Metcalf v. Arnold

• Decision Date: 26 May 1896
• Citation: 20 So. 301,110 Ala. 180
• Parties: METCALF ET AL. v. ARNOLD ET AL.
• Court: Alabama Supreme Court

20 So. 301

110 Ala. 180

METCALF ET AL. v. ARNOLD ET AL.

Supreme Court of Alabama

May 26, 1896

Appeal from city court of Montgomery; Jere N. Williams, Judge.

Bill by Francis R. Arnold and others against H. B. Metcalf and others. From a decree overruling their demurrer to the bill respondents appeal. Affirmed.

The bill in this case was filed by the appellees, who were judgment creditors, for the benefit of themselves and all other creditors of the Metcalf Drug Company who might desire to come in and make themselves parties. The bill avers that complainants recovered a judgment against H. B. Metcalf and F. G. Weatherly, who were doing business under the firm name of H. B. Metcalf, and that executions on each of said judgments were issued, and returned "No property found." It was further averred in the bill that after the debts which were the bases of the judgment in favor of each of the complainants were contracted, and while said H B. Metcalf and F. G. Weatherly were indebted to complainants and other creditors, the said H. B. Metcalf and F. G Weatherly were conducting a drug business in the city of Montgomery, Ala., and had a large stock of goods and assets in said business, none of which were exempt to them, or either of them; that after the creation of the indebtedness to the complainants, but prior to the rendition of the judgment in their favor, "the said H. B. Metcalf and F G. Weatherly, with the intention to hinder, delay, and defraud" complainants and other of their creditors attempted to form a corporation, with a capital stock of $8,000, and put into the said corporation, as its only capital stock, the stock of goods, wares, and merchandise and notes and accounts, which were the assets of the firm of H. B. Metcalf; that "said H. B. Metcalf and F. G. Weatherly, carrying out their hitherto formed intention of hindering, delaying, and defrauding complainants and their other creditors, had the stock of said corporation, consisting of eighty shares, of the par value of $100 each, issued as follows: 36 shares, of the par value of $3,600, to A. P. Metcalf, the wife of H. B. Metcalf; 18 shares, of the par value of $1,800, to H. B. Metcalf; 17 shares, of the par value of $1,700, to M. M. Weatherly, the wife of F. G. Weatherly; and 9 shares, of the par value of $900, to F. G. Weatherly." It was further averred that the corporation so attempted to be formed was known and called the Metcalf Drug Company, but that the said A. P. Metcalf and M. M. Weatherly had no interest whatever in the effects put into the formation of the capital stock of said corporation; that all of said property put into the said corporation belonged to H. B. Metcalf and F. G. Weatherly, doing business in the firm name of H. B. Metcalf; and that the property so put into the corporation constituted all, or substantially all, of the property belonging to said firm, and to each member thereof, upon which property the complainants had an equitable lien for the payment of their debts. It was further averred "that on, to wit, April 18, 1894, by a collusion between H. B. Metcalf and F. G. Weatherly and a small creditor of theirs, a judgment was allowed to be taken against the said defendants H. B. Metcalf and F. G. Weatherly, in a justice court, for an amount less than one hundred dollars, upon which judgment execution was issued, and levied upon 17 shares of stock in the name of H. B. Metcalf, and 8 shares in the name of F. G....