Luikart v. Paine
| Decision Date | 27 February 1934 |
| Docket Number | 28843 |
| Citation | 253 N.W. 86,126 Neb. 251 |
| Parties | E. H. LUIKART, RECEIVER, APPELLANT, v. J. E. PAINE ET AL., APPELLEES |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Logan county: BRUNO O. HOSTETLER JUDGE. Affirmed.
AFFIRMED.
Syllabus by the Court.
1. Constitutional double liability of stockholders in banking corporations was, prior to the amendment of 1930, a secondary liability to be enforced only after assets had been exhausted and the amount due on liability had been judicially determined.
2. Stockholders' double liability in banking corporations is contractual obligation and by construction constitutional provisions in effect at the time of purchase of corporate stock are material parts thereof.
3. State Constitution changing procedure in suit on contractual liability does not impair obligations of contract and is applicable to existing contracts.
4. The nature and extent of bank stockholders' double liability is determin able under constitutional provisions extant when stock is purchased.
5. Suit against stockholders to recover double liability on bank stock purchased prior to 1930 amendment (Const. art. 12, § 7), brought before corporate assets exhausted and exact amount justly due judicially ascertained, is premature and should be dismissed.
Appeal from District Court, Logan County; Hostetler, Judge.
Suit by E. H. Luikart, receiver of the Farmers' State Bank Stapleton, Neb., against J. E. Paine, first real name unknown, and others. From the judgment, plaintiff appeals.
Affirmed.
F. C. Radke, Barlow Nye, G. E. Price and Bert L. Overcash, for appellant.
Squires, Johnson & Johnson and Henry E. Dress, contra.
Heard before GOSS, C. J., ROSE, GOOD, EBERLY, DAY, and PAINE, JJ., and MEYER, District Judge.
This is a suit to collect the constitutional double liability of stockholders in the Farmers State Bank of Stapleton. The trial court decreed that the suit was prematurely brought, because the assets of the bank had not been exhausted, and dismissed the cause of action. The receiver appeals.
The Stapleton bank was organized in 1925, when all the capital stock was subscribed and purchased. None of the stock has been held by the bank since organization. At the time of the purchase of the stock, the constitutional stockholders' double liability was provided as follows:
"Every stockholder in a banking corporation or institution shall be individually responsible and liable to its creditors over and above the amount of stock by him held to an amount equal to his respective stock or shares so held, for all its liabilities accruing while he remains such stockholder," etc. Const. art. XII, sec. 7.
"In all cases of claims against corporations and joint stock associations, the exact amount justly due shall be first ascertained, and after the corporate property shall have been exhausted the original subscribers thereof shall be individually liable to the extent of their unpaid subscription, and the liability for the unpaid subscription shall follow the stock." Const. art. XII, sec. 4.
These provisions have been construed together for the determination of the stockholders' liability in banking corporations. The constitutional double liability of stockholders in banking corporations was, prior to the amendment of 1930, a secondary liability to be enforced only after assets had been exhausted and the amount due on liability had been judicially determined. State v. German Savings Bank, 50 Neb. 734, 70 N.W. 221; Farmers Loan & Trust Co. v. Funk, 49 Neb. 353, 68 N.W. 520; Bodie v. Pollock, 110 Neb. 844, 195 N.W. 457; State v. Farmers State Bank, 113 Neb. 497, 203 N.W. 629; Rogers v. Selleck, 117 Neb. 569, 221 N.W. 702.
Stockholders' double liability in banking corporations is contractual obligation and by construction constitutional provisions in effect at the time of purchase of corporate stock are material parts thereof. Allen v. White, 103 Neb. 256, 171 N.W. 52; Brownell v. Adams, 121 Neb. 304; Bourne v. Baer, 107 Neb. 255, 185 N.W. 408; Rogers v. Selleck, 117 Neb. 569, 221 N.W. 702. This has been the holding in so many cases that it is impractical to cite all of them. It is the general rule. 14 C. J. 843.
In 1930, section 7, art. XII of the Constitution, was amended to read as follows (the change is shown in italics): ...
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