Northwestern National Bank of Minneapolis v. Mickelson-Shapiro Company
| Citation | 159 N.W. 948,134 Minn. 422 |
| Decision Date | 17 November 1916 |
| Docket Number | 19,996 - (154) |
| Parties | NORTHWESTERN NATIONAL BANK OF MINNEAPOLIS AND ANOTHER v. MICKELSON-SHAPIRO COMPANY AND ANOTHER |
| Court | Supreme Court of Minnesota (US) |
Action in the district court for Hennepin county to have the court take possession of the assets of defendant corporation and for the appointment of a receiver. From an order, Fish, J. directing a sale by the receiver, from an order, Steele, J denying an application to vacate the sale and from an order Steele, J., confirming the sale, Charles E. Johnson intervener, appealed. Affirmed.
Notice of hearing, when unnecessary.
1. A person cannot complain of want of notice of a hearing in court if thereafter, upon application made, he is heard on the merits.
Appeal and error -- attack on sale made by receiver not permitted.
2. The record does not show upon what grounds appellant opposed a confirmation of receiver's sale, neither does it indicate any deviation from the mode in which the court had ordered it to be made nor inadequacy of price, hence the order confirming the sale cannot be attacked on appeal.
Corporation -- appointment of receiver -- general equity power.
3. Subdivisions 3 and 4 of section 7892, G.S. 1913, do not limit the authority of the court in the appointment of receivers for corporations to the instances provided for in section 6634, G.S. 1913, but recognize the general equity powers of the court to appoint receivers for corporations when proper grounds are made to appear.
Corporation -- waiver of statutory prerequisites -- estoppel of appellant.
4. By admitting all the allegations of the complaint in its answer and expressly consenting to the appointment of a receiver, the defendant corporation waived the prerequisites to a receivership specified in said section 6634, viz., that no judgment had been rendered against it upon which an execution had been returned unsatisfied. And appellant, after having acquiesced in the action of the corporation and its receiver for almost two years, should not now be heard to question the jurisdiction of the court in making the appointment.
Sale by receiver -- order not improvident.
5. The record shows that a sale of all the assets of the corporation was imperative, hence the order directing such sale was not improvidently granted.
F. Alex Stewart, for appellant.
Koon, Whelan & Hempstead, for respondent.
Plaintiffs the one a creditor and the other a stockholder of the defendant, a domestic corporation, brought this action, in behalf of themselves and all others similarly situated, against the corporation and Anton Mickelson, its president, to the end that the court might take possession and control of all the assets of the defendant corporation as trust property for the benefit of plaintiffs and all others who show themselves entitled thereto, and in furtherance of that purpose appoint a receiver to take charge of the assets and business of the corporation and to restrain Mickelson from wrongfully taking and destroying its property and business and for such further relief as might be proper. The grounds for this application are quite fully set forth in the complaint. We mention only the chief facts alleged: That the corporation has built up an extensive business in the manufacture and sale of certain poisons compounded according to secret formulas; that a large part of the business and stock are in Canada; that the corporation is heavily indebted, the obligations are maturing, and it is not possible to meet these since the assets are not readily convertible into cash, so that there is imminent danger of insolvency; that Anton Mickelson, the owner of onehalf the common stock, a director and the president of the corporation, has wrongfully appropriated $2,500 of the corporation funds, and withdrawn for personal purposes $12,500 worth of the stock in trade which the corporation owns and had stored in Canada; and that for his own profit he is making use of the secret formulas, trade-name and trademarks of the corporation to the destruction of its business. The corporation answered, admitting all the allegations of the complaint. No jurisdiction was obtained of Mickelson. Upon the answer coming in, the court, on November 13, 1913, appointed a receiver to take charge of the property of the corporation, conduct its business under the direction of the court, and take the necessary legal steps to recover and conserve its property and business. After the business of the corporation had been carried on by the receiver for almost two years, during which various suits had been successfully carried on against Mickelson in the courts of Canada, to recover the property of the corporation, and to prevent him from the wrongful use of the corporation's trade-name, trade-marks, and secret formulas, the receiver made a report to the court, setting forth what had been done, and the condition of the assets, business and liabilities of the corporation. This report indicated that the interests of all concerned required that the assets and business of the corporation be disposed of, and the receiver asked that this might be ordered by the court. Upon the hearing of an order to show cause, the court, on October 12, 1915, authorized and directed the receiver to sell and dispose of all the assets and business of the corporation at public auction. A few days later, appellant, a stockholder of the corporation, obtained an order to show cause why the order of sale should not be vacated on the grounds, that he had had no notice of the hearing, that the sale was improvidently granted, and that the receiver appointed by the court's order was without power or authority to make a sale. The court, after a hearing, by an order filed on November 3, 1915, set aside the restraining order and refused to vacate the order of sale. The sale took place on the fourth day of November, 1915, the property and business being sold at public auction for $20,000; and, upon notice, the sale came before the court for confirmation on November 13, 1915, when the attorney for the receiver and the attorney for appellant appeared and were heard. By an order filed the same day, the sale was confirmed. The appeal is from each of the...
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