145 Minn. 5 | Minn. | 1920
Lead Opinion
This is a sequestration proceeding against the Twin City Motor Speedway Company, a Minnesota corporation. The controversy now before the court is upon the claim of Paust and Cooke for $9,994.05 on an account stated. It was here before and is reported in 140 Minn. 240, 167 N. W. 796. So far as is possible we avoid a repetition of the facts.
The question of the validity of the stock in consideration of which Paust and Cooke released their claim is the fundamental one. The conclusion which we have reached upon it makes it unnecessary to determine the question whether there was an account stated such as is claimed, and we pass the question with the suggestion that it would be difficult to sustain the finding that an account was stated. We have then these two questions:
(1) Was the stock issued to Paust and Cooke an over-issue, or was it valid stock and. by consequence the transfer of it an effectual discharge of their claim on an account stated ?
(2) Is the'opinion on the former appeal the law of the case so that the appellants are concluded upon the question of the over-issue ?
The two questions we consider in the order of their statement.
The capital stock of the company was one million dollars, and it was issued about the time of the incorporation. It does not seem that it rep
On December 16, 1915, apparently in view of the contemplated settlement of the company’s debts, it was voted at a meeting of the stockholders that all of the stock be surrendered and canceled. All except the 50 shares and perhaps a few others were surrendered and canceled, and the certificates were returned and attached to the stubs in the stock book. A certificate of one share was then issued to each member surrendering his stock, some seven in all. No more stock was issued until February 9, 1916:
Negotiations for the settlement of the company’s debts through a bond issue proceeded satisfactorily. On January 14,1916, at a meeting of the creditors and stockholders, an agreement was made, whereby the greater portion of the creditors agreed to accept bonds, and the issuance of bonds in the amount of $350,000 secured by a trust deed was authorized, and afterwards the deed, was executed and the bonds were issued. At this meeting Paust and Cooke agreed to take $10,000 in stock and $5,000 of bonds in payment of their account stated and their subsequent services in inducing creditors to take bonds in lieu of cash. On February 9, 1916, $10,000 in stock was delivered to Paust and Cooke and they accepted it along with their bonds and their claims against the company were satisfied. Paust soon after was elected a director.
The resolution of December 16,1915, for the cancelation and surrender of the stock intended clearly enough that the stock surrendered would be reissued to the parties in interest as their interests should later be determined, but it was further in contemplation that the stock or some of it might be used in some way to care for the debts of the company which it was then in mind to discharge. The resolution recited that some of the corporate stock “may necessarily have to be sold, pledged or
It is argued by counsel for claimants that the stockholders cannot successfully assert a valid surrender and cancelation of their stock such as was made in December, 1915, as against creditors, and that Paust and Cooke were creditors. This may readily be conceded, but, instead of continuing to be creditors, Paust and Cooke took stock and ceased to be creditors and became stockholders. They cannot get back into the creditor class, except by successfully maintaining that the stock issued to them was an over-issue and that is the object of this action. The claim which they make assumes that they have won this action and it takes them nowhere. Except as against creditors a cancelation and surrender and redistribution of the stock was not invalid,, and as against creditors it was invalid, only so far as the liability of stockholders was involved. The principle invoked is without application to the controversy before us. As before said the controlling fact is that Paust and Cooke got valid stock.
We hold that the surrender and cancelation of the stock in accordance with the resolution of December 16, 1915, was valid; that the stock issued to Paust and Cooke was not an over-issue; that it was a consideration for the discharge of their claim on the account stated, and that they are bound by the release which they executed.
■ It is the settled rule of this court that its decision will not be reviewed in the same case except by way of reargument, and therefore that a determination once made upon an issue in the ease will not be reviewed upon a subsequent appeal. 1 Dunnell, Minn. Dig. § 398, and cases cited. The rule stated in the absence of statute is one of practice and does not express a limitation of power. Messenger v. Anderson, 225 U. S. 436, 32 Sup. Ct. 739, 56 L. ed. 1152. It applies to questions decided but not to questions which are raised and not determined, and questions not decided may be considered on a second appeal. Kramer v. N. W. Ele. Co. 97 Minn. 44, 106 N. W. 86. The questions whether there was an account stated and whether there was an over-issue of stock were argued in the briefs. About the first nothing was said. After holding that the respondents, appellants here, could not sustain their order upon their claim of estoppel, on which alone they prevailed in the trial court, we said [140 Minn. 244]:
“Neither can we go into the record for the purpose of discovering evidence claimed by respondents to support their contention that the stock was not an over-issue, for we can neither make nor amend the findings of the trial court. The evidence does not conclusively sustain respondents’ contention in that respect, and, since the conclusions of law are not supported by the facts as found by the trial court, there must be a reversal. We do not think, however, that claimants are entitled to judgment on their claim. 'There should be a new trial upon all the issues in the case.”
We did not intend that if the case should be retried, and a finding of an over-issue should be made on similar evidence, the finding would not be subject to review. What was said as to the over-issue was incidental to the question of estoppel to which our attention was directed as the point of decision, and we made no determination foreclosing a review. There was no thought of settling the law of the case. It may be noted that on the former appeal Paust and Cooke were the appellants and the findings
Order reversed.
Dissenting Opinion
(dissenting).
On the former trial the court found that the issue of stock to Paust and Cooke was an over-issue, but that they .were estopped to show that fact.
On the former appeal Paust and Cooke, as appellants, contended that the-finding of the court that the stock was an over-issue was sustained by the evidence, and that the finding that they were estopped was not sustained.
The respondents there, appellants here, contended that there was no evidence to sustain the finding that there was an over-issue of stock, but if there was then' that the finding of estoppel should be sustained.
Both parties briefed both questions fully. This court considered both questions, and decided that there was no estoppel and that the evidence did not conclusively show that there was not an over-issue and ordered a new trial. The evidence as to over-issue is the same now as it was then. It seems to me the question was before the court and that if we had been of the opinion that there was no evidence of over-issue we should have said so and ended the case, and the opinion on the former
I concur in Justice Hallam’s dissent.