52 Mo. 583 | Mo. | 1873
delivered the opinion of the court.
This was an action against the defendants, as stockholders
The answer of the defendants denies that they or either of them are in any manner liable to the plaintiffs, but there is no denial of the insolvency of the incorporation. At the trial plaintiff proved the indebtedness of the corporation as stated in the petition. The case was then submitted on the pleadings and proofs, and at the request of the defendants the court declared the law to be, that the plaintiffs could not recover. This action was brought under the statute (1 W. S., p. 293, § 22) which declares, if any company formed under this act dissolve leaving debts unpaid, suits may be brought against any person or persons who were stockholders at the time of such dissolution, without joining the company in such suit.
The first question is, whether the insolvency of the company amounted to a dissolution so as to give the plaintiffs the right to pursue this remedy.
In the case of Moore vs. Whitcomb, (48 Mo., 543,) it was held that a corporation might be dissolved by a surrender of its franchises, and if it suffered acts to be done which had the effect of destroying the end or object for which it was created, it was equivalent to a surrender of its rights and in effect a dissolution.
In the above cited case we mainly followed the leading case of Slee vs. Bloom, (19 John. 456) where the question is most thoroughly examined in the Court of Errors, in the State of New York. In that case it appears that pursuant to a statute the defendants associated together for establishing a cotton
The court held that the corporation within the meaning and intent of 'the act, as regarded creditors, was dissolved, after ceasing to act as a corporation for such a length of time, and after a sale of all its property, and that the defendants were individually responsible for the debts of the corporation according to the act.
In the course of his able opinion Chief Justice Spencer said, “In point of good sense, this corporation was dissolved within the meanihg and intent of the act, as regards creditors when it ceased to own any property, real or personal, and when it ceased for such a space of time, from doing any one act manifesting an intention to resume their corporate functions. The end, being and design of the corporation were completely determined, and if even it had the capacity to re-organize and re-invigorate itself, the case has happened when, as relates to its creditors, it is dissolved.” The learned judge continued that, with respect to the period of dissolution, it happened when all the property of the company, was sold and that after that time no corporate act was done. So in Penniman vs. Briggs, (Hopk. Ch., 300 ; S. C., 8 Cow., 387) where a manufacturing corporation, established under the same general law as that just alluded to, for twenty years, became insolvent within the time, and incompetent to act by the loss of all its funds, and under the provisions that “for all debts which shall be due and owing by the company at the time of its dissolution, the persons then composing the company should be
Now the averment in the petition was that when the company presented its petition to the United States District Court,, it was dissolved, being wholly unable, by reason of a total want of funds and means, to exercise its corporate powers. The answer admitted the total want of funds and means, the absolute destitution of assets, but denied the legal inference that the corporation was thereby dissolved within the meaning or sense in which that word is used in the statute.
When the corporation was utterly penniless, for what end or object did it continue. What good did it do the creditor to be told that there was the naked shadow but that the substance was all gone. The corporation for all essential purposes was as effectually dissolved as if a solemn judgment of court had been pronounced to that effect. I have no hesitation in coming to the opinion that there was such a dissolution as would afford creditors a remedy against the individual shareholders.
The law does not require useless things, and what xoossible good could have been accomplished by bringing suit against 'die company. It would only have been accumulating costs for the plaintiff to pay in addition to its failure to obtain any natisfaction.
Before the debt was sixty days old, the company was decreed a bankrupt. It had no assets whatever, it would have been an idle ceremony — a useless form — to have proved up the claim in the Bankrupt Court, for the estate was totally without funds or means of any kind. The Statute' plainly refers to ordinary actions where there is a subsisting corporation. But here, before the limitation had expired the corporation was dissolved. The mere bringing of a suit under such a state of facts, would have been idle, vain and fruitless. Says Kent, Ch. J., in Trustees of Huntington, vs. Nicoll, (3 Johns., 566-598.) “It is one of the maxims of the common law, and which is a dictate of common sense, that the law will not attempt to do an act which would be vain, or to enforce an act which would be frivolous.”
The acts in this case surely take it out of the dry letter of the law, and furnish a remedy within its spirit and meaning. A literal compliance would have been wholly futile, and the reason for not proceeding I think is good, legal and sufficient.
I am of the opinion that the judgment should be reversed, and the cause remanded.