Lakin v. Chartered Co. of Lower Cal.

• Decision Date: 05 May 1914
• Citation: 111 Me. 556,90 A. 427
• Parties: LAKIN et al. v. CHARTERED CO. OF LOWER CALIFORNIA.
• Court: Maine Supreme Court

90 A. 427

111 Me. 556

LAKIN et al.

v. CHARTERED CO. OF LOWER CALIFORNIA.

Supreme Judicial Court of Maine.

May 5, 1914.

Exceptions from Supreme Judicial Court, Cumberland County, in Equity.

Bill by Wilbur F. Lakin and another against the Chartered Company of Lower California. A demurrer being sustained, and an amendment offered by plaintiffs being denied, they excepted. Exceptions overruled.

Argued before SAVAGE, C. J., and SPEAR, KING, HANSON, and PHILBROOK, JJ.

George F. Gould, of Portland, and Francis Hurtubis, Jr., Whipple, Sears & Ogden, and Edwin C. Gilman, all of Boston, Mass., for plaintiffs. John W. McAnarney, of Boston, Mass., and Verrill, Hale & Booth, of Portland, for defendant. John F. A. Merrill, of Portland, for petitioner Reed.

SPEAR, J. This case comes up on exceptions to the ruling of the sitting justice sustaining a demurrer to the plaintiffs' bill, and denying an amendment offered by them. The plaintiffs claim that "this is a creditors' bill, to reach and apply, in payment of debts, property of the defendant," brought under the last part of paragraph 9, § 6, c. 79, R. S., which reads: The Supreme Judicial Court has equity jurisdiction in suits "by creditors, to reach and apply in payment of a debt, any property, right, title or interest, legal or equitable, of a debtor, or debtors, which cannot be come at to be attached on writ, or taken on execution in a suit at law." The defendant, in its brief, also concedes that the proceeding "appears to be purely a creditors' bill, in which the plaintiffs rely on one or both of two grounds; namely, either on the ground that they have no plain, adequate, and complete remedy at law, and are therefore entitled to relief in equity, or on the ground that the case comes within the provisions of Revised Statutes, c. 79, § 6, cl. 9." The bill alleges the defendant company to be a Maine corporation and having its principal place of business at Portland, Me.; the purpose for which it was organized, and, in pursuit of that purpose, the acquisition of a large tract of land in the territory of Lower California in the republic of Mexico; that Lakin, one of the complainants, was the owner of a large block of bonds of the defendant company of the par value of $1,000,000, and of shares of its capital stock to the value of $7,700,000; that he loaned his stock and bonds to the defendant, to be used by it as collateral security for raising money; that the bonds and stock were used as collateral to secure the payment of notes of the company for $200,000; that it was agreed, if the stock and bonds were used as collateral, the defendant company would stand indebted, and would repay the complainant the amount of collateral applied to the payment of the loan, and return the balance; that the value of the collateral used should be taken at its par value, and notes immediately issued therefor by the defendant to the plaintiff; that all the bonds and shares of stock so loaned were used in payment of the loan of $200,000; that the defendant stands indebted to the complainant for the par value of all the bonds and all the shares of capital stock loaned; that the plaintiff demanded of defendant promissory notes for the amount due him in accordance with their mutual agreement; that the defendant has declined and refused to issue the notes; that Lakin is a creditor of defendant corporation. George F. Gould, the other complainant, alleges that the defendant company owes him $1,516.90 for services, and that he is a creditor of the defendant company.

It is then further alleged that the defendant corporation has no property of any name, kind, or description in this state which can be come at to be attached on a writ, or taken upon execution in a suit at law, and not exempt from attachment or seizure; but is the owner of the real estate described in paragraph 2, and that this real estate ought to be taken and applied in equity to satisfy the complainants' several claims. This is the same real estate above referred to as situated in Lower California. The bill applies for a subpœna; for a restraining order pending these proceedings enjoining the defendants from alienating the property; and that a receiver may be appointed to sell, or otherwise dispose of, the whole or enough of the property, as the court may direct, for the payment of the plaintiff's claim. Upon the prayer for temporary injunction, the court issued a restraining order, and set the case for hearing on the prayer for injunction on the 13th day of April, 1912. No hearing seems to have been held upon the question of injunction; the matter having been continued from time to time, until superseded by a hearing upon the demurrer and motion to amend. It appears by the docket entry that a motion to amend the bill was filed June 4, 1912. The amendment consisted of a new paragraph alleging material facts as the basis for a decree for injunction, but was not verified by oath. This amendment was granted July 25th. July 31st a demurrer was filed. On July 2, 1913, upon hearing, the demurrer was sustained. October 6th a draft of final decree was filed. October 22d a motion was filed to amend the amendment, already allowed as paragraph 8. This amendment amended paragraph 8 by inserting new material matter, and then repeating the whole paragraph as amended. This paragraph, as amended, was verified by the oath of George F. Gould for himself and for the plaintiff Wilbur F. Lakin. A hearing was had upon this motion to amend, and the amendment denied by the sitting justice. The demurrer was sustained, and the bill dismissed, with costs. It is apparent that section 8, the amendment allowed, is not well pleaded, since it contains allegations of material fact, and is not sworn to. Farnsworth v. Whiting, 104 Me. 488, 72 Atl. 314. It becomes important, therefore, to determine whether the last amendment, which contained new material matter for injunction, and was verified by oath, should have been allowed. We are of the opinion that this question is not now open. The granting or denying the amendment was within the discretion of the sitting justice. R. S. c. 79, § 12, touching the question of amendment, provides: "The bill of complaint, * * * may be amended or reformed at the discretion of the court." In Shaw v. Slate Company, 96 Me. 41, 51 Atl. 285, the power of the court over amendments is thus stated: "In equity proceedings the court has ample power to allow proper amendments at any time; but it also has as ample power to refuse them at any time. The whole matter of amendments is within the discretion of the...