State ex rel. Gentry v. Bray
| Decision Date | 02 August 1929 |
| Docket Number | 26649 |
| Citation | 20 S.W.2d 56,323 Mo. 562 |
| Parties | The State ex rel. North Todd Gentry, Attorney-General, v. Daniel Bray, Thomas L. Healy, C. F. Roberts, Wilbur J. Mansfield, Earl K. Townsdin, and Monarch Transfer & Storage Company |
| Court | Missouri Supreme Court |
Rehearing Granted, Reported at 323 Mo. 562 at 574.
Dismissed.
Stratton Shartel, Attorney-General, for relator; W. W Graves, Manvel H. Davis and Ira B. Burns of counsel.
(1) The relator excepts to the finding of the special commissioner that the burden of proof is upon the State. Sec. 2981, R. S 1919; State ex rel. v. Hogan, 163 Mo. 43. (2) The commissioner put a wrongful value (a) upon the lumber and materials, (b) upon the motor equipment and (c) upon the real estate, and accepted and considered incompetent in arriving at the value of the real estate. Sherwood v. Elevated Railroad Co., 12 N.Y.S. 852; Stephens v. Springer, 22 Mo.App. 375; Newton v. Armstrong, 19 N.Y.S. 573; In re Gilroy, 49 N.Y.S. 798; Dubuol v. Railroad Co., 111 Ill. 499; St. Louis v. Ry. Co., 266 Mo. 694, 182 S.W. 750; State v. American Canning Co., 4 S.W.2d 448; Coleman v. Booth, 268 Mo. 64, 186 S.W. 1021; Hess Heating & Ventilating Co. v. Elevator Co., 217 S.W. 500; Van Cleve v. Berkey, 143 Mo. 109.
R. R. Brewster, James R. Page, and Carl L. Crocker for respondent.
(1) The information shows upon its face that it is an action for penalty and forfeiture; that defendant was incorporated and its charter granted more than ten years before the commencement of this action. Defendant is not charged with violating the law in the conduct of its business. There is nothing stated in the information that tolls the statute of limitations. Secs. 1318, 1343, 1316, R. S. 1919; State v. Lumber Co., 260 Mo. 212, 284; State ex rel. v. Westport, 116 Mo. 595; Wood v. Carpenter, 101 U.S. 135. (2) The report and findings of the special commissioner should be affirmed because of the failure of the relator to serve his brief and abstract within the time provided in the rules of the Supreme Court. Rules 33, 15, 12, Supreme Court Rules; Rose v. Rose, 128 Mo. 576; Taylor v. Hospital Assn., 2 S.W.2d 804; Rule 16, Supreme Court Rules. (3) The report and findings of the special commissioner should be affirmed because of the fact that there is nothing before this court under the relator's brief for this court's consideration, in as much as said relator did not set out in said brief a statement in numerical order of the points relied upon by him as provided in Rule 15 of the Supreme Court Rules. Coe v. Greenley, 295 Mo. 664; Vahldick v. Vahldick, 264 Mo. 529; Mahmet v. Radiator Co., 294 S.W. 1014. (4) The commissioner properly held that the burden of proof was upon the relator. State ex inf. Attorney-General v. Hogan, 163 Mo. 43; State ex rel. v. Societe Republicaine, 9 Mo.App. 114; State v. Kupferle, 44 Mo. 154; State ex rel. Walker v. Talbot, 123 Mo. 69; State ex inf. v. Standard Oil Co., 218 Mo. 324; State ex rel. v. Grimm, 220 Mo. 483; State ex inf. v. Railroad, 206 Mo. 28; 22 R. C. L. 719, 716, par. 41; Highs Extraordinary Legal Remedies (3 Ed.) 628. (5) In a proceeding of this type the State must prove not only that stock was issued for fictitious values, but that the acts of the corporation in so issuing such stock, and in so placing fictitious valuation upon the property taken in payment for such stock, was a wilful or fraudulent misuser, or that it was due to culpable negligence. 8 Fletcher's Cyc. Corporations, 89, par. 5471; People v. Bristol & R. Turnpike Road, 23 Wend. (N. Y.) 222; State ex rel. v. School of Osteopathy, 76 Mo.App. 439; State ex rel. v. Societe etc., 9 Mo.App. 114; State ex inf. v. Jockey Club, 200 Mo. 34; 9 Fletcher's Cyc. Corporations 9099, par. 5482. (6) The commissioner committed no error in estimating the value of the real estate. (a) There was no error in his estimate of the actual physical value of the realty. (b) No error was committed by the commissioner in his consideration of the elements properly going to make up the fair cash value of the real estate. Beebe v. Hatfield, 67 Mo.App. 609; Red Wing Malting Co. v. Willcuts, 15 F.2d 626; 28 C. J. 730; Washburn v. Wall-Paper Co., 81 F. 17; King v. Railway Co., 20 N.W. 135; Coleman v. Booth, 268 Mo. 64; Hodde v. Hahn, 283 Mo. 320. (7) The commissioner committed no error in finding that the fair cash value of all the motor equipment owned by respondent company on September 14, 1920, was $ 20,875.
Blair, J. All concur, except Walker, J., absent.
This is an original proceeding by quo warranto, instituted by the Attorney-General of this State, seeking the ouster from its corporate franchise of Monarch Transfer & Storage Company, a corporation organized under the laws of this State and doing a general transfer and storage business at Kansas City. Our preliminary writ issued returns were filed on behalf of said corporation and by Bray et al., directors thereof, all of whom were named as respondents. Informant, designated as relator in the information and hereafter so referred to, filed answer to the several returns of respondents. Thereafter Honorable Nelson E. Johnson was appointed as special commissioner of this court, with authority to report his findings of fact and conclusions of law. Said commissioner heard all the evidence and has filed his report. The case has been briefed and argued and is thus before us for decision.
Respondents embodied in their brief a motion for an order of this court affirming the findings of the special commissioner and dismissing relator's exceptions thereto, because relator failed to comply with our rules by serving upon respondents his printed abstract of the record thirty days before the case was set for hearing. Rule 33, taken in connection with Rules 12 and 16, fixes the penalty for such failure at dismissal of the original proceeding. We know of neither rule nor precedent for rendering judgment upon the merits in an original proceeding for violation of Rule 12.
The information charged that the original incorporation of Monarch Transfer & Storage Company in April, 1915, with authorized capital stock of $ 15,000, was in fraud, evasion and violation of the laws of this State and was an illegal usurpation of the franchises thereof. Said information also alleged that the increase of the capital stock of said corporation on September 14, 1920, was likewise in fraud, evasion and violation of the laws of this State and an illegal usurpation of the franchises thereof.
On August 16, 1926, this court handed down an opinion by Walker, J., overruling respondents' demurrer to the information, except that portion thereof "in regard to the original improper incorporation of the company in 1915." While the parties to this proceeding have been furnished copies of said opinion, it does not appear to have been published officially or otherwise. It will be published in connection with this opinion. In view of said former ruling, the issue of fraud in the original organization of the corporation is out of the case.
In their statement of September 14, 1920, increasing the capital stock of respondent Monarch Transfer & Storage Company, stockholders Bray, Healy, Goodwin and A. V. and H. Cresto made the following statement:
"The amount paid up of the capital stock thus increased is $ 138,500 or 1385 shares, the remaining 115 shares are unsubscribed and unissued; that more than fifty per cent of said increase of capital stock has been actually paid up, part in cash, the balance in property of a cash value equal to par value of stock issued on increase, an itemized description of which, with the cash value of each item thereof, is as follows:
Real Estate (East 55 ft. Lot 158 Altamont Addition
situate at Northwest corner 31st St. & Michigan
Ave., Kansas City, Mo.)
$ 115,000.00
Personal property (located at 31st St. & Michigan
Ave., Kansas City, Mo.)
30,000.00
Motor Equipment
30,000.00
Inventory (including lumber, packing material, etc.)
9,000.00
Warehouse equipment
4,000.00
Furniture, fixtures & office supplies
4,000.00
Accounts receivable (good)
7,500.00
Cash
5,500.00
175,000.00
Less Mortgage on Real Estate
35,000.00
140,000.00
In his report our special commissioner summarizes his findings in respect to the value of the corporate assets on September 14, 1920, as follows:
Assuming as we must, that the original incorporation of respondent Monarch Transfer & Storage Company in 1915 was lawful, our special commissioner properly laid upon relator the burden of proof as to his charge that the subsequent increase of its capital stock in September, 1920, was "in fraud, evasion and violation of the laws of the State of...
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State ex rel. Gentry v. Monarch Transfer & Storage Co.
...20 S.W.2d 60 323 Mo. 562 The State ex rel. North Todd Gentry, Attorney-General, v. Daniel Bray, Thomas L. Healy, C. F. Roberts, Wilbur J. Mansfield, Earl K. Townsdin, and Monarch Transfer & Storage Company No. 26649Supreme Court of MissouriAugust 2, 1929 ... ... Reported at 323 Mo. 562 at 574 ... Original ... Opinion of August 2, 1929, Reported at ... ...