24 Wash. 620 | Wash. | 1901
The opinion of the court was delivered hy
Suit to recover upon unpaid subscription to the capital stock of a corporation. Plaintiff recovered judgment against the corporation defendant, C. A. Lundy & Co., in an action at law, execution was issued thereon, the property of the corporation exhausted, and the execution returned, with the sum of $2,126.12 unsatisfied. Thereupon plaintiff commenced the present action to recover from the defendants E. M. Rauch and C. A. Lundy the remainder of the judgment. Rauch and Lundy, when the corporation was formed, subscribed for the entire capital stock, in the sum of $50,000, each subscribing for $25,000 thereof. The complaint alleges these facts, and also that Lundy and Rauch were the managers of the corporation since its formation; that each had paid on his subscription the sum of $12,500; that there was due from each on his subscription the sum of $12,500; that the corporation has no assets or property excepting the
Humerous assignments of error are made by appellant, and the briefs are extensive and somewhat involved. The main contention is that the complaint states, an action at law against stockholders on their unpaid subscription, and that in such form it cannot be maintained. We have frequently observed that the form of action is immaterial, if the facts stated entitle the plaintiff to any relief, and the case is fairly tried. The case of Hurlbutt v. N. W. Spaulding Saw Co., 93 Cal. 55 (28 Pac. 795), is pertinent. The court observed:
“There is in this state but one form of civil actions for the enforcement or protection of private rights and the redress or prevention of private -wrongs (Code Civ. Proc. § 307), and the facts constituting the cause of action are required to be stated in ordinary and concise language. Here the plaintiffs stated in their complaint their cause of action in clear and intelligible language, and the defendants answered thereto. The court was therefore authorized to try the case as made, and to grant any relief embraced in the issues.”
To the same effect, this court said, in Surber v. Kittenger, 6 Wash. 240 (33 Pac. 507) :
“Although an action may be commenced as an equitable*624 one, yet, where there is nothing to give a court of equity jurisdiction thereof, the court has authority to permit it to be tried as an action at law, if the defendant is not thereby prevented from having a fair trial.”
In Burch v. Taylor, 1 Wash. 245 (24 Pac. 438) it was ruled that the unpaid subscription to capital stock was a trust fund, to be reached in equity by the creditor. An equitable suit by a judgment creditor, when recourse against the property of the corporation was exhausted, was maintained in Adamant Mfg. Co. v. Wallace, 16 Wash. 614 (48 Pac. 415), and Kroenert v. Johnston, 19 Wash. 96 (52 Pac. 605). In Shuey v. Adair, ante, p. 378 (64 Pac. 536), it was said, relative to the constitutional liability added to the stockholder in a banking corporation:
“In the only other case where this constitutional provision was directly before this court, the case of Watterson v. Masterson, 15 Wash. 511 (46 Pac. 1041), we held that a creditor could not maintain an action to enforce this liability after a receiver had been appointed to wind up the affairs of the corporation, even though the action was prosecuted on behalf of all of the creditors of the corporation, and the receiver was made a party defendant in the action. . . . But in neither of these cases did this court prescribe, or undertake to prescribe, what form of procedure was necessary in order to charge the stockholders upon their superadded liability. . . . On this question we went no further than to hold that the action brought against the stockholders directly, whatever its form, must be prosecuted by the receiver in all cases where a receiver has been appointed to administer the assets of an insolvent banking corporation.”
In Gager v. Bank of Edgerton, 101 Wis. 593 (77 N. W. 920), it seems, in substance, to be held that the action can be maintained either through creditors on their own behalf or through a receiver, but that both remedies cannot be pursued. 3 Thompson, Corporations, § 3482, attempts to reconcile the cases as follows: The assets of an in
It will be observed plaintiff commenced this action when there was no disclosure of other creditors or of any inadequacy of assets to meet all claims against the corporation. Pending the suit, one of the defendants commenced an action in the same court for the appointment of a receiver, and, upon his petition, Receiver Beach was appointed. Thereupon the plaintiff in the present action requested that the receiver be substituted for herself, or, in effect, that her cause be continued for the benefit of all the creditors, and such relief be given as pertained to equity. The court proceeded according to this theory, concluded the action, and gave relief for the benefit of all the creditors. We deem it of no consequence that the court did not direct amendments of the pleadings or a formal substitution of the receiver, and we are not disposed to disturb or to interfere with the discretion exercised by the trial court in this regard.
Relative tp the plea in the answer of payment in property by agreement of the corporators, the court found adversely to such agreement, and that such payment was not made. While there has been some conflict in the expres
We have examined the testimony, and conclude that the facts found by the superior court are fully supported by the evidence. The judgment is affirmed.
Fullerton, Dunbar, and Anders, JJ., concur.