Scott v. Gittings
| Decision Date | 08 April 1915 |
| Docket Number | 36,37,,38. |
| Citation | 94 A. 209,125 Md. 595 |
| Parties | SCOTT v. GITTINGS. STATE v. SAME. MAYOR AND CITY COUNCIL OF BALTIMORE v. SAME. |
| Court | Maryland Court of Appeals |
Three Appeals in one Record from Circuit Court of Baltimore City Walter I. Dawkins, Judge.
Action by William Force Scott and others against John S. Gittings receiver. From an order overruling exceptions filed to an auditor's account, appeals were taken on behalf of the State, and on behalf of the Mayor and City Council of Baltimore, and by William Force Scott, assignee in bankruptcy. Appeals dismissed.
John Dix Nock, of Baltimore, Edgar Allan Poe, Atty. Gen., and Carville D. Benson, of Baltimore, for the State.
Leigh Bonsal and Joseph C. France, both of Baltimore, for appellant Scott. S. S. Field, City Sol., of Baltimore, for appellant Mayor and City Council of Baltimore.
Richard S. Culbreth, of Baltimore, for appellees.
Charles McH. Howard, of Baltimore (Venable, Baetjer & Howard and Bernard Carter & Sons, all of Baltimore, on the brief), for stockholders.
Stuart S. Janney, of Baltimore (Ritchie, Janney, Griswold & Hamilton, of Baltimore, on the brief), for Baltimore Trust Co.
The record in this case contains three appeals from an order of the circuit court of Baltimore city by which certain exceptions which had been filed to an auditor's account were overruled, and that account finally ratified and confirmed. One of these appeals was taken on behalf of the state of Maryland, another on behalf of the mayor and city council of Baltimore, and the third by William Force Scott general assignee in bankruptcy, acting especially for James Watson Webb and for Tilley Allen, and Charles B. Peabody and Henry C. Little, substituted trustees under a deed of trust from George Peabody. The last exceptions, in their amended form, are conditional, and are only to be considered in the event of the contention in the first two appeals being sustained.
Motions have been made to dismiss the appeals of the state of Maryland and of the mayor and city council of Baltimore, and, in our opinion, those motions should be granted. The questions involved in these two appeals are the same, but in view of the large amount of litigation to which the fund in this controversy has given rise, it seems proper to review as concisely as may be the facts out of which the litigation has arisen, and then consider the questions of law presented by the claims made on behalf of the city and state.
In 1838 there was issued by the George's Creek Coal & Iron Company a certificate for 100 shares of its stock in the name of "Morris Robinson, Agent," and in 1841 there was issued a certificate for 41 shares of the same stock in the name of "Tilley Allen, in Trust." There was no entry whatever upon the books of the George's Creek Company to indicate for whom Morris Robinson was agent, or for whom Tilley Allen was trustee, or the nature of the trust. Neither at the time of the issue of these certificates nor for a long period thereafter was the stock a paying one. No dividend of any description was declared or paid to the stockholders until the year 1864, and from that time on dividends were regularly declared and paid to the stockholders, once or twice in stock, but generally in cash. No one, however, appeared to claim any of the dividends declared upon the stock so standing in the names of "Robinson, Agent," or "Allen, in Trust." The certificates of the stock dividends and the cash of the cash dividends remained in the hands of the George's Creek Company up until the time of the dissolution of that company, and in the course of the 40-odd years which elapsed from the time when the declaration of dividends was begun the aggregate of those dividends amounted to a very considerable sum, approximately, for the two holdings, to $90,000.
In 1910 Malcolm V. Tyson filed a bill in the circuit court No. 2 of Baltimore city, as administrator of Rohinson, deceased, the purpose of which was to have delivered and paid over to him the stock and accumulated dividends upon the stock standing in the name of "Morris Robinson, Agent." The decision in that case is reported in 115 Md. 564, 81 A. 41, where this court held that, as Tyson was suing in the representative capacity of an administrator, he could recover only such property as had belonged to Robinson individually, and that the addition of the word "Agent," as it appeared on the stub of the certificate, indicated that the stock and dividends for which his bill was filed were not the property of Robinson personally, and therefore that his personal representative was not entitled to have delivered to him any stock or other property which Robinson may have held in a fiduciary capacity, such as an agent.
The next step in the litigation was the case of the Baltimore Trust Co. George's Creek Coal & Iron Co., 119 Md. 21, 85 A. 949. That suit was brought by the Baltimore Trust Company, as receiver for the Tilley Allen stock, and in that case the pleadings alleged the belief of the plaintiff that no trust ever existed in respect to said stock, but that the same belonged to him individually. The receiver had been appointed without notice to the George's Creek Company, and in that case it was held: First, that the pleadings did not disclose any sufficient reason for the appointment of a receiver without notice to the George's Creek Company; and, second, that the plaintiff had not shown any such legal or equitable interest in the subject-matter of the petition as to warrant it in asking for the appointment of a receiver.
The third suit was a bill filed by certain stockholders of the George's Creek Company asking that the circuit court of Baltimore city assume jurisdiction over the dissolution of that company, steps looking to that end having been previously taken by the corporation without judicial proceedings, and asking, further, that receivers might be appointed to take charge of and distribute the assets of the corporation, and wind up its affairs. In that bill it was alleged that it was probable that the stock standing in the name of "Robinson, Agent," was held by him as an agent of the corporation, and it asked that the value of that stock and the dividends accumulated thereon should be divided among the remaining stockholders in proportion to their respective holdings; and with regard to the Allen stock it was alleged that, if the proceedings instituted by the Baltimore Trust Company was successful, the George's Creek Company would be divested of the possession of said accumulated fund, although the lawful ownership of the same might remain unestablished, to the injury of the plaintiffs and other stockholders in the George's Creek Company. In this case a decree was entered on the 26th of January, 1914, dissolving the George's Creek Company, and appointing John S. Gittings, the present appellee, receiver.
A further attempt to secure the stock and accumulated dividends in the "Robinson, Agent," branch of this case was made in a bill filed in the circuit court No. 2 of Baltimore city, by Charles B. Peabody et al., Trustees, v. George's Creek Coal & Iron Co., reported in 120 Md. 659, 87 A. 1097. This case was brought upon the theory that the stock in question was the property of James Watson Webb; that said Webb was indebted to the Bank of the United States in the sum of $3,090, upon his note dated May 23, 1839, and that the stock which stood in the name of "Robinson, Agent," had been delivered as collateral security for this note at the time of its negotiation with the Bank of the United States, and that it passed to the trustees of that bank under the deeds of June 7, 1841, was uncollected by them, and passed by their deed of May 21, 1855, to Samuel Jaudon and others, the stock being a part of the unadministered assets of the bank; that subsequently, on December 31, 1866, all of the then unadministered assets of the Bank of the United States were disposed of by Jaudon and others, trustees, to George Peabody, and that on September 28, 1869, George Peabody transferred to George Peabody Russell and others, as trustees, all of the remaining assets of the United States Bank then held by him. In the auditor's account filed in 1855 was contained a list of assets then in the hands of Jaudon and others, as trustees. In that list of assets appears the entry, "J. Watson Webb, $3,090," but without mention of the collateral, and to the petition for the order under which Jaudon and others made their sale to Peabody was appended a schedule which was said to contain a "full statement of all of the said assets yet remaining in the hands of your petitioners," but in this schedule neither the note of James Watson Webb nor any collateral deposited with it appeared. In the case of Peabody v. George's Creek Co. this court held that the evidence adduced failed to show sufficiently that the 100 shares of George's Creek stock had passed to George Peabody in December, 1866, and therefore the plaintiffs in that action failed to recover the stock and dividends which had been declared on it.
The case of Scott v. George's Creek Co. was instituted in the United States District Court for Maryland (see 202 F. 251) and the purpose of that suit was to recover the Tilley Allen stock, upon the theory that Allen had been adjudicated a bankrupt by the United States District Court of the Southern District of New York in 1842, and that Scott, as official or general assignee in bankruptcy, was entitled to any of the property of the bankrupt not theretofore reduced to possession by a bankrupt assignee. It further raised the question of the bona fides of the trust, claiming substantially that there was no trust in fact, but that such designation was for the purpose of concealing the...
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