Whitaker v. Coudon
| Decision Date | 15 February 1917 |
| Docket Number | 70. |
| Citation | 100 A. 279,130 Md. 234 |
| Parties | WHITAKER et al. v. COUDON et al. |
| Court | Maryland Court of Appeals |
Appeal from Circuit Court, Cecil County, in Equity; Albert Constable, Philemon B. Hopper, and W. H. Adkins, Judges.
Bill by Martha E. Whitaker, individually and as executrix of the last will and testament of Carrie C. Updegraff, deceased, and others, against Joseph Coudon, individually and as sole surviving executor-trustee of the estate and last will and testament of George P. Whitaker, deceased, and others. From order sustaining a demurrer to the bill, complainants appeal. Affirmed.
Argued before BOYD, C.J., and BURKE, PATTISON, URNER, and STOCKBRIDGE, JJ.
John S Strahorn, of Annapolis, and H. A. Brann, Jr., of New York City, for appellants.
Thomas H. Robinson, of Bel Air (Chas. B. Finley, Jr., of Elkton, and John A. Howard and George R. E. Gilchrist, both of Wheeling W. Va., on the brief), for appellees.
The appeal in this case is from an order of the circuit court for Cecil county sustaining the demurrer to the appellants' bill. The bill is a very long one and contains much argumentative matter. The facts alleged in it are substantially as follows:
In 1878, George P. Whitaker, of Cecil county, Md., formed a corporation under the laws of this state, known as the George P. Whitaker Company. Its capital stock consisted of 520 shares, of the par value of $500 per share, all of which was taken by him; but of it he sold one share to each of seven persons, among whom were Joseph E. Whitaker, Nelson E Whitaker, and Joseph Coudon, who subsequently became executors of his last will and testament. To the corporation so formed he conveyed certain lands owned by him individually, located in Cecil and Baltimore counties and in the state of Delaware, the value of which, as stated in the bill, was $260,000. George P. Whitaker had previously, in the year 1875, formed the Whitaker Iron Company, incorporated under the laws of West Virginia. It was capitalized at $500,000, consisting of 5,000 shares, at the par value of $100 per share, but only $125,000 of its stock was issued. Of the 1,250 shares issued, 250 shares were disposed of by him to each of his children, Nelson, Edmund, Cecil, and Caroline and the remaining 250 shares he held for his two grandchildren, George P. Whitaker, Jr., and Carrie Coudon Whitaker (later Updegraff), minor heirs of his deceased son Henry C. Whitaker, until they should come of age. Thereafter George P. Whitaker, Jr., sold his entire stock-125 shares-to persons not named in the proceedings; and George P. Whitaker, Sr., became the purchaser of one-half of Edmund's stock therein, being one-tenth of its entire stock, and also the purchaser of the stock of Carrie Whitaker, amounting also to one-tenth of the entire stock of the company. As a result of these purchases, George P. Whitaker, Sr., became the owner in his own right of one-fifth of the stock of the company.
George P. Whitaker died on September 30, 1890, and by his last will and testament, admitted to probate in the orphans' court of Cecil county, January 5, 1891, he, after making provision for his widow, directed that all the rest, residue, and remainder of his estate and property should be divided into five equal parts or shares, and that one of such parts or shares be distributed to each of his three children, Caroline Naudine, Nelson E. Whitaker, and Edmund S. Whitaker; one part or share to Carrie Whitaker and George P. Whitaker, Jr., daughter and son of Henry C. Whitaker, a deceased son of the testator; and one part or share to Nelson Price Whitaker, son of Cecil Whitaker, another of his deceased sons. By his said will George P. Whitaker named as his executors Joseph R. Whitaker, Nelson E. Whitaker, and Joseph Coudon, who thereafter qualified and entered upon the discharge of the duties of their office; but Joseph R. Whitaker resigned his trust some time prior to October, 1891.
In 1909, Nelson E. Whitaker died testate in West Virginia, and letters testamentary on his estate were granted to Sarah F. Whitaker, Albert C. Whitaker, and Alexander Glass, in that state; but no letters have been granted them, or to any one else, on his estate, in Maryland.
Joseph Coudon is still alive and is the sole surviving executor of George P. Whitaker.
The personal estate of George P. Whitaker at the time of his death consisted principally of the 513 shares of stock in the George P. Whitaker Company assessed at $500 per share, or $256,000, and the 250 shares in the Whitaker Iron Company assessed at $100 per share, or $25,000, and the advancements to his beneficiaries, which he directed should be charged against them, which amounted to $340,729.73. So far as the record discloses, he died seised and possessed of no real estate unless, as claimed by the plaintiffs, he was at such time the owner of the lands held by the George P. Whitaker Company.
The contention of the plaintiff is made upon the allegation that the seven shares disposed of by George P. Whitaker were only nominally held by those to whom they were assigned, including Nelson E. Whitaker and Joseph Coudon, were only nominally held by such parties, "who paid nothing therefor and immediately assigned said stock back to the company as collateral security for the payment of the par value thereof," and was thereafter so held by the company.
On the 14th day of October, 1891, the orphans' court of Cecil county, upon the petition of the executors of George P. Whitaker, deceased, passed the following order:
On the 31st day of December following, the George P. Whitaker Company conveyed all the lands of the George P. Whitaker Company, both in Maryland and in Delaware, to John S. Wirt, in trust, to convey the same to the said Principio Furnace & Rolling Mill Company. It seems, however, nothing more was done in relation to this matter, as the lands were never conveyed to the Principio Furnace & Rolling Mill Company, nor was the deed to Wirt ever canceled.
On March 1, 1892, after Joseph R. Whitaker had resigned as one of the executors of George P. Whitaker, a bill was filed by the George P. Whitaker Company, in the circuit court for Cecil county, asking for its dissolution. This was pursuant to a resolution of the stockholders of the company passed by a unanimous vote at a stockholders' meeting held on the 28th day of January, 1892, at which all of the stockholders were said to have been present and to have voted. It was alleged in the bill, as a reason for the dissolution of the company that:
"While said company is solvent, it has not sufficient capital to work and develop its property to advantage so as to earn dividends for its stockholders and to meet its outstanding indebtedness when and as the same matures, although the value of its property real and personal is in excess of its debts; that there is no prospect of securing additional capital for the necessary uses of said company, nor is there the ability on the part of the holders to dispose of the property at private sale, owing to the objections that have been made and are now urged to said sale by the cestui que trusts under said will of George P. Whitaker, deceased, who will not consent to the surrender of the stock of the George P. Whitaker, in which said cestui que trusts have an interest."
On April 6, 1892, by a decree of the circuit court for Cecil county passed on that day, the company was dissolved, and John S. Wirt was appointed receiver. He thereafter duly qualified as such, and sold the company's real estate to the Whitaker Iron Company, as the bill alleges for $70,000 although by the deeds therefor given to the purchasers therefor it is shown that the aggregate amount of sales...
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