Tacoma Ledger Co. v. Western Home Bldg. Ass'n

• Decision Date: 15 March 1905
• Citation: 79 P. 992,37 Wash. 467
• Court: Washington Supreme Court
• Parties: TACOMA LEDGER CO. v. WESTERN HOME BLDG. ASS'N et al.

79 P. 992

37 Wash. 467

TACOMA LEDGER CO. v. WESTERN HOME BLDG. ASS'N et al.

Supreme Court of Washington

March 15, 1905

Appeal from Superior Court, King County; Boyd J. Tallman, Judge.

Action by the Tacoma Ledger Company against the Western Home Building Association and the California, Oregon & Washington Homebuilders' Association and others. From a judgment for plaintiff, the defendant the California, Oregon & Washington Homebuilders' Association appeals. Affirmed.

Fred'k R. Burch, for appellant.

J. B Alexander, for respondent.

DUNBAR J.

The complaint alleges that the plaintiff is a domestic corporation; that the defendant the Western Home Building Association is a like corporation; that the defendant the California, Oregon & Washington Homebuilders' Association is a foreign corporation organized and existing under the laws of the state of California, with like powers as the Western Home Building Association; that a judgment was recovered by plaintiff against the defendant the Western Home Building Association in the sum of $187, with $16.80 costs and alleges the entry of said judgment; that the Western Home Building Association was at the time of the entry of said judgment, and for some time before, in a failing and insolvent condition, which fact was known to the trustees of said corporation; that on or about the date of the entry of said judgment, namely, the 25th day of March, 1902 stockholders of the Western Home Building Association, with the consent and assistance of the trustees and all the officers thereof, made and entered into a fraudulent and illegal agreement with the California, Oregon & Washington Homebuilders Association, whereby all the capital stock of the Western Home Building Association and all the properties and assets of every kind should be sold and turned over to the California, Oregon & Washington Homebuilders' Association for the consideration of 40,000 shares of the capital stock of the California, Oregon &amp Washington Homebuilders' Association, which said stock was to be issued to and for the benefit of the stockholders and officers and trustees of the Western Home Building Association, the trustees being named in the complaint; and that it was agreed that the Western Home Building Association should cease to do business in the state of Washington, and alleges the consummation of this plan, and the turning over of all of the properties of the Western Home Building Association to the California, Oregon & Washington Homebuilders' Association, naming the assets, and alleging that the California, Oregon & Washington Homebuilders' Association has since been receiving and appropriating to its own use and benefit the said money so received, and refuses to apply the same to the satisfaction of the judgment above referred to; that the California, Oregon & Washington Homebuilders' Association knew of the insolvency of the Western Home Building Association at the time of this transaction, and had notice of the indebtedness of the Western Home Building Association. The plaintiff's demurrer to this complaint was overruled, and the California, Oregon & Washington Homebuilders' Association then answered, and denied any knowledge of the insolvency of the Western Home Building Association, denied entering into any fraudulent and illegal plan with said association, and denied any knowledge of the indebtedness of said association to plaintiff, and denied generally all of the allegations of the complaint, and affirmatively pleaded that the alleged board of directors in the Western Home Building Association ceased to be such directors on or about the 9th day of March, 1902; that on or about the 24th day of March, 1902, the Western Home Building Association, agreeing through its authorized officers and board of trustees, and with full acquiescence and authority of all its stockholders, proposed to the California, Oregon & Washington Homebuilders' Association that they purchase the business conducted by the said Western Home Building Association, and that they did purchase the entire business of said association, being all its property and assets and the entire capital stock of the said corporation. At the time of said purchase the Western Home Building Association represented to the California, Oregon & Washington Homebuilders' Association that the said Western Home Building Association was thoroughly solvent, and that there were no debts of any kind existing against the same save and except the current expenses of the said month of March, 1902, amounting in all to about $250; and that the said California, Oregon & Washington Homebuilders' Association paid to said Western Home Building Association the sum of $250 for the express purpose of liquidating the current expense account. This is a sufficient recital of the pleadings, we think, to...