Case Name: West Side Telephone Company et al., Appellants, v. Ralph B. Kenison et al., Respondents
Court: Washington Supreme Court
Jurisdiction: Washington
Decision Date: 1928-04-14
Citations: 147 Wash. 542
Docket Number: No. 20883
Parties: West Side Telephone Company et al., Appellants, v. Ralph B. Kenison et al., Respondents.
Judges: 
Reporter: Washington Reports
Volume: 147
Pages: 542–546

Head Matter:
[No. 20883.
Department One.
April 14, 1928.]
West Side Telephone Company et al., Appellants, v. Ralph B. Kenison et al., Respondents.
L. B. Gillette, for appellants.
Chas. T. Borg, P. D. Smith, and John W. Hanna, for respondents.
Reported in 266 Pae. 706.

Opinion:
French, J.
The record in this case shows that the West Side Telephone Company, was organized in July, 1910, having the usual powers of a stock company engaged in conducting a rural telephone system. Sometime in the year 1913, the appellant W. S. Eidge and family became the owners of about three-fourths of the outstanding capital stock, and thereafter the affairs of the company were conducted largely by W. S. Eidge and members of his family as officers and employees of the company.
In 1920, an action was commenced by one Luther and wife against the West Side Telephone Company to recover damages for personal injuries. Eespondent P. D. Smith was attorney for the Luthers, and thereafter the cause was tried and judgment rendered for the plaintiffs, and an appeal taken to this court. During the pendency of the appeal, respondent Kenison, at the suggestion of the Luthers, and evidently with the consent of all interested parties, was appointed receiver of the telephone company. The Luther judgment was sold and assigned to the respondent Smith, and the claim was compromised by the receiver and the compromise settlement approved by the court. Thereafter this court reversed the judgment on account of errors of law occurring at the trial, and the cause was remanded for a new trial. Luther v. West Side Telephone Co., 134 Wash. 410, 235 Pac. 783.
The Luther claim, however, having been compromised and allowed as a claim against the receivership estate by both the receiver and the court, and the attorneys for the telephone company having been notified of the settlement, nothing further seems to have been done in tbe matter, both sides seemingly treating the compromise settlement as final.
Thereafter application was made by the receiver, respondent Kenison, for the sale of all the property and assets belonging to the telephone company. Petition for an order of sale setting forth the indebtedness of the company was filed; dne notice of the time and place of the sale was given; Richard Burke, now deceased, purchased all of the assets at receiver's sale, and application was made to the superior court for ah order of confirmation. Appellant W. S. Ridge and his wife intervened in the receivership matter and objected to the confirmation of the sale, and an order having been made by the superior court approving and confirming such sale, an appeal was taken to this court, which appeal was subsequently, on motion of the receiver, dismissed.
The actual possession of the physical assets of the telephone company was turned over to Burke Brothers Telephone Company, a corporation, and it, together with certain of the other respondents as officers and trustees, have since that time been operating the telephone system. The receiver has rendered a final account, and in so far as the record indicates, nothing has been done looking towards the approval of the final account or the final winding up of the business of the company and discharge of the receiver.
The appellants have brought this action, alleging generally all of the facts heretofore detailed, setting forth the value of the property taken, alleging generally a fraudulent conspiracy on the part of the receiver, the Burkes and P. D. Smith to secure possession of the assets of the telephone company, alleging that the sale made by the receiver is fraudulent and void, and claiming the right to repossess the property free and clear of all claims.
Answers were filed by tbe various defendants, and from an order and judgment of dismissal this appeal is taken.
An examination of the record clearly indicates that the case was presented, tried and determined on the theory of fraud, collusion and conspiracy, and we think it is the settled law of this state that the case will be considered in this court upon the same theory upon which it was presented in the trial court. Mielke v. Miller, 100 Wash. 119, 170 Pac. 143.
Complaint is made that the West Side Telephone Company was dismissed from the case by the trial court. The parties defendant raised the question that neither by pleading nor proof was it shown that the West Side Telephone Company, a corporation, had paid its last annual license fee. Passing for the moment the question of whether or not the West Side Telephone Company, being in the hands of a receiver, could, without the approval of the court or receiver, and at the instigation of its officers, maintain an independent action against the receiver and others, we think the law is clearly settled in this state that the payment of the annual corporate license fee must be alleged and proved as a condition precedent to the maintenance of an action.
Complaint is also made that the respondent, Burke Brothers Telephone Company, was permitted to file an answer in the nature of a general denial during the pendency of the trial. This was so clearly within the discretion of the trial court that, in the absence of any showing of abuse of discretion, the action of the court in this particular will not be disturbed.
Complaint is made that the sale of all of the assets of the company by the receiver was void, but it was approved by tbe court, objection made to tbe confirmation of tbe sale, tbe sale duly confirmed, appeal taken from tbe order of confirmation, and tbe appeal dismissed; and tbe record shows conclusively tbat tbe appellants bad knowledge thereof and participated therein. They are therefore barred and foreclosed.
At tbe close of tbe case, tbe trial court found thát there bad been a failure of proof; tbat there was no evidence showing fraud, conspiracy or collusion. Practically all of tbe pertinent evidence in this case is a matter of documentary proof, as shown by tbe records of tbe superior court of Okanogan county. Tbe record shows that some of tbe things complained of were done with tbe consent of tbe appellants; others over their protest, but all on due and proper notice. Tbe record not only fails to show evidence to support tbe allegations of tbe complaint, but, on tbe contrary, affirmatively sustains tbe respondents' position.
Tbe judgment of tbe lower court is affirmed.
•Mackintosh) O. J., Parker, and Mitchell, JJ., concur.