The times. [volume] (Richmond, Va.) 1890-1903, 1897-01-29
SUPREME COURT OF APPEALS
A Case of Lively Interest TO Richmond
incorporates.
COUNTRY LAWYER NTH CITY OFFICE
Must PAY City Liccnsc-Joint Obiigors-
Parai Evidence-Judicial sales-stat-
ute of Frauds-Adversary Posses
sion-Other Gases

The following opinions were handed
down by the Supreme Court Of Appeols
yesterday:
Nunnally &C. ". Strauss &c. Re
versed. Opinion by Judge Harrison.
Judges Rely and Cardwell concurring:
Judges Keith and Buchanan. dissenting.
The York steel and Iron Company was
incorporated under the laws Of Virginia.
in 1880. It's capital stock was TO be not
less than one hundred thousand nor more
than one million dollars. and It's real
estate not 10 exceed four million dollars
in value
Seven citizens OF Richmond constitu-
ted tho charter members. who were its
officers. directors and only members from
lbs organization until this suit was in
stituted
The BILL filed boy appellants for them
selves and all other creditors Of the com
pany alleges that the company gave out
through it's officers and directors. and BIZ
means of mercantile agencies. through
out the country. that its minimum cap
ital stock had been subscribed that in
the faith OF said organization and the
sumcioncy OF lbs capital, and relying on
the responsibility, capacity and fidelity
Of its incOrpOratOrs. compliments had
sold them without other security than Il
secured mortgage a large quantity Of
land ln YORK county. $ g.. for which they
gave their notes for forty odd thousand
dollars and their assuming three other
notes agsrceating $1,000. that nothing
has been paid. and an effort 10 pay has
long since ceased. That at the request
of tho company. the land was conveyed
10 one proskauor individually. one OF the
inc0rpOratOrs of the company and by him
conveyed 10 the company in consideration
of five dollars and his subscription 10
$3.50 shares of the capital stock OF the
company at the par value Of 500. and
the further payment by The company OF
$4,000 secured hy deed of trust upon the
property; that through fraud and mis-
management in not collecting its stock
subscriptions and paying of the prior
MORTGAGES the lands have already been
sacrificed in large part % satisfy prefer
red creditors. leaving nothing 10 CONF
| pldlnants from that source. and that
| their only resource is tho unpaid stock
subscriptions which the company refuses
10 collect and apply 10 that end. That
Iroskaucr. one of the stockholders. was
wholly insOlvent at time of organization
and has SO remained. that the other six
members are solvent. that the books OF
The company show that these SIX sub,
scribod t0 only two shares each of the
capital stock. at the par value Of 800 and
that Pro l,1uer subscribed 90 $3.50 shares
of the same OF the stock thus SUBJ
s0rhed each incorporation paid therein
$500. no part of which was applied 10 the
debts. that Pr0skauer subscribed as
trustee for himself and the other incor-
p0rat0rs in equal proportions and that
though the lands were first conveyed 70
Proskauer Individually, yet only and sole
ly as trustee for the company ana that
the stock h the stock Of AN tho incorpOr-
1t0rs. and the subscription price remains
almost wholly unpaid. the design being
tO shield an the solvent ncOrporatOrs in
case OF failure and defraud complain
ants and creditors
They further aiiege Insolvency unless
The stock subscriptions made in the name
of Pro-kaucr Dee paid, that there has
been no meeting OF stockholders or di-
rcct0rs since February, 1888, that the
company does not intend to collect the
unpaid subscriptions due only by them
selves; that the enterprise has been
abandoned, and bv reason % fraud and
mlsmanaeomcnt Of the officers and direc-
tors. they are all jointly and generally
liable with the compliments and an 9TH
OPP creditors The York Steel and Iron
Company IT'S officers directors and stock
holders are made defendants
The prayer is that the court will as-
certain what debts have been contracted
i'm the nqme Of The comnan,. tbat it
Will decree prosl,auor a frlstoo for him
ealf and fho other six frcorporators fn
eorll nrororfior.. ana win either bv
annoinfiu.- "a receiver mr. a., som. ohio.
,ronor MAJ, raoii,o fine inrornorstors to
pay the same or so much as remains
dino or as MAY, De- necessary. IA r,,,. the
debts cost. otc or n the coirf CON
slider That fho directors bv reason Of
fraud ana negligence. have made Them
selves personally RESPONSIBLE that it will
decree against them personally. or IL
tho court consider that tic CORPORATION
yyas conceived ora1rized and ueed SOLE
1v as cloak To shield am tho solvent
generators from Liability or rick and
thus defraud courllinanfq efe Thar
Gaia i,corno-otior Dr., brrsbod asia, and
said inc0rDorators De held directly liable
bv reason ~ their fraud and deere
a.,airst thorn an i,liviIuauy ana for
General r.rfar
Demurrer 20 hill sustained and annoal
Held. The general rule is that where
n creditor has no len or interest i'm the
uropcrtv 10 be- subjected. lo must Obtain
Indictment and execution before bo cam
nrocoed I'm eoultv and This is usualIv
time I'm the case Of corporations as we'll
ae - individuals The rgle IS different
en- cases Ike this. The demurrer admits
tho o1aoatfons ~ the hin. which ALLEGES
insolvency 81 the CORPORATION. the stor-
maze Of IT'S business. abandonment bv
ifs officers and directors and that IL
t. 80 -.. D.. ..f..t .f.frr 60. %. er.r..- 90