Porter v. Sherman Cnty. Banking Co.
| Decision Date | 15 February 1893 |
| Citation | 54 N.W. 424,36 Neb. 271 |
| Parties | PORTER v. SHERMAN COUNTY BANKING CO. ET AL. |
| Court | Nebraska Supreme Court |
1. The evidence being in writing, and practically undisputed, as to the amount due the plaintiff, a verdict for a sum greatly less cannot be sustained.
2. W. and T. were conducting a private bank at L., and on November 1, 1887, organized a corporation with an alleged capital of $50,000, of which they retained a controlling interest. They turned over the deposits and assets of the private bank to the new corporation, and notes were taken from a number of the stockholders for the amount of their stock. Held, that the stockholders were liable for the unpaid stock held by each, and for a sum equal to the shares so held by each for all liabilities of the bank accruing while he was a stockholder.
3. The proof tends to show a de facto corporation, and not a partnership.
4. The debts having been contracted by the bank before it was in default, the provisions of sections 136 and 139 of the corporation law do not apply.
5. Where there is a misjoinder of causes of action, which plainly appears on the face of the petition, the adverse party should demur for that cause. If he fails to do so, he will waive the defect.
Error to district court, Sherman county; Hamer, Judge.
Action by Samuel S. Porter against the Sherman County Banking Company and others to recover money due on account. Plaintiff had judgment for a sum much less than was claimed by him, and brings error. Reversed.Nightingale Bros., for plaintiff in error.
G. M. Lambertson and J. R. Scott, for defendants in error. J. H. Broady, amicus curiae.
This is an action against the banking company, and several stockholders thereof, to recover the sum of $3,817.85, with interest. The cause of action is set forth in the petition as follows: “(3) There is due plaintiff from said defendant the Sherman County Banking Company, on an account current, the sum of $48.97. The following is a copy of said account, with all credits, to wit:
--No part thereof has been paid, though often demanded. (4) The defendants Ezra S. Hayhurst, Lyman J. Tracy, John Hogue, Milton A. Theis, Edward E. Whaley, H. J. Shupp, Charles A. Wheeler, William H. Morris, James K. Pearson, Joel R. Scott, Charles W. Gibson, and William R. Mellor were, at the time of contracting said debt by the Sherman County Banking Company, defendant, stockholders of said corporation, and still are, and at all times since November 1, 1887, have been, stockholders of said corporation. The said corporation made an assignment for the benefit of creditors on December 26, 1888, and is wholly insolvent. [The last sentence is an amendment inserted by leave of court, June 20, 1889.] The said Sherman County Banking Company, defendant, is not a duly organized and duly incorporated company under the laws of the state of Nebraska, but has wholly failed to comply with the provisions of chapter 16, Comp. St. Neb., in relation to giving notice, and other requisitions of organization, and has failed to comply with general provisions of law governing corporations. Such failure to comply with the law is specifically set forth as follows, to wit: (a) The articles of incorporation of said Sherman County Banking Company, as filed and recorded in the county clerk's office of said county of Sherman, and state of Nebraska, do not set forth the time and conditions on which the capital stock of said corporation is to be paid in. (b) No notice of the incorporation or organization of said Sherman County Banking Company was ever published by said corporation in any newspaper near the principal place of business of said corporation. (c) No copy of the by-laws of the corporation, with the names of the officers appended thereto, was ever posted in a conspicuous place at the place of doing business of said corporation in Loup City, Neb., subject to public inspection. (d) No notice of the amount of all the existing debts of said corporation was ever printed and published in any newspaper, signed by the president and a majority of the directors of said corporation, since the time of commencing business of said corporation, on November 1, 1887, until the present time. (e) The capital stock of said corporation was not fully described at the date of filing the articles of incorporation of said Sherman County Banking Company in the county clerk's office of said county, nor at any time thereafter. (f) The capital stock of said corporation was not paid for in cash, but about 400 shares of said capital stock, representing a nominal value of $40,000, were paid for with the notes of said stockholders, payable to the order of said corporation, and part of the remaining $10,000 worth of said capital stock was paid for with real estate, which said corporation had no power to take and hold, and with worthless notes and securities belonging to Edward E. Whaley and Milton A. Theis, formerly partners, and doing business as bankers, under the firm name of the Sherman County Banking Company, and only a very small portion of said capital stock was paid for with cash, to wit, about $3,000. (g) No quarterly statement, under oath, of the assets and liabilities of said corporation, was ever made and published by said corporation, as required by section 7, art. 11, of the constitution of the state of Nebraska, entitled ‘Corporations,’ subdivision ‘Miscellaneous Corporations.’ (6) By reason of the failure of said corporation defendant to comply with the provisions of law as set forth in paragraph 8, the defendants Ezra S. Hayhurst, Lyman J. Tracy, John Hogue, Milton A. Theis, Edward E. Whaley, H. J. Shupp, Charles A. Wheeler, ...
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Porter v. Sherman County Banking Company
...274 SAMUEL S. PORTER v. SHERMAN COUNTY BANKING COMPANY ET AL No. 4612Supreme Court of NebraskaApril 17, 1894 REHEARING of case reported in 36 Neb. 271. REVERSED AND Nightingale Bros., for plaintiff in error. G. M. Lambertson and J. R. Scott, contra. OPINION IRVINE, C. This case is before us......