State ex rel. Kopke v. Mulloy

• Decision Date: 20 November 1931
• Citation: 43 S.W.2d 806,329 Mo. 1
• Parties: The State ex rel. E. W. Kopke v. Jerry Mulloy, Judge of Circuit Court, County of St. Louis, and Richard F. Ralph, Receiver
• Court: Missouri Supreme Court

43 S.W.2d 806

329 Mo. 1

The State ex rel. E. W. Kopke v. Jerry Mulloy, Judge of Circuit Court, County of St. Louis, and Richard F. Ralph, Receiver

Supreme Court of Missouri

November 20, 1931

Preliminary rule made absolute.

Lewis & Rice and R. W. Chubb for relator; Monroe Oppenheimer of counsel.

(1) The petition presented to the respondent judge was fatally defective. (a) It shows on its face that plaintiff therein is without equity since it shows that the plaintiff's stock is worthless. Wells v. Adams-Evans & Co., 191 N.Y.S 399; Gila Water Co. v. Witbeck (C. C. A.), 29 F.2d 177; Darraugh v. H. Welter Mfg. Co. (C. C. A.), 78 F. 15; Ford v. Railway Co., 52 Mo.App. 450. (b) The petition fails to show plaintiff has exhausted his remedies within the corporation. Caldwell v. Eubanks, 30 S.W.2d 979. (2) The petition alleges no facts showing any emergency or urgent necessity for the appointment of a receiver without notice. In the absence of such allegations such appointment was in excess of the court's jurisdiction. 1 Clark on Receivers (2 Ed.) sec. 82; State ex rel. v. Calhoun, 234 S.W. 857; St. Louis etc Railroad v. Wear, 135 Mo. 261; Rees v. Andrews, 169 Mo. 189; Merriam v. Ry. Co., 136 Mo. 160. (3) The appointment was void because not predicated on any legal proof, since it was made solely upon a petition verified "upon information and belief." High on Receivers (4 Ed.) sec. 89; 34 Cyc. 134; 23 R. C. L. 40, 41; Reneke-Owenhouse Co. v. Scheidegger, 32 Mont. 424, 80 P. 1024; Sherman Park State Bank v. Loop Office Bldg., 238 Ill.App. 450; Southwest Grain & Hay Co. v. Continental Inv. Co. (Tex. Civ. App.), 240 S.W. 686; Ledger Pub. Co. v. Scott, 193 Ind. 683, 141 N.E. 609. (4) The appointment, therefore, constituted a denial to defendants of due process of law. Riverside & Dan River Cotton Mills v. Menefee, 237 U.S. 193, 35 S.Ct. 580, 59 L.Ed. 910; Nottebaum v. Leckie, 31 F.2d 556; 1 Clark on Receivers (2 Ed.), sec. 82. (5) Prohibition lies without application to the judge to vacate the order appointing a receiver. State ex rel. v. Dearing, 184 Mo. 665; State ex rel. v. Oliver, 163 Mo. 696; State ex rel. v. Herzel, 137 Mo. 436; State ex rel. v. Eley, 170 Mo. 497; State ex rel. Mills v. Calhoun, 234 S.W. 855, 857; State ex rel. Burton v. Montgomery, 291 S.W. 472; State ex rel. Priest v. Calhoun, 226 S.W. 329.

Wurdeman, Stevens & Hoester and John H. Haley for respondents.

(1) Prohibition can be invoked only when the court acts without jurisdiction or clearly exceeds its jurisdiction. This is a Delaware corporation, and therefore relator repeatedly cites cases as authority that the courts of Missouri have no authority or jurisdiction in this case, but note the provisions of Art. I, Chap. 90, R. S. 1919, and particularly Sec. 9791, R. S. 1919 (now Sec. 4597, R. S. 1929); State v. Reynolds, 204 S.W. 1097; Low v. R. P. K. Pres. Met. Co., 91 Conn. 91, 99 A. 1, L. R. A. 1917D, 291-306. (2) While independently of statute a court of equity has power to entertain a bill against a domestic, and, in accord with our rulings, a foreign corporation as well, under the facts in the instant case (Cantwell v. Lead Co., 199 Mo. 1; Thompson v. Greeley, 107 Mo. 577; Greeley v. Bank, 103 Mo. 212; Cox v. Volkert, 86 Mo. 505), we are not without legislative authority in that behalf. Under Sec. 3037, R. S. 1909, foreign corporations doing business here are subjected to all of the liabilities, restrictions and duties of corporations of like character organized under the laws of this State. Sec. 3038, R. S. 1909, provides explicitly that receivers may be appointed to take charge of the business, property and effects of foreign corporations, etc., the powers granted to the receiver being similar, if not identical, to those conferred upon receivers of domestic corporations. There is, therefore, under the pleadings and facts, no question as to the power of court of equity to take cognizance of this case. (3) It is contended that there was no notice of the application for temporary injunctive relief, and the appointment of a receiver. The proceeding here was not to stay a judgment, within the contemplation of Secs. 2517, 2518, R. S. 1909. While notice of applications in cases of this character is usually required, where, as in this case, the need is a crying one, notice is not held to be a prerequisite. State ex rel. v. McQuillin, 256 Mo. 707; Tuttle v. Blow, 176 Mo. 171, 98 Am. St. 488. Equity has never prescribed the necessity of giving notice as a condition precedent in all cases of the granting of temporary injunctions. State ex rel. v. Woodside, 254 Mo. 592.

Sturgis, C. Ferguson and Hyde, CC., concur.

OPINION

STURGIS

This is an original proceeding in this court by writ of prohibition against one of the circuit judges of St. Louis County and a receiver appointed by him, to restrain them from further action in a case there pending. It challenges the jurisdiction of that court in what has been done and invokes the power of this court to prevent any further act in excess of the jurisdiction of that court. The defendant Judge Mulloy appointed defendant Ralph temporary receiver of the Fulton Iron Works Company, a Delaware corporation having its chief office, place of business, manufacturing plant, and most of its property in St. Louis County, Missouri. This action was taken by the judge on the filing and presentation to him of a petition entitled Lena A. Wurdeman v. Fulton Iron Works Company et al., without any sort of service on or notice to the defendant company or the individual defendants, or any of them. The order appointing the receiver empowered and directed him to at once take possession and charge of defendant's business and property to the exclusion of its officers and agents then in possession, the principal officers being named as parties defendant. The other individual defendants, ten in number, are alleged to compose an advisory committee of defendant's creditors, alleged to have large control and direction of its business. When we speak of defendant in respect to the proceedings in the circuit court, without other designation, we mean the Fulton Iron Works Company, and by plaintiff we mean Lena A. Wurdeman.

It stands conceded that the petition of Lena A. Wurdeman was filed and presented to the defendant judge of the circuit court, and the order appointing the receiver made, and bond filed and approved on Saturday afternoon of November 22, 1930. The circuit court also made an order that defendant appear in that court on the next Saturday, November 29th, and show cause, if any, why the appointment of the receiver should not be made permanent. Thereupon the relator, who was president of defendant company and in charge and control of its business, applied to this court for this writ of prohibition to restrain said circuit judge from taking further cognizance of said cause and the receiver from taking possession of or interfering with the possession of the Fulton Iron Works Company of its property and business.

The petition or application for our writ is sworn to and contains certified copies of the petition of Lena A. Wurdeman filed in the circuit court and the order of that court appointing the receiver. This court granted its preliminary writ of prohibition and ordered the respondents here to show cause on a day named why the same should not be made permanent. The respondents have made return or answer in this court, to which the relator has filed his reply. In the answer the respondents deny many allegations of the petition for our writ and ask that on the facts stated therein the preliminary rule in prohibition be dissolved. In the reply the relator denies the affirmative matter set up in the respondents' answer and prays that on the pleadings, affidavits and exhibits herein filed that the alternative writ in prohibition be made permanent.

It will thus be seen that issues of fact are raised by the pleadings in this court which have no support except the verification of the pleadings, but the parties, by their submission of the case, treat such matters as non-essential to a proper disposition of the case here; and we find that the essential facts necessary for our decision are either expressly admitted or stand undisputed. Thus it stands conceded that the plaintiff in the case of Lena A. Wurdeman v. Fulton Iron Works Company and the individual defendants, filed her petition asking for the appointment of a receiver of that company, and that the same was at once and without any service on or notice to any of the defendants, and in their absence, acted on by the respondent judge, who, without any evidence other than the verification of the petition, made an order appointing Ralph temporary receiver with instructions and power to at once take possession of defendant's property, and fixing a future date for defendant to show cause why the receivership should not be made permanent. It is further conceded that, three days previous to this action a suit of the same nature and for the same purpose, the petitions being practically alike and against the same defendant, had been filed in the same court by Swartwout Company and J. Harry Bedsar, and that Judge Lashly, one of the judges of the same court, before whom same was pending, had declined to act at once and without notice in appointing a receiver, but had fixed a day, November 25th, not yet reached, on which all parties would be heard; that such suit had been voluntarily dismissed on the same day the Lena A. Wurdeman suit was filed; that one of the attorneys for the Fulton Iron Works Company and the other defendants being proceeded against in both such suits, either by chance or from suspicion, appeared in court and learned of the dismissal of the old suit and the filing of the new one and...