Court Opinion

ID: 6430186
Source: CourtListenerOpinion
Date Created: 2022-06-25 12:07:30.689455+00
Date Added: 2024-06-11T15:52:09.585188
License: Public Domain

Sheldon, J.
Whatever right of action the plaintiff had to maintain this bill against the individual defendants or any of them is that which was given to him by R. L. c. 110, § 58, cl. 3, which made them liable, if the debts of the corporation exceeded its capital, “ to the extent of such excess existing at the time of the commencement of the suit against the corporation in which the judgment was recovered, upon which the suit in equity to enforce such liability is brought.” The plaintiff’s original suit against the corporation was brought on September 14,1903. But the statute referred to was repealed by St. 1903, c. 437, § 95, which took effect on the first day of August of that year. And it is claimed by the defendants that the liability now sought to be enforced accrued for the first time on September 14,1903, when the plaintiff brought his original suit; and so that this cause of action was not preserved by the last sentence of § 96 of the act last cited, that “ the repeal of a law by this act shall not affect. . . any right accrued or established, or any action, suit or proceeding commenced under any of the laws repealed before the repeal took effect.” See Thayer v. New England Lithographic Co. 108 Mass. 523. The question thus presented is one of some nicety; but we have not found it necessary to pass upon it, as we are of opinion that the plaintiff must fail for other reasons.
The plaintiff, in consideration of a payment made by the other individual defendants, has covenanted not to sue them or to enforce their liability, and has given to them a limited release ; and seeks to obtain a decree only against the heirs and next of kin of George S. Wellman.
Wellman died on November 1, 1903; an administrator of *80his estate was duly appointed, and the period , allowed by R. L. c. 141, § 9, for the bringing of actions against the administrator expired on November 5, 1905. The plaintiff recovered judgment in his suit against the corporation on March 10, 1906, and brought this bill May 19, 1906.
The plaintiff claims that he can maintain this bill under R. L. c. 141, §§ 26, 27. The first of these sections provides that after the settlement of an estate by an executor or administrator, and after the expiration of the time within which creditors of the deceased may sue him, “the heirs, next of kin, devisees and legatees of the deceased shall be liable in the manner provided in the following sections for all debts for which actions could not have been brought against the executor or administrator, and for which provision is not made in the preceding sections of this chapter.” The following sections fix the manner in which a “ creditor ” of the deceased may enforce the liability thus created. To be entitled to this remedy, accordingly, the plaintiff must show that he was a creditor of the deceased, and that he holds a “ debt ” for which provision has not been made in the previous sections of R. L. c. 141.
Able and elaborate arguments have been addressed to us upon the question whether the statutory liability of a director of a corporation for the excess of the debts of the corporation above the amount of its capital existing at the time a creditor of the corporation may happen to select for bringing suit against the corporation, is a debt of the director himself within the meaning of R. L. c. 141, § 26. The question is not whether the original liability of the corporation to the plaintiff could be called a corporate debt, Anderson v. Metropolitan Stock Exchange, 191 Mass. 117, or whether similar liabilities of the corporation to other persons can be considered to be debts of the corporation for the purpose of determining whether its debts exceeded the amount of its capital stock; but whether the statutory liability of a director, as yet unfixed by any judgment or decree, can be said to be a debt due from him within the meaning of our statutes for the administration of estates. See Woodbury v. Sparrell Print, 187 Mass. 426; Old Colony Boot & Shoe Co. v. Parker, 183 Mass. 557; Kelton v. Phillips, 3 Met. 61; Savage v. Shaw, 195 Mass. 571. When such a liability of a director *81was not by the terms of the statute made chargeable upon his estate, it was held that an executor or administrator could not be held therefor. Ripley v. Sampson, 10 Pick. 370. Child v. Coffin, 17 Mass. 64. The liability was so extended by the statutes embodied in R. L. c. 110, § 64, and by St. 1903, c. 437, § 37.
In our opinion, however, this bill cannot be maintained against the heirs or next of kin of Wellman, whether the liability sought to be enforced did or did not constitute a debt of their deceased ancestor. If it did constitute such a debt, the plaintiff’s remedy was to present his claim to the Probate Court before the estate was fully administered, and to have the administrator ordered to retain sufficient assets of the estate for its satisfaction. R. L. c. 141, § 13. Peabody v. Allen, 194 Mass. 345. Downer v. Squire, 186 Mass. 189, 198,199. If there was an existing debt, though the right of action had not yet accrued and would not accrue within two years from the giving of the administration bond, the provisions of this section made ample provision for the plaintiff’s demand, and this bill cannot be maintained under the terms of § 26 of that chapter. Pratt v. Lamson, 128 Mass. 528. Low v. Bartlett, 8 Allen, 259. If the plaintiff’s demand was a debt of this deceased director at all, the liability became fixed when he brought his suit against the corporation in September, 1903, although the right of action would not accrue until after he should obtain final judgment in that suit; and the case was not like Bullard v. Moore, 158 Mass. 418, or Forbes v. Harrington, 171 Mass. 386, 389.
If on the other hand the plaintiff’s claim against Wellman for the debt of the corporation was not a debt within the meaning of that word as used in R. L. c. 141, then his heirs and next of kin are under no liability for its payment under §§ 26 and 27 of that chapter.
In either event the plaintiff has failed to make out any case against the only defendants whom he seeks to hold ; and it is not necessary to consider the effect of the releases given by the plaintiff to the other defendants or of the other suits brought by the plaintiff.
Nor need we consider the admissibility of the certificates filed by the corporation in the office of the Secretary of the *82Commonwealth, though it is somewhat difficult to see on what ground they could be held to be inadmissible, at any rate against the individuals who had signed them.

Bill dismissed.