Case Name: State of Louisiana ex rel. the Gullett Gin Manufacturing Co. vs. James M. Thompson, Judge, et al.
Court: Louisiana Supreme Court
Jurisdiction: Louisiana
Decision Date: 1882-05
Citations: 34 La. 758
Docket Number: No. 8601
Parties: State of Louisiana ex rel. the Gullett Gin Manufacturing Co. vs. James M. Thompson, Judge, et al.
Judges: Levy, J., absent.
Reporter: Louisiana Annual Reports
Volume: 34
Pages: 758–762

Head Matter:
No. 8601.
State of Louisiana ex rel. the Gullett Gin Manufacturing Co. vs. James M. Thompson, Judge, et al.
A District Court ■which, has jurisdiction of a cause is competent to pass upon and decide all legal points and issues presented in a reconventional demand, and in all other incidental, demands growing out of or connected with the main suit.
In such a case, the charge that the Judge has usurped authority in deciding pleas or issues alleged to he hevond his jurisdiction, will not entitle the party complaining to a writ of prohibition from the appellate tribunal, unless the record discloses a plain usurpation of authority or jurisdiction, or arbitrary exercise of power by the inferior court.
APPLICATION for writ of Prohibition. Thompson, Judge, Respondent.
Bussell & Marr, W. 8. Benedict, for Relator :
1. The capacity of a defacto officer of a corporation cannot be impeached collaterally. C P. 867 ; 25 A. 673 ; 26 A. 493 ; 28 A. 274.
2. The law provides a remedy in such cases. C. P.867.
3. Defendant is estopped from denying the capacity of plaintiff in this case, by reason of her call in warranty of plaintiff in the case Holden vs. 35. D. Gullett, Sr., represented by Mrs. M. A. Gullett, curatrix of same party. In that case she distinctly alleges that the Gullett Gin Manufacturing Company was represented by Albert Baldwin, acting president. In that case exceptors aslced. for judgment againstthe Gullet Gin Manufacturing Company, thus represented. 4 A. 339 ; 14 A. 308.
4. The scope of the exceptions, when reduced to their essence, is an impeachment of the capacity of Albert Baldwin to represent the Gullett Gin Manufacturing Company. Though to do so, the assault is made on the amended charter by the ingenious allegations that plain tiff does not represent the Company under old or original charter, and plaintiff’s sole authority is based on the amended charter which, for certain reasons specified, is alleged to be absolutely void. What cannot be allowed directly, will not be allowed to be done indirectly.
r>. Albert Baldwin and his co-directors were elected under the original charter, which exceptor admits to be valid. Vide Minutes of Board Directors, 31 January, 1881.
<>. The determination of the validity of tbeamended charteris not restrained in the case, save for the purpose of impeaching the authority of Baldwin, the alleged defacto officer. This suit is brought by Gullett Gin Manufacturing Company, represented by A. Baldwin, President, against a stockholder for an alleged indebtedness to the Gullett Manufacturing Company, and growing out of his relation to the Company. The allegation is, that the Company plaintiff was organized by act passed in 1870. The exception is, that plaintiff is not that Company, because deriving its sole authority from an amended charter formed in 1881,' which exceptor says in an absolute nullity and in no manner affects the charter of 1870.
As appears by the evidence the acting directory were elected under the old charter at its place of domicile and before the adoption of the amended charter, so if the amended charter is an absolute nullity, or the party suing was chosen under the old charter, the annulment of the amended charter does not affect the right to sue and cl&im the debt demanded, liis capacity remains intact.
7. The defects alleged in the adoption of the amended charter are, if they existed, defects growing out of fraud on part of certain persons and matters of form. Fraud vitiates contracts and all acts, but does not operate as absolute nullity. Fraud may form the basis of relative nullity. Relative nullities are remedied by direct action. “Uor shall anymore informality in organization have the effect of rendering the charter null or of exposing any stockholder to any liability beyond.the amount of his stock.” R. S. 1870, Sec. 690.
8. Corporate charters, like all other written instruments legal in character and object with all appearance of regularity and complete in execution, cannot be collaterally impeached, and are to be treated as valid in any collateral proceedings, until they have been adjudged invalid in a proceeding to set them aside. Charges of forfeiture will not be entertained in collateral proceedings. Abbott Dig. Corp. p. 149, 2 Kent Com. p. 312. 13 A. 545.
9. A party who has dealt with a corporation, participated in its organization, or in any manner dealt with it so as to give it credit, or recognize its existence, cannot be heard to impeach it. Wiltz vs. Fetors, 4 A., 339, and authorities cited. Yredenberg vs. Behan} 33 A. 636; E. Fascagoula Hotel vs. West, 13 A. 545.
10. Charters and acts of incorporation are subject to the general rules for the interpretation of agreements between individuals. AtchafalayaBank'vs. Dawson, 13 La. 497.
11. The amended charter'in this case.is, in it§ purposes and objects, sanctioned bylaw as well in its form -, it recites all the facts necessary to give it validity; it purports to be adopted by thereqxusite number of votes at ameetingwhenthe requisite number of stockholders (three-fourths) were present and signed the project as it exists in the notarial act, including defendant administratrix and her intestate, being legal in form and purpose; like agreements between individuals, it cannot be collaterally impeached, specially at a period nearly twelvemonths since its promulgation and registration, and specially also by parties who participated in its adoption. R. S. 1870, Secs. 683, 685, 690, 686; 13 La. 497; 15 La. 26; 4 A. 339; 33 A. 636 ; 13 A. 545.
12. When a corporation has forfeited its charter that forfeiture cannot be inquired into collaterally. Until duly forfeited by proper proceedings to that end it has capacity to sue. 13 La. 497; 15 La. 26; Kent Com. 312.
13. The questions involved are now pending in a suit in the United States Court for Eastern District, La., at Bow Orleans, between the same parties or contradictorily with same defendant. Vide proceedings in said Court, 7 N. S. 187; 8 A. 15 ; 4 A. 520; 5 A. 494; 26 A. 113; 33 A. 768.
14. Ids pendens, nearly akin to res adjudioata, is allowed to prevent harassment by an infinitude of suits and conflict of jurisdiction; it rests upon a wise public policy. 4 A. 420; Dick vs. Gilmer, C. 3?. 335.
15. Ids pendens may be urged by plaintiff on tile trial, or he may plead it. Pierce vs. Miller, 3 A. 354. Union Bank vs. Lobdell, 10 A. 130.
16. The pendency of the suit plead Us pendens may be in a different court, so that it be a court of competont and concurrent jurisdiction. C. C. 335. Vonwyck vs. Gaiues, 13 A. 233; Bocheroau Sc Co. vs. Lewis, 26 A. 581.
The'plea of misjoinder of Mrs. Gullett, as administratrix and individually, incase Gullett Gin Manufacturing Company vs. Mrs. Gullett, administratrix and individually, is not tenable. All the effects reciprocally possessed by both husband and wife during marriage, and at its dissolution, aro presumed go be common effects or funds. The stock charged to have been obtained by Mrs. Gullett individually, like that charged to have been issued to her intestate, B. D. Gullett, Sr., is presumably community property. The joinder is therefore proper. B. C. C. 2405 (2374).
The snit is really for what is community property presumably, tboughlield by the two spouses separately.
JE. Howard McOaleb, same side :
Where evidence, under an issue legally presented, is sought to be introduced, the proper practice is to object to such evidence, iatlier than move to strikeout the allegation. 23 An. 193; 21 An. 271.
The law authorizes issuance of writs of prohibition to provent usurpations of j urisdiotion by inferior courts in just such oases as the instautone. C. P. Arts. 846 et seq.; High’s Ex. Leg. Bom., Prohibition §762 et seq.
The regularity of the corporate organization cannot be questioned collaterally. Boone on Corporations, §34; Angelí Sc Ames on Corporations, Chap. XXI, Quo "Warranto.
It can only be dono by suit under Intrusion Into Office Act, and proceedings in conformity with the Articles of Code of Practice relating to the writ of quo warranto. Bev. Statutes, Sec. 2593 et seq.; C. P. Art. 867 et seq.
The State is a necessary party to such a suit. Abbott’s Dig., Law of Corporations, vo. Officers Quo Warranto.
An injunction cannot issue from a District Court and be made operative beyond tbe territoi ial limits of that court. C. P. Arts. 125, 129.
JEUis & Hllis, H. JD. White, for Respondent.

Opinion:
The opinion of the Court was delivered by
Pocrili, J.
This is an application for a writ of prohibition and is predicated upon the following proceedings and facts:
Relator sued Mrs. Gullett in the Eighteenth Judicial District Court, Parish of Tangipahoa, for the recovery of seventy-five shares of stock of said Company, worth $7,500.
Defendant first excepted, on the ground that the plaintiff in that suit was not the real Gullett Gin Manufacturing Co., duly represented, hut a mere pretender, without power or capacity to stand in judgment, and she subsequently waived her exception and pleaded to the merits.
With her answer she coupled a reconventional demand praying that an amendment to the original charter of the Company, adopted in January, 1881, under which the officers representing the corporation in the suit- were elected, be declared null and void, for reasons which it is not necessary to enumerate in this opinion ; and that the original charter, adopted in February, 1870, be declared as the sole legal charter of the corporation.
During the absence of the District Judge from the Parish, she presented a petition, made part of her reconventional demand, and obtained from the clerk of the court an injunction restraining the president and directors from doing certain acts alleged to be injurious to her interests and to her reconventional demand.
At the ensuing term of the court, the Relator herein moved for the dissolution of the injunction, on the ground that it had been illegally issued by the clerk, aud on a bond insufficient in amount; which motion was overruled by the lower court.
During the progress of the trial, plaintiff in the original suit objected' to the introduction of evidence in support of the reconventional demand, on the following grounds, substantially :
1. That the legal status of the plaintiff corporation and the legality of its amended charter could not be inquired into collaterally.
2. Want of proper parties necessary to the decision of such an issue.
3. That the defendant was estopped by many acts recognizing the existence of the corporation, from now denying its legal existence, and that she was further estopped by similar acts of her deceased husband, whom she now represents as administratrix.
4. The plea of Ms pendens by a suit pending in the United States Circuit Court.
To the ruling of the court disposing of said objections, plaintiff reserved a bill of exceptions.
Relator now charges that in maintaining the injunction, in entertaining the reconventional demand, and in admitting the testimony objected to, the defendant Judge has usurped jurisdiction, and that its only remedy is a writ of prohibition.
We have diligently searched the record for any .plea or objection on behalf of Relator, touching the jurisdiction of the lower court over the matters involved, or issues presented in the reconventional demand, and we have been unable to discover any such plea or objection, and the record contains no ruling of the District Judge on a point involving his right of jurisdiction.
The motion to dissolve the injunction was addressed to that court, the objection to the introduction of evidence on the reconventional demand, on the grounds hereinabove enumerated, submitted to that court for decision questions of law and of practice which it was competent to decide, and neither the motion to dissolve, nor the objections urged, directly or indirectly denied the inherent jurisdiction of the court over the matters and issues discussed. And it is more than manifest that in case of a favorable ruling, Relator would not now complain of the alleged usurpation of jurisdiction or authority by the District Judge.
The case being appealable, all the rulings of the Judge on the points thus for submitted to his adjudication, will be reviewed on appeal.
It was competent for the Judge to pass upon all the pleas and objections submitted to his consideration in a case pending before his court, and if he erred, as charged, in maintaining a reconventional demand over all the legal' obstacles interposed by plaintiff, the injury is not irreparable, and his rulings do not involve the naked question of jurisdiction vel non.
Ithas been so frequently held by this Court, that it can now be considered as elementary, that a writ of prohibition will be granted only when " there is a plain usurpation of authority or an arbitrary exercise of power on the part of the inferior court, and when the injury is actual or immediately impending."
In the case of State ex. rel. Hernandez vs. Monroe, Judge, 33 A. 926, in which two District Courts were trying cases between the same parties, we refused our interference by prohibition, on the ground that the act of either court, in wrongfully maintaining jurisdiction, could be corrected on appeal.
After a careful review of the record in this case, we are more than convinced that to issue the writ herein prayed for would establish a most dangerous precedent, and would open the door to a premature examination by the court of preliminary rulings of inferior tribunals on many legal questions, not involving the inherent right of jurisdiction of such courts in the premises.
The court having undisputed jurisdiction of the main suit, was fully competent to entertain jurisdiction of the pleas and issues submitted in the reconventional demand, and the Judge's rulings, whether right or wrong, on the legal propositions involved, cannot, in any contingency, be construed as the exercise of unwarranted authority, and do not present a question of jurisdiction which would justify the interference of this Court, at this stage of the proceedings.
The writ of prohibition prayed for is, therefore, refused, at Relator's costs.
Levy, J., absent.