Lenoir v. Linville Imp. Co

• Decision Date: 09 June 1900
• Citation: 36 S.E. 185,126 N.C. 922
• Court: North Carolina Supreme Court
• Parties: LENOIR et al. v. LINVILLE IMP. CO.

126 N.C. 922

36 S.E. 185

LENOIR et al.

v.LINVILLE IMP. CO.

Supreme Court of North Carolina.

June 9, 1900.

INSOLVENT CORPORATIONS—CLAIMS FOR SALARIES—REVIEW ON APPEAL.

1. Where a receiver was appointed to take control and entire management of all the assets of a corporation, it was not liable to an officer for salary during such receivership, since the performance of the contract between the corporation and the officer was renderedimpossible by judicial action, and not by the fault of the corporation.

2. Where a fact is found without any evidence tending to prove it, the finding is reviewable; but when, without excluding any evidence, the court finds there is no evidence to prove an allegation, the finding cannot be reviewed.

Appeal from superior court, Mitchell county; Allen, Judge.

Action by T. B. Lenoir and others against the Linville Improvement Company. From a referee's report disallowing the claim of petitioners, Thomas F. Parker and another, they appeal. Affirmed.

Davidson & Jones and Busbee & Busbee, for appellants.

E. J. Justice and D. W. Robinson, for appellee.

DOUGLAS, J. This is an appeal by the petitioners, Parker and Kelsey, claiming, respectively, as president and secretary of the company, the balance of their salaries coming due while the company was in the hands of the receiver. The following is the report of Referee Burwell:

"This cause having been referred to me, I proceeded, on June 29, 1898, at Linville, N. C., to hear evidence upon the matters submitted to me for determination. There were present at such hearing Messrs. Davidson & Jones, attorneys for Thomas F. Parker and Harlan P. Kelsey, petitioners, and E. J. Justice, attorney for the defendant. I send herewith the testimony of the several witnesses who were examined before me, it having been taken down by a stenographer. When the cause was called for hearing before me, counsel suggested that the following issues had been agreed upon as covering the matters in dispute: (1) Is the Linville Improvement Company indebted to the plaintiff Thomas F. Parker upon his claim filed in this case? If so, in what amount? (2) Is the Linville Improvement Company indebted to the plaintiff Harlan P. Kelsey upon his claim filed in this case? If so, in what amount? From the testimony introduced before me by the petitioners and defendant, I find the following facts: (1) On August 21, 1893, an order was made appointing a receiver of the defendant corporation, and this order prescribed the duties of such receiver as follows: 'To take into his hands all the property and effects of the Linville Improvement Company, both real and personal, together with all choses in action, debts, claims, and demands of every kind; to collect all debts due the company; to keep in proper repair the houses and other property; to pay all taxes lawfully assessed against the said company, and to defend arid prosecute all suits at law or in equity touching or concerning the said company, and for this purpose to employ counsel at a compensation to be fixed and allowed by the court; to sell and dispose of, for cash, all the property of a personal nature, and especially such as is liable to deterioration, at either public or private sale, and at such times and places as he may elect to sell and dispose of the houses, lands, and tenements of said company, in such quantities, and at such times and places, and upon such terms, as he may deem best, and, upon confirmation of the said sale or sales by the court, to execute deeds conveying such to the purchaser or purchasers.' (2) That, pursuant to this order, J. F. Spainhour was duly qualified as receiver, and immediately thereafter took charge of the property and effects of defendant corporation according to the terms of the order appointing him receiver. (3) That at the time of said appointment of a receiver the petitioner Thomas F. Parker was president, and Harlan P. Kelsey was secretary, of defendant corporation. (4) The charter of the defendant corporation provided that there should be a president and a secretary and a treasurer, who should be elected annually, and should hold their offices, respectively, for one year, or until their successors should be chosen. The charter provided that the treasurer should be elected by the board of directors, and should hold his office for one year, or until his successor should be elected or inducted into office, unless he should be removed by the board of directors, and that he should give bond with good and sufficient surety for the safe-keeping of all moneys that might come into his hands, and for the faithful discharge of all the duties of his office. (5) The by-laws of the corporation provided that the salaries or other compensation of all offices should be fixed by the directors, and might be changed or discontinued at the end of any month. (6) Thomas F. Parker was duly elected president on July 20, 1893, and immediately thereafter, at a meeting of the directors, he was elected treasurer, and as such treasurer he gave bond in the sum of $20,000. (7) At that time (July 20, 1893) Harlan P. Kelsey was duly elected secretary of defendant corporation, and was duly inducted into that office. (8) At a meeting of the directors on July 20, 1893, the compensation of these offices, to wit, president and secretary, was fixed as follows: President, $100 per month; secretary, $25 per month. The secretary and treasurer were both ex officio members of the board of directors that so fixed their compensation. (9) It was always the custom of the defendant company to pay the actual expenses of the directors of the company in attending meetings whenever they made any charge for so doing. (10) That the receiver paid to each of these petitioners the amount due them on account of salary up to September 1, 1893, the date of his qualification as receiver and his taking charge of the property and effects of the company. (11) That, after the appointment of the receiver and his entering upon the duties of his office, the petitioner Harlan P. Kelsey was not called upon or required to perform any service whatever for the company, and did not in fact perform any service on Its account, ex-cept attendance at meetings of the stockholders. (12) That the petitioner Thomas F. Parker, after the appointment of receiver and his qualification, continued to act as president of the corporation as to all matters that seemed to require his attention, and interested himself in the affairs of the company, and in the efforts made by himself and others to extricate the corporation from its financial difficulties. He was recognized as the president of the company at the meeting of the corporation held in 1894, and he aided and assisted the receiver in his care of the affairs of the...