Spargo v. Converse
| Decision Date | 13 November 1911 |
| Docket Number | 92. |
| Citation | 191 F. 823 |
| Parties | SPARGO v. CONVERSE. |
| Court | U.S. Court of Appeals — Second Circuit |
J. C Chamberlain, for plaintiff in error.
Wm Waldo Hyde and Charles Welles Gross, for defendant in error.
Before LACOMBE, COXE, and NOYES, Circuit Judges.
The question presented by the demurrer to the answer is whether an assessment, made by a court having jurisdiction, upon the stockholders of an insolvent corporation, is valid against the estate of a stockholder, if made after his death. Armenia H. Simmons was the owner of 80 shares of the capital stock of the Minnesota Thresher Manufacturing Company, of the par value of $80 each. This company became insolvent and a receiver was duly appointed. Two assessments were ordered by the District Court of Minnesota against the said Simmons, one on December 22, 1902, for 36 per cent. and the other on June 11, 1907, for 64 per cent., or $32 per share. On November 25 1906, Armenia H. Simmons died, and Edward C. Spargo, the defendant, was appointed her executor. The question here arises regarding the second assessment of June, 1907, which was made after her death, it being the theory of the defendant that the assessment was invalid, because the proceeding was conducted in the same manner that it would have been had the stockholder actually been alive, the notice being sent to her instead of to her executor. We think this position cannot be sustained. The proceeding under the Minnesota law is, in a sense, a proceeding in rem. It provides for an assessment against each share of stock and for the payment of the amount so assessed. Whoever is the lawful owner and holder of the stock must pay the amount. While he is the lawful owner he is entitled to all the advantages, and must suffer all the disadvantages incident to such holding. If the stock earns dividends he will receive them; if it be assessed to pay losses, he must pay them. The proceeding in Minnesota was against a corporation, which represented its stockholders, and the receiver complied with the order and followed the direction of the court. Notice was sent to all persons whose names and addresses were known to the receiver. The judgment of the Minnesota court cannot be disregarded. It is conclusive as to the insolvency of the corporation and that the assessment of 64 per cent. was necessary to enable it to pay its debts. The stockholders whether holding individually or in a representative capacity, were liable for the amount so assessed. The law of Minnesota (Rev. Laws 1905, Sec. 3186) provides that:
'Such an order shall be conclusive as to all matters relating to the amount, propriety, and necessity of the assessment against all parties therein adjudged liable upon, or on account of any stock or shares of such corporation, whether...
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Marin v. Augedahl
...Swing v. Red River Lumber Co. 105 Minn. 336, 117 N.W. 442; Straw & E. Mfg. Co. v. L. D. Kilbourne Boot & Shoe Co. supra; Spargo v. Converse, 112 C. C. A. 337, 191 F. 823; Neff v. Lamm, 99 Minn. 115, 108 N.W. 849, and cited; Ward v. Joslin, 186 U.S. 142, 46 L. ed. 1093, 22 S.Ct. 807; Swing v......
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...234 U. S. 652, 34 S. Ct. 926, 58 L. Ed. 1518, Ann. Cas. 1917A, 104; Hale v. Hardon, 95 F. 747, 37 C. C. A. 240; Spargo v. Converse, 191 F. 823, 112 C. C. A. 337; In re M. Stipp Const. Co., 221 F. 372, 137 C. C. A. 180; Rosoff v. Gilbert Transp. Co. (D. C.) 221 F. 972, 979; Howarth v. Lombar......
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Irvine v. Baker
...and the presence of the corporation is the presence of the stockholder for the purpose of the making of the assessment. Spargo v. Converse, 191 F. 823, 112 C.C.A. 337; Hamilton v. Simon (C.C.) 178 F. 130; Goss Carter, 156 F. 746, 84 C.C.A. 402; Bernheimer v. Converse, 206 U.S. 516, 27 Sup.C......
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...of stockholders is commensurate with that of the corporation itself and extends to costs and interest on the judgments.' In Spargo v. Converse (C.C.A.) 191 F. 823, it was 'The validity of an assessment made by a court of Minnesota against the stockholders of an insolvent corporation under R......