26 Wend. 43 | N.Y. Sup. Ct. | 1841
After advisement, the following opinion was delivered:
The bill in this case was filed by several creditors of The Commercial Insurance Company ofJVew-Ybrk for the purpose of charging the defendants, as stockholders of the same, under the twelfth section of its charter, which declared, that in respect to all debts contracted by the corporation previous to the expiration of its charter, the persons composing the company at the time of its dissolution should be responsible in their individual and private capacity to the extent of their respective shares of stock at the time.
The several debts of the complainants had accrued before the passage of the act of April, 1814, respecting incorporated insurance companies in cases of their insolvency, of which act this company took the benefit in July of the same year, and were discharged from their debts in pursuance of its provisions. The second section of the act makes the assignment under the order of the proper officer, a full discharge not only of the corporation, but also of the president, directors, and stockholders of the company from all debts due at the time of the assignment. The complainants admit that they have received from the assignees, under the act of 1814, several dividends out of the assets of the company, amounting in the whole to fifty-one per cent upon their respective demands. The defendants mainly rely, as a defence to these claims by the creditors of the company, and as exempting them from personal liability: 1st. Upon the statute of limitations, which they set up in analogy to proceedings at law, the case not being one of exclusive equity cognizance ; and 2d. Upon the discharge of the Chancellor under the act of 1814.
I. As to the statute of limitations: A clause in the sixth section of the R. L. 1813, (p. 187,) and the like provision
I do not, however, intend to discuss the question, not regarding it material in the view I have taken of the case; but felt bound to present it for the purpose of entering my dissent to the construction attempted to be given to the clause. If it really possesses the sweeping effect claimed, for aught I see, it must present a short bar of three years
II. Jis to the discharge: As all the debts of the complainants accrued before the act of 1814, under which the discharge was granted, the act is clearly inoperative according to the doctrine of Sturges v. Crowninshield, 4 Wheaton, 122, and Ogden v. Saunders, 12 Id. 213, as impairing the obligation of the contract, unless there is some thing in the case that forbids the application of the doctrine of these cases. As I understand the final decision of the court in the case of Ogden v. Saunders, as'delivered by Mr. Justice Johnson, it was intended to hold, that as between citizens of the same state, the insolvent’s discharge is valid as it affects contracts made posterior to the law; but as against citizens of other states it is void, as to all contracts wherever made. Accordingly, a discharge in New-York, under the law of 1801, from a debt contracted in the state with a citizen of Kentucky, after the passage of the act was held void, and in Shaw v. Robbins, 12 Wheaton, 369, n., a like judgment was given. A majority of the court concurred in the opinion of Mr. Justice Johnson, and have since regarded the principles there established as the settled law of the court. 6 Peters, 349 and 635.
Mr. Justice Story, in his commentaries on the constitution, thus states the result of the various decisions: 1st. That they (the state insolvent laws) apply to all contracts
But in Clay v. Smith, 3 Peters 411, the court held, that if the creditor voluntarily makes himself a party to the proceedings under a state insolvent law which discharges the debt, and accepts a dividend declared under the law, he will be bound by his own act, and be deemed to have abandoned this extra territorial immunity. The facts are so imperfectly stated in the report of the case, that no principle can be deduced from the decision, except we may presume that without the assent of the creditor to the proceedings, by coming in and accepting a dividend, the discharge would have been invalid. The principle is not new, as it had been before repeatedly recognized in analagous cases, both in this country and in England. 3 Caines 154. 8 Barn. & Cres. 477. 2 Kent’s Comm,. 393, n. 3d ed. Baldwin’s C. C. R. 296. 2 Peters Dig. 470. In Phillips v. Allan, 8 Barn. & Cres. 477, a discharge under the law of Scotland was set up against a debt contracted in England, which was conceded to be no bar; but the plea averred that the plaintiff appeared in the court in Scotland and opposed the discharge of the defendant, which was relied on as evidence of .his consenting to be bound by that law: That conclusion from the premises, was de
On the question being put, Shall this decree be reversed ? the members of the court present at the argument unanimously answered in the negative. Whereupon the decree was Affirmed.