The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1913-08-02
WON'T DROP CASE
Supreme Court Refused to Dis
miss MOunDay Suit.
States Application for Receiv-
er Is Denied.
CASE NOW IN DISTRICT COURT
But Supreme Court Says 1t Ha.
Jurisdiction.
Restraining Order in Land
SquabbIe Held in Force.


a motion to dismiss the custer and re-
ceivership suit against Don A. Noun
Day and wife and their sugar COM
panies. In the same opinion the court
denied an application for a receiver
for the companies, but held in force a
restraining order against the Noun
Days and their corporation, suggesting
to the state that new receiVershlp
suits be filed in the district court. Half
an hour after the opinion was re-
ceived, Attorney General Dawson filed
in the Shawnee county district court a
suit TO OuSt the sugar companies and
the MounDays from the state and to
appoint q receiver to Hquldate the
business and distribute the assets
among investors in the MounDay land
de.IlS.
In their opinion. the court held that
the supreme court has original Jur1S-
diction in the quo warranto proceed
ings, provided it is shown that the cor
pOrations for which a receiver is ask
ed, has been doing business in Kansas.
on evidence submitted, the court holds
that the MounDays have been doing
business within the state as repre-
sentatiVes of the corporations and that
the court has jurisdiction over them
in the action to oust them from the
state.
Why Receiver Was Denied.
Because the proceedings in quo
warranto are not we'll adapted to an
investigation of a question of fraud,
or to the adjustment of the rights OF
contributors to the fund as against the
defendants or betW them, the court
declines the appointment of a receiver.
Ii states, however, that the pendency
of the proceedings in the supreme
court will not act as a bar to an ap-
plicatiOn for the appointment OF a re-
ceiVer by a court of general jurisdic-
ton. The restraining order against
the transfer of funds or property of
S,NI nl n
PENDANTS, is held in force for ten days
pending the action of the state in
another court.
There is no question. the court in
dicated, regarding the original jurisdic- |
ton of the district court in the case in !
controversy. Yet the original juris-
diction of the supreme court is limited |
and not so broad that of a district |
court.
After reading the opinion of the su-
preme court in the case, Attorney Cen
.eral Dawson Immediately secured a
copy of the petition filed in the custer
and receivership suit in the supreme
court and the same was sent at once
to the office of the clerk of the Shaw
nee county district court. 1t was on
file within a half hour after the su-
preme court opinion had been made
public. The case will now come up be-
fore the district court on it's merits
and the state will ask for the appoint
II
the business of the American Sugar
Manufacturing & Refining company,
both of Oklahoma and New Mexico, the
Consolidated Sugar company and the
land department of the sugar company,
conducted by Don A. MounDay and L.
d. w. MounDay. his wife.
In the argument of the case 5afore
the supreme court, d. r. Hite lad
urged that the court should order the
dismissal of the action because the
operations of the MounDays was in
the capacity of individuals. The court,
however, found that the individual de-
PENDANTS were so closely connected
with the sugar companies that there
was reason to assume that the Noun
Days have been doing business In ne
name of the corporations and has
power to oust them. Only on the ap-
justment of the affairs through a re-
ceiver did the court hesitate and suG-
gest that the litigation should be
brought in a district court with great
er original jurisdiction.
As Dawson Sees Case.
Discussing the opinion of the court
today. Attorney General John S. Daw-
son stated:
"Abridging the language of the opin-
ion, the decision is this: The court re-
fuses to dismiss the lawsuit. That if
the MounDays transacted business
-
business of the corporation the court
has power TO oust the MounDays from ,
such business; that better plan to ;
save the assets for the people who have I
been swindled, would be to sue in a
court with broader powers than the
supreme court. In other words, a mint
Is given to get this mess into dis
.rict court and permission is given to
1Ie such suit without prejudice to the ,
state by having this suit in the su-
oreme court; and the supreme court
md stops the MounDays from busi-
ness for that time
The Courts Opinion.
The opinion of the court is as follows:
The state brings an action against
Don A. MounDay and L. d. w. Noun
Day, and two corporations, one organ
'ked under the laws of Oklahoma, the 4
ltner under the laws of New Mexico. | ,
rhe corporate names were originally
he same-the American Sugar Manu- {
featuring & Refining company. The
name of the New Mexico corporation
mas been changed to the Consolidated
sugar company. The plaintiff alleges
Il substance that neither corporation
mas authority to do business in Kansas,
out that through the MounDays each
has operated here, receiving payment
rom a large number of persons on
)uTported sales of real estate and
zig hts connected Herewith, for which
40 substantial equivalent was return
ID. 1t asks that the defendants be
functions, and that receiver be ap- :
pointed to take charge of the business !
lnu its proceeds. J
Upon the hearing of the appIica- I
ion for the appointment of a receiver
40 appearance was made for either of