Lamar Ins. Co. v. Hildreth
| Decision Date | 14 December 1880 |
| Citation | 7 N.W. 573,55 Iowa 248 |
| Parties | LAMAR INS. CO. v. HILDRETH |
| Court | Iowa Supreme Court |
Appeal from Floyd Circuit Court.
ACTION at law to recover of defendant upon his subscription to the stock of Lamar Insurance Company. A demurrer to the petition was sustained, and, plaintiff electing to stand upon the petition, judgment was rendered for defendant. Plaintiff appeals.
AFFIRMED.
J. S Root, for appellant.
Ellis & Ellis, for appellee.
I.
The petition alleges that defendant subscribed to the stock of the Lamar Insurance Company, agreeing to pay twenty per centum of the subscription within nine months, and the balance on call of the directors of the company, for which he gave a bond or stock note; that the twenty per centum alone has been paid; that the company became insolvent, and without assets of any kind except the claims upon the subscribers to its stock, and that upon a bill filed in the Superior Court of Cook County, Illinois, by Edwin Burnham, for himself and other creditors of the company, George Chandler was appointed receiver, to whom was transferred defendant's stock note.
It is shown in the petition that subsequently the receiver and the plaintiff presented their petition setting out that all the creditors of the company had appeared in the proceedings and proved their claims; that the only assets of the company were the stock notes of the stockholders; that voluntary payment had been made by a part of the stockholders, so that the receiver had been able to pay a part of the claims of the creditors proved against the company, and that as no other assets existed except the stock notes, and the receiver was unable to make other collections thereon, no further payments could be made until collections should be enforced from the stockholders. It was further shown that many of the stockholders were insolvent, many were dead, many could not be found, and that many were not residents of the State of Illinois. It was also alleged that the stockholders numbered eighteen hundred, and that it was impossible to join all of them in one action, and that the debts of the company can be paid in no other way than by assessment made upon the stock of the share-holders. It is shown that four stockholders have been served with process in the proceedings. Thereupon the court ordered that a notice should be given in some newspaper, copies of which should be sent by mail to each stockholder, of the application to assess the stockholders upon their subscription, and the four stockholders served with process were required to answer the petition for assessment for all the stockholders. Afterward, it appearing that the order for publication and service of the same had been complied with, and that no appearance or answer was made by the stockholders, an order was made assessing forty dollars upon each share of stock, which declared that each stockholder was found indebted in the sum of forty dollars upon each share of stock held by him, and the receiver was authorized to prosecute in proper actions either in his own name or in the name of the company each stockholder, to recover the amount so found and adjudged against him. The plaintiff claims in his petition that defendant is bound by the assessment made against him in pursuance of the order of the Superior Court of Cook County, Illinois, as above set out.
The demurrer was sustained on the ground that the petition fails to allege or show that the Superior Court had any jurisdiction of the person of defendant in the proceeding wherein the receiver was appointed and the assessment of the stock was made.
II. The question presented by the case for our determination is this: Did the Superior Court of Cook County, Illinois, have jurisdiction to appoint the receiver and order an assessment upon the shares of the stockholders, in view of the facts alleged in plaintiff's petition?
It will be remarked that defendant and other stockholders were not made parties in the action. It cannot be claimed that the notice given under the order of the court upon the application of the receiver made the stockholders parties. The application was to obtain an interlocutory order. It does...
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