Brandon Iron Co. v. Gleason, 24 Vt. 228

24 Vt. 228 | Vt. | 1852

The opinion of the court was delivered by

Isham, J.

This is an action on the case against the defendant as sheriff of Chittenden county, for not keeping and delivering certain articles of personal property attached by him as such sheriff, at the suit of the plaintiffs against David French.

The case shows the disposition of all the property attached. No claim is made for that part of the property which was sold on. the execution of Wm. Randall, the surplus of which was paid over to the plaintiffs on their execution. But they claim to have all the property embraced in the officer’s return applied on their execution which was not disposed of on the execution of Wm. Randall.

In relation to this property, we learn, that previous to the plaintiffs’ attachment, it had been attached at the suit of C. W. Conant, and which had priority of lien over the attachment of the plaintiffs, and that his claim exceeded in value all the property attached. We learn also, that after these several attachments were made, Mr. Conant, by an arrangement with Mr. French, received all the property included in the officer’s return and which has not been otherwise properly accounted for, at its full value, and which was applied in part satisfaction of his claim and attachment against French, and under an agreement which was carried into effect, that the attachment and suit of Conant should be discharged and discontinued. It is under this arrangement and application of this property on his debt, that Mr. Conant claims title to this property not only as against Mr. French, but also as against the' plaintiffs as subsequent attaching creditor’s, and the defendant also relies upon this agreement and appropriation, as legally accounting for the property by him attached. And if by this agreement Mr. Conant has perfected a legal title to this property, it is evident that the property attached by the defendant has all been accounted for, and he is not liable in this suit. But if that arrangement was insufficient to convey such title, or if his lien by virtue of his attachment is lost, by a discharge and discontinuance of the suit, then the defendant is responsible in this suit for the property received by Mr-. Conant and appropriated on his debt.

In the case of Hall v. Walbridge, 2 Aik. Rep. 215, it was held that successive liens by attachment, and in favor of different creditors could be created on the same property. The same principle was recognized in the case of Murray v. Eldrige, 2 Vt. Rep. 388, and in relation to the rights of subsequent attaching creditors where their proceedings to judgment and execution have been regularly taken, the court use this language: “ that they have “ thereby established their right not only to the surplus of said “ property, after the plaintiffs’ lien should be satisfied, but to the “ whole of the property if the lien of the prior attaching creditors “ should not be perfected.”

No practical inconvenience has been found to follow from this rule, and we entertain no doubt as to its correctness to the extent to which it has been carried by the former decisions of this court. The question in this case is therefore narrowed down to the simple inquiry, whether Mr. Conant has so perfected his title under his attachment and agreement with French, as' to give him a good right to this property as against the plaintiffs. The statute has been uniform in relation to the rights of attaching creditors and the steps necessary to be taken to perfect their right to the property attached. The attachment creates a lien, and places the, property in the custody of the law to respond the judgment and execution .that shall be obtained thereon. As against subsequent attachments, the rendition of a judgment in due form and course of law is as necessary as the attachment itself. So is also the issuing of an execution on that judgment and duly charging the property therewith. And as these proceedings are in invitum there should be a general and substantial compliance, at 'least, with all the requirements of the statute. Upon this principle it was held in the case of Hall v. Walbridge, that a confession of judgment in a suit, before the act allowing the same, would discharge a lien created by the attachment, as no judgment had been rendered upon the process, on which the attachment was made, and the property was held by the subsequent attaching creditors. So also in the case of Murray v. Eldridge a judgment was rendered by the agreement of the parties, a few days before the time specified in the writ, and its effect was to discharge the lien created by the attachment, and the property was held by subsequent attachments. In that case the court say, “the moment in which “the action was discontinued, or a judgment obtained by confes- “ sion, or in any other way- not in the regular prosecution of the “ action, the lien of the subsequent attaching creditors was per“fected to the whole of the property, the property ceased to “be holden by the first attachment.” These decisions must be decisive upon the question arising in this case, for if the application of the property upon the debt in those cases, under a judgment and sale on the execution superadded to the 'assent and agreement of the parties was ineffectual to perfect the creditor’s title, much less, as in this case, will such an application have that effect, under the simple agreement of the original debtor.

The case of Munger v. Fletcher, 2 Vt. Rep. 524, has been urged by the defendants as sustaining the right of Mr. Conant to this property under his agreement with 'Mr. French. In that case the property of one Fisk was attached at the suit of six different creditors, and under an arrangement with Fisk and the five first attaching creditors, the property was sold, against the consent of the last creditor, and the avails of the sale held by the officer to respond the judgment and executions that should he obtained. All the creditors perfected their lien and attachment by obtaining judgment, issuing executions thereon, and duly charging the property therewith. The last attaching creditor brought his suit and claimed that the lien of the other creditors was lost, and that the property was subject to his attachment alone. The court held that as the avails of the .sale were not sufficient to pay the first attachment, the action could not he sustained, and that the claim of the different creditors were not lost by that arrangement 'and sale. It is to be observed that in that case all the creditors perfected their respective attachments by proceeding to judgment, issuing executions and charging the property attached thereon, and it is upon this ground that the court placed their decision. If the officer had neglected to account for the property or its avails and the several creditors had prosecuted him therefor, the first attaching creditor would have recovered the whole, as the avails of the sale were not sufficient to pay his debt. The last creditor, therefore, having sustained no damage, could sustain no action, and the officer having paid the avails of the sale to the first creditor, he had applied the property as it would have been recovered of him. But in this casé, if Mr. Conant retains the property, it is applied in a different manner from what it could be recovered.

Mr. Conant by discontinuing his suit and neglecting to prosecute to judgment, can sustain no action against the sheriff for the property attached, as he has no lien thereon for that purpose. The plaintiifs are the only attaching creditors who have perfected their lien by judgment and execution, and they alone can sustain their action against the officer therefor. Upon the principle and authority of that case, even the attaching creditors must perfect their lien under their attachment, so that the officer can apply the property on those debts secured by attachment and satisfy the claims of those who have a right to call upon him for it. As Mr. Conant had no such right,, the defendant is not protected by his claim or lien, in permitting the property to pass into his hands.

As agains't Mr. French the title of C. ~W. Conant may be good, as by his agreement he will be estopped to deny Conant’s title. But this can have no effect as against the plaintiffs, unless their assent was also obtained. The fact that Mr. Conant was a stockholder in the Brandon Iron Company at the time of his arrangement with French, can furnish no evidence of such assent, for he at that time was in interest adverse to that of the corporation, in no way its representative, or acting as the agent of the corporation. On the contrary, after 1841 the general agency and charge of the debts of the corporation was placed in the hands of John A. Conant, and he alone could act as agent in its behalf.

It has been urged that the plaintiffs have lost their corporate existence by having ceased to do business after April, 1841, and by disposing of their personal property and neglecting to choose corporate officers since that period, and that in consequence of it the stockholders stood in relation to the concerns of that company as partners, which rendered the act of C. W. Conant in making that arrangement binding upon all.

We are not prepared to say, even if that relation existed, that the act of C. W. Conant, situated as he was, would have that effect upon the others interested; much less are we authorized to say, from any fact appearing in the case, that the plaintiffs have lost their corporate existence, or are incapable of exercising their corporate franchises. That they had a charter, and a legal corporate existence under that charter, and were duly organized, has not been put in issue by plea in abatement, or in bar. 11 Vt. Rep. 393, Bank v. Allen.

And where a charter has been granted and an organization effected under it, the question whether there has been a forfeiture of that charter, or a surrender of its franchises, cannot be tried, so as to be conclusive upon the corporation, in this collateral or incidental manner. On the question of forfeiture, it can only be tried by the writ of scire facias or quo warranto in direct proceedings between the corporation and the State granting the charter; and until judicially determined there' has been no forfeiture, although a cause therefor may exist. State v. Essex Bank, 8 Vt. Rep. 489. 7 Conn. Rep. 45. 15 Pick. Rep. 351. 5 Mass. Rep. 230. 5 John Ch. 366. Ang. & Ames on Corpt. 664. So, to constitute a legal surrender of a charter, there must be an act of the corporation to that effect, and an acceptance of the same by .the government granting the charter. In England it is effected iby deed to the King, which must be enrolled. 1 Salk. 192. 2 Kyd. on Corpt. 465. In this country by acceptance, and the authorities are uniform, that it is of no avail until accepted. 2 Kent’s Com. 358, last ed. Ang. & Ames on Corpt. 658. 24 Pick. Rep. 49. 15 Pick. Rep. 351. 7 Conn. Rep. 45. This doctrine is fully recognized in NeV York, though they have found the necessity of qualifying the rule in relation to those charters where, in a certain event the individual stockholders are made personally liable — where, for the sake of the remedy and in favor of creditors, they will presume a virtual surrender. 2 Kent Com. 358. 1 Hop. 300. 8 Conn. 387. Aside from that particular purpose, Chancellor Kent remarks that “ The old and well estab- “ lished principle of law remains good as a general rule, that a cor- “ poration is not to be deemed dissolved by reason of any misuser “ or nonuser of its franchises, until the default has been judicially “ ascertained and declared.” 2 Kents Com. 359. 4 Paige Ch. Rep. 481, Wilde v. Jenkins. It is probably true that a legal surrender may be presumed where, for a sufficient length of time, there has existed an entire nonuser of corporate franchises, and a neglect to choose corporate officers. Such has been the general received doctrine in this State, and was recognized in Penfield v. Skinner, 11 Vt. Rep. 296. But the lapse of time required for that purpose has never been decided. In Slee v. Brown, 5 Johns. 399, it was held that two years would have no such effect. So, also, in Russell v. McLeland, 14 Pick. 63. A nonuser for ten years was held not to work a forfeiture, or loss of corporate franchises, 7 Conn. Rep. 47. In Regina v. Ballvas, 1 P. Wm.’s 207, it was held by Parker, Ch. J., that after twenty-two years, a vacancy in an office under the charter could not be filled, though Powell, J., dissented, and thought an election might be made on a charter day. It is upon the ground alone, of a presumed surrender of the charter, that evidence of nonuser of corporate franchises can be received. This case does not require a more definite determination as to the length of time necessary to raise such presumption; as no-doubt is entertained that there has not been such a neglect by this corporation, in the use of their corporate franchises, as will operate as a dissolution of its charter.

The plaintiffs therefore, having still their legal existence, and not having assented to the arrangement of C. W. Conant with Mr. French, cannot be concluded by that arrangement, and the defendant must be held responsible for not keeping and delivering up on demand, the property for which this action was brought.

The judgment of the county court must therefore be reversed.