Wright v. Spencer

• Decision Date: 29 December 1923
• Citation: 38 Idaho 447,221 P. 846
• Parties: JOHN M. WRIGHT, Respondent, v. E. S. SPENCER and POCATELLO SECURITY TRUST COMPANY, a Corporation, Appellants
• Court: Idaho Supreme Court

221 P. 846

38 Idaho 447

JOHN M. WRIGHT, Respondent, v. E. S. SPENCER and POCATELLO SECURITY TRUST COMPANY, a Corporation, Appellants

Supreme Court of Idaho

December 29, 1923

APPEAL AND ERROR-MOTION TO DISMISS-"ADVERSE PARTY"-CORPORATIONS-INSOLVENCY.

1. An adverse party within the meaning of C. S., sec. 7153, is any party who would be prejudicially affected by a modification or reversal of the judgment appealed from.

2. Where a corporation, one of several defendants in an action defaults or appears and answers but does not support its answer by proof, and a joint and several judgment is entered and it is an adverse party within the meaning of C. S., sec 7153, and entitled to notice of appeal, nevertheless, where it is properly shown that it is hopelessly insolvent and practically defunct, a motion to dismiss on the ground that it was not served with notice of appeal will be denied.

APPEAL from the District Court of the Fourth Judicial District, for Lincoln County. Hon. H. F. Ensign, Judge.

Motion to dismiss appeal. Denied.

Judgment rendered that the defendant corporation was virtually defunct at the time.

McFadden & Perkins and W. A. Brodhead, for Respondent.

"Adverse party" means every party whose rights might be adverse or injuriously affected by a reversal of such judgment. Nominal or useless parties need not be joined. (3 C. J 1006.)

The Pocatello Security Trust Co. is an adverse party within the meaning of C. S., sec. 7153, and must be served with notice of appeal, otherwise the appeal is subject to dismissal. ( Holt v. Empey, 32 Idaho 106, 178 P. 703; Nelson-Bennett Co. v. Twin Falls Co., 13 Idaho 767, 92 P. 980; Diamond Bank v. Van Meter, 18 Idaho 243, 108 P. 1042; Titiman v. Alamance M. Co., 9 Idaho 240, 74 P. 529; Aulbach v. Dahler, 4 Idaho 522, 43 P. 192; Bannock Nat. Bank v. Auto Acc. Co., 36 Idaho 527, 212 P. 864.)

"Nothing short of actual dissolution, however, abates actions already pending; the mere commencement of winding-up proceedings and the appointment of a receiver pendente lite does not have that result." (Pomeroy Eq. Jur., 4th ed., sec. 1614.)

E. D. Reynolds and P. S. Haddock, for Appellant Spencer.

A corporation which is hopelessly involved and practically defunct is not a necessary party to an appeal. ( Galveston etc. R. R. Co. v. House, 102 F. 112, 42 C. C. A. 205.)

Budge & Merrill, for Defendant Pocatello Security Trust Co.

OPINION

PER CURIAM.

--This is an action brought to recover on a promissory note given by appellant Spencer to the Pocatello Security Trust Co., and by the latter sold and transferred by blank indorsement and delivery to the plaintiff Wright, in whose favor a joint judgment against both Spencer and the company was entered. Both defendants answered, but only Spencer appeared at the trial and only Spencer appealed. It is admitted that he did not serve notice of appeal on his codefendant Pocatello Security Trust Co., and this is the ground for the motion to dismiss.

It has often been held by this court that an "adverse party" within the meaning of C. S., sec. 7153, is any party who would be prejudicially affected by a modification or reversal of the judgment appealed from. In the late case of Bannock National Bank v. Auto Acc. Co., 36 Idaho 527, 212 P. 864, the rule was applied where defaulting defendants were not served by appealing codefendant with notice of appeal from a joint and several judgment. Where a codefendant has answered, as in the instant case, his right to be served would be at least as strong, if not stronger, than in the case of one who had wholly defaulted.

If the judgment in this case is reversed as to Spencer he will be freed from liability, while the judgment would still stand as to the company, which did not appeal, and if actually recovered from the company, or any part thereof, it would be deprived of its right to enforce contribution against its codefendant Spencer, and would therefore be injuriously affected by such reversal.

Counsel for appellant contends, however, that the defendant corporation was practically defunct at the time judgment was rendered against it and Spencer on May 11, 1922. He has filed an affidavit made by himself in which he states, among other things: "That at the time the defendant E. S. Spencer was negotiating with plaintiff for a change of place of trial, this affiant consulted the said general attorneys of Pocatello Security Trust Co., as to...