Morgan v. New York Nat. Bldg. & Loan Ass'n

• Decision Date: 13 July 1900
• Citation: 46 A. 877,73 Conn. 151
• Court: Connecticut Supreme Court
• Parties: MORGAN v. NEW YORK NAT. BUILDING & LOAN ASS'N.

46 A. 877

73 Conn. 151

MORGAN

v. NEW YORK NAT. BUILDING & LOAN ASS'N.

Supreme Court of Errors of Connecticut.

July 13, 1900.

Case reserved from superior court, New Haven county; George W. Wheeler, Judge.

Action by A. R. Morgan against the New York National Building & Loan Association, a New York corporation. Reserved in the superior court of New Haven county for advice of the supreme court of errors on a plea in abatement, filed by the receivers of defendant, setting up a dissolution of the corporation and asking the vacation of a writ of attachment. Advice given that attachment be dissolved.

On July 27, 1899, in a suit by the people of the state of New York against the corporation, in the supreme court of that state, praying for its dissolution, temporary receivers were appointed; and on July 31st, in a suit by a stockholder and creditor of the corporation against it, brought in the Unitec States circuit court for the district of Connecticut, the same persons were appointed ancillary receivers, and it was ordered that the defendant be enjoined from disposing of any of its property, except by transferring it to them. The persons named as receivers qualified as such under each of these decrees, and the corporation thereupon conveyed to them the real estate attached. On December 9th the same persons were, by a decree of the supreme court of New York, appointed permanent receivers, and the corporation was dissolved, and its corporate rights, privileges, and franchises forfeited. The receivers also qualified under this decree. On March 9, 1900, they applied to the superior court for leave to enter a special appearance in this action, for the purpose of pleading in abatement and procuring an order vacating the attachment. The plaintiff opposed this application, claiming that they ought not to be allowed to appear, Unless generally, but it was granted (George W. Wheeler, Judge). They then entered such a special appearance, and pleaded the facts above stated as to the proceedings in the other courts; asking that (1) the suit abate, and (2) the attachment lien be vacated. A demurrer to the plea and also to the claims for judgment having been filed, the case was reserved for the advice of this court.

Henry G. Newton and Harrison Hewitt, for plaintiff. Edward H. Rogers, for receivers of defendant.

BALDWIN, J. (after stating the facts).An attachment of property on mesne process is a mode of obtaining security for the satisfaction of any judgment which the plaintiff may finally recover. In the case at bar the plaintiff can never recover judgment on his demand. His suit is in personam, and the defendant was an artificial person, whose existence has been terminated by authority of the same government from which it was originally derived. An attachment in a suit against a natural person is dissolved by his death, notwithstanding the entry by his administrator to defend, and a judgment duly rendered against the latter. Green v. Barker, 14 Conn. 431, 432, 435. The same principle governs the disposition of attachments where the defendant is an artificial person which is dissolved pending the action. Wilcox v. Insurance Co., 56 Conn. 468, 476, 16 Atl. 244; Bank v. Colby, 21 Wall. 609, 615, 22 L. Ed. 687. An attaching creditor must stand upon his legal right. He claims a preference over other creditors, and he can only obtain it by complying with the statutory conditions. One of these is his recovery of a final judgment against the party whose property he subjected to the lien, and another is an attempt to collect it on execution from the judgment debtor. There can be no judgment or execution against the dead. Flynn v. Morgan, 55 Conn. 130, 138, 10 Atl. 466; Mumma v. Potomac Co., 8 Pet. 281, 287, 8 L. Ed. 945. This is true alike as respects domestic and foreign corporations. The capacity of suing and being sued is possessed by corporations only by law; by foreign corporations, only because of their existence by force of foreign law. If there is no such law, there is no such capacity. The state which grants a corporate franchise has exclusive and supreme power to withdraw it, whatever may be the effect of its so doing on property rights which may have been acquired under the laws of other governments. Hart v. Railroad Co., 40 Conn. 524, 539. The laws of New York provide that, if a corporation be dissolved pending an action against it, the court may, on application, make an order in such action for its continuance. This is a statute affecting judicial procedure in actions pending in another state. No order of such a nature has been made by the superior court in this action, and none could have been. The decree of dissolution pronounced by the supreme court of New York was unqualified. It is entitled, under the laws of the United States, to the same effect here which it has there; and it is settled by judicial decision in New York that its statute as to continuances does not, in the absence of any order of court, avail to prolong the existence of the corporation. McCulloch v. Norwood, 58 N. Y. 562; Marstaller v. Mills, 143 N. Y. 398, 38 N. E. 370. But the attachment would have been dissolved, although the...