Daily capital journal. (Salem, Oregon) 1903-1919, 1911-10-12
Hafer V. MedfOrd & Crater Lake Rail.
road Co. ct al, Jackson County.

Edgar Hafer, plaintiff, V. Medford
& Crater Lake Railroad company, A.
A. Davis, b. F. Adkins, r. H. White
head, j. NJ. Keene and w. l. Vawter,
defendants. A. A. Davis, claimant and
appellant, V. ]. F. Reddy, receiver of
| the Medford & Crater Lake Railroad
company, respondent. Appeal from
the Circuit Court for Jackson county.
Hon F. NJ Calkins, Judge. Motion to
dismiss appeal, George H. Durham
and William NJ. Colvig, for appellant.
A. r. Reames, for respondent. Eakin
C. j. Allowed.
Defendants Davis, Adkins, White
head, Keene and Vawter, as promoters
and incorporators, incorporated de-
fendant company for the purpose of
constructing a railroad from Medford
to Crater Lake in Jackson county, Or
egon, with capital stock of 100000
shares of the par value of one dollar
per share.
In the complaint it is alleged that
the original incorpOrators issued to
themselves, as fully paid, 60 per cent
OF the stock of the corporation, name
ly 100000 shares, when, in fact,
nothing was paid for it, except it was
| shown by the minutes of the corpora
| tion that a resolution was adopted to
purchase from one of their number
all the rights of way, surveys, esti-
mates and franchises for the sum of
$26OOOO, and made it appear on the
stock books and record that the $780,
600 had been paid on the stock sub
scribed by them, and that amount paid
for the rights of way, estimates, etc. (;
that the whole proceeding was de-
vice on the part of the promoters to
secure a majority of the stock, fully
paid up, without expense to them;
and that thereafter plaintiff and other
citizens of Jackson county were in
duced by the promoters to, and they
ala, subscribe for stock in the corpor-
alton, and paid the face value thereof
to the amount of $21 900; that. after
spending in construction work the
$2l 900, $50 600 borrowed by the COM
pany and secured by mortgage upon
the property of the company, and GER
tain moneys advanced by Davis, as
manager of the company, the work
was abandoned.
Plaintiff, as a stakeholder COM
menced this suit on behalf of himself
and such other stockholders as should
ask to be Joined with him as plain
titts, to have a receiver appointed to
take charge of the property of the
corporation to collect the unpaid sub
scription of stock and to settle its
affairs. A receiver was appointed
who sold the property of the corpor-
alton for the sum of $50 800, $46, ,457 so
OF which amount was paid in satisfac-
ton OF the mortgage debt of the COM
pany' After the sale of the property
Of the company by the receiver, de-
tendant y. A Davis presented to the
receiver claim against the corpora-
tion for 2l,753,42, for money advanced
Dy him to the company and applied in
construction work, which claim was
disallowed by the receiver. Plaintiff
and other stockholders, who had paid
for their stock, filed with the clerk
of the court their formal appearance
IN writing, and protested against the
allowance of payment of the claim of
Davis, which came on for hearing be-
fore the court, the proteStants appear
ing by their counsel and after the
evidence was heard the court adiudged
that the claim of Davis cannot be al
lowed as an Indebtedness against the
orporation for the reason that, at the
time Davis advanced to the corpora
ton the money which makes up the
claim, he was indebted to the corpor
alton in a sum greater than the
amount so advanced, and that his
claim should be set off against his
debt to the corporation, but that he
be considered as having paid up stock
IN the corporation to the amount of
his claim. Davis appeals from this
decision.
The notice of appeal is directed to
F. Reddy, receiver, and Reames. his
attorney. due service of which notice
was accepted by Reames. The receiver
now moves the court to dismiss the
appeal for the reason that the notice |
was not given TO or served upon the
ADVERSE party in the decree.
EAKIN, c. ], The rule is that ev-
cry party to litigation who is inter-
ested in sustaining Judgment or de-
cree appealed from is an adverse
party and must be served with notice:
Moody V Miller, "a Or. 179, 4 party
% Judgment must be one who was
made party at the commencement
II the case or brought in thereafter
'y order OF the court or became a
'arty in some manner recognized by
aw: Medynski V. Thesis. So Or. Ssf, I