Wehmeier v. Mercantile Banking Company

• Decision Date: 16 February 1912
• Docket Number: 7,501
• Citation: 97 N.E. 558,49 Ind.App. 454
• Parties: WEHMEIER ET AL. v. MERCANTILE BANKING COMPANY ET AL
• Court: Indiana Appellate Court

97 N.E. 558

49 Ind.App. 454

WEHMEIER ET AL. v. MERCANTILE BANKING COMPANY ET AL

No. 7,501

Court of Appeals of Indiana

February 16, 1912

From Superior Court of Marion County (78,461); Vinson Carter Judge.

Suit by Otto G. Wehmeier and others against the Mercantile Banking Company and others. From a judgment for defendants plaintiffs appeal.

Reversed.

William C. Thompson and Franklin McCray, for appellants.

G. W Paul and William B. Paul, for appellees.

OPINION

FELT, C. J.

Appellee Mercantile Banking Company has moved that this appeal be dismissed, for the reason that no final judgment in the case has been rendered by the lower court from which an appeal to this court will lie.

Appellants brought this suit against the Mercantile Banking Company and seven other defendants for a dissolution of partnership in a banking business, for an accounting, and for the appointment of a receiver for said bank.

The complaint was in one paragraph, to which appellee Mercantile Banking Company filed a demurrer. The demurrer was sustained, and the ruling thereon is the only error presented by appellants. On motion by appellee company, the court rendered judgment as follows: "Come the parties, and the court being fully advised sustains defendants' motion for judgment in their favor on the ruling of the court sustaining defendants' demurrer to plaintiffs' complaint. It is therefore considered and adjudged by the court that plaintiffs take nothing by their action and that defendants recover of plaintiffs their costs taxed at $ ."

The right of appeal is statutory, and in cases of this character it is expressly provided that the appeal shall be taken from a final judgment. § 671 Burns 1908, § 632 R. S. 1881.

A final judgment was defined in the case of Neyens v. Flesher (1907), 39 Ind.App. 399, 402, 79 N.E. 1087, as a judgment "that at once disposes of all the issues, as to all parties, involved in the controversy presented by the pleadings, to the full extent of the power of the court to dispose of the same, and puts an end to the particular case as to all of such parties and all of such issues." To the same effect are the following cases: Barnes v. Wagener (1907), 169 Ind. 511, 82 N.E. 1037; Keller v. Jordan (1897), 147 Ind. 113, 46 N.E. 343; Hopp v. Luken (1909), 44 Ind.App. 568, 89 N.E. 916; Rife v. Diamond Flint Glass Co. (1908), 42 Ind.App. 346, 85 N.E. 726.

The form of the judgment rendered in this case is that of a final judgment. Starkey v. Starkey (1905), 166 Ind. 140, 76 N.E. 876; Thomas v. Chicago, etc., R. Co. (1894), 139 Ind. 462, 465, 39 N.E. 44; Neyens v. Flesher, supra.

It is presumed, therefore, for the purpose of the motion to dismiss, that the ruling on the demurrer of appellee Mercantile Banking Company disposed of all the issues as to all defendants in the lower court, for "it will be assumed on appeal, in cases where the record is silent, that the preliminary steps necessary to impart vitality and force to a judgment were duly taken. * * * In the absence of a recital or statement in the record to the contrary, the presumption is that the judgment is within the issues and supported by the appropriate pleadings." Elliott, App. Proc. §§ 718, 719.

The demurrer was for (1) the insufficiency of the facts alleged to state a cause of action, and (2) defect of parties plaintiff in this, that the right of action relied on can be enforced only by the Auditor of State.

The complaint alleges, in substance, that appellants and appellees, other than the Mercantile Banking Company, are partners doing business under the name of Mercantile Banking Company, and are engaged in conducting a private bank in the city of Indianapolis; that the capital stock of said bank was and is $ 11,000; that appellant Wehmeier paid for, and there was duly issued to him, capital stock of said bank of the value of $ 200, and he is now the owner thereof; that in the same manner appellant Kerr became and is the owner of capital stock of said bank of the value of $ 100; that since the organization of said bank its business has been conducted by the defendants Albert B. Hall, Robert J. Espy and James T. Bymaster; that said Espy is president and said Bymaster cashier of said bank; that the business of said bank "has been mismanaged, and the assets thereof misapplied, misused and wasted in the following manner." Here follow detailed averments to the effect that more than thirty per cent of the capital stock of said bank has been loaned to its officers on insufficient security, in violation of the law; that various loans in large amounts have been made to nonresidents without any, or on insufficient security, which loans were in fact for the use and benefit of said officers, though nominally to other persons; that large loans have been made to some members of said copartnership on unrecorded, void and worthless chattel mortgages and other insufficient securities; that said bank has unsecured overdrafts amounting to $ 211.43, and has cashed a draft for $ 1,000 which has been dishonored and protested, and the bank has not been reimbursed therefor; that the affairs of said bank have been managed and controlled by said Hall, Espy and Bymaster, who have so managed them as to consume all the earnings of said bank in expenses and for salaries that were paid for nominal services which have never been authorized by said partnership; that the monthly expenses of said bank under said management are in excess of the earnings thereof; that said bank has deposits of $ 2,200 subject to check and $ 156.60 time deposits, and only $ 1,650.60 in cash resources, and is wholly insolvent; that its resources are being wasted and dissipated by worthless investments, insecure loans and exorbitant expenses; that the members of said partnership are hopelessly at variance as to the policy to pursue in managing the business of said bank; that appellants have no voice in or control over the management of said bank, and no dividends have been allowed or paid; that the members of said firm cannot agree upon a mutual settlement or a dissolution of said firm; that a continuance of the business under the present management will result in the loss of all the capital stock owned by appellants in said bank, and bring upon them additional personal liability for the debts of said bank; that before bringing this suit appellants demanded of said bank and the members of said firm a dissolution of said partnership and a full accounting of all its business with the members of said partnership, and that necessary steps be taken to accomplish such purpose; that appellees will not consent to such dissolution, and it can only be accomplished, and the interests of appellees in said business preserved, by the appointment of a receiver.

Prayer for an accounting, for a dissolution of the partnership, and for the appointment of a receiver.

We think the complaint is sufficient to withstand the demurrer for want of facts, if appellants have the right to maintain the suit. § 1279 Burns 1908, § 1222 R. S. 1881; High, Receivers (4th ed.) § 472 et seq.; Fink v. Montgomery (1904), 162 Ind. 424, 68 N.E. 1010; Levin v. Florsheim & Co. (1903), 161 Ind. 457, 68 N.E. 1025; Chicago, etc., R. Co. v. Kenney (1902), 159 Ind. 72, 62 N.E. 26; Sheridan Brick Works v. Marion Trust Co. (1901), 157 Ind. 292, 87 Am. St. 207, 61 N.E. 666; Wallace v. Milligan (1887), 110 Ind. 498, 11 N.E. 599; Webb v. Allen (1897), 15 Tex. Civ. App. 605, 40 S.W. 342; Allen v. Hawley (1855), 6 Fla. 142, 63 Am. Dec. 198; Saylor v. Mockbie (1859), 9 Iowa 209.

The further and more serious question presented, is whether appellants have the right to maintain this suit, or whether, by statute, that power is vested exclusively in the Auditor of State.

Section eight of the act of 1907 (Acts 1907 p. 174, § 3409 Burns 1908), relating to private banks, provides, among other things, as follows: "The Auditor of State, once in twelve months, or as often as he deem it necessary, shall appoint a suitable person, or persons, to make examination of the affairs of every bank under this act, * * * and if such bank or its owners be in an insolvent, or failing condition, or if the assets thereof are being wasted or improperly used or converted, then, in any of these events, said examiner shall at once notify said Auditor of State, and if the owners are unable to satisfy said auditor that they can make good the assets of said bank, said Auditor of State shall thereupon direct said examiner, or some other person appointed by him, at once to take charge and control of said bank and all the books, notes, cash on hand and other assets, and said Auditor of State shall, upon five days' notice being given to the cashier of said bank, thereafter make application to the judge of the circuit court, or superior court of the county where such bank is situated, either during term time or during vacation, for the appointment of a receiver to take charge of said bank. * * * Said examiner shall make a full and detailed report of the condition of the bank to the auditor, and the bank shall not be subject to any other visitorial powers than such as are authorized by this act, except such as are vested in the several courts of this State."

That the...