56 Wash. 515 | Wash. | 1910
On May 5,1906, H. D. Boyes obtained a judgment in the superior court of Stevens county against the Turk Mining Company, a corporation, for $1,280.95, and costs. Afterwards he caused an execution to be issued and
Prom the evidence it appears that on October 12, 1905,. the Turk Mining Company, being indebted to the Lincoln County State Bank in the sum of $7,859.94, executed and delivered to the bank its note and mortgage deed; that the mining company was unable to pay the note when due; that certain of its stockholders thereupon agreed among themselves to raise a fund by individual subscription, and deposit, it with the bank in the names of Henry Carstens and C. H.. Blake; that the bank was to foreclose its mortgage; that Carstens and Blake were to purchase the property at the foreclosure sale, using the subscription fund for that purpose; that a new mining company was to be then organized in which stock was to be issued to the subscribers in proportion to their several subscriptions; that Carstens and Blake-were to convey the property to the new company, and that this plan had been fully consummated before the commencement of this action, except that the conveyance to the new-mining company was made thereafter.
The appellant contends that the agreement by certain-stockholders to raise the subscription fund was made for the-benefit of the Turk Mining Company, and that the foreclosure and sale were conducted in pursuance of a fraudulent and' collusive design to illegally divert the assets of the company and prevent the appellant from collecting his claim. The-trial court found that the foreclosure proceedings had been-prosecuted in good faith, that no fraud was proven, and that:
Appellant, in substance, insists that the Turk Mining Company was insolvent; that the assets of an insolvent corporation constitute a trust fund for the payment of all of its creditors, and that the scheme in pursuance of which the mortgage was foreclosed was fraudulent in that it unlawfully diverted the assets of an insolvent corporation for the benefit of its stockholders, and prevented the payment of its just debts. The trust fund theory stated by appellant has been repeatedly announced by this court and cannot be questioned. It has, however, no bearing upon the facts of this case. Appellant on the trial admitted that the mortgage had been given for a legal consideration, and made no attack on its validity. It did not appear that the corporation was insolvent when the mortgage was given. In fact, the indica
The judgment is affirmed.
Rudkin, C. J., Parker, Mount, and Dunbar, JJ., concur.