State ex rel. American Bankers Assurance Co. v. McQuillin

260 Mo. 164 | Mo. | 1914

OPINION.

BOND, J.

(After stating the facts as above). — The writ of prohibition does not lie except for the lack of jurisdiction or excess of jurisdiction on the part of an inferior court.

In the matter in hand the applicants for the writ insist that respondent, one of the judges of the circuit court of the city of St. Louis, had no jurisdiction to award the injunction nor. appoint the receiver on the petition submitted to him; and further, that no subject-matter of equitable cognizance was stated in the petition. These in order.

The right to grant a temporary or preliminary injunction (as one is called in equity jurisprudence which precedes a final decree) is forbidden by statute “until” a sufficient bond is executed ‘ ‘ to the other party except in suits instituted by the State in its own behalf. ’ ’ [R. S. 1909, sec. 2522; State ex rel. v. Williams, 221 Mo. l. c. 266-7, and cases cited; Davison v. Huff, 165 Mo. l. c. 578.] If .such an injunction is issued without bond it is inoperative and disobedience to- its commands is not a contempt. [Ex parte Miller, 129 Ala. 130; State ex rel. v. Greene, 48 Neb. 327; 2 High on Injunctions, sec. 1429.] Although a bond is indispensable to the rightful issuance of a temporary injunction (R. S. 1909, secs. 2515, 2522), and hence the respondent had no legal right to award that writ under the agreed facts, he would have been authorized, if the facts stated in the verified petition brought it within another section of the statute, to have made an order to show cause “at a specified time and place” why the tern porary injunction should not be granted, and in the meantime he might have restrained the defendant by an ad interim order until the day set for the hearing of the application for the temporary injunction. The making of such an order is allowed in the interest of justice and to preserve the “in statu quo ante helium” until the court can hear the application and determine whether upon the showing then made, its “temporary writ” should be granted.

The statute does not expressly require that such a stay order should not be made without a bond (R. S. 1909; sec. 2522); it leaves that question to the enlightened discretion of the chancellor, who- should, however, require a bond unless it is apparent that no injury would accrue in the brief interval before the hearing of the motion for an injunction or unless the extraordinary circumstances of the case make it necessary to dispense with it until the hearing of the motion. His discretion in this matter should be moved only by the exigencies of the case — just as it may be appealed to in dispensing with notice of the application for injunction in certain cases where the statute makes no provision. [State v. Woodside, 254 Mo. 580.]

In the case in hand the learned respondent did not issue a stay order to preserve the existing condition of affairs until he could hear the application for the temporary injunction, but he granted the temporary injunction in direct contravention of the terms of the statute making it his duty to require a bond before awarding that writ.

It follows that his action in this regard was futile and not binding on any persons purported to be restrained by the temporary injunction.

II.

We cannot consent to the view that a circuit judge possessed, of full chancery powers, is powerless to appoint a receiver in vacation in any legal or equitable proceeding whatever, that may be pending before him.

The power to make such an appointment is expressly given by statute. [R. S. 1909, sec. 2018.] It is an extraordinary power and should never be exerted except to prevent irreparable injury or the defeat of justice and then only after due notice or upon such conditions as will secure a prompt hearing of the right to make and continue the appointment. [State ex rel. v. McQuillin, 256 Mo. 693.]

So sedulously has the statute .guarded the exercise of this power, that it gives the remedy of an immediate appeal from a refusal to “revoke, modify or-change an interlocutory order appointing a receiver,” which it requires to be advanced and summarily disposed of in the appellate court. [R. S. 1909. sec. 2038.]

In the case at bar the record shows that after the receiver was appointed, respondents (plaintiffs below) petitioned the court to rule defendants to show cause why the appointment of the receiver should not stand, which was accordingly done and the time for such hearing set on the 14th day of August, 1911. Pending the lapse of time thus set the relators sued out the present writ. We have ruled that such a writ should not be issued pending the consideration in the lower court of a timely rule to show cause, for the reason that if the lower court was possessed of jurisdiction of the subject-matter and the parties, an opportunity should be given to it to make a ruling not in excess of its jurisdiction on the collateral question of the propriety of revoking an appointment of the receiver. [State ex rel. v. McQuillin, supra.]

It follows that the writ in this case was prematurely issued unless it can be shown that the lower court had no jurisdiction .of the matters of equity alleged in the suit against relators and this presents for review the last contention of relators.

III.

The right of stockholders to bring an action for the benefit of the corporation to recover assets wasted or fraudulently appropriated to themselves by its officers, in case of the refusal of the board of directors to institute such action, is the unquestionable rule in equity and under the statutes of this State.

The petition filed in the lower court, though lacking in definiteness, explicitness, precision of statement, or regularity, seems to have been intended to set out a cause of action in conformity with the above, principle. At least such an intendment can be ascribed to it when looked at from the standpoint of its sufficiency to give the lower court jurisdiction of the matters alleged therein. It therefore presented a subject-matter within the jurisdiction of the circuit court. We must assume that said court will conduct the proceedings before it according to correct principles of law and equity, and if the hearing should disclose no matter for which relief could be given, it will be denied or vice versa.

It is said in the oral argument that the entire assets of the American Bankers Assurance Company have been administered in a suit brought in Delaware where the corporation was created and domiciled. If that has been lawfully and properly done, there would seem to be little occasion for administration here through the medium of a suit to realize the assets of the foreign corporation. In any event the proceedings in this State must be conducted under the auspices of, or auxiliary to, the receiver appointed for the foreign corporation in its home State and where the bulk of its assets were located. While the foreign administrator could not demand to be made a party as a matter of legal right, yet such a substitution is authorized in this State upon principles of comity. [State ex rel. v. Denton, 229 Mo. l. c. 200; Clark v. Lopp, 80 Mo. App. l. c. 553, and cases cited.]

But all the questions arising on the petition below must be resolved primarily by the trial court. We are satisfied that the case presented there was not outside of its jurisdiction and that at the time of the application for our writ of prohibition respondent had not exceeded his lawful jurisdiction.

It follows that the alternative writ awarded in this ease must be quashed and the proceedings dismissed.

All concur.