172 Mass. 39 | Mass. | 1898
This case was once before considered by us on demurrer to the declaration. Hancock National Bank v. Bilis, 166 Mass. 414. The demurrer having been overruled, the defendant answered, and the cause was heard by a justice of the Superior Court, without a jury.
At the close of the evidence, both the plaintiff and the defend- s ant made numerous requests for rulings. The presiding justice gave the third, fourth, fifth, sixth, and eighth of the rulings requested by the plaintiff, and all of the rulings requested by the defendant, and made the following special findings:
“ 1. I find that the Commonwealth Loan and Trust Company ceased to do business on February 21, 1891.
“ 2. I find from the evidence that such corporation did not resume business thereafter, and that by virtue of the statutory law of Kansas there was a dissolution of the corporation previous to the date of this writ.
“ 3. There was no legal or competent evidence given at the trial which enabled me to find what were the assets or the liabilities of this corporation at the date of the original judgment against the corporation, or at the date of the issue of execution against it, or at the date of the writ in this action.”
The first four rulings requested by the plaintiff which the court gave were as follows:
“ 3. Upon all the evidence in the casa, as matter of law, the court is bound to find that, under the laws of Kansas, stockholders in corporations organized under the laws of Kansas are liable severally, and not jointly, to the judgment creditors of the corpo
“4. Upon all the evidence in the case, as matter of law, the court is bound to find that, under the laws of Kansas, stockholders in Kansas corporations who appear as stockholders upon the books of the corporation are conclusively presumed to be stockholders of the corporation within the meaning and liability of said paragraph 1192, already referred to.
“ 5. Upon all the evidence in the case, as matter of law, the court is bound to find that, under the laws of Kansas, the stockholder’s liability under said paragraph 1192, already referred to, is a contractual liability, and arises upon the contract of subscription to the capital stock made by the defendant in becoming a stockholder; and that in subscribing to said stock and becoming a stockholder he thereby guaranteed payment to the creditors of the corporation of an amount equal to the par value of the stock held and owned by him.
“ 6. Upon all the evidence in the case, as matter of law, the court is bound to find that, under the laws of Kansas, the stockholder who is liable under said paragraph 1192 is liable to the judgment creditor of the corporation who first pursues his remedy under the statutes, and is discharged from all further liability by once paying the full amount thereof to such creditor.”
Among the rulings requested by the plaintiff which the court declined to give is the seventh, which is as follows:
“ 7. Upon all the evidence in the case, as matter of law, the court is bound to find that, under the laws of Kansas, an action to enforce the stockholder’s liability under said paragraph 1192, already referred to, is transitory, and may be brought in any court of general jurisdiction in the State where personal service can be made upon the stockholder.”
The rulings requested by the defendant which the court gave are to the effect that the obligations imposed by the statutes of Kansas will be enforced in Massachusetts only as a matter of comity; that the courts of Massachusetts will not enforce them against a resident citizen of Massachusetts unless it appears that no injustice will be done; that these courts are unable to do justice tb stockholders resident in Massachusetts who have paid the debts of the corporation, and are entitled to sue other
The Commonwealth Loan and Trust Company is a private corporation, established under the laws of the State of Kansas on February 2, 1887, for the purpose of transacting the business of a loan and trust company, and having places of business at Kansas City in Kansas, and in Missouri, and in the city of Boston in Massachusetts. The plaintiff, the Hancock National Bank of Boston, is the same corporation as the Traders’ National Bank of Boston. On September 1,1891, the Traders’ National Bank of Boston, having previously lent the Loan and Trust Company $25,000, received its' promissory note therefor signed by the Loan and Trust Company, indorsed on which appear payments of interest and certain sums of money on account of the principal. On September 9,1893, the bank commenced suit against the Loan and Trust Company on this note in the Circuit Court of tlie United States for the District of Kansas, and on December 8, 1893, recovered judgment therein against the Loan and Trust Company in the sum of $16,136.76, damages, and $28.45, costs of suit; and on April 27, 1894, execution issued therefor, which was returned on May 29, 1894, by the marshal of the United States for said district wholly unsatisfied, after he had made diligent search for any property of the defendant on which to levy the execution and had found none. The present suit wras brought in the Superior Court for the County of Suffolk in this Commonwealth, on May 25, 1895. The defendant is a resident of the Commonwealth. On April 27, 1894, the defendant owned one certificate of five shares of stock of the Loan and Trust Company, and had in his possession as collateral security for the payment of a debt due to him another certificate of five shares, both of which he continued to hold down to the time of the trial here, and the certifi
The plaintiff in the present suit put in evidence the General Statutes of Kansas of 1889, paragraphs 1192,1193, 1199, 1205, 1206, 4080, 4081, 4083, 4084, 4085,4087, 4167, 4168, 4169, 4170. Paragraphs 1192, 1205, and 1206 are printed in the margin.
The decisions of State courts other than those of Kansas are not uniform upon the question whether the statutory liability of
This court has many times decided that the statutes of other States, creating the liability of stockholders to creditors of a corporation, which provide for a suit of a special kind to which the corporation and all the stockholders are to be made parties, will not in general be enforced by the courts of this State. It often happens that the courts of this State could acquire no jurisdiction over the corporation which is a necessary party, or over many of the stockholders, and the suit itself is sometimes of a kind unknown to our laws. The proper courts of the State under whose laws the corporation is established have full jurisdiction over the corporation. Whether in such a suit such courts can acquire jurisdiction over all the stockholders, wherever they reside, in order to determine their liability under the statutes to which they may be held to have assented in becoming stockholders, it is unnecessary now to consider. The proceedings are somewhat analogous to the laying of assessments ratably upon all stockholders for the purpose of paying the debts of the corporation in the manner and to the extent prescribed by the statutes. The special remedy provided by the statutes must be pursued, and, as the statutes of a State have no force ex proprio vigore beyond the territorial limits of the State, the remedy usually must be pursued in the State where the corporation has been established and the statutes passed. Erickson v. Nesmith, 15 Gray, 221; S. C. 4 Allen, 233. New Haven Horse Nail Co. v. Linden Spring Co. 142 Mass. 349. Post v. Toledo, Cincinnati, & St. Louis Railroad, 144 Mass. 341. Bank of North America v. Rindge, 154 Mass. 203. Coffing v. Dodge,
In Higgins v. Central New England & Western Railroad, 155 Mass. 176, the grounds on which the courts of this State entertain an action at law founded on the statutes of another State are stated to be as follows: “ Assuming that the cause of action is one not existing at the common law, but created by the statute of another State, we have seen that it is transitory, and that it survives and passes from the deceased to his administrator. When an action is brought upon it here, the plaintiff is not met by any difficulty upon these points. Whether our courts will entertain it depends upon the general principles which are to be applied in determining the question whether actions founded upon the laws of other States shall be heard here. These principles require that, in cases of other than penal actions, the foreign law, if not contrary to our public policy, or to abstract justice or pure morals, or calculated to injure the State or its citizens, shall be recognized and enforced here, if we have jurisdiction of all necessary parties, and if we can see that, consistently with our own forms of procedure and law of trials, we can do substantial justice between the parties. If the foreign law is a penal statute, or if it offends our own policy, or is repugnant to justice or to good morals, or is calculated to injure this State or its citizens, or if we have not jurisdiction of parties who must be brought in to enable us to give a satisfactory remedy, or if under our forms, of procedure an action here cannot give a substantial remedy, we are at liberty to decline jurisdiction. Blanchard v. Russell, 13 Mass. 1, 6. Prentiss v. Savage, 13 Mass. 20, 24. Ingraham v. Geyer, 13 Mass. 146. Tappan v. Poor, 15 Mass. 419. Zipcey v. Thompson, 1 Gray, 243, 245. Erickson v. Nesmith, 15 Gray, 221, and 4 Allen, 233, 236. Halsey v. McLean, 12 Allen, 438, 443. New Haven Horse Nail Co. v Linden Spring Co. 142 Mass. 349, 353. Bank of North America v. Rindge, 154 Mass. 203.”
In Post v. Toledo, Cincinnati, & St. Louis Railroad, ubi supra, this court say: “The obligation imposed by the statutes of Ohio upon the stockholders for the purpose of securing the
When the liability is distinctly imposed by statute upon the stockholders severally, it would be unfortunate if it could not be enforced against stockholders not resident within the State under whose laws the corporation has been established, on the ground that due process could not be served on them within that State, and the courts of the State where they reside would not take jurisdiction of suits to enforce the liability.
It certainly concerns the due administration of justice that all stockholders, wherever they reside, should be compelled by proceedings somewhere to perform the statutory obligations toward creditors of the corporation which they have assumed by becoming stockholders.
The remedy provided by paragraphs 1200 and 1204 of the General Statutes of Kansas, even if applicable to the present case, was not intended to be exclusive when a judgment has been obtained against the corporation. The present plaintiff has pursued exactly the remedy provided by paragraph 1192 of those
We are unable to assent to the decision of the Supreme Court of Pennsylvania in Cushing v. Perot, 175 Penn. St. 66, that the liability of the defendant passed to the receivers of the corpora
The law of Kansas was a fact to be proved in the present suit. Where the evidence of foreign law consists entirely of statutes or reports of judicial decisions, the constructions and effects of the statutes and decisions are usually for the court alone. Bride v. Clark, 161 Mass. 130. Reyer v. Odd Fellows’ Fraternal Accident Association, 157 Mass. 367. Gibson v. Manufacturers’ Ins. Co. 144 Mass. 81. Where the decisions are conflicting, or where inferences of fact musttbe drawn, the question of what the law is becomes one of fact. Wylie v. Cotter, 170 Mass. 356.
Upon the evidence introduced at the trial, a majority of the court think that the reasonable inference is that the action given to enforce the liability of stockholders under paragraph 1192 of the General Statutes of Kansas of 1889 was intended to be a transitory action of such a nature that it might be brought in any court of general jurisdiction over similar actions in any State or country where service according to the laws of that State or country could be made upon a stockholder.
'They are of opinion that the Superior Court should have found in accordance with the seventh request of the plaintiff. This almost necessarily follows in the view they have taken of the statutes of Kansas, from the four rulings requested by the plaintiff which the court gave, whether they be regarded as rulings of law or findings of fact. It is unnecessary now to consider the other questions which have been argued, or which appear in the bill of exceptions. The entyy must be,
Exceptions sustained.
“ 1192. If any execution shall have been issued against the property or effects of a corporation, except a railway or a religious or charitable corporation, and there cannot be found any property whereon to levy such execution, then execution may be issued against any of the stockholders, to an extent equal in amount to the amount of stock by him or her owned, together with any amount unpaid thereon; hut no execution shall issue against any stockholder, except upon an order of the court in which the action, suit, or other proceeding shall have been brought or instituted, made upon motion in open court, after reasonable notice in writing to the person or persons sought to be charged; and, upon such motion, such court may order execution to issue accordingly; or the plaintiff in the execution may proceed by action to charge the stockholders with the amount of his judgment.”
“ 1205. If any stockholder pay more than his due proportion of any debt of the corporation, he may compel contribution, from the other stockholders by action.
“211. Dues from corporations shall be secured by individual liability of the stockholders to an additional amount equal to the stock owned by each stockholder; and such other means as shall be provided by law; but such individual liabilities shall not apply to railroad corporations, nor corporations for religious or charitable purposes.”
“ 1200. A corporation is dissolved, first, by the expiration of the time limited in its charter; second, by a judgment of dissolution rendered by a court of competent jurisdiction; but any such corporation shall be deemed to be dissolved for the purpose of enabling any creditors of such corporation to prosecute suits against the stockholders thereof to enforce their individual liability, if it be shown that such corporation has suspended business for more than one year, or that any corporation now so suspended from business shall for three months after the passage of this act fail to resume its usual and ordinary business.”
“ 1204. If any corporation, created under this or any general statute of this State, except railway or charitable or religious corporations, be dissolved, leaving debts unpaid, suits may be brought against any person or persons who were stockholders at the time of such dissolution, without joining the corporation in such suit; and if judgment be rendered, and execution satisfied, the defendant or defendants may sue all who were stockholders at the time of dissolution, for the recovery of the portion of such debt for which they were liable, and the execution upon the judgment shall direct the col
