Young v. Hughes

• Decision Date: 12 August 1901
• Citation: 39 Or. 586,65 P. 987
• Parties: YOUNG et al. v. HUGHES.
• Court: Oregon Supreme Court

65 P. 987

39 Or. 586

YOUNG et al. v. HUGHES.

Supreme Court of Oregon

August 12, 1901

Appeal from circuit court, Marion county; R.P. Boise, Judge.

Action by S.E. Young and others against John Hughes, as administrator of the estate of Seth R. Hammer, deceased. From a judgment for plaintiffs, defendant appeals. Modified.

This is a suit by certain stockholders of a corporation, for themselves and on behalf of all others similarly situated, to establish and enforce a lien upon a fund in the hands of the representative of a deceased trustee. It is alleged in the complaint, in effect, that the Gold Mountain & Dry Gulch Gold & Silver Mining Company, a corporation, sold its mining property, for which its secretary, Seth R. Hammer, received the sum of $5,000 to be distributed to its stockholders in certain proportions; that on December 2, 1898, Hammer died intestate, having in his possession of said money the sum of $1,312.12 and certain office furniture, the property of the corporation; that on December 5, 1898, the defendant, John Hughes, was duly appointed administrator of the decedent's estate, and, having qualified and entered upon the discharge of his trust, wrongfully took possession of said money and furniture, which, upon a demand therefor, he refused to deliver to plaintiffs; that more than 100 stockholders of said corporation, residing in this and other states, have not received their share of said fund, and their number and diverse citizenship render it impracticable that they should be made parties; that there is no person now authorized to demand, take possession of, or sue for the recovery of said money or property in the name of the corporation, or to act for or on its behalf or that of its stockholders; and that it is necessary that some qualified person should be appointed to take charge of said money and property for the benefit of plaintiffs and the other stockholders, so that he may convert the property into money and distribute it, with such fund, to those entitled thereto according to their respective rights. The summons was served upon the defendant, John Hughes, only, who alone answered denying the material allegations of the complaint, and averring that prior to the commencement of the suit he offered to deliver to the plaintiffs any property belonging to the corporation which they could identify as such; but they failing and refusing to identify any of the corporate property, he took its seal and dating stamp into court for them. The reply having put in issue the allegations of new matter in the answer, a trial was had, resulting in a decree awarding the plaintiffs and other stockholders who had not received their share of the proceeds of sale the sum of $1,201.62 of the money in Hammer's possession at the time of his death, appointing Amos Strong receiver to hold said sum for, and to distribute it to, the unpaid stockholders, and that plaintiffs recover of Hughes, as administrator, their costs and disbursements; from which decree he appeals.

J.A. Carson and P.H. D'Arcy, for appellant.

W.T. Slater, for respondents.

MOORE J. (after stating the facts).

A careful examination of the testimony convinces us that the court properly found that the plaintiffs and other stockholders had a preferred lien upon a part of the money received by Hammer upon a sale of the mining property remaining in his possession at the time of his death. A.N Bush, an accountant in the bank of Messrs. Ladd & Bush, at Salem, Or., testifies that for many years Hammer had been a customer of their bank, that he was acquainted with his mode of doing business with banking institutions, and that it was his general custom to deposit money held by him for others in such a manner as to show who were the equitable owners thereof. The testimony shows that upon Hammer's death a box belonging to him, and kept in the vaults of said bank, was found to contain certificates of deposit payable to himself or order in the sum of $1,050, and there were also found in his office like certificates in the sum of $350. It also appears that, while the mining property of the corporation was sold by its officers in pursuance of authority conferred upon them by a majority of the stockholders, several of the minority were dissatisfied with the price received therefor, and this fact probably explains why a part of the money remained in Hammer's possession at the time of his death. These displeased stockholders had threatened to sue the corporation, causing Hammer to fear that their menaces would be executed, and that they might possibly secure a greater proportion than had been paid to the...