Thompson v. Bemis Paper Company

• Decision Date: 12 November 1879
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: Frederick A. Thompson v. Bemis Paper Company & others

127 Mass. 595

Frederick A. Thompson v. Bemis Paper Company & others

Supreme Court of Massachusetts

November 12, 1879

[Syllabus Material]

Hampden. Bill in equity, under the St. of 1870, c. 224 § 42, by a judgment creditor, in behalf of himself and all other creditors of the Bemis Paper Company, against said corporation and Daniel D. Warren, Roswell P. Crafts, Pliny J Crafts and C. G. Buttrick, stockholders in the corporation, to enforce the personal liability of the latter, on the ground that the capital of the corporation had been withdrawn and paid to the stockholders. St. 1870, c. 224, § 39, cl. 2.

The case was heard by Soule, J., and reported for the determination of the full court in substance as follows:

The plaintiff, upon a writ dated May 5, 1875, due service of which was made on the same day upon the defendant corporation, recovered judgment in the Superior Court, on June 28, 1876, against said corporation for the sum of $ 1192 damages, and $ 80.43 costs of suit. This action was brought and judgment recovered for the balance due the plaintiff for his personal labor and services for the corporation, for the two years and two months ending June 16, 1870, at a salary of $ 2500 per annum. Execution duly issued thereon, and was placed in the hands of a deputy sheriff for service, who, on July 18, 1876, made demand upon said corporation, its president and its treasurer, to pay the amount thereof, with the officer's fees; and the corporation and its president and treasurer neglected, for the space of thirty days after the demand, to pay the amount due, with the officer's fees, or any part thereof, or to exhibit to the officer real or personal estate of the corporation, subject to be taken on execution, sufficient to satisfy said execution, or any part thereof.

The defendant corporation was duly organized as a manufacturing corporation, under the laws of this Commonwealth, on or about June 8, 1866, with a capital stock of $ 40,000, divided into forty shares, of $ 1000 each, and it continued in business in Holy oke until June, 1870, when it sold out its property and ceased to do any manufacturing business. It was dissolved by the St. of 1872, c. 354.

At the time of the commencement of the suit, Warren, Roswell P. Crafts, Pliny J. Crafts, C. G. Buttrick, G. Buttrick's estate, and the plaintiff, were stockholders in the corporation, said Warren owning eleven shares, Roswell P. fourteen shares, Pliny J. one shares, C. G. Buttrick four shares, G. Buttrick's estate two shares, and the plaintiff eight shares of the stock, and the same number of shares was held by each of these parties on March 21, 1871, at the time of the division of the capital hereinafter stated, except that Warren held a certificate for nineteen shares standing in his own name. G. Buttrick died intestate after March 21, 1871, and prior to the commencement of the suit in which the judgment was recovered. He was a resident in Hampden County at the time of his death, and no administration has ever been applied for or taken out upon his estate.

When the plaintiff went to work for the corporation, he bargained for eight shares of the stock, and paid a part of the agreed price. No stock was transferred to him, and Warren lent him the money and held the stock standing in his own name as the absolute owner, so far as the record showed, but in fact as collateral security for the loan until March 29, 1871, when the...