60 P. 881 | Ariz. | 1900
On the sixth day of February, 1899, S. R. H. Robinson filed his complaint in the territorial district court of Maricopa County against the Minnesota and Arizona Construction Company, a corporation, to recover $20,500 for
At the trial of the. issue as to whether the company should be adjudged bankrupt it was shown that the articles of incorporation were filed with the secretary of the territory on the ninth day of May, 1895, and at a meeting of the corporation held at Minneapolis, Minn., on May 28, 1895, a resolution was passed reciting that Messrs. Langdon, Linton & Co. and Messrs. D. Grant & Co. were the owners of a certain contract with the Rio Yerde Canal Company for the construction of a canal in Arizona, and resolved: “That this company purchase of said Langdon, Linton & Ce. and D. Grant & Co. the said contracts above set out, and that upon the execution and delivery to this company of the proper assignments thereof the president and secretary be authorized and directed to execute and deliver to said Langdon, Linton & Co. and said D. Grant & Co. 5,000 shares of the full-paid stock of this company, or to such parties, firms, or corporations as they may direct.” It was also shown that the. organizers of the company and the directors in the company were all of them, except S. R. H. Robinson, members of either the firm of Lang-don, Linton & Co. or D. Grant & Co.; and it was also shown'
If the claims of the directors are not debts against the corporation, but advances made by them upon their subscription to stock, it could scarcely be said that the Minnesota and Arizona Construction Company is insolvent. It is the owner of personal property and money in the amount to pay the admitted indebtedness of the company to Robinson. Section 4 of the Bankruptcy Act does not provide for bankruptcy of corporations under voluntary petitions, and for only such corporations on involuntary petitions as are “engaged principally in manufacturing, trading, printing, publishing, or mercantile pursuits.” The first question is whether, under the evidence, the defendant is such a corporation. This, if determined in the negative, will render unnecessary the consideration of the other issues presented. There was some evidence upon the part of petitioners that the. company had engaged in mercantile pursuits, but this is fully met by the testimony of the intervener that they never were in the mercantile business. The first work undertaken by them was. the construction of the Rio Yerde Canal in Arizona, at a point far removed from the base of supplies. They furnished their men with provisions, shoes, overalls, tobacco, and such necessary articles as men have to have while at work, from E. F. Kellner’s store, and paid to Kellner the price thereof, and took the amount out of their men’s wages. After it ceased labor on the canal, and in order to employ its teams while waiting for a probable resumption of work thereon, it took a contract to freight from Gerónimo, the terminal of a railroad, to the city of Globe. At Gerónimo it did no merchandising, but dealt for itself and men at the supply store of the company from which it took its subcontract. Afterwards it
The. next- question is whether it is a corporation principally engaged in trading. The usual meaning of trader is “one who buys and sells goods”; “one who makes it his business to buy merchandise, goods, and chattels, and sells the same for the purpose of making a profit.” The firm of Langdon, Linton & Co., as contractors, could not be called traders, nor could D. Grant & Co., or S. R. H. Robinson. When they combined, and undertook to transact their business through the medium of a corporation of which they themselves were directors, we do not- find that they changed the character of the business engaged in. It possibly may he said that their articles of incorporation would have allowed them to have changed their business, or extended it into trading, but we have seen them in fact engaged in no business but the business of construction. Counsel on both sides have cited many authorities from which they reason either that the construction company was engaged in trading or that it was not. It has been decided that a baker buying flour and supplying his customers was a trader; that “merchant” includes “hotel-keeper”; that a butcher buying beef on foot and selling it was a trader, but that a butcher billing his own stock and selling it was not a trader; that a teamster who to a very considerable extent buys and sells hay and straw to support his teams while idle, is not a trader; that railroad and transportation companies are not traders; that a theatrical manager, though he buy and sell costumes, is not a trader. The consensus of opinions gathered from the reports seems to he that, to constitute a trader, the operation of buying and selling for profit must enter into the occupation. The only case that seems to be in point is In re Smith, reported in 2 Lowell, 69, 22 Fed. Cas. 394 (No. 12,981), a decision under the old Bankruptcy Law of 1867, which seems to be quite analogous to, if not-identical with, the case at bar; and it was there decided that one who contracts with a railroad company to grade and build its road is not a trader. If an individual contractor who contracts to dig a canal or to build a railroad
Sloan, J., and Davis, J., concur.