Lime City Bldg. v. Ass'n v. Black
| Decision Date | 15 December 1893 |
| Citation | 35 N.E. 829,136 Ind. 544 |
| Court | Indiana Supreme Court |
| Parties | LIME CITY BLDG., LOAN & SAV. ASS'N v. BLACK. |
OPINION TEXT STARTS HERE
Appeal from circuit court, Huntington county; E. C. Vaughn, Judge.
Action by Harvey C. Black against the Lime City Building, Loan & Savings Association to recover the value of certain shares of stock of defendant corporation issued to plaintiff, and for the appointment of a receiver. From a judgment for plaintiff, defendant appeals. Affirmed.J. M. Hatfield and Kenner & Lesh, for appellant. Milligan & Cook, for appellee.
This was a suit brought by the appellee against the appellant to recover the value of six shares of the stock in said association, alleged to belong to appellee, and have a receiver appointed for said association, to wind up its affairs. The complaint was in two paragraphs; the second being filed some time after the commencement of the suit, in which new parties defendant are made. There was a demurrer to each paragraph of the complaint overruled. Answer in six paragraphs, the first of which is a general denial. A demurrer to each of the second, third, fourth, fifth, and sixth paragraphs of answer was overruled as to the second, and sustained as to the third, fourth, fifth, and sixth paragraphs. Reply in three paragraphs, the first of which is a general denial. A demurrer to the first and second paragraphs of the reply was overruled. Trial by the court, finding for appellee as against the appellant, upon which appellee had judgment over a motion for a new trial, and a receiver was appointed for appellant; and the cause, as to the new parties brought in by the second paragraph of the complaint, was dismissed by appellee. The errors assigned call in question the action of the trial court in overruling a demurrer to the complaint, sustaining the demurrer to the third, fourth, and fifth paragraphs of the answer, overruling the demurrer to the second and third paragraphs of the reply, overruling the motion for a new trial, and question the sufficiency of the complaint, and the propriety of appointing a receiver.
The substance of the first paragraph of the complaint is that appellant was organized on the 5th day of May, 1879, as a corporation, under the laws of the state of Indiana, with articles of association and by-laws and rules of business, all of which are set out in the body of the complaint. The fourth article provided that “this association shall continue in operation eight years, unless the funds of the association shall be sufficient to pay all debts and to redeem all stock in a shorter time.” It is provided that the capital stock of the association shall be 500 shares, of $150 each, and that dues are to be paid by each shareholder or member, of 25 cents per share, each week, until the value of each share should be $150, and that on the said 5th day of May, 1879, appellee purchased and became the owner of six shares of the capital stock of said association; that he paid his weekly dues of 25 cents on each share from the date of purchase until the ----- day of -----, 1889, and all fines and assessments made against him as such stockholder; that he paid into said association, as dues and interest, the sum of $628.50, and that, at said date to which dues were paid, said shares were of the face value of, viz. $150 per share, or a total value of $900, and are of the value of $900; that he has received no interest or dividends on said shares of stock, but he says that said association, by its board of directors, who have the management and control of the affairs of said association, have fraudulently and illegally paid out to a majority of the stockholders of said association the sum of $155 per share of stock, and have paid out to other stockholders the sum of $135 per share of said stock. The exact number who have received these sums, plaintiff cannot give, for the reason that the books and papers of said association are in the hands of the secretary thereof, who refuses to allow this plaintiff to examine them. And plaintiff further avers that said association had paid all the stockholders from $135 to $150 per share, except plaintiff; that he has demanded payment of his shares of stock as other stockholders were paid, but defendant refused and still refuses to pay this plaintiff more than $135 on one of his shares, and absolutely refuses to pay him anything whatever on his five remaining shares of stock; that there is now due and unpaid from said corporation to this plaintiff, on account of said shares owned by him, the sum of $1,000; that there is now due said corporation from the stockholders a large amount in dues, which said association refuses to collect, the exact amount of which this plaintiff is unable to give, for the reason that said association, and the secretary thereof, fraudulently conceal the books of said association. And the plaintiff now asks the court to compel the defendant to recover back from the stockholders of said association the sums illegally and fraudulently paid them, and that the defendant be required to give a complete and full statement of all stock issued, the amount of dues collected on each share,-in short, to make a true and complete accounting of all receipts and disbursements of said association from its organization until the present time, and that the defendant be ordered to pay plaintiff on account of said shares, etc. “* * * And plaintiff avers that said corporation having been organized on May 5, 1879, and limited to eight years from said date, and the three years given by statute within which to close up the affairs of the said corporation may expire before said collections can be fully made, settlement had of the affairs of said association; and plaintiff now asks the court to appoint a receiver to collect all sums due said corporation, and recover back all said sums wrongfully paid out by said corporation, or the officers thereof, and for all other and further relief.” The second paragraph is substantially the same as the first, except that it makes the officers of the corporation parties defendant, and does not ask the appointment of a receiver. As already observed, there having been no finding either for or against such officers, the cause was dismissed as to them, and even prior to that time the subsequent pleadings treated the second paragraph of the complaint as abandoned; and, inasmuch as the finding and judgment seem to be based on the first paragraph, the ruling was harmless, even if erroneous in overruling the demurrer to the second paragraph of the complaint. If a judgment is based wholly on a paragraph of a complaint that is good, errors in overruling a demurrer to other paragraphs, that are bad, will not be considered. Railroad Co. v. Van Slike, 107 Ind. 480, 8 N. E. 269;Tracewell v. Farnsley, 104 Ind. 497, 4 N. E. 162;Railway Co. v. Gaines, 104 Ind. 526, 4 N. E. 34, and 5 N. E. 746;Martin v. Cauble, 72 Ind. 67;Blasingame v. Blasingame, 24 Ind. 86.
The complaint was filed and the suit begun on the 12th day of April, 1890. The receiver was appointed on the 15th day of June, 1892. The appellant was organized as a corporation, under the laws of the state of Indiana, on the 5th day of May, 1879, and its corporate existence was limited by its articles of association to eight years after that time. The judgment was rendered on the 22d day of February, 1893,-more than the eight years limited for the corporate life of appellant since its incorporation, and more than three years allowed by statute for closing up the affairs of the corporation after the expiration of appellant's charter. And it is claimed that, the corporate existence of appellant having expired before that part of the first paragraph of the complaint asking for a receiver was inserted therein, the same was fatally defective, because it showed that the corporation was defunct, could neither sue nor be sued, and that debts remaining due to and from it are totally extinguished. If that is the true status of appellant, and was at the time the receiver was asked for, then such debts are extinguished, and the first paragraph of the complaint was and is bad. Conwell v. Pattison, 28 Ind. 509;Cunningham v. Clark, 24 Ind. 7. Section 3006, Rev. St. 1881, provides that “all corporations whose charters shall expire by limitation, forfeiture or otherwise shall nevertheless be continued bodies corporate for three years after the time they would have been so dissolved, for the purpose of prosecuting and defending suits to which they are a party, and to enable them to settle, dispose of and convey their property and divide the capital stock, but not to continue the business for which such corporations were established.” Section 3012, Rev. St. 1881, provides that, “when the charter of any corporation shall expire, the circuit court of the county in which such corporation has its principal place of business, on application of any creditor, stockholder or member thereof, within the said three years, may appoint one or more persons to be receivers or trustees of such corporation, to take charge of the estate and effects, collect the debts and property due and belonging to the corporation, with power to prosecute and defend, in the name of the corporation or otherwise, all suits for the purposes aforesaid, and to appoint agents, and do all other acts which might be done by such corporation, and the power of such receivers may be continued beyond the said three years, and as long as the court shall think necessary for the purposes aforesaid.”
To establish appellant's contention that the first paragraph of the complaint is bad, it is first contended that a proper construction of the last section quoted requires, not only that the complaint asking for the appointment of a receiver must be filed before the expiration of the charter, eight years next ensuing the organization, and the additional three years allowed by section 3006, supra, but the receiver must...
To continue reading
Request your trial