Pierce v. Scott
| Decision Date | 05 April 1940 |
| Citation | 195 So. 160,142 Fla. 581 |
| Parties | PIERCE v. SCOTT et al. |
| Court | Florida Supreme Court |
Suit by Anna M. Pierce against Wynn W. Scott and others, as directors of Racine Groves, Inc., and against Racine Groves, Inc., for the appointment of a receiver to take charge of the assets of the corporation and preserve them pending suit, that a temporary injunction be issued restraining the defendants from further dealing with assets of the corporation pending final hearing, that accounting be made by the officers and directors of the corporation, and that on final hearing the court should decree such distribution of the assets as the stockholders should be found entitled to receive. From an adverse judgment, the plaintiff appeals.
Affirmed. Appeal from Circuit Court, Polk County; W. J Barker, Judge.
B. M Skelton, of St. Petersburg, for appellant.
W Wallace Shafer, of Haines City, for appellees.
This is an appeal from a final decree entered on March 10, 1939, by Hon. W. J. Barker, then Judge of the Circuit Court in and for Polk County, Florida, in a chancery case wherein Anna M. Pierce was the plaintiff and Wynn W. Scott, Erna M. Scott and W. Curtis Scott, as Directors of Racine Groves, Inc., a Florida corporation, and the corporation itself were the defendants, and also from a certain order made by said Judge on July 6, 1939, denying plaintiff's petition to vacate the judgment and execution.
It appears from the record that the corporation was insolvent its liabilities, exclusive of capital stock outstanding, exceeding its total gross assets by several thousand dollars. The principal creditor, Mrs. Erna M. Scott, was a stockholder and director of the corporation. Notice was given of a special stockholder's meeting, which notice specifically stated that one of the purposes for which the meeting was called was the liquidation of the corporation and the distribution of its assets received from the sale of the corporation's property. The complainant in the court below, Mrs. Anna M. Pierce, received the notice of such meeting, but she did not attend, nor was she represented at the meeting. The resolution adopted at the meeting of the stockholders for the winding up of the corporation did not strictly comply with the statutes governing the dissolution of corporations and the distribution of their assets. If this had been done, the creditors of the corporation would necessarily have had to be protected first before any distribution was made to the stockholders, and in this case it appears that under such procedure the stockholders would have received nothing. But by the method agreed to at the stockholders' meeting, the principal creditor, by waiving a substantial portion of the debt due her by the corporation, made it possible for the stockholders to receive a substantial proportion of the face or par value of their stock. All of the stockholders except Mrs. Pierce, the complainant, were satisfied with the settlements made with them, but Mrs. Pierce, evidently not believing that the debt due by the corporation to Mrs. Erna M. Scott was a bona fide indebtedness, refused the amount offered to her and filed a bill in equity in said court against said three directors and the corporation, praying the appointment of a receiver to take charge of the assets of the corporation and preserve the same pending the suit, that a temporary injunction be issued by the court restraining the defendants from further dealing with the assets of the corporation pending final hearing, that an accounting be made by the officers and directors of the corporation, and that upon final hearing the court should decree such distribution of the assets as the stockholders be found entitled to receive. An answer to the bill was filed by the defendants and considerable testimony taken. The evidence was very fairly and accurately reviewed in the final decree, and the unusual situation presented was dealt with by the chancellor in a very fair...
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