Weil v. Defenbach

Decision Date05 August 1922
CourtIdaho Supreme Court
PartiesIGNATZ WEIL, Receiver of the TRADERS' STATE BANK, Respondent, v. B. S. DEFENBACH, RUFUS JACKSON, W. F. WHITAKER, E. DRIESBACH, W. A. BERND, ROBERT GRIMES and R. N. JACKSON, Appellants

APPEAL AND ERROR-LAW OF THE CASE-JUDGMENTS-COLLATERAL ATTACK - CORPORATIONS - OFFICERS AND DIRECTORS - LIABILITY OF STOCKHOLDERS TO WHOM ASSETS HAVE BEEN WRONGFULLY DISTRIBUTED-CONCLUSIVENESS OF JUDGMENT AGAINST CORPORATION UPON A STOCKHOLDER-STATUTE OF LIMITATIONS.

1. The doctrine of the law of the case is not binding upon this court upon second appeal beyond the points of law actually decided upon the former appeal and those necessarily involved in the decision actually made.

2. A void judgment is subject to collateral attack.

3. Where a judgment of a court of general jurisdiction is attacked collaterally upon the ground that the court did not have jurisdiction of the persons, a recital in the judgment of the jurisdictional facts is conclusive unless contradicted by other portions of the record.

4. The directors and officers of a corporation last duly elected remain as such until they resign or are removed or the corporation has been legally dissolved or has forfeited its charter.

5. The appointment of a receiver of a corporation cannot be attacked collaterally unless it be shown that the order making the appointment was absolutely void. The district court has power to appoint a receiver for an insolvent corporation and power to decide whether facts existed which authorized such appointment. The appointment of a receiver for a corporation found to be insolvent is not void.

6. The liability of a stockholder of a corporation to return to it for the benefit of its creditors assets which he has wrongfully received in contravention of the provisions of C S., sec. 4715, is a liability created by law.

7. C S., sec. 6630, provides for the time within which an action must be commenced against a stockholder of a corporation to recover assets thereof which have been wrongfully distributed to him.

8. Where an action is brought by a receiver of a corporation against a stockholder to recover sufficient assets to pay a specified judgment and no more, the party aggrieved under C S., sec. 6630, is the judgment creditor.

9. Final judgment against a corporation is conclusive upon a stockholder in an action brought against him to recover assets of the corporation which have been improperly distributed, as to all matters which might have been urged by the corporation as a defense thereto, unless the stockholder can show fraud or collusion on the part of the directors of the corporation in permitting the judgment to be entered.

APPEAL from the District Court of the Eighth Judicial District, for Bonner County. Hon. R. N. Dunn, Judge.

Action by receiver to recover assets of a corporation wrongfully distributed to a stockholder. Judgment for receiver. Affirmed.

Judgment affirmed, with costs to respondent.

G. H Martin and E. W. Wheelan, for Appellants.

The proof conclusively establishes that Defenbach was not the president of the Traders' State Bank at the time service is claimed to have been made. Service on him could not support a judgment against the corporation that would be conclusive or binding upon the former stockholders, the defendants having all parted with their stock in the Traders' State Bank in October, 1910. (C. S., sec. 5226; Sturges v. Vanderbilt, 73 N.Y. 384; Buchanan v. Prospect Park Hotel Co., 14 Misc. 435, 35 N.Y.S. 712; Lippman v. Kehoe Stenograph Co., 11 Del. Ch. 190, 98 A. 943; Wright v. First Nat. Bank, 52 N.J. Eq. 392, 28 A. 719; Chemical Nat. Bank of New York v. Colwell, 132 N.Y. 250, 30 N.E. 644; Beardsley v. Johnson, 121 N.Y. 224, 24 N.E. 380; Oudin & Bergman Fire Clay Min. & Mfg. Co. v. Conlan, 34 Wash. 216, 75 P. 798; Stanton v. Gilpin, 38 Wash. 191, 80 P. 290.),

Even in jurisdictions where the judgment against the corporation is conclusive against the stockholders the rule is applicable only in cases where service is made on an officer of the corporation during the time that the corporation is actively engaged in business, and not after the corporation has ceased to do any business and the alleged officer no longer represents the corporation. (Schrader v. Manufacturers' Nat. Bank, 133 U.S. 67, 10 S.Ct. 238, 33 L.Ed. 564, citing Moss v. McCullough, 5 Hill (N. Y.), 131; Miller v. White, 50 N.Y. 137; McMahon v. Macy, 51 N.Y. 155; Trippe v. Huncheon, 82 Ind. 307; Stanton v. Gilpin, supra.)

The appointment of the plaintiff as receiver is void, the statutes of Idaho having provided an exclusive remedy for the liquidation of state banks. (C. S., secs. 5293, 5295, 5297, 5304; State v. Title Guaranty & Surety Co., 27 Idaho 752, 152 P. 189; 2 Tardy's Smith on Receivers, p. 1254, sec. 441; Koch v. Missouri-Lincoln Trust Co. (Mo.), 181 S.W. 44; People v. Superior Court, 100 Cal. 105, 34 P. 492; Craughwell v. Mousam River Trust Co., 113 Me. 531, 95 A. 221.)

As this action was not commenced until May 5, 1913, the right of the plaintiff to recover for capital assets distributed in November, 1908, is barred by his laches and the statutes of limitations. (C. S., secs. 6610, 6611, 6614.)

The only thing that falls within the law of the case is the one rule announced in the former opinion that as to the distribution of assets in October, 1910, the statute of limitations had not run. (Wostl v. Montana Union Ry. Co., 24 Mont. 159, 61 P. 9; Herriman Irr. Co. v. Keel, 25 Utah 96, 69 P. 719; Allen v. Bryant, 155 Cal. 256, 100 P. 704; Mutual Life Ins. Co. v. Hill, 193 U.S. 551, 24 S.Ct. 538, 48 L.Ed. 788; Hastings v. Foxworthy, 45 Neb. 676, 63 N.W. 955, 34 L. R. A. 321; Lorimer v. Fairchild, 68 Kan. 328, 75 P. 124; Board of School Directors v. Asheville, 137 N.C. 503, 50 S.E. 279.)

A judgment void for want of jurisdiction is open to contradiction or impeachment in a collateral proceeding. (23 Cyc. 1073, 1074, and cases cited; 15 R. C. L. 840, 844.)

Where the court does not have jurisdiction of the person that fact may be shown by any competent evidence. (15 R. C. L. 846-848.)

Ezra R. Whitla, for Respondent.

Every fact which existed and every proposition of law which should have been submitted upon the former appeal is now settled. The first appeal having decided these questions, the law of the case is settled and this court will only decide any new questions since arising. (4 C. J. 1093; Hall v. Blackman, 9 Idaho 555, 75 P. 608; Palmer v. Utah & Northern Ry. Co., 2 Idaho 382, 16 P. 553; Westerfeld v. New York Life Ins. Co., 157 Cal. 339, 107 P. 699.)

This rule applies to practically every kind of an appeal, whether upon the merits, nonsuit or questions of proceeding. (Strehlau v. John Schroeder Lbr. Co., 152 Wis. 589, 142 N.W. 120, 48 L. R. A., N. S., 464.)

If the matters attempted to be presented in the second appeal arose prior to the first appeal and appeared in the original record, or should have been presented by the original record, the court is just as much estopped from taking them up as if they had been squarely presented. (Benbow v. The James John, 61 Ore. 153, 121 P. 899; Perrault v. Emporium Department Store Co., 83 Wash. 578, 145 P. 438; Lutien v. City of Kewaunee, 151 Wis. 607, 139 N.W. 312.)

"Where a prior appeal was taken in an action in which a receiver was appointed and no objection was made thereon to such appointment, no objection to the propriety or regularity of such appointment could be made on a subsequent appeal." (Clark v. Brown, 119 F. 130, 57 C. C. A. 76; Dunshee v. Standard Oil Co., 165 Iowa 625, 146 N.W. 830; Jordan v. Northwestern Electric Equipment Co., 117 Minn. 209, 135 N.W. 529.)

"A judgment of the district court, having jurisdiction of the subject matter of the action, unless void on its face or on inspection of the judgment-roll, is not open to collateral attack." (Burke v. Inter-State Savings & Loan Assn., 25 Mont. 315, 87 Am. St. 416, 64 P. 879; Morrill v. Morrill, 20 Ore. 96, 23 Am. St. 95, 25 P. 362, 11 L. R. A. 155; Haupt v. Simington, 27 Mont. 480, 94 Am. St. 839, 71 P. 672.)

Where any evidence dehors the record is attempted to be introduced, it becomes a collateral attack. (Ex Parte Sternes, 77 Cal. 156, 11 Am. St. 251, 19 P. 275; Culley v. Shirk, 131 Ind. 76, 31 Am. St. 414, 30 N.E. 882.)

"Fact that the judgment is void must appear upon the face of the record." (O'Neill v. Potvin, 13 Idaho 721, 93 P. 20.)

"The sheriff's return is not traversable and the court will not permit it to be attacked collaterally even if the officer is shown to have been guilty of fraud and collusion." (Egery v. Buchanan, 5 Cal. 53; Johnson v. Mead, 73 Mich. 326, 41 N.W. 487; Thomas v. Ireland, 88 Ky. 581, 21 Am. St. 356, 11 S.W. 653; Michels v. Stork, 52 Mich. 260, 17 N.W. 833.)

In domestic judgments where the court finds the fact of service this is conclusive. (Pettis v. Johnston, 78 Okla. 277, 190 P. 681; Crist v. Cosby, 11 Okla. 635, 69 P. 885.)

"Where the court judicially considers and adjudicates the question of its jurisdiction, and decides that the facts exist which are necessary to give it jurisdiction of the case, the finding is conclusive and cannot be controverted in a collateral proceeding." (23 Cyc. 1086, 1088; White v. Crow, 110 U.S. 183, 4 S.Ct. 71, 28 L. ed., 113; 1 Black on Judgments, 2d ed., par. 275; Blackwell v. McCall, 54 Okla. 96, 153 P. 815; Lancaster v. Snow, 184 Ill. 534, 56 N.E. 813; Bruce v. Osgood, 154 Ind. 375, 56 N.E. 25; Ketchum v. White, 72 Iowa 193, 33 N.W. 627; 15 R. C. L. 888, 893.)

A judgment against a corporation is conclusive against the stockholders. It conclusively settles the liability of the corporation as well as the validity of the claim and cannot thereafter be contested in any...

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