Meyer v. Bristol Hotel Co.

• Decision Date: 07 May 1901
• Citation: 63 S.W. 96,163 Mo. 59
• Parties: MEYER v. BRISTOL HOTEL CO. et al.
• Court: Missouri Supreme Court

63 S.W. 96

163 Mo. 59

MEYER v. BRISTOL HOTEL CO. et al.

Supreme Court of Missouri, Division No. 2.

May 7, 1901.

CORPORATIONS — STOCKHOLDERS — ACTIONS — DEFENSE — PARTIES.

1. Where, in an action against a corporation to recover on a contract debt, a person asks to be admitted to defend on the ground that plaintiff claims such person is a stockholder, and seeks the judgment so as to enforce it against him, as, if a stockholder, he is the only solvent one, while, by a true construction of the law, he believes he is not a stockholder, the petition should be denied, since he should not be permitted to exercise the right of a stockholder in defending the suit unless he admits that he is one.

2. Where, in an action against an insolvent corporation to recover a debt, a person asks to be admitted to defend as administrator on the ground that among the assets of the estate coming into his hands was a large amount of stock of such company, his application should be refused, since it does not appear that his intestate was owner of the stock, or that it had not been fully paid, and hence was nonassessable.

3. Where, in an action against a corporation to recover a debt, the defendant answers, admitting the allegations of the complaint, stockholders should not be admitted to defend by interposing the defense of limitations, on the ground that the company is insolvent, and the directors have employed counsel to answer admitting plaintiff's allegations, since such action on their part is not fraudulent, and the directors are under no obligations to protect stockholders who have not paid for their stock from being required to pay the balance due on their subscriptions.

Appeal from St. Louis circuit court; Jacob Klein, Judge.

Action by John P. Meyer against the Bristol Hotel Company and others. From a judgment for defendants, plaintiff appeals. Reversed.

This is an action by John P. Meyer, as the assignee of a note executed by D. C. Thatcher to Hudson E. Bridge in part payment of a certain leasehold and personal property in the city of St. Louis. Thatcher, it is alleged in the petition, by written agreement sold the leasehold and personal property to the Bristol Hotel Company, a corporation, and the said company assumed and agreed to pay the said note at its maturity as a part of its obligation to Thatcher. The corporation was served, and by its counsel answered that the allegations of the petition were true. Before judgment was entered for the plaintiff, however, Judson M. Thompson, for himself, and William C. Richardson, as administrator of D. C. Thatcher, deceased, moved the court to be made defendants in said action. The application of Judson M. Thompson is in the words and figures following:

"Circuit Court, City of St. Louis. Room No. 1. John P. Meyer, Plaintiff, vs. Bristol Hotel Company, Defendant. No. 1,827. Now, at this day comes Judson M. Thompson, and moves the court for an order allowing him to be made a party defendant in the above-entitled cause, for the following reasons: First. Because the said Bristol Hotel Company is utterly insolvent, and unable to respond to a judgment should one be rendered against it in this case, and the stockholders of said company are insolvent, except as hereinafter set forth. That plaintiff is prosecuting this cause with a view to obtain a judgment against defendant, and to have an execution issued thereon and returned nulla bona for the purpose of proceeding by motion against this mover, who plaintiff claims to be a stockholder of said Bristol Hotel Company, to subject him to the payment of any judgment which may be obtained in this case. That while plaintiff believes that upon a true interpretation of the law and facts he is not a stockholder of said company, but he says that the St. Louis court of appeals in the case of August K. Farrar against this mover, and the case of S. T. Hauser, trustee, against this mover, has decided in both cases that this mover was a stockholder of said Bristol Hotel Company, and mover was obliged to pay the judgments rendered in said cause, which were not appealable to the supreme court of this state, and mover's relation to said Bristol Hotel Company has not been altered since the production of said two suits against said Bristol Hotel Company and this mover, yet it is a matter of grave doubt, and, if it should be held by the supreme court of Missouri that he was a stockholder, he is entirely responsible, and should be the only person interested in defending this suit. Second. That the directors of said company are unfriendly to mover, and have appointed counsel to represent said company in said suit, and instructed him to file an answer admitting the truth of plaintiff's petition; and said Thompson has just been informed that the counsel employed by said directors of said Bristol Hotel Company in said cause has filed an answer admitting the truth of all the allegations in the petition of plaintiff, and that he is informed and believes that the said defendant corporation has one or more good and substantial defenses to said cause of action, which, if properly pleaded, would defeat same; and this mover agrees to give bond to indemnify said defendant against all costs and expenses of defending said suit if this motion is granted. Wherefore, in consideration of the premises, said Judson M. Thompson moves the court for leave to appear and file an answer for and on behalf of said corporation, as well as on his own behalf, to the alleged causes of action set up in plaintiff's petition. Campbell & Ryan, Attorneys for Mover, Judson M. Thompson. Judson M. Thompson.

"Subscribed and sworn to before me this 15th day of May, 1896. Thomas B. Rodgers, Clerk."

— Which motion, over the objection and exception of plaintiff, was sustained, and plaintiff duly excepted. Application was made by William C. Richardson, administrator of D. C. Thatcher, to be made a defendant, substantially like that of Judson M. Thompson, save that he...