Court Opinion

ID: 6243652
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:51:46.800076+00
Date Added: 2024-06-11T08:59:13.939551
License: Public Domain

Opinion by
Mr. Justice Mitchell,
A plain statement of the substantial facts of this case is all that is necessary to indicate the result. Certain parties, called for convenience the subscribers, advanced money to the Ken*100sington Land Company on specified conditions, the principal of which were that the money was to be expended by the company in payment and improvement of a tract of land in Georgia already purchased for it, and the entire proceeds of sale of lots should be paid over to the Solicitors’ Loan and Trust Company to repay the subscribers, and in the meantime to secure the latter the entire capital stock of the Land Company was to be deposited with the Solicitors’ Company. This is putting the matter in the most favorable light for the appellant, by treating it as a direct contract between the subscribers and the Land Company. In fact it was done by contract of each party separately with the Solicitors’ Company, but as the latter was admittedly merely an agent and trustee the legal effect was the same as if the contract had been made directly between the parties actually interested.
The money was paid over by the Solicitors’ Company to the Land Company, and so far as appears used by the latter in payment for the land. Sales of parts of the land were then made and the proceeds, according to agreement, paid to the Solicitors’ Company for the subscribers, but before actual distribution to the latter the money was attached by the appellant as the money of the Land Company. This was the issue in the court below, and on the undisputed facts the learned judge could not have done otherwise than enter a nonsuit. The money was clearly no longer the money of the Land Company. As between that company and the subscribers at least the agreements were valid, the Land Company was a debtor, and when it paid the money to the Solicitors’ Company as trustee or agent for the subscribers the effect was the same as if it had paid directly to the subscribers themselves. This is an effort by a creditor of the Land Company to overturn the whole transaction and get into its own hands a payment made by its debtor to another creditor. It cannot be done in this way. Even if the Land Company is insolvent, and if the parties have so acted as to make the agreements fraudulent and void as to its creditors, the remedy is by bill in equity and not by a collateral issue in the present form.
But it nowhere appears except by inference from the existence of appellant’s judgment, that the Land Company is insolvent. It received the hundred thousand dollars advanced by the subscribers, purchased the land and has sold part of it. Pre*101sumably it has as assets in its hands the rest of the land, one fourth of its capital stock delivered to it by the Solicitors’ Company, and the right to receive the remaining three fourths of the stock on payment of the balance due the subscribers on their advances.
Nor is it shown in the evidence that the subscribers who furnished the money, are or were the promoters, officers or stockholders of the Land Company, except so far as they may have received a part of the stock at the rate of four shares per hundred dollars as additional compensation for money advanced. The fact may be so but it was not proved in the case, and without such proof even a bill hi equity would have nothing to stand on.
. Judgment affirmed.