Court Opinion

ID: 5566740
Source: CourtListenerOpinion
Date Created: 2022-01-11 01:03:30.227373+00
Date Added: 2024-06-11T08:35:37.525346
License: Public Domain

Atkinson, Justice.
1. The word “person,” according to section 5 of tbe code, includes “corporation,” and tbe word “party,” as employed in section 4263 of the code, cannot mean less than person; otherwise there is no provision of law by which a corporation can obtain a supersedeas to a judgment rendered against it. The mere use of the personal pronoun “his” cannot be held to limit the right of supersedeas to natural persons; for to place upon it the narrow construction which would limit the application of the statute to such persons would likewise limit it to persons of the male gender, whereas it was the manifest purpose and intent of the General Assembly to provide a means of obtaining a supersedeas in favor of any party whose interest might be affected by the judgment of a court from whose decision a writ of error lies. So we conclude that this right was extended as well to corporations as to natural persons, and that the former, by their appropriate officers, may as lawfully make the oath required to obtain a supersedeas by affidavit in forma pauperis, as it may execute a bond to accomplish the same purpose.
2. An examination of the record will show that the defendant in the present case bought of the plaintiff and two other persons the railroad property involved in the present litigation (it being at the time subject to the lien of certain encumbrances), paid no part of the purchase money, but entered into an agreement for the prompt payment of the purchase price, time being made of the essence of such agreement, and it being further conditioned that upon default of payment the sellers should have the right of re-entry. Several of the stockholders of the purchaser corporation claimed to have advanced certain moneys upon the betterment and improvement of the property purchased by it. Upon breach of covenant to promptly pay the purchase money, the sellers filed a petition praying for a rescission of the agreement, that they be permitted to re-enter, and failing *65this, that the court should decree a sale of the property, and after discharging the prior encumbrances thereon, the balance of the proceeds be applied to the extinguishment of the •sums respectively due to the sellers of the property. The Collins Park & Belt Railroad Company, the defendant in the court below, made no answer, and prayed no judgment or relief of any kind. No point was made by it that it was entitled to have anything returned to it, nor was any such claim or contention made on its behalf at the trial. The court decreed a rescission, that the purchase -money note be canceled; and upon the prayers of the cross-bill of certain, creditors claiming liens upon the property, the entire railroad property and its equipment were sold, and under the decree distributed in a manner satisfactory to the plaintiff and the contending creditors. The plaintiff in error insists that the court erred in decreeing a rescission without first repaying to its stockholders moneys advanced by them for improvement and betterment of the road. "We do not think that, under the evidence submitted, there was any merit in this contention. The agreement under which the plaintiff in error entered stipulated for a rescission and re-entry upon the part of the sellers, upon breach of the condition to pay; and the decree of the court, in so far as it was concerned, went no further than to decree a performance of this agreement. This is not a case in which rescission is sought upon equitable grounds alone independently of contract, but it rests upon an express covenant for rescission upon breach of condition, which is shown to have occurred, and therefore the doctrine of restitution to the status quo has no application; there is no right to restitution; there is nothing to be restored. At most under the agreement, the plaintiff in error would not have been entitled to more than a decree directing that its claims for betterments should be allowed .as a charge upon the property after all the pre-existing liens wvere discharged; and there was no pleading which author*66ized even this. But it will be observed that this money was-not paid by the purchaser corporation itself for betterments, but was advanced to it by its individual stockholders for that purpose. Certainly in favor of such stockholders, who are mere general creditors of the corporation, the right of rescission should not be postponed until restitution of suck, funds. The effect of such a ruling would be to give to such creditors a preference over creditors holding pre-existingliens. So it cannot be said that the court erred in decreeing a rescission without reference to the claims of such individual stockholders. Besides, it would seem that these stockholders were the proper persons to make that question,, if they conceived that they had an interest. The corporation was not their guardian and was not entitled to object for-them; but inasmuch as the question of the right of the corporation to represent them was not made, we have preferred to examine the question as though through their supposed equities the corporation could call in question the decree of the court directing a rescission.
3. The evidence fully authorized the decree of rescission;., and inasmuch as the contract being rescinded the property was restored to and became the property of the sellers, the court had authority under the pleadings filed to proceed through its receiver to sell the property and distribute its. proceeds according to the equities, of the several conflicting claimants of the fund. It is obvious that in this distribution the purchaser corporation had no concern. It had no reversionary interest which it sought by appropriate pleadings to protect, and if as between the several contestants before the court errors were committed (and that there were-we do not concede), such errors were harmless in so far as-the purchaser corporation was concerned, and therefore afford on its behalf no cause either of complaint or exception. Bor this reason we do not deem it profitable to inquire into - the various exceptions taken to the rulings of the court made in adjusting the equities between the conflicting; *67claimants. With, the final distribution by the decree they are satisfied, and we acquiesce. Judgment affirmed.