Nichols v. Taunton Safe Deposit & Trust Co.

• Decision Date: 23 November 1909
• Citation: 89 N.E. 1035,203 Mass. 551
• Parties: NICHOLS et al. v. TAUNTON SAFE DEPOSIT & TRUST CO. et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

203 Mass. 551

89 N.E. 1035

NICHOLS et al. v. TAUNTON SAFE DEPOSIT & TRUST CO. et al.

Supreme Judicial Court of Massachusetts, Suffolk.

November 23, 1909

COUNSEL

F. S. Hall (G. F. Williams, on the brief), for plaintiffs.

Geo. A Sweetser, for respondents Baker and others.

S. D Conant, for respondents Walker and others.

W. R Bigelow, for respondent C. H. Conant.

OPINION

LORING J.

1. Unless the personal liability of stockholders in trust companies subject to Rev. Laws, c. 116, depends upon one set of facts when the personal liability is enforced by a creditor, and upon another set of facts when it is enforced by a receiver, the decision of this court in Priest v. Essex Hat Manuf. Co., 115 Mass. 380, is fatal to the maintenance of this suit.

In Priest v. Essex Hat Manuf. Co., as in the case at bar, the return on the execution was made on the day on which the demand under it was made upon the corporation. In deciding that case Wells, J., speaking for this court, said : 'Section 4 provides that 'after the execution shall be so returned, the judgment creditor, or any other creditor, may file a bill in equity, in behalf of himself and all other creditors.' This shows conclusively that the return of the execution contemplated by the statute is its return unsatisfied after the neglect of the corporation for the period of 30 days, which alone warrants a return upon which the creditors can proceed against directors or stockholders. One alternative allowed to the corporation is, at any time within the 30 days, to exhibit to the officer property that he may take upon the execution. This implies that the execution is to remain in his hands for that purpose; and before the directors or stockholders can be proceeded against, his return must show default in this respect. In the present case, the return, having been made on the same day with the first demand, not only fails to show that the execution remained unsatisfied at the end of the 30 days thereafter, but shows affirmatively that the opportunity was not kept open for 30 days for the corporation to exhibit property that might be taken upon it. We think this is a step in the process which must be taken by formal proceedings, and cannot be supplied by proof that the corporation neglected to pay the debt, made no attempt to exhibit property, and had none to exhibit. The omission cannot be regarded as immaterial because it does not affect the equity of the case. The liability does not rest upon equity, but is of strict statute imposition.'

The statute under consideration in Priest v. Essex Hat Manuf. Co. was St. 1862, p. 189, c. 218, § 3, and is the very act which is embodied to-day in Rev. Laws, c. 110, § 60.

The return in the case at bar, made on the day of the demand although in fact filed in court more than 30 days later, does not satisfy the statute in requiring a 'return unsatisfied after the neglect of the corporation for the period...