Case Name: Bullock v. Kilgour
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1883-01
Citations: 39 Ohio St. 543
Docket Number: 
Parties: Bullock v. Kilgour.
Judges: 
Reporter: Ohio State Reports, New Service
Volume: 39
Pages: 543–546

Head Matter:
Bullock v. Kilgour.
K., a creditor of an insolvent corporation, brought- suit against its stockholders, including H., B. and L., to enforce their individual liability as stockholders, for the benefit of the creditors of the corporation, and obtained judgment against such stockholders respectively for the amounts found to be required for the payment of the debts of the corporation; and the court appointed a receiver to collect the amounts for which judgment was rendered, and apply the money to the payment of such debts. K. afterwards filed a supplemental petition against B. and L., alleging that an execution issued agaiust H., upon such judgment, had been returned unsatisfied, that he was insolvent, that he acquired his stock from B. and L., who had held and owned it, and praying judgment againt B. and L., for the amount of the judgment rendered against H.
Held, the judgment rendered in the action brought by K. is a final judgment, conclusive upon K., and the other creditors, as to the liability of the several stockholders who were parties to the action.
Error fo the Superior Court of Cincinnati.
In July, 1868, Charles H. Kilgour filed a petition in the superior court of Cincinnati against the Pendleton Street Railroad Company, The Franklin Bank of' Cincinnati, John J. Hooker, Anthony D. Bullock, Henry Lewis and others, alleging that be bad recovered a judgment, which was still in force and unsatisfied, against the street railroad company,0a corporation of wbicli he and the other defendants, except the Franklin Bank, were the stockholders ; that the Franklin Bank had also obtained judgment against the company, and that there were other debts due from the company ; that the entire property of the company had been sold and the proceeds applied to the payment of other debts, and that the company was wholly insolvent; that each of the stockholders was liable to the plaintiff and the other creditors of the company pro rata with the other stockholders to such amounts as were unpaid on their stock, and in a sum of money equal to the amount of his stock, or to such proportion thereof as might be required to pay all the debts of the company ; but that controversies had arisen among said stockholders as to the number of shares of stock held by them respectively, and the amounts for which they were liable. The petition prayed that an account might be taken of the debts of the company, and to whom owing; and also of the stockholders of the company, the amount of stock held by each, the amount due on the stock, and also due for the extra liability of one hundred per cent.; that an assessment might be made on the stockholders, in proportion to their liability, of such sums as would be sufficient to pay all the debts of the company; that judgment might be rendered against the stockholders respectively, for the sums so assessed, and for other relief. The case was referred to a master, to take and state the account prayed for, and upon the confirmation of his report judgment was rendered, in June, 1870, against those stockholders who had been served with process. ■
It was found by the court that Bullock and Lewis held' stock to the amount of sixteen hundred dollars, and judgment was rendered against them for $652 ; and judgment was also rendered against Hooker, as the holder of stock to the amount of seven thousand nine hundred dollars, for $3,219.
The court appointed a receiver to collect the sums for which judgment was rendered, and also, by legal proceedings or otherwise, the sums found due from those defendants not served with process, and from the money thus collected to pay the costs of the suit, and to distribute the balance pro rata among all the creditors of the company.
In March, 1882, Kilgour filed a supplemental petition against Bullock and Lewis, alleging that an execution had been issued against Hooker and returned unsatisfied, and that he was insolvent: that Hooker acquired his stock by transfer from Bullock' and Lewis August 17, 1867, at which time all the debts of the company had been contracted, and that prior to that day Bullock and Lewis were the owners and holders of that stock; and praying judgment, on behalf of Kilgour and the other creditors of the company, against Bullock and Lewis for the amount of the original judgment against Hooker.
Bullock and Lewis moved to strike the supplemental petition from the files, but their motion was overruled. They then demurred, but the court overruled their demurrer, and rendered judgment against them in accordance with the prayer of the supplemental petition. This proceeding is prosecuted to reverse that judgment.
Ramsey & Matthews, for plaintiff in error.
Ilealy, Drannan ds Desmond, for defendant in error

Opinion:
Upson, J.
It was supposed that in deciding this case it would bo necessary to review the decision of this court in Brown v. Hitchcock, 36 Ohio St. 667, in regard to the time at which the individual liability of the stockholders of a corporation attaches in favor of its creditors. This we should not be willing to do in any case where it is not necessary, as we think it is not in the case now presented for our consideration. The first question to be decided is, whether the judgment rendered in 1870, in the action brought by Kilgour, is a final judgment. If it is, it can only be vacated, modified or rev-er: sed in the mode prescribed by statute, and until thus vacated, modified or reversed it is conclusive upon all parties to the action, as to all matters involved therein; upon the principle that the public good requires a limit to litigation.
The object of the. action was to enforce the individual liability of the stockholders of the company, for the benefit of all its creditors, and in order to enforce such liability it was necessary to determine the controversies 'which the petition stated to have arisen among the stockholders as to the number of shares held by them respectively and the amounts for which they were liable. To á complete determination of the questions involved in such an action it is necessary that all of the stockholders should be made parties for the purposes of a general account and to enforce from them contribution in proportion to their shares of stock, as decided in Umsted v. Buskirk, 17 Ohio St. 113, and also that the liabilities of the.parties, as between themselves, may be marshaled in accordance with the rules of equity. If there were other stockholders of the Pendleton Street Railroad Company, who were liable, it was the right of. any defendant to insist upon their being made parties.
It is clear that- no other parties, and no other allegations in the petition, were needed to give the court power to determine finally all questions, affecting the individual liability of the parties to the action, as stockholders of the company.
Bullock and Lewis were parties defendant, and the cause of action against them existed'at the time the suit was brought, whether their liability, as stockholders, attached at that time, or when the debts of the company were contracted. It was the duty of the court, under the allegations of the petition, to determine the extent of their liability, whether primary or ultimate, and the court did determine that they were the holders of stock to the amount of sixteen hundred dollars, and were therefore liable to contribute towards the 'payment of the company's debts the sum of six hundred and fifty-two dollars, for which judgment was rendered against them. While this judgment-remains in force it'is a conclusive determination of their liability as stockholders to pay the amount, of such judgment, and- no more.
Section 5119 of the Revised Statutes does not authorize the plaintiff to file a supplemental petition after final judgment has'been rendered, for the purpose of vacating, reversing or modifying such judgment.
Judgment reversed.