Wooding v. John Wooding Co.

• Decision Date: 08 January 1895
• Citation: 39 P. 137,10 Wash. 531
• Parties: WOODING v. JOHN WOODING CO. ET AL.
• Court: Washington Supreme Court

39 P. 137

10 Wash. 531

WOODING v. JOHN WOODING CO. ET AL.

Supreme Court of Washington

January 8, 1895

Appeal from superior court, King county; J. W. Langley, Judge.

Action by John Wooding against the John Wooding Company to have a receiver appointed. A receiver was appointed, and, without intervening, W. I. Vail, and others, copartners as the Northwestern Shoe Company, judgment creditors of defendant filed a motion to vacate the order appointing a receiver, and from a denial of this motion now appeal. Appeal dismissed.

H. E Snook, for appellants.

S. H Piles and I. B. Knickerbocker, for respondent.

STILES, J.

Upon the complaint of a stockholder of the corporation known, as the John Wooding Company the superior court appointed a receiver of the corporate property, whereupon appellants, who were judgment creditors, filed a motion in the stockholders' action to vacate the order appointing a receiver. In aid of this motion an affidavit was filed showing the judgment obtained by affiants, that the plaintiff in the original case was the president of the corporation and that no notice of the application for a receiver was given to affiants. It was also alleged that the complaint did not state facts sufficient to entitle the plaintiff to the appointment of a receiver. The court heard the motion, but denied it, and this appeal is from that order.

A motion was made to strike respondent's brief, but we shall not discuss or decide it, as the result would be the same whether the respondent had filed a brief or not.

Appellants' first point is that there was really no action pending, but that the receivership was a collusive proceeding between the nominal plaintiff and the corporation, intended to get the property into the hands of a receiver for the purpose of hindering and delaying creditors. So far as the collusion is concerned, nothing is more common than for a receiver to be appointed to care for the assets of an insolvent corporation, and distribute its assets ratably among its creditors, at the suit of a creditor, a stockholder, or of the corporation itself. And nothing is more proper. But when such a receivership is procured for the purpose of hindering and delaying creditors, the proceeding is obnoxious to a charge of fraud, and can be set aside in the same way as any other act, instrument, or proceeding done, made, or taken either in or out of a court; that is, by an action brought by some...