Moyer v. Pennsylvania Slate Co.

| Pa. | May 12, 1872

Lead Opinion

The opinion of the court in the cases of Moyer and Keller were delivered, by

Thompson, C. J.

These two actions were by agreement tried together below, and were brought against the above-named corporation and stockholders, under the provisions of the Act of incorporation, approved 25th June 1864. The stockholders’ liability clause in the act is as follows : “ The stockholders of said company shall be jointly and severally liable in-their individual capacity, for debts due mechanics, workmen and laborers, employed by said company, and for materials furnished said company.”

The claims embraced by these suits are not of a like nature, but are within the same governing principle on the question of liability of the stockholders. The first is a claim by the plaintiff for himself and team in hauling slate from the quarry of defendant, to a railroad station for shipment. The second was for repairing wagons at plaintiff’s shop in an adjoining county, some five miles distant from defendants’ quarry. It was assumed by the plaintiff, that these claims were good against the stockholders jointly and severally, under the provisions of the Act of Assembly referred to. The court below thought they were not.

Corporations are just what the law of their organization makes them — no more, no less; and when there is anything in the law calling for interpretation on account of ambiguous or indefinite language, we must explain the meaning in view of the objects of the enactment — its purposes — and consider the appropriateness of the language used to the supposed purpose in view by the legislature.

By the common law, the individuality of the members of a corporation was merged in the associated body, so far as liability for debts was concerned. The artificial body represented them in that. Whenever, therefore, there is a change in this particular in the act of incorporation, it is consequently just so far in derogation of the common law, and is to be strictly construed; McMullin v. McCreary, 4 P. F. Smith 230; that is to say, it is not to be extended by implication. Many authorities go to prove this which need not be cited. It is not to be forgotten, however, that this, as a rule, has no place where the intent is manifest from the words of the law.

The common law was certainly changed in regard to the liability of the stockholders of this company, so far as it renders them liable in their private capacity, for “ debts due to mechanics, workmen, and laborers, employed by said company.” It has been contended by the able counsel for the plaintiff in error, that these words are broad enough to cover any claim of any mechanic for work done for the company at his shop anywhere, without regard to any connection as a mechanic of the company, and so of any laborer anywhere, whose services the company may have temporarily availed themselves of.

Undoubtedly the corporation itself is' liable for all manner of claims against it, arising out of its business, whether for money borrowed, territory acquired, teams bought, merchandise, provisions or produce obtained, or professional services; in short, for whatever may be deemed necessary to the life and prosperity of its business. This is an incident of its artificial existence, as fully recognised in law, as it is of natural persons. Employees of every description have the responsibility of the corporation to look to for payment.

Now it is plain, that when the liability to a limited extent was cast upon the stockholders personally, it was with a view to an additional security to the operatives of the establishment, who were the producers — the life of it. It is generally only to such that liens are extended in the mining districts. For them the law provides additional security; so in this case, the additional security of the individual responsibility of the stockholders is added to that of the corporation, in favor of the employees of the corporation, “ its mechanics, workmen and laborers.”

If this be not the meaning of the words “ employed by the company,” we see no possible use of the enumeration of the grounds of liability of the stockholders. Were it intended to hold them liable generally, enumeration, it is reasonable to suppose, would have been omitted. If the words in themselves were general enough to seem to bear the construction contended for, we are admonished by these considerations that they were not so intended. Generality of expression in Acts of Assembly, as in contracts, is often restricted by regard to the subject-matter to which it has been used: Commonwealth v. The Councils of the Borough of Montrose, 2 P. F. Smith 391.

The learned judge of the Common Pleas was right therefore, we think, in holding as he did, that the charge for hauling slate, the party using his own team and contributing his own time, was not embraced by the liability clause quoted. Indeed, I regard it as not within the words at all. The teamster was not strictly either a laborer or workman, but the ruling stands well enough on the general ground suggested. His was labor of the same kind as that performed by the railroad company in transporting the slates to market, and the yardmen who took charge of them on their arrival at their destination. These parties were independent of the corporation altogether, and cannot be regarded as employees at all. All this is true of the wagon-maker’s bill. He was not the mechanic of the corporation. His was an independent business under his own control and option, and he was no more entitled to avail himself of the stockholders’ liability, than the horse-shoer, or the ordinary shoemaker, who might furnish shoes worn by .the workmen and laborers. And so of materials furnished.. That of course has reference only to such as form part or portions of the products of the establishment. Without injustice to the stockholders, we cannot hold to the general liability clause against them, and yet it is to be regretted, if loss ensue to individuals, because the corporation may be unable to pay them their dues. This, however, is the fault of the legislation on the subject. For the reasons given these judgments must be affirmed.

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Concurrence Opinion

Williams, J.

I concur in the construction given to the act in these cases, except so far as the opinion decides that lumber furnished for the erection and construction of a derrick used in hoisting slate from the quarry, and powder and fuse used in blasting the slate, are not “materials,” within the meaning of the act for which the stockholders are individually liable.

In the other cases judgment was entered November 12th 1872.

Per, Curiam. Our views of the liability of stockholders in this corporation have been pretty fully explained in the case of Moyer v. The Pennsylvania Slate Company et, al., besides which, and the opinion of the learned judge below in the case stated, embracing all the foregoing suits, nothing further is needed to show that the judgments entered therein must be

Affirmed.