1 F. 564 | U.S. Cir. Ct. | 1880
The only question to be now determined is whether the persons named in the marshal’s return shall be allowed to plead. The question here raised usually arises in some collateral way, and when it has been directly presented, as in this case, the courts are always beset with technical difficulties. On the one hand it is urged that a dead party cannot speak; that a non-existing thing cannot, without admitting the very question in dispute, plead in the manner it might if it did exist; while on the other hand it is said with
Every corporation has officers who speak and act for it by authority of law, and process must be served on the proper officer, or the judicial proceeding is not binding. Alexandria v. Fairfax, 95 U. S. 774. Under the Tennessee Code a failure to elect officers does not dissolve corporations, and those last in office continue, and process may be served upon them; so, after dissolution, they continue for five years for the very purpose of prosecuting and defending suits. T. & S. Code, §§ 1481, 1493, 2831, 2834. If the defendant here has a qualified existence, under these provisions of the statute, there should be a plea by the corporation itself. In the absence of such statutes the tendency of modern decisions is to treat a corporation once existing as continuing to exist for the purpose of suing and being sued in winding up its affairs. Pomeroy v. Bank, 1 Wall. 23; R. Co. v. Evans, 6 Heisk. 607; Skackelford v. R. Co. 52 Miss. 159.
But we are met at the threshold with the question whether this defendant exists at all, for any purpose, as a question of fact to be ascertained in determining whether the plaintiff is entitled to a judgment by default. He insists that he has the right to take his judgment at the peril of its being void, if there be, in fact, no corporation. In England there can be no judgment by default without appearance, and if the defendant refuses to appear the plaintiff must enter appearance for him, and in doing so must make affidavit of proper service on the defendant. This may be contested by cross-affidavits, and motions to quash the service and the writ. 3 Chit. Prac. 264, 277, 280. In Alabama and other states the court will
In Bank v. Skillem, 2 Sneed, 698, a judgment by default was set aside in the affidavit, and in Jones v. Cloud, 4 Cold. 236-239, on the motion of one not a party to the record, and in both cases it was held not to be error. No Tennessee case has been found which shows how the alleged extinction of a corporation may be contested in a suit against it in its corporate name; and, until modified by the statutes above cited, the law was settled that upon the civil death of a corporation it could no longer sue or be sued, and could have neither officers nor stockholders; and the same would doubtless .be the rule under these statutes after the five years of qualified post mortem existence have elapsed. White v. Campbell, 5 Humph. 37; Hopkins v. Whitesides, 1 Head. 33; Ingraham v. Terry, 11 Humph. 571; Blake v. Hinkle, 10 Yerg. 217; Nashville Bank v. Petway, 3 Humph. 522. It is said in R. Co. v. Evans, 6 Heisk. 607, that the question of extinction must be raided “by a plea in abatement, motion or other proceeding, ” but there is nothing to indicate by whom these may be taken. In this case, and uniformly, it is held that a.
The plaintiff may take a judgment at his peril, and if there be no corporation it is void, as we have seen. Thornton v. Railway, 123 Mass. 32. But I do not see that he is entitled to this as a matter of right, nor that the stockholders or others interested should be compelled to submit to such a judgment without a preliminary contest over the fact of corporate existence; because, if there be a corporation, the judgment by default is binding, and all opportunity to make other defences is gone. This throws on all interested the peril of determining the important question of existence for themselves, without the aid of judicial inquiry into the disputed facts, and is an immense advantage to a plaintiff; and it would, in my opinion, be a reproach to the law to permit it, upon any technical theory that the officers and stockholders are not parties, and therefore cannot plead in the suit. That they are not parties, even when served with process, cannot be denied. Bronson v. La Crosse R. Co. supra; French v. Bank, 7 Ben. 488; S. C. 11 N. B. R. 189; Apperson v. Ins. Co. 38 N. J. L. 272; Blackman v. R. Co. 58 Ga. 189.
How, then, can the defence be made ? It is said in Oxford Co. v. Spradeen, 46 Ala. 98, that there is no precedent for a plea by a corporation of Its own non-existence; that it is an inappropriate plea and an inconsistency in itself; but it is intimated in McCullough v. Ins. Co. Id. 376, that such a plea is permissible in eases of misnomer and dissolution. In W. U. Tel. Co. v. Eyser, 2 Cold. 141, Mr. Justice Belford says that such a plea by the corporation itself is not anomalous, and
In Massachusetts it is held that the plea must be by the corporation, and that an officer or stockholder cannot make defence. Townsend v. Freewill Baptist, 6 Cush. 281; Byers v. Franklin Co. 14 Allen, 470; Robbins v. Justices, 12 Gray, 225. Yet in Buck v. Ashuelot Co. 4 Allen, 357, and Foster v. Essex Bank, 16 Mass. 245, the fact of non-existence was otherwise made to appear in the one case by one haying no right to plead, and in the other bj suggestion of counsel.
In Callender v. Painesville Co. 11 Ohio St. 516, the question was directly adjudicated. An officer, not even served with process, was allowed to file ,his affidavit and move to dismiss the suit, because the defendant had no corporate existence, the court holding that he was not an intruder; that a judgment against the company would be against all the members collectively, including him as an individual; and that any member, under the circumstances, might make the motion to dismiss, and be heard upon it. And in Pilbrow v. Railway Co. 54 E. C. L. 730, the right of the person served to make the defence was upheld. See, also, Stevenson v. Thorn, 13 M. & W. 149; Stewart v. Dunn, 12 M. & W. 655.
The defence was made by the persons served with process, pleading in abatement, in Rand v. Proprietors, 3 Day, 441; Evarts v. Killingworth Co. 20 Conn. 447; and Express Co. v. Haggard, 37 Ill. 465. And in Elliott v. Holmes, 1 McLean, 466, it was held that a person served with process against another
Persons sued in a representative capacity, as executors, trustees, and the like, may plead that they hold no such relation. 1 Danl. Ch. 631; Story’s Eq. Pl. 732. This is quite analogous to the situation of the parties here. It is true executors are parties to the writ, but only in their representative capacity; and where they plead “no such executor,” it is their individual plea. So the head officer of the corporation, sued as such, may deny that he sustains that relation. Stewart v. Dunn, supra. And in Stevenson v. Thorn, supra, it was said that a person served with process is, for some purposes, at least, to be considered the defendant. And there is another analogy in the case of a judgment of outlawry, where, if the outlaw dies, the death may he pleaded by any person to release his property. 1 Tidd, 144. The defence of the non-existence of a corporation, sued as such, may also he made by an attorney in his own name, suggesting it on the record. Greeley v. Smith, 3 Story, 657; Mumma v. Potomac Co. 8 Pet. 281; Pomeroy v. Bank, 1 Wall. 23. Whether he be the attorney of the corporation must depend on whether it exists or not. If not, lie must be the attorney of some one else having an interest in the matter; for a non-existing corporation cannot, in the nature of things, appoint an attorney under a common seal, and the dissolution would revoke any appointment already made.
The objections suggested against any method of making the defence come from pressing too far 'the doctrine that a corporation has an independent existence. This ens rationis called a corporation is, after all, only an incorporeal defendant, and it cannot, till its existence is established, have any independent status separate and apart from the personality of those composing it. To speak of it as dying is a somewhat false analogy. The law provides heirs, executors, or admin
In Welch v. St. Genevieve, 1 Dill. 130, the facts were presented by the return to a mandamus of individuals held to have no official connection with the corporation, and upon the suggestion of an amicus cu/rice the question of extinction was tried. In McGoon v. Scales, 9 Wall. 23, the defence was made both by trustees not sued and the extinct coiqporation itself; and in Bank v. Colby, 21 Wall. 609, the motion to abate was made by a receiver.
The plaintiff having treated the persons served with process as representing the alleged corporation, he cannot preclude them from at least denying that there is such a corporation. Whether they do this in their own names or that of the alleged corporation is quite immaterial, but it seems to me
The motion to strike out the pleas, and for judgment by default, is denied.