28 Kan. 474 | Kan. | 1882
The opinion of the court was delivered by
On June 15th, 1880, plaintiff in error (plaintiff below) commenced his action against the defendant to recover for personal injuries. The name of defendant as stated in the title to the petition is, “Union Pacific Railway Company, Kansas Division, formerly Kansas Pacific Railway Company.” In the body of the petition it is alleged “that said Union Pacific railway company, Kansas division, formerly Kansas Pacific railway company, defendant, is a railway company* duly organized under the laws of the state of Kansas, and as such corporation was, on the second day of August, 1879,” etc. The petition further alleged, that the injuries were done on the second day of August, 1879. Defendant answered by a general denial, and afterward, by leave of the court, filed an amendment to its alnswer, which, duly verified, denied that it was a corporation organized under the laws of the state of Kansas, as alleged in the petition. Upon the trial, after plaintiff had offered testimony tending to establish the allegations of his petition, and had rested, the defendant showed that at the time of the injury the Kansas Pacific railway company, a corporation organized under the laws of the state of Kansas, was the owner of and operating the road; that subsequently thereto, and on the 24th day of January, 1880, the Kansas Pacific railway company was consolidated with the Union Paoific railway company and the Denver Pacific railroad and telegraph company, and by such consolidation became merged in the Union Pacific railway company; and that the consolidated company, the. Union Pacific railway company, was since operating the road, and that all the agents and employés along the line of the road were the agents
Plaintiff contends that the consolidation is, so far as the Kansas Pacific railway company was concerned, absolutely null and void; and secondly, that if it be valid he has ,a right to maintain this action directly against the defendant under the terms of the consolidation. On the other hand, defendant contends that the consolidation is valid, and that under its terms no action can be maintained against the defendant on account of this injury; and further, that the question of the validity of the consolidation is not properly presented in this case, and cannot properly be determined under the issues as formed by the parties. "Very full and elaborate arguments have been made on both sides upon all these questions, and we have also been favored with briefs prepared by the attorney general of the state and other learned counsel in cases involving the validity of this con
Secondly, it appears impliedly from the petition as originally framed, and clearly from the amendment tendered, that the party sued was the consolidated corporation; but that consolidation, whether it be a legal corporation or an irregular association, did not do' the injuries complained of. They were unquestionably done by the Kansas Pacific railway company. Now this consolidation can be held for the liabilities of either constituent company only by and to this extent of express stipulation. If A., B., and C., individuals, enter into partnership, form an association, or organize a corporation, such partnership, association or corporation is in no manner, except by express contract, liable for the individual debts of either A., B., or C. So the Union Pacific railway company, whether a legal corporation or an irregular association, a corporation de jure or de facto, is not liable for the debt of either constituent company unless it has in terms contracted to become so. Article 8 of the consolidation agreement provides for the transfer to the consolidated company of all the properties of the constituent companies, and closes with the words: “This assignment, transfer, sale and
Article 10 reads as follows:
“The new company hereby formed does not.herein assume any separate or individual liability for the outstanding debts, obligations and liabilities of the respective constituent companies, whose several and separate existence as to/ third parties shall, as respects such debts, obligations and liabilities of every -kind and nature, still continue, notwithstanding these articles of union and consolidation. But nothing herein contained shall prevent any valid debt, obligation or liability of either constituent company from being enforced against the property of the' proper constituent company, which by force of these articles becomes the property of the consolidated company. The corporate existence of the respective constituent companies shall not absolutely cease eo instanti, on the consummation of the union and consolidation herein provided for, but shall remain and continue so far as necessary to carry out the intent and purpose thereof.”
This is all there is in the consolidation agreement, which bears upon the question of the liability of the consolidated company for any of the obligations of the constituent companies. Clearly that is not enough to sustain this action of the plaintiff, which is simply on an unliquidated demand ¿gainst the Kansas Pacific railway. The consolidated corporation has no power to adjust such a claim and bind the Kansas Pacific railway company by such adjustment; neither can it be compelled to bear the cost and. expense of an action for its adjustment. The Kansas Pacific has a right to be heard before any unliquidated demand against it is adjusted and paid out of the properties that it has turned over to the consolidated company. It has never made such consolidated company its agent for the purpose of adjustment.
Again, a judgment recovered in this action becomes a general lien on all the properties of the consolidated company, and this irrespective of the amount of properties received from the Kansas Pacific company. It is true, the amount claimed is but $20,000, and we may presume the value of the properties turned over by the Kansas Pacific, to be largely in
Thirdly, the Kansas Pacific is the original, the primary debtor, and therefore prima facie the one to be sued for the alleged injuries. If the consolidation agreement be invalid, then of course tbe Kansas Pacific remains a corporation intact and in full vigor, and alone liable for this demand. If the consolidation agreement be valid, then by its terms the existence of the Kansas Pacific is preserved for the purpose of the settlement of all claims against it, and it, and it alone, is the defendant which must primarily be sued. Whatever proceedings may be proper after judgment for the purpose of enforcing such judgment, the first step is a judgment against the Kansas Pacific. It may be then that a common-law execution will be sufficient, or it may be that the powers of a court of equity will be requisite for the purpose of adjusting liens and equities. But we are met here by the objection of counsel for plaintiff, that according to the testimony there is no way of bringing the Kansas corporation into the courts of .this state. It is of course a citizen of this state, being a cor