United States v. Leche, 19712.

Citation44 F. Supp. 765
Decision Date30 April 1942
Docket NumberNo. 19712.,19712.
PartiesUNITED STATES v. LECHE et al.
CourtUnited States District Courts. 5th Circuit. United States District Court (Eastern District of Louisiana)

Robert Weinstein, Asst. U. S. Atty., of New Orleans, La., for the United States.

J. Hart Willis and Dillard Estes, both of Dallas, Tex., and W. P. Z. German, of Tulsa, Okl., for the motion.

CAILLOUET, District Judge.

Upon the hearing had of the demurrers and pleas thitherto filed on behalf of one of the defendants named in the indictment herein, i. e., East Texas Refining Company, there was also submitted and heard the motion of Attorneys J. Hart Willis, Dillard Estes and W. P. Z. German, suggesting that subsequent to the filing of the aforementioned demurrers and pleas, said corporation was dissolved on December 10, 1941, in form and manner provided by the laws of the State of Texas, under which it had come into existence; and moving that proceedings under the indictment, as respects said former corporation, be now abated in view of the corporate death.

The official certificate of dissolution, executed and signed by the Texas Secretary of State, and evidencing such claimed dissolution, forms part of said attorneys' motion and plea in abatement.

Broadly speaking, in the absence of statutory enactment providing otherwise, the dissolution of a corporation abates pending court proceedings against it; the dissolution ends the corporate existence, and can not be distinguished from the death of a natural person, insofar as relates to the legal effect thereof upon such pending proceedings. 1 C.J.S., Abatement and Revival, § 102, pp. 140, 141; 19 C.J.S., Corporations, § 1737, p. 1503; 13 Am.Jur. (Corporations) § 1342, p. 1191; Jacob Mumma v. Potomac Company, 1834, 8 Pet. 281, 8 L.Ed. 945; Oklahoma Natural Gas Company v. State of Oklahoma, 1927, 273 U.S. 257, 47 S.Ct. 391, 71 L.Ed. 634.

Judgment can not be rendered against a dead natural person, dying pendente lite; ordinarily, judgment can no more be rendered against a defunct corporate institution, whose corporate death by legal dissolution takes place during the pendency of court proceedings against it. First National Bank of Selma v. George W. Colby, 1875, 21 Wall, 609, 22 L.Ed. 687; Pendleton v. Russell, Receiver, 1892, 144 U.S. 640, 12 S.Ct. 743, 36 L.Ed. 574.

The proceeding or "suit" (in the most extended sense of the word, for which, see 1 C.J.S., Actions, § 1, p. 962) under the indictment against the East Texas Refining Company in this federal court, is one authorized by federal statute for the recovery of a pecuniary penalty for the commission of a public offense. See 19 C.J.S., Corporations, § 1365, p. 1079. John Gund Brewing Co. v. United States, 8 Cir., 1913, 204 F. 17; Id., 8 Cir., 206 F. 386.

Congress has not, generally speaking, attempted to prescribe the causes which survive death of either party to suits in courts of the United States, but has provided that, in any instance where the cause of action does survive "by law", the administrator or executor of the deceased party may continue to prosecute or defend the suit to final judgment. 28 U.S.C.A. § 778; and Rule 25, Federal Rules of Civil Procedure, 28 U.S.C.A. following section 723c. See, also, Patton v. Brady, 1902, 184 U.S. 608, 22 S.Ct. 493, 46 L.Ed. 713, at page 716; Gerling v. Baltimore & Ohio R. R. Co., 1894, 151 U.S. 673, 14 S.Ct. 533, 38 L.Ed. 311, at page 318.

In a proceeding before a federal court, based on federal law, the question whether such proceeding may continue beyond the natural death of an individual party thereto, or beyond the corporate death by legal dissolution of a corporation party, must be decided, in the absence of federal statute on the subject, in accordance with the principles of the common law existing prior to the Declaration of Independence; there being no federal general common law. United Copper Securities Company v. Amalgamated Copper Co., 2 Cir., 1916, 232 F. 574; 1 C.J.S., Abatement and Revival, § 135, p. 183. 1 Am.Jur. (Abatement and Revival) § 97, p. 77. See, also, Van Choate v. General Electric Co., D.C. D. Mass. 1917, 245 F. 120; Sullivan v. Associated Bill Posters and Distributors of the United States and Canada, 2 Cir., 1925, 6 F.2d 1000, 42 A. L.R. 503.

At common law, proceedings to recover a penalty (such as was sought to be prosecuted by indictment herein against the then still-existent East Texas...

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    ...the subject, the statute is controlling. 1 C.J.S., Abatement and Revival, § 135, p. 183; § 27.10 Cyc. Federal Procedure; United States v. Leche, D.C., 44 F.Supp. 765; Sullivan v. Associated, etc., 2 Cir., 6 F.2d 1000, 42 A.L.R. 503. Causes of action under Federal statutes have been held to ......
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