Court Opinion

ID: 8748290
Source: CourtListenerOpinion
Date Created: 2022-11-26 11:16:05.272136+00
Date Added: 2024-06-11T17:00:47.828664
License: Public Domain

LOCHREN, District Judge,
after stating the case as above, delivered the opinion of the court.
1. The amended petition alleges that the articles of agreement for incorporation of the A. J. Gillespie Commission Company were signed and acknowledged in accordance with the laws of Missouri, and for amounts of stock aggregating its entire capital, “on or about” the 29th day of September, 1898, and were filed in the office of the recorder of deeds at Kansas City, Mo., where by the articles the corporation was located, and a certified copy thereof filed in the office of the secretary of state of Missouri, who issued to the incorporators a certificate of incorporation. These were all the steps necessary to form ' r 1 constitute a valid corporation, the existence of which began when the secretary of state issued the certificate of incorporation. Rev. St. Mo. § 2492.
2. Other alleganons of the amended petition seeking to assail the validity of the corporation are irrelevant, as they relate to matters to be done after the corporation had come into existence. The recording of a certified copy of the certificate of incorporation, establishing an office in the state for the transaction of business, election of resident directors, and payment for the stock subscribed, are all acts to be done after the corporation had become an existing body. Rev. St. Mo. §§ 961, 1283, provide for the collection of stock subscriptions, and Id. § 1024, gives the remedy where there is failure to keep an office in the state. As to any of these acts to be done after the corporation became an existing body, there could be no failure affecting its status or corporate rights within the brief time covered by these allegations of the amended petition; and as to such matters the right of the corporation to continued existence can only be questioned by the state in a direct proceeding. Smelting Co. v. Richards, 95 Mo. 106, 8 S. W. 246.
. 3. Neither stockholders nor promoters can be held liable, individually or as partners, on contracts made or liabilities incurred by an existing corporation. In Missouri it is held that, if persons who sign articles for incorporation contract debts or incur liabilities in the name of the projected corporation before all acts necessary to bring the corporation into existence have been performed, such persons may be held liable as partners. Hurt v. Salisbury, 55 Mo. 310; Richardson v. Pitts, 71 Mo. 128; Martin v. Fewell, 79 Mo. 401; Carpet Co. v. Crawford, 127 Mo. 356, 30 S. W. 163.
4. The serious question in the case is raised by the tenth assignment of error, based on the allegation of the amended petition that the notes in suit were “executed and delivered to the said A. J. Gillespie Commission Company, and by them sold, and the proceeds thereof received by said company, before any certificate of incorporation was issued by the secretary of state of the state of Missouri; and that said proceeds went into the treasury of said association, and were by them retained and used after the issuance of said certificate.” If this allegation can be held to state acts done by the signers of the articles, which incurred liability in the name of the corporation, before the secretary of state issued the certificate of incorporation, and if such statement is not nullified as being repugnant to and inconsistent with other *219and more particular allegations of fact in the sanie pleading, it will sustain that assignment of error; otherwise it will not. The sole acts done which incurred any liability in the name of the corporation were the indorsement of the corporate name upon the notes, and their delivery so indorsed. But it is not alleged in the extract above quoted, nor elsewhere in the amended petition, that any of the notes were indorsed in the corporate name or delivered to any one before the secretary of state had issued the certificate. The averment that they had, before the certificate was issued, sold the notes and received the proceeds, which were put into-the treasury of the corporation after the certificate was issued, states no fact from which any obligation, in the name of the corporation could arise. The only obligation ever incurred rests on the indorsement in the corporate name, which, for aught that is alleged, may have been made after the certificate was issued, and when the proceeds were placed in the treasury of the corporation, though the notes had been bargained and proceeds paid over to go to the corporation upon indorsement and delivery of the notes. A pleader is required to state material facts with directness and reasonable certainty, and upon demurrer it cannot be held sufficient that the pleading contains loose statements, from which the existence of material facts, not alleged, may be surmised. Again, the whole of the above-quoted' allegation is so plainly repugnant to the other allegations of the same pleading that it is nullified. A pleading must be considered as a whole, and construed upon demurrer most strongly against the pleader wherever its allegations are doubtful or inconsistent. It is averred that the articles for incorporation were signed and acknowledged “on or about the 29th day of September, 1898.” It is not alleged that these acts were done after that date, and, applying the rule just referred to to this averment, it must be held equivalent to an allegation that the articles were so executed on or shortly before the date named. This is followed immediately by allegations that the articles were filed in the office of the recorder of deeds at Kansas City, Mo., and a certified copy thereof filed in the .office of the secretary of state, who issued to the parties the certificate of incorporation. No other date than the one first given is stated as the date of any of these acts. “When in one continued sentence, or in several sentences connected with the conjunction ‘and/ several facts are stated, the time, though only once alleged, will apply to each fact.” 1 Chit. Pl. 274. These several acts are stated in connected sequence, and whenever the conjunction “and” is omitted between any of the clauses it is understood and implied, so that, if now written in, it would make no shade of change in the sense. It follows that under proper construction this pleading alleges that all these acts, including the issuing by the secretary of the certificate of incorporation, occurred on or shortly prior to September 29, 1898. It devolved on the plaintiff to show, and, of course, to allege with certainty, that these acts, or some of them, occurred after the indorsement of {he notes in suit, in order to present any case against these defendants. Statements of facts, purposely made vague, and which, if accepted with all their vagueness, can only cast doubt, surely state no case. That the statements are purposely made vague is manifest from the fact that most of these allegations are *220concerning matters of public record, which the plaintiff could hardly learn of without learning also of the dates connected with the same.
Turning to the allegations concerning the notes, the first note counted on is alleged to have been made “on or about September 29, 1898.” The other six notes are alleged to have been made on September 29, 1898, and the copies of the seven notes attached to the pleading show that all bear that date. All other acts connected with said notes, including their indorsement and transfer, were necessarily subsequent to the making, and not earlier than September 29, 1898. It must therefore be held that the amended complaint, when properly construed, avers facts showing that the corporation came into existence not later than September 29, 1898, the very day when the notes were made and delivered to the company, according to the same pleading; and therefore that the allegation that the notes were sold and the proceeds received, etc., before the certificate of incorporation issued, is, on the face of the pleading, a futile attempt to aver that, although all these matters occurred on the same day, yet the issuing of the certificate was later as an undefined matter of moments. But in respect to such matters a day is an indivisible unit of time. And even had the pleading alleged, as it does not, that the indorsement of the notes was before the certificate issued, such allegation would have been nugatory, and contradicted by the other averments.
The demurrers were properly sustained, and the judgment is affirmed.

 3. See Corporations, vol. 12, Cent. Dig. § 78.