Pope v. Leonard

• Decision Date: 20 June 1874
• Citation: 115 Mass. 286
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: Chester Pope & another v. Frederick S. Leonard & others; Chester Pope & another v. Salamanca Oil & Refining Company & others

115 Mass. 286

Chester Pope & another v. Frederick S. Leonard & others;

Chester Pope & another v. Salamanca Oil & Refining Company & others

Supreme Court of Massachusetts

June 20, 1874

Argued January 6, 1873; November 25, 1872.

Argued March 26, 1872.

Suffolk.

Suffolk.

Demurrer sustained. Demurrer overruled.

P. H Sears, for the defendants.

L. M Child & H. B. Crandall, for the plaintiffs.

Morton, J. Ames, J., absent.

OPINION

The first case was a bill in equity filed June 3, 1870, by two judgment creditors of a corporation, against the officers and stockholders thereof, but not joining the corporation as a party defendant. The bill did not purport to be in behalf of the plaintiffs and all the other creditors of the corporation, but alleged "that the plaintiffs are the only creditors of said company known to the plaintiffs."

The grounds upon which the defendants were sought to be made liable are stated in the opinion of the court. Certain of the defendants demurred and the case was reserved on bill and demurrer by Chapman, C. J., for the consideration of the full court.

Morton J.

This is a bill in equity against the officers and the stockholders of the Salamanca Oil and Refining Company, alleged to be a manufacturing corporation established under the Gen. Sts. c. 61.

The plaintiffs seek to hold such of the defendants as are officers personally liable, upon the ground that they did not file in the clerk's office of the city of Boston the certificates required by the St. of 1862, c. 210, and also upon the ground that they signed the certificate required by the Gen. Sts. c. 61, § 8, knowing it to be false. They seek to hold the stockholders personally liable, upon the ground that the capital was never fully paid in.

We are of opinion that the demurrer must be sustained for several reasons:

1. The corporation should be made a party defendant to the suit. St. 1862, c. 218, § 4.

2. The plaintiffs' bill should be in behalf of themselves and all other creditors of the corporation.

The statute above cited gives the plaintiffs their only remedy, which is to bring a bill in equity in behalf of themselves and all other creditors of the corporation against it and the stockholders, or officers who are liable, for the recovery of the sums due to themselves and such other creditors. Moore v. Reynolds, 109 Mass. 473. The allegation that there are no other creditors known to the plaintiffs is not sufficient to excuse them from bringing their suit as required by the statute.

3. The bill is multifarious. It embraces in one suit distinct and independent matters, against several parties, who have no common interest in the distinct matter. There are two classes of defendants, the officers and the stockholders. The grounds of liability alleged against them respectively are entirely distinct, and depend upon facts wholly independent of each other. The case of Cambridge Water Works v. Somerville Dyeing & Bleaching Company, 14 Gray 193, is decisive of the point that these two claims cannot be joined in one suit. Until a bill with proper parties is presented we do not deem it necessary, if proper, to consider the other causes of demurrer.

Demurrer sustained.

The second case was a bill in equity filed June 6, 1873, by the same plaintiffs in behalf of themselves and all other creditors of the defendant corporation against said corporation and the officers thereof.

The bill alleged that the plaintiffs had on June 25, 1868, recovered judgment for a sum stated in an action at law against said corporation in a suit begun February 21, 1868; that July 14, 1868, execution issued on said judgment; that a demand was made thereon July 22, 1868, upon said corporation and the officers thereof; that for the space of thirty days next after said demand the corporation neglected to pay the amount due on the execution, and also neglected to exhibit to the officer real or personal estate of said corporation subject to be taken on said execution sufficient to satisfy said execution or any part thereof; that the execution was returned unsatisfied September 12, 1868, and that the amount of the judgment was still due.

The bill then alleged "that the said Salamanca Oil and Refining Company was organized on or about April 1, 1865, as a manufacturing corporation under the provisions of the Gen. Sts. c. 61, at Boston, and at a meeting held April 12, 1865, the defendants were elected and became officers of said corporation;' and that "the defendants did accept the offices to which they were respectively elected, and did continue to hold the same to and including February 21, 1868; and the plaintiffs are informed and believe that the said defendants were all the officers of said corporation during the time above alleged; and that at said meeting the said corporation was established in said Boston, and for the purpose of purchasing, holding, disposing of and working petroleum oil lands, and manufacturing oil."

The bill further alleged that the last instalment of the capital stock of the corporation was paid in on or before April 14 1865, and that the president and directors, with the treasurer and clerk did not make or cause to be recorded in the registry of deeds for the county of Suffolk, at any time from April 14, 1865, to and including July 31, 1868, a certificate signed and sworn to by the president, treasurer, clerk and a majority of the directors of said corporation, stating the amount of capital so fixed and paid in; that on February 21, 1868, the debts of the corporation exceeded its capital in the sum of $ 5366.66; that the defendants did not within thirty days after the date of the annual meeting held April 12, 1865, or of the annual meeting held in June, 1866, or of the annual meeting held in June, 1867, deposit with the clerk of the city of Boston, in which said corporation was established, any certificate signed and sworn to by the president and a majority of the directors of said corporation, stating the date of said annual meeting next preceding, the amount of capital stock paid in, the name of and number...