Thum v. Pyke

Decision Date01 July 1901
PartiesTHUM, RECEIVER, v. PYKE, RECEIVER (OGDEN SAVINGS BANK, INTERVENER)
CourtIdaho Supreme Court

FOREIGN CORPORATION-RIGHTS OF COURTS OF THIS STATE.-Where O. S. B., a corporation of Utah, has submitted itself to the jurisdiction of a court of this state in certain insolvency proceedings and thereafter, by proceedings in the courts of another state, claims to have secured title to shares of stock which are evidence of assets in the custody of this state, said O S. B. corporation will not be assisted by the courts of this state in obtaining such assets, to the detriment of citizens of this and other states who have filed and proved their claims in the court of this state having possession of such assets.

JURISDICTION-SERVICE OF SUMMONS.-When judgment was obtained in a court of a sister state, and it is sought to give effect to such judgment in the courts of this state, and it is shown that the service of summons was made upon a former secretary of the corporation defendant, and it appears that such person was not such secretary at the date of the service of summons, and that plaintiff knew that he was not such secretary or an officer of the defendant corporation, held, that jurisdiction of the defendant corporation was not obtained by such service, and that the judgment rendered the ein is absolutely void so far as its enforcement by the courts of this state is concerned.

JUDGMENTS AND DECREES OF SISTER STATES.-The jurisdiction of every court is open to inquiry when its judgments and decrees are produced in the court of a sister state, and it is there sought to give them effect.

FULL FAITH AND CREDIT TO PROCEEDINGS OF COURTS OF OTHER STATES. Full faith and credit shall be given in each state to the judicial proceedings of every other state. But that rule does not require the court of a state that first obtained possession of the assets of an insolvent to give up such assets to a creditor of such insolvent who acquired title to shares of stock, representing such assets subsequent to the time of the appointment of a receiver for the estate of such insolvent and taking possession of said assets by the receiver.

NONRESIDENT SUBMITTING TO JURISDICTION.-A citizen of another state who has submitted himself to the jurisdiction of a court of this state, which has in its possession assets of an insolvent will not be given or permitted an advantage over citizens of our own and other states in recovering debts due from such insolvent estate.

RESIDENT AND NONRESIDENT CREDITORS.-The laws of this state will not permit nonresident creditors of an insolvent, whose assets are in the hands of a receiver, to obtain any advantage over resident creditors. Resident and nonresident creditors, in such cases, stand before the courts of this state on an equality.

COMITY.-Comity between states does not require the courts of this state to give to foreign creditors an advantage over resident creditors of an insolvent.

(Syllabus by the court.)

APPEAL from District Court, Bingham County.

Reversed and remanded, with instructions. Costs of this appeal awarded to the appellant.

E. E. Chalmers and F. S. Dietrich, for Appellant.

The Utah statutes, like ours, requires that summons shall state the sum or amount for which judgment will be taken upon a money demand in case default is made, but the summons in this case fails to specify such amount, but only that "judgment will be entered according to the prayer of the complaint." To establish that this is a fatal jurisdictional defect scarcely requires citation of authority. But see Idaho Rev. Stats., sec. 4140, subd. 4; Dyas v. Keaton, 3 Mont. 498; Ward v. Ward, 59 Cal. 139; Atchinson etc. F. R. Co. v. Nicholls, 8 Colo. 189, 6 P. 512. The affidavit for attachment does not purport to be made on behalf of or by the plaintiff. It is false, in that it asserts that the demand has accrued, whereas the verified complaint states and shows that it had not then accrued. It is further false in that it avers the defendant to have been a nonresident, whereas the verified complaint and the proof show that defendant is a Utah corporation. It is further false in that the debt was not then due. If an affidavit for attachment is false, the court acquires no jurisdiction to issue the writ. (Murphy v. Montandon, 3 Idaho 325, 35 Am. St. Rep. 279, 29 P. 851; Vollmer v. Spencer, 5 Idaho 557, 51 P. 609.) The judgment is not signed by the judge; purports to be by default, and is for more than the amount specified in the summons. It is not, therefore, supported by the prior proceedings, and must fall. (State v. Woodlief, 2 Cal. 242.) It is conceded on behalf of the intervener that these judgments, like any others, may be attacked for jurisdictional defects; these are the very grounds upon which we attack them, and yet counsel retort that the matters therein referred to have been adjudicated, and cannot therefore be inquired into jurisdiction or no jurisdiction. We attack the jurisdiction first, and then, believing that it has been overturned by the record herein made, show by the testimony that there was nothing due to either McCornick & Co. or to its assignee, the intervener herein, for which to foreclose and acquire title to the stock in question. (See the recent case of Eureka Merc. Co. v. California Ins. Co., 130 Cal. 153, 62 P. 393; Freeman on Judgments, 3d ed., secs. 561, 563, 565, 566; 12 Ency. Pl. & Pr. 216 et seq. See, also, Leland v. Isenbeck, 1 Idaho 469; Strode v. Strode, 6 Idaho 67, 96 Am. St. Rep. 249, 52 P. 161.) Additional authorities to effect that a judgment in a foreign jurisdiction is not conclusive: Beach on Receivers, par. 450; Rust v. Waterworks Co., 70 F. 420; Smith on Receivers, par. 237; High on Receivers, sec. 47a; also sec. 349; Reynolds v. Stockton, 140 U.S. 254, 11 S.Ct. 773, 35 L. ed. 466; Pendleton v. Russell, 144 U.S. 640, 12 S.Ct. 743, 36 L. ed. 574.

W. D. Riter (by courtesy of Court) and David Evans, for Intervener and Respondent.

The appellant was appointed receiver of this corporation by a court of this state. He had no extraterritorial jurisdiction. He was appointed receiver by a court of this state simply to collect and preserve the property of the corporation within its jurisdiction, and to distribute it as the court might direct. By his appointment the corporation was not dissolved and a party outside the state where he was appointed was not bound to make him a party defendant to a suit instituted to recover judgment against the corporation. This is elementary. (Thum v. Pingree, 21 Utah 348, 61 P. 18.) There being no receiver appointed in the state of Utah, our contention is that any property which may be found within the state of Utah is subject to attachment, levy and sale, the title to which passes to the purchaser as against a receiver in a foreign jurisdiction. It is perfectly clear under the authorities that insolvent laws have no force outside of the state in which the receiver is appointed. Property attached in any other state before reduced to possession by a receiver or trustee will be held by such prior levy. This includes the capital stock of a corporation, on debts and choses in action. (Moran v. Struges, 154 U.S. 256, 14 S.Ct. 1019; Reynolds v. Adden, 136 U.S. 348, 10 S.Ct. 843; Rhown v. Pearce, 110 Ill. 350, 51 Am. Rep. 691; Story on Conflict of Laws, 414; High on Receivers, secs. 47, 239, 244 (a).) It is well settled that the judgment of a court having general jurisdiction of the subject matter involved in the judgment cannot be successfully attacked in a collateral proceeding, because of an imperfect or defective complaint in the action in which it was rendered. If the facts stated in the complaint are not sufficient to entitle the plaintiff to the relief demanded therein and awarded by the judgment, the action of the court in deciding otherwise and rendering its judgment in accordance with the prayer of the complaint can be nothing more than an error. (In re James, 99 Cal. 374, 37 Am. St. 60, 33 P. 1122; Rowe v. Palmer, 29 Kan. 337; Frankfurth v. Anderson, 61 Wis. 107, 20 N.W. 662; Matthews v. Densmore, 109 U.S. 216, 3 S.Ct. 126; Vanfleet's Collateral Attack, sec. 61.) The next objection is to the jurisdiction of the court. The statutes of Utah, at the time the summons in question was served, contained the requirement that in an action arising on a contract for the recovery of money or damages only, the summons shall contain a notice that unless the defendant so appears and answers the plaintiff will take judgment for the sum demanded in the complaint, stating it. The summons served by the plaintiff upon the defendant, C. Bunting & Co., Bankers, in the suit now under consideration, instead of naming the amount, contained this clause: "And you will please take notice that unless you do so appear and answer said complaint within said time, that judgment will be entered against you according to the prayer of the complaint, a copy of which is herewith served upon you." Was the variance fatal, and did it deprive the court of jurisdiction? The supreme court of Utah has passed upon this very question, holding that the variance is immaterial and does not deprive the court of jurisdiction. (Miller v. Zeigler, 3 Utah 17, 5 P. 518; Keybers v. McComber, 67 Cal. 395, 7 P. 838; Holland v. Adair, 55 Mo. 49; Highley v. Pollock, 21 Nev. 198, 27 P. 895; Behlow v. Shorb, 91 Cal. 141, 27 P. 546; Clark v. Palmer, 90 Cal. 504, 27 P. 375; McCoun v. New York C. Ry. Co., 50 N.Y. 176; Brown v. Eaton, 37 How. Pr. 385; Schuttler v. King, 12 Mont. 149, 30 P. 25; Burkhardt v. Haycox, 19 Colo. 339, 35 P. 730.) When the court has jurisdiction of the subject matter of the suit, and by personal service of the summons has jurisdiction of the person of the defendant, the entry of...

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8 cases
  • Newell v. Newell
    • United States
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