110 Mo. 83 | Mo. | 1892
This is a controversy over two hundred and one shares of stock in the Schilling & Schneider Brewing Company. The real plaintiffs in interest represent the Schilling estate, and the defendants represent the Schneider estate.
The facts are these:
‘ ‘And it is agreed by and between the said Schilling and Schneider that the said purchase money shall be paid out of the earnings of the Koch & Schilling Brewery Company, and charged to expense account, but this agreement shall in no way be deemed to limit the liability of the said parties of the second part, individually and jointly, for the whole of said liability or debt.”
It stands admitted that Schilling and Schneider borrowed the $10,000, which they paid to Mrs. Koch in cash on a note executed by the Koch & Schilling Brewing Company, indorsed by them, due at nine months after date. This note and the four given by them to Mrs. Koch, each for $3,750, were all paid by the corporation; that is to say, the corporation paid them from time to time and charged the amount thus paid to Schilling and Schneider. Dividends were then declared annually to an amount which equaled the payments made on the notes with an amount added which would give to Reck a like dividend on his twenty-five shares. The dividends thus. divided, except on the Reck shares, were credited to Schilling & Schneider, thus canceling their .indebtedness to the company.
The plaintiffs in this case represent the two hundred and fifty-three shares owned by Schilling individually, Reck having acquired his interest at the times and in the manner before stated. Some of the plaintiffs •are distributees of the Schilling estate, and the other plaintiffs are assignees of the other distributees of that ■estate.
The claim pressed by plaintiffs that the contract between Mrs. Koch and Schilling and Schneider shows •on its face that they purchased the two hundred and one shares for the benefit of the corporation cannot be ■.sustained. This contract, it is true, contains a stipulation to the effect that the stock so purchased shall be paid for out of the earnings of the company, but this is plainly a stipulation between Schilling and Schneider, with which Mrs. Koch had no concern whatever; for, besides being in terms an agreement between themselves, the further clause is added that this agreement shall in no way limit their joint and several liability to Mrs. Koch. The purchase was clearly one by them on their own account, and not for or on account of the ■ company. Of all this there can be no doubt.
The further claim that these two hundred and one shares belong to the corporation, because purchased with funds of the corporation, is equally untenable. In saying this we again reassert the rule that officers of a corporation will not be allowed to deal with the funds and property of the corporation for their private gain; but the rule has no application to a case like the one in hand. Schilling and Schneider had a perfect right to buy the stock. After that purchase, they owned all ■.the stdck, and it was entirely competent and proper for
But it is said Schilling and Schneider made use of the credit of the company to raise the money for the-payment of $10,000, and so they did. But these plaintiffs are in no condition to complain of that act. Some-of them inherited the stock owned by them from Schilling and stand in his shoes, and surely he could not complain of his own act. The assignees from other heirs of Schilling stand in no better position; for they did not acquire their stock until the dividends had been declared and paid. The dividends belonged to-the persons who owned the stock when declared and made payable. Morawetz on Private Corporations, sec. 449; 5 American & English Encyclopedia of Law, 731.
Reck, the other plaintiff, was the president of the-corporation from the time he purchased the twenty-five-shares in January, 1883, and knew of this contract, between Schilling and Schneider. It was after that date that the company paid the $10,000 note and the-other notes, and charged' the same to Schilling and. Schneider, and then canceled the charges by a credit, of dividends. He knew of and gave his consent to the-transaction, and, hence, cannot be heard to complain of' them.
The trial court found that the Schneider estate was entitled to half of the two hundred and one shares, and in doing so it but followed the plain meaning of the contract, and the judgment is, therefore, affirmed.