Roman v. Dimmick

• Citation: 22 So. 109,115 Ala. 233
• Parties: ROMAN v. DIMMICK ET AL.
• Decision Date: 19 May 1897
• Court: Supreme Court of Alabama

22 So. 109

115 Ala. 233

ROMAN v. DIMMICK ET AL.

Supreme Court of Alabama

May 19, 1897

Appeal from city court of Montgomery; John G. Winter, Judge.

Bill by Sigmund Roman against J. W. Dimmick and others. From a decree for defendants, plaintiff appeals. Reversed.

The bill sought the enforcement of a judgment in favor of the complainant against the Montgomery Iron Works, of which corporation the respondents in the present bill were stockholders and the holders of bonds, by subjecting the parties respondent to the payment of the difference between the actual value of the property put in as payment of their stock subscription and the amount subscribed, and by holding them liable upon the bonds of the corporation which were in their hands. The respondents interposed a demurrer and a motion to dismiss the bill for want of equity. Upon the submission of this cause upon this motion and demurrer, it was sustained, and the bill was ordered dismissed. From this decree the complainant appeals, and assigns the rendition thereof as error.

J. M. &amp P. W. White, for appellant.

Tompkins & Troy, for appellees.

COLEMAN J.

The appeal is prosecuted from a decree of the court dismissing complainant's bill upon the ground that it is without equity. The complainant avers in the bill of complaint that he is a judgment creditor of the Montgomery Iron Works, a corporation, and that execution issued upon his judgment which was returned "No property found." The bill avers that the defendant corporation is insolvent. The object of the bill is to hold certain stockholders and bondholders who are made respondents, liable for the satisfaction of his judgment. The right of complainant to equitable relief against the stockholders and bondholders is based upon the following statement of facts: The respondents Dimmick and Baldwin, and others, were promoters and incorporators of the defendant corporation, and fixed its capital stock at $50,000. The respondents Dimmick and Baldwin each subscribed for $5,000 of stock, and Craig for $2,500. The remainder of the stock was subscribed for by others, who (the bill avers) are totally insolvent, and for this reason are not made parties defendant. The bill avers that the capital stock was paid for by selling or turning over to the defendant corporation property of an old plant which belonged to or was controlled by the promoters and incorporators, the value of which did not exceeed $2,500; and as a part of the consideration it was understood that bonds of the face value of $50,000, in addition to the stock, were to be issued one-half of which were to be retained by the corporation, and the remaining half to be issued to the stockholders, and that nothing was paid and nothing was to be paid by the stockholders for the bonds issued to them. The conclusion of the pleader from these facts is that respondents are liable on their subscription for stock, to the creditors of the corporation, for the difference between the actual value of the property paid in as capital stock and the amount subscribed for and received by them. Complainant further concludes that these respondents are liable to creditors of the corporation for the full face value of the bonds received by them, for which they have paid nothing. The bill shows that the $25,000 of bonds retained by the corporation have been disposed of in due course of trade, but it avers that the stockholders who are made respondents have not parted with the bonds issued to and received by them. The bill contains a prayer for general relief.

So far as the bill of complaint seeks to fasten...