Mitchell v. Banking Corp., No. 6238.

Docket NºNo. 6238.
Citation81 Mont. 459
Case DateFebruary 04, 1928

81 Mont. 459

MITCHELL et al.
v.
BANKING CORPORATION OF MONTANA et al.

No. 6238.

Supreme Court of Montana.

Feb. 4, 1928.


Appeal from District Court, Lewis and Clark County; W. H. Poorman, Judge.

Action by Grace Mitchell and others against the Banking Corporation of Montana, Claude C. Gray, as receiver of the Banking Corporation of Montana, and others. Judgment dismissing the action, and plaintiffs appeal. Appeal dismissed without prejudice.

See, also, 77 Mont. 134, 251 P. 151.


C. E. Pew, of Helena, for appellants.

E. C. Day, Paul W. Smith, David R. Smith, Ulysses A. Gribble, Stewart & Brown, F. W. Mettler, Edward Horsky, George W. Padbury, Jr., H. S. Hepner, T. B. Weir, Harry P. Bennett, R. R. Purcell, Walsh & Nagle, W. D. Rankin and J. Miller Smith, all of Helena, S. C. Ford, of Great Falls, Loble & Adair, of Helena, G. W. Pierson and Brown, Wiggenhorn & Davis, all of Billings, G. Y. Patten, Walter Aitken, H. M. Stewart and H. A. Bolinger, all of Bozeman, Clark T. Brown, of Washington, D. C., Walter L. Pope, of Missoula, Clark Legal Dept., of Butte, Jones & Jones, of Harlowton, John G. Skinner, of Red Lodge, Robert L. Clinton and Black & MacDonald, all of Shelby, Arnot & Doyle, of Conrad, Gilbert, Gilbert & McFadden, of Dillon, George W. Magee, of Choteau, S. P. Wilson and W. E. Keeley, both of Deer Lodge, Freeman, Thelen & Frary, of Great Falls, Roy E. Ayers, of Lewistown, J. A. McDonough, of Great Falls, O'Hara & Madeen and J. D. Taylor, all of Hamilton, and M. M. Duncan, of Virginia City, for respondents.


MATTHEWS, J.

This is an appeal from a judgment dismissing plaintiffs' action upon the merits, entered after the court had sustained demurrers to the complaint and plaintiffs had refused to plead further.

The Banking Corporation, being then insolvent, failed to open for business on May 2, 1923, and thereafter Claude C. Gray was duly appointed its receiver and has since been steadily engaged in winding up its affairs.

On February 28, 1922, the stockholders of the institution passed a resolution purporting to reduce the capital stock of the corporation from $500,000, divided into 5,000 shares of the par value of $100 each, to $250,000, divided into 2,500 shares of the par value of $100 each.

During his administration receiver Gray has enforced the statutory stockholders' liability on the basis of the reduced capital stock, and from this source and others has paid dividends amounting to 15 per cent. of the proved indebtedness of the institution. Plaintiffs made demand upon the receiver that he enforce an additional liability of the same amount upon the theory that the attempted reduction of the capital stock was abortive and void, and therefore each of the stockholders held double the number of shares on which liability had been enforced. The receiver refused to comply with the demand made upon him, and also refused to join in a suit for the purpose of enforcing such additional liability, and thereupon the plaintiffs secured an order of court permitting them to bring such an action and to join the receiver as a party defendant.

Action was commenced on February 27, 1925, on behalf of the plaintiffs and all creditors of the Banking Corporation similarly situated. The complaint filed named all holders of certificates of stock on February 28, 1922, just prior to the passage of the resolution of reduction, as defendants, thus making over 400 individuals, firms, and corporations defendants in the action, and on June 9, 1925, an amended complaint was filed. Service was secured upon approximately 300 defendants, leaving about 100 unserved. Of those served, many failed to appear, and, at the time judgment was entered, had made no appearance, but no defaults had been entered against them.

The only answer filed was that of the Banking Corporation and Receiver Gray, which answer is in the nature of an admission of the allegations of the complaint, a showing that all of the amount prayed for in the complaint will be necessary in order to make payment of a part of the indebtedness of the corporation, and that, under no circumstances, will the receiver be able to pay the creditors in full; it closes with the prayer that plaintiffs have judgment.

One defendant made formal appearance, but neither demurred to, nor answered, the complaint. Seventy-three demurrers, joined in by upwards of 250 defendants, represented by forty-odd individuals and firms of attorneys, were filed and on presentation were sustained by the court. Plaintiffs were given 20 days in which to further plead, but refused to do so, and thereupon judgment was rendered dismissing the action in toto upon the merits.

On appealing from the judgment, plaintiffs entitled their notice of appeal as they did their complaint, thus naming all persons served and unserved and whether appearing or not, but they addressed it “to the above named defendants who have appeared herein and to their attorneys,” and, having filed the notice, served it only upon the attorneys for the appearing defendants. No default was then, nor has yet been, entered against any defendant served with process although the statutory time for their appearance had expired prior to the entry of judgment.

The defendants served with the notice have moved to dismiss the appeal on the ground that this court is not vested with jurisdiction by reason of the following fatal defects and omissions in perfecting the appeal: (a) That the notice of appeal is addressed to but a part of the defendants; and (b) is thereby rendered vague, indefinite, and incomplete in that it cannot be determined therefrom which defendants are made respondents, which were served with process and did not appear, and which ones were not served; (c) that the defendant who made formal appearance was not served with notice of appeal; (d) that all persons named as defendants and not served with process should have been served with notice of the appeal, and likewise (e) all persons served with process and who did not appear should have been served with notice of the appeal.

1. An appeal is authorized by statute only. Tuohy's Estate, 23 Mont. 305, 58 P. 722. Section 9733, Revised Codes of 1921, declares that:

“An appeal is taken by filing with the clerk of the court in which the judgment or order appealed from is entered, a notice stating the appeal from the same, or some specific part thereof, and serving a similar notice on the adverse party, or his attorney.”

The use of words in the singular include the plural (sections 16 and 10713, Rev. Codes 1921); therefore section 9733 above must be considered in this matter as though it provided that the notice of appeal must be served upon each of the adverse parties, or on all adverse parties, and their attorneys.

2. An “adverse party,” within the meaning of the statute, is “a party to a judgment whose rights may be injuriously affected by its reversal or modification” (T. C. Power & Bro. v. Murphy et al., 26 Mont. 387, 68 P. 411), or “one...

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19 practice notes
  • Brownell v. Adams, No. 27682.
    • United States
    • Nebraska Supreme Court
    • May 29, 1931
    ...254; Crease v. Babcock, 10 Metc. (Mass.) 525; Vick v. Lane, Hazlehurst & Co., 56 Miss. 681;Mitchell v. Banking Corporation of Montana, 81 Mont. 459, 264 P. 127. We have held that where two defendants are jointly liable, summons for one may be sent to another county from the one in which......
  • Halverson v. Hageman, No. 49547
    • United States
    • United States State Supreme Court of Iowa
    • October 14, 1958
    ...finds support in Balkins v. Norrby, 61 Cal.App.2d 413, 142 P.2d 958, 960, and citation; Mitchell v. Banking Corporation of Montana, 81 Mont. 459, 264 P. 127, 130; Drake Lumber Co. v. Lindquist, 179 Ore. 402, 170 P.2d 712, [249 Iowa 1392] (3) Plaintiff contends it does not appear the overrul......
  • State ex rel. Lewis & Clark Cnty. v. Dist. Court of First Judicial Dist. In, No. 6831.
    • United States
    • Montana United States State Supreme Court of Montana
    • June 22, 1931
    ...and for further details reference may be made to the reports of the case of Mitchell v. Banking Corporation of Montana, to be found in 81 Mont. 459, 264 P. 127, and 83 Mont. 581, 273 P. 1055. Upon the creditors' suit being remanded to the trial court for further proceedings, notice was sent......
  • Mitchell v. Banking Corp., No. 6325.
    • United States
    • Montana United States State Supreme Court of Montana
    • February 6, 1929
    ...attempted to appeal from the judgment, but the attempt was abortive and was dismissed in February, 1928 (Mitchell v. Banking Corporation, 81 Mont. 459, 264 P. 127), and thereafter, within the statutory time, this appeal was taken. 1. Defendants have interposed a motion to strike certain por......
  • Request a trial to view additional results
19 cases
  • Brownell v. Adams, No. 27682.
    • United States
    • Nebraska Supreme Court
    • May 29, 1931
    ...254; Crease v. Babcock, 10 Metc. (Mass.) 525; Vick v. Lane, Hazlehurst & Co., 56 Miss. 681;Mitchell v. Banking Corporation of Montana, 81 Mont. 459, 264 P. 127. We have held that where two defendants are jointly liable, summons for one may be sent to another county from the one in which......
  • Halverson v. Hageman, No. 49547
    • United States
    • United States State Supreme Court of Iowa
    • October 14, 1958
    ...finds support in Balkins v. Norrby, 61 Cal.App.2d 413, 142 P.2d 958, 960, and citation; Mitchell v. Banking Corporation of Montana, 81 Mont. 459, 264 P. 127, 130; Drake Lumber Co. v. Lindquist, 179 Ore. 402, 170 P.2d 712, [249 Iowa 1392] (3) Plaintiff contends it does not appear the overrul......
  • State ex rel. Lewis & Clark Cnty. v. Dist. Court of First Judicial Dist. In, No. 6831.
    • United States
    • Montana United States State Supreme Court of Montana
    • June 22, 1931
    ...and for further details reference may be made to the reports of the case of Mitchell v. Banking Corporation of Montana, to be found in 81 Mont. 459, 264 P. 127, and 83 Mont. 581, 273 P. 1055. Upon the creditors' suit being remanded to the trial court for further proceedings, notice was sent......
  • Mitchell v. Banking Corp., No. 6325.
    • United States
    • Montana United States State Supreme Court of Montana
    • February 6, 1929
    ...attempted to appeal from the judgment, but the attempt was abortive and was dismissed in February, 1928 (Mitchell v. Banking Corporation, 81 Mont. 459, 264 P. 127), and thereafter, within the statutory time, this appeal was taken. 1. Defendants have interposed a motion to strike certain por......
  • Request a trial to view additional results

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