Case ID: f_82/html/0269-01.html
Source: Caselaw Access Project
Author: {"author": "COXE, District Judge.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

AMERICAN FREEHOLD LAND-MORTGAGE CO. OF LONDON, Limited, v. WOODWORTH.
    (Circuit Court, N. D. New York.
    August 18, 1897.)
    No. 3,178.
    Coupobations — Creditors’ Suit against Stockholder — Epff,ct of RecbiV-erkiiip.
    Under the statute of Kansas giving a judgment, creditor of a corporation the right to proceed by action to charge the stockholders with the amount of the judgment, such a creditor of a Kansas corporation may maintain an action in a federal court against a stockholder in another state, though the corporation is in the hands of a receiver.
    This was a suit in equity by the American Freehold Land-Mortgage Company of London, Limited, a judgment creditor of an insolvent Kansas farm-mortgage company, against Chauncey B. Woodworth, to enforce defendant’s liability as a stockholder in the Kansas corporation under the Kansas statute. The cause was heard on demurrer to the bill.
    P. Tecumseh Sherman and W. Pierrepont White, for plaintiff.
    William F. Cogswell and William N. Cogswell, for defendant.
   COXE, District Judge.

When this demurrer was first before the court it was decided that the action could be maintained upon the judgment alone without alleging or proving the original indebtedness. 79 Fed. 951. The remaining propositions were argued at the June term. Since the argument the circuit court of appeals for this circuit has rendered a decision which disposes of all the questions involved in favor of the plaintiff, with possibly one exception. Whitman v. Bank, 83 Fed. 288. It is argued that as the Kansas Mortgage Company is in the hands of a receiver, he is the only party who can maintain this suit for the benefit of all the creditors. Although this precise point is not involved in the Whitman Case it is covered by the logic of that decision and the authorities cited in the former opinion herein. The Kansas law gives a right of action to the judgment creditor. This is enough. The demurrer is overruled, with costs. The defendant may answer within 20 days.