. & I. Co., 41 Colo. 3, 91 P. 1114; Hoover v. Shott, 66 Colo. 456, 182 P. 883; E. I. Dupont, etc., Co. v. Smith, 249 F. 403, 161 C.C.A. 377.

We think that, when the attorneys for defendants in error signed the bill of exceptions approving the same, without noting any objections thereon, and permitted the judge thereafter to allow the bill without making objection thereto, the defendants in error consented to the allowance of the bill and waived the right to thereafter object.

The bill of exceptions will be reinstated.

In preparing its annual report the corporation made no answers to subdivisions sixth and seventh of the purported report filed with the Secretary of State. These subdivisions sixth and seventh are constituent parts of the statute, which specifically state what, among other things, the report shall show. To eliminate them from the statute would be doing violence to the manifest intention of the Legislature. To ignore these requirements in making the report would be doing violence to the specific provisions of the act. The document which was filed as...