77 Mo. App. 509 | Mo. Ct. App. | 1898
Lead Opinion
This is a suit in equity, the object of which is to charge the assets in the hands of the assignee of an insolvent corporation, with a lien for $1,000, alleged to have been delivered to the corporation for the purchase of its preferred stock to that amount, which it agreed to issue to plaintiff upon an increase of its capitalization to be thereafter effected. The transaction between the parties was evidenced by the following contract:
“St. Louis, October 9, 1896.
“Received of Rudolph Bireher the sum of one thousand dollars ($1,000) for which the undersigned agrees to sell to him twenty shares of the par value of $50.00 each of its preferred stock out of the increase-of its capital stock, now about to be increased to $15,000.00, and to be made in accordance with the. laws of the State of Missouri, said increase to be made as speedily as the law will allow, and the certificates, for said stock to be delivered as soon as such increase is authorized, upon the return of this receipt. St. Louis Sheet Metal and Ornament Company.
“By Feed Buel, Pres.
“Chas. A. Schulze,
“Sec’y and Treas.”
There was no increase of the stock of said corporation, hence no shares were delivered to plaintiff, as provided for in the above contract, nor was the money returned to him. On the twelfth of August, 1897, the corporation conveyed its entire plant and assets to defendant Walther, for the benefit of certain of its creditors in a numerical order of priority according to the appearance of their names on an attached schedule, plaintiff’s name being the last on the list of creditors. The money in question was advanced to plaintiff by the administrator of his father’s estate, who testified
The first point insisted upon for a reversal is the fact that one of the beneficiaries joined as defendant was not served with process. There was no necessity for joining any of the cestuis qui trusts. The conveyance to the trustee devolved full title upon him and imposed on him the duty of full administration and disbursement of the assets, to which end he was placed in possession of the property. He was therefore the only necessary party to a suit seeking to charge the assets in his hands with a lien. The beneficiaries, though pi’oper, were not necessary parties to that action. Story’s Eq. Pleading, secs. 149, 215 and 216; Harrison v. Smith, 83 Mo. 210; Paul v. Draper, 73 Mo. App.
The second point made by appellants is that the conveyance to the trustee was a valid exercise of the right to prefer its creditors on the part of the corporation. We will concede for this discussion that the conveyance passed to the trustee all the title and interest of the corporation in its assets. But no more. That assumption makes it important to determine the third point urged m appellant’s brief, which is, that the corporation by its contract with plaintiff established the relation between the two of “debtor and creditor, not trustee and eestue que trust.” This view of the effect of the contract in question can not be maintained. That instrument is susceptible of only one interpretation which is that the $1,000 therein receipted for was to be paid for the article therein agreed to be sold, to wit, “20 shares of its preferred stock.” Until this stock came into being, the price to be given for it belonged to plaintiff, and the prior custody of the money by the corporation was that of agent, bailee or trustee for the plaintiff, as against whom it could neither acquire nor assert title to the money before rendering that which it agreed to exchange for it. The general rule applicable to such a transaction has been well expressed by the Kansas City court of appeals, Clark v. Bank, 57 Mo. App. loc. cit. 286, as follows: “By the well settled doctrine of equity a constructive trust arises where one party has obtained money which does not equitably belong to him and which he can not in good conscience retain or withhold from another who is beneficially entitled to it.”
Appellants’ next contention is that conceding the relationship of trust was created between plaintiff and
Finally appellant complains of the allowance of interest. The moment the defendant corporation violated its written contract with plaintiff, it became liable for the money received thereunder, and interest was properly allowed as from the time of the conversion. Padley v. Catterlin, 64 Mo. App. loc. cit. 647. The decree in this case is affirmed. Judge Bland concurs; Judge Biggs dissents for the reason stated in the second paragraph of his dissenting opinion in the case of Paul v. Draper, 73 Mo. App. loc. cit. 570.
Dissenting Opinion
DISSENTING OPINION BY
In this case the assignment was made ten months after the alleged conversion of the trust fund. During the entire time the defendant was engaged in active business. If the opinion of my associates receives the sanction of the supreme court, then any cestui que trust