Spring Garden Bank v. Hulings Lumber Co.
| Decision Date | 07 March 1889 |
| Citation | 9 S.E. 243,32 W.Va. 357 |
| Parties | SPRING GARDEN BANK v. HULINGS LUMBER CO. |
| Court | West Virginia Supreme Court |
Submitted January 22, 1889.
Syllabus by the Court.
After the corporators had signed an agreement to become a corporation, and before the charter had been obtained, a deed conveying land to such corporation by name was signed and acknowledged by the grantor, and delivered to a third party with directions to retain it until the corporation obtained its charter and organized, and then to deliver it to the corporation; and, after the charter had been received, and the corporation organized under it, such third person delivered the deed to, and it was accepted by, the corporation. Held, the said deed operated as a valid conveyance of said land to the corporation from the date of the delivery of said deed to it.
Appeal from circuit court, Tucker county.
C Heydrick, J. J. Davis, and L. D. Strader, for appellant.
C. C. & W. L. Cole, for appellee.
SNYDER Presiding.
On December 7, 1886, the Spring Garden Bank, a Pennsylvania corporation, sued out of the clerk's office of the circuit court of Tucker county an attachment against the estate of Marcus Hulings, a non-resident of this state, and caused the same to be levied upon a number of tracts of land lying in the counties of Tucker and Randolph, in this state. At the January rules, 1887, the said Spring Garden Bank suing on behalf of itself and other attachment creditors exhibited its bill in said circuit court against the said Marcus Hulings, the Hulings Lumber Company, F. W. Mitchell, and others, to set aside a deed dated January 2, 1885, made by said Marcus Hulings to the said Hulings Lumber Company, purporting to convey to it the lands attached as aforesaid, and to subject said lands to the payment of certain debts due to the plaintiff and others from said Marcus Hulings. The bill assails said deed upon two grounds: First, that there was no such body or corporation as The Hulings Lumber Company, mentioned in the deed as grantee, at the time the deed was made; and, second, that the said deed was voluntary, and made for the purpose of delaying and defrauding creditors. Answers were filed by the defendants, and depositions taken, upon which the cause was heard, and a decree entered, September 7, 1887, holding the said deed to be void, and referring the cause to a commissioner, to ascertain and report the liens on said lands, etc. Upon the incoming of the commissioner's report, the court, on May 14, 1888, made a decree fixing the amounts and priorities of the various liens on said lands, and directed a sale thereof. From this decree and that of September 7, 1887, the defendant the Hulings Lumber Company obtained this appeal.
The facts disclosed by the record appear to be as follows: During the years 1882, 1883, and 1884, Marcus Hulings purchased certain timber lands, and took options to purchase other lands, in the counties of Tucker and Randolph, along or near the Cheat river and its tributaries. On some of said lands he paid parts of the purchase money, the whole amount paid by him not exceeding $10,000, and obtained deeds therefore giving his notes for the balance, amounting in the aggregate to about $50,000, which were secured by vendor's liens retained in the deeds. On other portions of the lands he paid nothing, and for others still he had no deeds. By a written agreement dated April 30, 1884, the said Marcus Hulings, his son, Willis J. Hulings, and John E. Butler entered into copartnership under the name of Hulings & Co., for the purpose of dealing in petroleum, manufacturing lumber, and buying, selling, holding, and dealing in lands, and building and operating saw-mills, etc., and carrying on a general lumber business. The said Marcus Hulings, for the consideration stated in said agreement, sold to his son and said Butler a two-thirds interest in all of said lands and options, thus making the said Marcus Hulings, Willis J. Hulings, and the said Butler, each the owner of one-third of said lands, subject to the vendor's liens existing thereon; and on the same day the said Marcus Hulings, by a contract in writing, bound himself to convey all of said lands subject to the said vendor's liens to a trustee, to be appointed by the said firm of Hulings & Co., as soon as surveys thereof could be completed, and the titles passed upon by counsel. The said firm at once entered into the possession of said lands, and began to operate them in the lumber business, and purchased other lands with partnership funds, taking the title in the name of said Marcus Hulings, who was to convey the whole of said lands to a trustee, when appointed as designated in said agreement. The said firm also took up a large number of the notes which had been given by said Marcus Hulings for said lands. Before the conveyance of said lands, or the selection of a trustee to whom they could be conveyed, the said firm of Hulings & Co. decided to become an incorporate body, and that said conveyance should be made to said corporation instead of to a trustee. Accordingly, on January 2, 1885, the parties duly executed an agreement to become a corporation of the state of West Virginia by the name of the "Hulings Lumber Co.," and on the same day, but subsequent to the execution and filing of said agreement, the said Hulings & Co., by a writing duly signed by said firm, agreed that they would "cause to be conveyed unto said corporation" all the aforesaid lands to which Marcus Hulings held the title, and also the mills and other property that had been acquired by said firm in the lumber business subsequent to the date of the aforesaid agreement of April 30, 1884. In pursuance of this writing or contract of January 2, 1885, a deed was written, signed, sealed, and acknowledged by Marcus Hulings and wife, conveying to the Hulings Lumber Company all of said lands, subject to the vendor's liens still existing upon them for unpaid purchase money, amounting to over $30,000. This deed was placed in the hands of John E. Butler, with the understanding that he was to deliver it to the Hulings Lumber Company as soon as it should be organized, and issued stock in payment for said lands to the corporators. On February 20, 1885, a certificate of incorporation was issued by the secretary of state of West Virginia for said corporation, and on March 28, 1885, the stockholders met and duly organized, and elected a board of directors, and on the same day the board of directors met and elected the following officers: Willis J. Hulings, president; John E. Butler, treasurer; and D. W. Osborne, secretary. At said meeting the president and secretary were authorized to issue $150,000 of the capital stock of the corporation in payment for said lands, and thereupon, at said meeting, John E. Butler delivered said deed, and it was duly accepted by the corporation, and the capital stock issued and delivered in payment for said lands. The corporation took possession of the lands, engaged largely in the lumber business, paid off part of the outstanding notes for the purchase money, and induced F. W. Mitchell & Co. to take up the balance, and executed a trust-deed on said lands, dated February 6, 1886, to secure F. W. Mitchell & Co. for the purchase notes so paid by them. The said deed to the Hulings Lumber Company was duly recorded in Tucker county on April 3, 1885, and in Randolph county on April 20, 1885; and the said trust-deed to secure F. W. Mitchell & Co. was duly recorded in said counties prior to ...
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