The Valley Virginian. [volume] (Staunton, Va.) 1865-1895, 1881-11-10
National Express Company Suits.

National Express Company Suits
DECISION IN FAVOR OF THE STOCKHOLDERS
INTERESTING OPINION BY JUDGE BROWN IN
BALTIMORE.
From the Baltimore Sun of Monday, we
copy the following report of the decision of
the Court of Common Pleas in Baltimore.
There were many stockholders in this COM
pany throughout this section, and the decision
will be read with interest by number of our
subscribers
| In the Court of Common Pleas, in this city,
on Saturday, Chief Judge Brown rendered his
decision in the case of John Glenn, trustee. VS..
John S. Williams and others, sustaining the
position taken in the argument by the counsel
for the defendants, in whose favor judgment
was accordingly rendered. The suit, as has
heretofore been stated in the Sun, was one OF
large number of suits instituted last Spring
| against stockholders of the defunct National
Express and Transportation Company resid-
| ing in this city, to enforce payment Of an as
sessment of thirty dollars per share on the
unpaid stock of the company, in pursuance OF
decree of the Chancery Court of the city OF
The company. it will be remembered, after a
short career, abandoned its business, and made
an assignment of all its property for the bene-
fit of creditors in the month OF September, 1866.
At that time only 20 per cent. of the entire
stock subscription of about 100000 had
been called in, leaving 80 per cent. unpaid.
The liabilities OF the company at the date OF
the assignment were estimated at about $3.50,
600, and the assets transferred to the trustees
| nod n, he To ha cI1f1-
Gent to cover the liabilities. There was no
election of officers of the company OF meet
ing of stockholders or directors held after 1866
Immediately after the assignment the affairs
of the company became involved in litigation
in several States, especially in New York,
Maryland and Virginia, and the trustees were
embarrassed and delayed in the performance OF
their duties by injunctons and receiverships,
in consequence of which, it is said, the assets
were wasted and lost, while the debts or the
greater part of them renamed unpaid: Under
these circumstances a creditors bill was filed
in 1871 in the Chancery Court of the City of
Richmond, Va, by the late W. W. Glenn, of
this city against the company, its officers and
trustees, for the purpose Of having the unpaid
subscriptions of the stockholders applied to
the payment of the debts. After the death of
Mr.. Glenn this suit was revived by his admin
istrator in 1879. No process was served upon
any officer of the company in the original suit
or until after the filing of the amended bill in
1879. The company never appeared or made
any defense to the suit, and decree was &C
cordngly taken by default An account was
taken, by direction of the court of the debts
of the company, which, with fourteen years
interest allowed, amounted to upwards of halt
million of dollars, and decree was given
against the company for that amount, and the
assessment of thirty dollars per share made
upon the stockholders, and Mr.. John Glenn, of
this city, appointed trustee, with authority to
collect the assessments, in place of the origi-
nal trustees named in the deed of September,
1866 1t was upon these proceedings in the
Virginia court that the suits against the Balti-
more stockholders were based No less than
| eleven pleas were filed by the counsel for the
stockholders, Messrs. 1. Nevett Steel and
Thomas W. Hall, to the statement of the cause
of action filed by Messrs Marshall & Fisher,
counsel for Mr. John Glenn, the trustee and
plaintiff in the suits. The question came be-
| tore the court upon demurrers to the defend
ants special pleas.
In giving his decision on Saturday, Judge
Brown, after recting the facts as above stated,
| remarked that the questions were of great i'm
portance and had been ably and fully argued
on both sides. There were two principal de-
| lenses relied upon by the stockholders. These
were, fist, that the Virginia court had no ju-
risdction in the case before it to make or de-
| cree the assessment as against the present de-
| PENDANTS, who were not parties to the suit :;
and, secondly, the defense of limitations. 1t
was admitted that neither the defendants nor
| any Of the stockholders were parties to the
suit in Virginia, and that the decree against
the company went by default. 1t was claimed
by the plaintiff that decree by default was as
valid as any other decree, and that the stock
holders were not necessary or proper parties
H.. III.
| ed by the company. To this view Judge
Brown said the court here could not assent
| The company, having made an assignment
stripping itself of its property and rights, was
| without funds or real interest in the cOntrO
! versy. 1t was the nominal party only to the
proceedings in Virginia. The stockholders
who were the parties to be directly and Pc
cuniarily affected by the courts Decree and
who were the real defendants in the suit, had
a decree passed against them in a case in
which neither they nor anybody who
could in fact or law represent them were par
es. The trustees did not represent them, for
| they were appointed for the benefit, not of the
stockholders, but of the creditors, and had adj
verse interests and duties to the stockholders
The decree of the Virginia court making the
assessment could not be considered binding
| upon the stockholders who were not parties to
| the suit in which it was rendered. The court
had considered the authorities relied upon by
the plaintiffs counsel-the cases in bankruptcy.
and particularly the case of Hall VS.. the In
surance Company, in 5 ellis Reports, but they
| were not analogous cases. The proceeding in
1 Virginia was in equity, and the decree of the
court had to conform to the established princi-
Piles and rules of equitable jurisdiction and
procedure.
pleaded by the stockholders to the suit for
their unpaid subscription, the court considered
this defense also we'll taken. In the case of a
living or "going" corporation, it was undOubt-
eddy true that the statute of limitations would
not begin to run in favor of stakeholder who
had not paid up his subscription until there
was "calr' made by the company or its di-
rectors, as provided for by the charter. But in
the case of a corporation which had abandoned
its business and made an assignment of all its
property, and was VIGOROUSLY insolvent, both
upon principle and according to the weight OF
modern decisions, it must be held that the
statute of limitations would begin to run from
that time. Then the unpaid subscriptions be-
came due and demandable at the suit of the
creditors, the insolvency of the company dis
pensing with the necessity of prior formal
CALL and the creditors having right to pro-
coed in equity against the stockholders to en-.
force payment of their unpaid subscriptions.
Stress has been laid by the plaintiffs counsel
upon the deed of trust as "the law of the case
and of the court" but the deed of trust could
not operate to bar or hinder the creditors
right OF suit, and did not, therefore, suspend
the running of the statute. The National Ex-
press and Transportation Company failed and
made an assignment in 1866, and the plea of
limitation was good defense to the stock
holders, who were not sued for more than three
years after that date. The other pleas set up
by the defendants, and which had been de-
INJURED to, were considered and passed upon
by the court in detail, but the decision OF the
court upon the two main questions disposed
of the suit in favor of the defendants. The
case, it is understood, will be taken to the
Court of Appeals.
Thanksgiving Day Proclamation.
On the 18th, the following proclamation was
issued from the Department OF State, Wash
|