Winchester & Lexington Turnpike Co. v. Wickliffe's Adm'R.

• Citation: 100 Ky. 531
• Parties: Winchester & Lexington Turnpike Co. v. Wickliffe's Adm'r.
• Decision Date: 27 January 1897
• Court: Court of Appeals of Kentucky

Page 531

100 Ky. 531

Winchester & Lexington Turnpike Co. v. Wickliffe's Adm'r.

Court of Appeals of Kentucky.

January 27, 1897.

APPEAL FROM FAYETTE CIRCUIT COURT.

BRECKINRIDGE & SHELBY FOR APPELLANT.

SAMUEL M. WILSON AND MORTON & DARNALL FOR APPELLEE.

BRECKINRIDGE & SHELBY IN PETITION FOR MODIFICATION OF OPINION.

JUDGE GUFFY DELIVERED THE OPINION OF THE COURT.

This action was instituted by the administrator of Robert Wickliffe against the appellant to recover $232.50, dividends due from the appellant upon the shares of stock owned and held by the decedent in the Lexington & Winchester Turnpike Co., which dividends accrued and were declared upon the shares so held, commencing with the year 1877 and ending in 1889. The appellant pleaded and relied on the statute of limitations as its only defense, relying on the five-years and also on the ten-years statute of limitations, and alleging that the dividends had been appropriated by the appellant to its own use more than five years as to part, and more than ten years as to the residue. This suit was filed October 16, 1894. The court below sustained a demurrer to the answer, and, appellant declining to amend, judgment was rendered in favor of appellee for the amount claimed; and from that judgment appellant prosecutes this appeal.

The only question presented for decision is whether or not the claim, or any part of it, was barred by limitation.

Appellant insists that the case of Mercer County Court v. Springfield, Maxville & Harrodsburg Turnpike Co., 10 Bush, 254, is decisive of this case, and determines that the five-years statute bars a claim for the dividends declared. It is true that the court held that the dividends in that case were barred by the five-year statute, but that case is unlike the case at bar. It will be seen, upon examination of the opinion in that case, that the company denied the right of the county to the shares of stock, and of course it had never declared any dividends as due to the county court; but in the case at bar, it is admitted, in effect, that the dividends had been declared in appellee's favor, and that if he had applied in time would have been entitled to the payment thereof.

Appellee's contention is that no right of action accrued to appellee until a demand for payment was made by him of the appellant; and as no demand had been made until a few days before suit, the statute had not commenced to run prior thereto; also that the appellant held the dividends as trustee for appellee, and, therefore, the statute constituted no bar to a recovery, and cites Bank of Louisville v. Gray, 84 Ky., 575, in which the court said: "A bank is a trustee for its stockholder," and further announced the doctrine that the bank should not be regarded as holding the dividends of its stockholders adversely until after a demand is made. Appellant insists that so much of the opinion as is relied on by appellee was not necessary to a decision of that case, hence is only obiter dicta and not authority; but it is not necessary to pass upon that question, for the reason that in no event can that decision be decisive of this case.

A bank is in many respects different from a turnpike company, and the reasons for holding it to be a trustee for its stockholders might be much stronger than any reason for so holding in regard to a turnpike company. It is part of the business of a bank to receive and hold the money of its patrons payable on demand.

It is said in Beach on Private Corporations, volume 2, page 953, section 599: "A dividend declared operates as a specific appropriation of a part of the property of the company to its payment, and the claims of the shareholders as creditors develop into an absolute title to the property so appropriated."

"Accordingly, after the declaration of the dividend,...