Case ID: tex-l-r_1/html/0045-01.html
Source: Caselaw Access Project
Author: {"author": "Gould, O. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

NEVINS ET AL VS. COLLINS
    SUPREME COURT
    APRIL, 14, 1881.
    
      Insolvent Corporation, — Liability of Stockholders. — An assignment by an insolvent banking corporation of “all assetts whatever belonging to said bank,” for the benefit of its creditors, includes whatever was due from stockholders for sfock unpaid, and by the deed of assignment the right to recover of the stockholders what was so due by them vested in the assignee. Having accepted a dividend under the assignment a creditor cannot thereafter treat it as invalid and appropriate to his exclusive benefit asset which belonged to the assignee for the benefit of all the creditors alike
    Appeal from Grayson county tried before Hon. Joseph Bledsoe, district judge. t
    The appellee having obtained a judgment in the Grayson district court against the Drovers and Planters’ bank, filed a motion against appellants and W. H. Hughes, alleging that they each owned stock in said bank, and had not paid for the same: that the bank was insolvent, and had no property on which to levy an execution, which had been issued on the judgment and returned nulla bona, and prayed for an order authorizing the issuance of an execution against appellants. The appellants pleaded the general denial, and appellant Hughes specially, that he was merely a nominal stockholder-having accepted the assignment of twenty-five shares of the capital stock of the bank at the instance of the officers there,, of, to qualify him for the position of assistan cashier of the bank, with the understanding that he was to pay nothing for the stock or be liable as a stockholder j also plead infancy at the date of the transfer of the stock to him, and appellant Hevins pleaded specially a compromise between himself and the creditors of the bank, including appellee, which had been partially carried out, and which he was ready and willing to complete, and the appellants jointly pleaded an assignment by the bank, prior to appellee’s judgment against it, and the tiling Si his motion against appellants, to Sam Hanna for the benefit of i£s creditors, conveying all its property to Hanna ; that Hanna accepted the assignment and qualified as assignee, and was proceeding to execute the trust, and had on hand unadministered assets of the bank subject to execution, that the assignment was made at the instance of the creditors, including appellee, and they had received the benefit of it. Appellee denied under oath being a party to the compromise alleged by Hevins.
    Upon the issues formed by the above pleading, the case came to trial before a jury, and- resulted in a verdict and judgment for appellee, against appellants and for W. H. Hughes. The appellants moved for a new trial, which being refused, they excepted, gave notice of appeal, assigned errors, and bring the case to this court by appeal.
    Woods Wilkins and Cunningham, attorneys for appellants.
    J. W. Story and J. H. Robertson, attorneys for appellees.
   Opinion by

Gould, O. J.

This is a proceeding under the statute which authorizes the court, on motion and after notice, to order execution against any of the stockholders of a corporation to an extent equal to the amount of stock unpaid, in case wherejexecution has been issued against the property or effects of the corporation and no property can be found whereon to levy. R. S. Art. 595 ; P. D. Art. 5960.

One of the defenses was that the defendant corporation, the Drover’s & Planter’s bank of the city of Denison, in July 1878, being insolvent,- at the request of some of its creditors, including plaintiff Collins, executed an assignment conveying to one Hanna “all assets whatsoever belonging to said bank,” for the benefit of its' creditors, that all the creditors assented to said assignment; that the plaintiff availed himself fully of its benefits and that Hanna was still proceeding to execute the same, having assets in his hands unadministered, it being yet impossible to tell what amount would be received by the creditors. ' The evidence was that the assignee had paid a dividend of 45 per cent, to the creditors including the plaintiff and that it was after receiving the dividend that plaintiff’ Collins sued on the balance of his claim and procured his j ndgment

Our opinion is that the terms of the assignment, ‘"all assets whatsoever belonging-to said bank,” included whatever was due from stockholders for stock unpaid, ánd that by the deed of assignment the right to recover of stockholders what was so due by them rested in the assignee Ilanna. Having accepted a dividend under this assignment, the plaintiff' could not thereafter treat it as invalid and appropriate to his exclusive benefit assets which belonged to the assignee for the* benefit of all the creditors alike. Thompson’s Liability of Stockholders, Sec. 31-0-341.

The statute provides the judgment creditor of a corporation with an efficient remedy against stockholders whose stock is unpaid, but was not designed to interfere with the operation of a valid assignment of an insolvent corporation covering its entire assets and therefore covering what is due from stockholders as well as others.

The court iu its charge took a different view of the law, requiring a reversal of the judgment. Other questions presented need not be noticed. The judgment is reversed and the cause remanded.