Knabe v. Johnson

• Decision Date: 31 March 1908
• Parties: KNABE v. JOHNSON et al.
• Court: Maryland Court of Appeals

69 A. 420

107 Md. 616

KNABE v. JOHNSON et al.

Court of Appeals of Maryland

March 31, 1908

Appeal from Circuit Court of Baltimore City; Thos. Ireland Elliott and Jas. P. Gorten, Judges.

Proceedings to wind up the National Building Association of Baltimore City, a corporation, in which Reverdy Johnson and others intervene. From an order of distribution of the funds, Ernest J. Knabe, Jr., receiver, appeals. Dismissed.

Edward C. Carrington, and Henry W. Williams, for appellant.

S. S Field, and John C. Rose, for appellees.

PEARCE J.

The National Building Association of Baltimore City, a body corporate under the laws of Maryland, was by a decree of the circuit court of Baltimore City, duly dissolved, and the appellant, Ernest J. Knabe, Jr., was duly appointed receiver to wind up the affairs of said corporation under the direction of said court.

It appears from the record that about three years prior to the decree of dissolution, there being then some dissatisfaction with the management of the association, it was determined at a meeting of the stockholders that each stockholder might elect to receive the book value of his shares of stock in cash, such cash with interest at 4 per centum until paid, to each shareholder in the order in which his shares might be filed for redemption, such payments to be made as rapidly as the cash receipts of the association applicable thereto would permit; or he might exchange his shares of stock for bonds of the association for an amount equal to the cash payments made upon his shares, said bonds to be payable in gold in 1912 with interest in the meantime payable semiannually in gold and to be a lien upon all the assets of the association after payment of the stockholders who elected to withdraw the then book value of their stock which was at, and by, said stockholders' meeting determined to be 76.97 per cent. of the amount paid thereon. The appellees elected to take the book value of their stock upon the terms above stated, as did other stockholders aggregating about $187,000, while other stockholders aggregating about $177,300 elected to receive bonds on the terms above stated. Of the $187,000 above mentioned, about $181,000 has been paid off, leaving only about $6,000 unpaid, which is held by the appellees, who have intervened by petition in the proceedings in which the decree of dissolution was passed, and who claim to be paid their 76.97 per cent. of the amounts paid in by them, with interest as above stated, in preference and priority to the allowance or payment of any sums from the assets of said association to the holders of any of the bonds issued as above mentioned. The auditor, in stating an account designated as "Account B," distributing the assets of the association, allowed the appellees the preference and priority claimed by them, leaving a balance for distribution among said bondholders, distributed among them by another account designated "Account C." The receiver excepted to the ratification of Account B on the ground that the claims of the appellees are not preferred claims, and are only entitled to such dividend as allowed ordinary creditors of said corporation. The circuit court overruled these exceptions and ratified Account B. The receiver then filed a petition alleging that he had received from the attorneys of record of about 50 per cent. of the general creditors of said association, a letter requestion him to obtain leave of the court to appeal from the order overruling the receiver's exceptions, and ratifying Account B, and he therefore prayed that he be authorized to appeal, and upon that petition the receiver was "authorized and directed to enter and take" such appeal. The appellees now move to dismiss this appeal "because the same was not taken by a party entitled to appeal."

It is obvious that the order appealed from establishes no claim against the association, and denies no claim asserted by it. It does not refuse, or diminish, the compensation of the receiver, nor in any manner affect any right of the receiver personally, nor his duty as such to conserve the whole estate for its distribution by the court among those adjudged to be entitled to it. It is purely an order...