Spear Mining Company v. Shinn

• Decision Date: 10 January 1910
• Citation: 124 S.W. 1045,93 Ark. 346
• Parties: SPEAR MINING COMPANY v. SHINN
• Court: Arkansas Supreme Court

124 S.W. 1045

93 Ark. 346

SPEAR MINING COMPANY v. SHINN

Supreme Court of Arkansas

January 10, 1910

Appeal from Newton Chancery Court; T. Haden Humphreys, Chancellor affirmed.

Decree affirmed.

Pace & Pace, Davis & Pace, and Hamlin & Seawel, for appellant.

The Spear Mining Company and the Spear Realty Company were not responsible for the debts of the Flynn Mining Company. 37 Ark. 23; 25 Ill. 353; 42 Ia. 563. The corporations were separate and distinct, and one would not be liable for the debts of the other without an express agreement to that effect. 48 S.W. 806; 33 L. R. A. 800; 61 Wis. 20; 70 U.S 234; Angell & Ames, Corp., §§ 40, 46, 100, 591 595. There was a misjoinder of parties plaintiff. 30 Cyc 114.

G. J. Crump, for appellee.

Where the transcript fails to show all the evidence upon which a cause was heard, the presumption is that the decree is correct. 77 Ark. 187; 58 Ark. 135; 45 Ark. 312; 88 Ark. 318, 322. A misjoinder of plaintiffs is waived unless taken advantage of in the trial court. Kirby's Dig., §§ 6093, 6096; 75 Ark. 288; 66 Ark. 560; 88 Ark. 589; 71 Ark. 47.

OPINION

FRAUENTHAL, J.

The plaintiffs below, T. J. Shinn & Company, the Boone County Hardware Company, and Charles Hill, were creditors of the Flynn Mining Company, a domestic corporation; and they instituted this suit in the Boone Chancery Court on behalf of themselves and all other creditors of said corporation who might join with them in the action, seeking to recover judgments for their several debts against all the defendants below. These defendants are the said Flynn Mining Company and the Spear Mining Company, which is a domestic corporation, and the Spear Realty Company, which is also a domestic corporation, and certain individuals who were officers of the Flynn Mining Company. In their complaint the plaintiffs set out the several debts due by the Flynn Mining Company to each of them; and they alleged that the stockholders and officers of the three corporations were the same, and that each corporation was succeeded by and merged into the other; that the Flynn Mining Company became largely indebted to various creditors, and turned over all its properties and assets to the two other corporations, and in effect went out of existence. They alleged that the two latter corporations, upon taking and receiving said property and assets, agreed to pay the liabilities of the Flynn Mining Company, and that these two corporations had failed to pay said liabilities or to account for said property and assets so received by them. They sought to discover these assets and to enforce the agreement made by the two latter corporations to pay the indebtedness of the Flynn Mining Company by recovering judgments for their debts against these two latter corporations, as well as against the Flynn Mining Company. They also alleged that the individual defendants had, by legal contract entered into by them, bound themselves and had become liable for said indebtedness of the Flynn Mining Company.

No other creditors of the Flynn Mining Company joined in this suit, and the total amount of the indebtedness due by the Flynn Mining Company to all the plaintiffs was $ 823.71.

The individuals who were made defendants herein filed no answer or other pleading; and judgment by default was rendered against them.

The three corporations filed separate answers, which were substantially the same in their denials and allegations. They admitted that the Flynn Mining Company was indebted to the plaintiffs as alleged in the complaint; but denied that the stockholders and officers of the three corporations were the same, or that the Flynn Mining Company was merged in the two latter corporations. They alleged that the Spear Mining Company had purchased from the Flynn Mining Company all its properties at the price of $ 1,100, and had assumed and agreed to pay that amount only of the indebtedness of the Flynn Mining Company; that it had paid out a portion of said purchase price, and that it was willing and ready to pay into court the balance of said purchase money. They denied that the two latter corporations had assumed all the liabilities of the Flynn Mining Company, or that they were responsible therefor; and they alleged that the three corporations were distinct and separate organizations.

The testimony of the plaintiffs was taken by depositions; and they finished taking their testimony on May 22, 1908. After this the defendants notified the plaintiffs that they would take the depositions of their witnesses on June 6, 1908, but they did not do so. About September 5, 1908, the attorney of the defendants sent by mail to the attorney of the plaintiffs certain interrogatories to which he requested him to append cross-interrogatories, in order that the testimony of the witnesses of the defendants could be taken thereon. The attorney of the defendants claimed that these were not returned to him in time to take the depositions of the defendants' witnesses before the day upon which the court in which the case was pending convened. That court convened on September 21, 1908, and the case was called for trial in that court on September 23, 1908. On that day the defendants moved the court to continue the trial of the case upon the ground that they had not taken any testimony, and in order that they might do so. In this motion they set out the names of the witnesses whose depositions they desired to take and what they expected to prove by them. The court overruled the motion to continue the case.

The plaintiffs took the testimony of John A. Bunch, who was the treasurer of the Flynn Mining Company, and of J. C. Bunch, who was a member of the Spear Mining Company, and the secretary of the Spear Realty Company; and these two persons had been actively engaged in the management of these respective corporations.

From their testimony it appears that with a few exceptions the three corporations were formed and composed of the same individuals, and were in effect under the management of the same persons; and that the place of business of each corporation was at Yardell, Arkansas. The Spear Mining Company was the owner of certain mining property, consisting of land, buildings and machinery, which was used in mining zinc, lead and other minerals. On January 20, 1904, it leased the land and fixtures to the Flynn Mining Company for a term of ten years in consideration of certain royalties which should be paid to it from the operation of the mine. The Flynn Mining Company acquired certain personal property, and conducted its mining operations until August 4, 1904, when it turned over to said Spear Mining Company all its properties and assets and said lease. On that date the Flynn Mining Company was indebted to various creditors in sums aggregating $ 2,000. The personal property of the Flynn Mining Company was estimated on that date to be of the value of $ 1,100; and all this property was turned over to the Spear Mining Company upon the agreement made by the latter corporation that it would assume and pay off that amount of the indebtedness of the Flynn Mining Company. The Spear Realty Company was incorporated on October 6, 1904, and took over all the assets of the Spear Mining Company and the property which had been received by the latter corporation from the Flynn Mining Company; and it took said property with the understanding and agreement that "the Spear Realty Company was to settle the indebtedness of the Flynn Mining Company to the extent of $ 1,100."

John A. Bunch, the treasurer of the Flynn Mining Company, testified that the said corporations had not paid said $ 1,100 in liquidation of the indebtedness of the Flynn Mining Company, and had not accounted therefor.

The chancery court rendered a decree in favor of the plaintiffs for their said debts and against the three corporations; and from that decree said defendants prosecute this appeal.

1. It is urged by the defendants that the chancery court erred in refusing to continue the case. It has been uniformly held by this court that a motion for a continuance is addressed to the sound discretion of the trial court; and that this court will not attempt to control that discretion unless it has been manifestly abused.

In the case of Watts v. Cohn, 40 Ark. 114, it is said: "Questions as to the trial or continuance of causes rest so much in the sound discretion of the trial court that it must be a very capricious exercise of power or a very flagrant case of injustice that the appellate court will interpose to correct."

In the case of Puckett v. State, 71 Ark. 62, 70 S.W. 1041, this court said: "Continuances are largely in the discretion of the court, and...