116 Ga. 303 | Ga. | 1902
On the petition of the American Bonding and Trust Company of Baltimore City, the assets of a private corporation using the name of the Williams Block Pavement Company were placed in the hands of Tichenor, as permanent receiver, and all persons were enjoined from interfering with him in his control of the assets of that company. The petition on which the receiver W'as appointed alleged, that in the fall of 1897 the defendant company paved North avenue from Peachtree to West Peachtree street, and from •West Peachtree to Williams street, with wooden blocks; that this work was done for the City of Atlanta, under certain contracts made
The judge denied the prayer, sustained the demurrer, and dismissed the petition. To these rulings the receiver excepted.
■ The question thus arises whether the trial judge erred in refusing to grant the prayers of the receiver. We do not think he did. It does not appear that the Pavement Company was a debtor either
Following these rules, which appear to be generally recognized, it is ruled in Wetherbee v. Baker, 35 N. J. Eq. 501, that “a creditor, having exhausted his remedy against the corporation by judgment, execution, and a return of nulla bona, may file a bill against stockholders to compel the payment of unpaid subscriptions to the capital stock.” We have referred to these authorities for the purpose of showing the necessity of having an existing debt against the insolvent or embarrassed corporation before a creditor can maintain a suit against an individual stockholder to recover the amount of his unpaid subscription. In the case of Wing v. Slater (R. I.), 33 L. R. A. 566, a very full discussion is had as to the nature of the debt, to be shown in order to authorize such a suit. In the case of King v. Sullivan, 93 Ga. 626, following the general rule, it was declared to be well settled that unpaid stock subscriptions are assets of an insolvent corporation which, when properly reached, may be applied to the benefit of its creditors. The facts of the present case show that neither the City of Atlanta nor the Bonding Company is a creditor of the defendant corporation. No present debt is shown or even alleged to be owing to either of these corporations by the defendant company; and giving the allegations of the receiver’s petition the full weight they are intended to have, it only appears that the Pavement Company will at some time in the future, if it has not already ■done so, probably make a breach of its contract with the City of Atlanta, and it will, after the surety has settled for the damages caused by the breach, then owe the Bonding Company
In the case of Guilmartin v. Railway Company, 101 Ga. 565, it was ruled that “ When a guarantee has taken from the guarantor no assurance of the guaranty by mortgage or otherwise, so as to create a lien in his favor upon the property of the latter, the mere-existence of the contract of guaranty presents no obstacle, legal or equitable, to such disposition of his property as the guarantor pray deem proper; and the fact that a guarantor may become insolvent- or may waste his goods before there is a breach of the contract-upon the part of the principal and before such time as the guarantor shall have become answerable upon his undertaking, affords no reason for the intervention of a court of equity, nor any reason for the grant of an injunction or the appointment of a receiver to seize and hold the guarantor’s estate. The assets of a corporation which has contracted as a guarantor are not liable to seizure, either at law or in equity, until after a breach by the principal of the guaranteed agreement; and neither the conveyance of its assets to third persons nor the misappropriation of its funds by its stockholders! affords any ground for equitable interference at the suit of the-guarantee, when it does not appear either that the principal is insolvent or that there has been any breach by him of the contract which was guaranteed. The mere possibility of a future breach of such contract, with a resulting liability against it as a guarantor,, will not authorize the appointment of a receiver to take its assets out of the hands of its stockholders.” Our present Chief Justice,, who delivered the opinion in that case, said, in conclusion, that-“Equity will not impound the property of a guarantor for thirty years, especially where other creditors have claims against him, in order to ascertain at the end of that time whether the principal will, be able to meet the obligation against him, which is the subject of the guaranty.” We must therefore rule, both-under the authorities generally and the spirit of our own decisions, that the court-
Judgment affirmed.