Court Opinion

ID: 7097781
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:12:45.321802+00
Date Added: 2024-06-11T16:13:18.513083
License: Public Domain

Beck, J.
I. The petition alleges that defendant is a subscriber to the stock of the Iowa and Minnesota Construction Company, to the amount of $20,000; that an assessment upon defendant’s stock was duly made July 22,1871, for the amount of ten per cent thereof; that plaintiff was duly appointed receiver of the corporation by the Circuit Court of Jones county; that plaintiff was ordered by the court appointing him receiver to make another assessment of ten per cent upon the stock of the corporation which, on the 16th day of June, 1876, he did under direction of the court, and that plaintiff has been ordered by the court appointing him receiver to collect the unpaid assessments upon the stock, for the payment of the debts of the corporation.
II. The answer of defendant sets up certain payments upon the subscription for stock made by him. It further denies that the assessments were legally made, or that assessments can be legally made, except when necessary. The defendant then alleges that the money due on his stock is claimed by another stockholder, J.S. Stacy, for advances made, which, however, defendant avers do not exceed the advances made by him. The answer proceeds in the following language :
“And for further answer, defendant says that the property and railroad line of said construction company was after-wards, by J. S. Stacy, who was the president of the railroad company which’ let the work to the construction company sold out, and a large sum of money received therefor, to wit5 about $10,000, which moneys went into the hands of said *84Stacy and Wallworth, and no part thereof to defendant; that no account thereof has been rendered defendant or said construction company; that, as defendant is informed and believes, the only claim now made against this defendant, and for which said Schoonover, as receiver, sues this defendant, is a claim by and in behalf of said Stacy and Wallworth; that said firm of Stacy & Wallworth was composed of J. S. Stacy, the subscriber of twenty shares of said construction stock, and one J. D. Wallworth, of Anamosa, who, for the sole purpose of harassing the stockholders unjustly, made an assignment of the moneys advanced by J. S. Stacy as a stock subscriber on his stock, as if it were a claim of Stacy and Wallworth, separate and apart from J. S. Stacy, to one Shaw, and thereupon, through said assignee and their own co-operation, with a view to gain an unfair advantage over this defendant and avoid the effect of said advances, as payments by Stacy, procured said Schoonover to' be appointed as receiver, and so fraudulently to appear as creditors of said construction company, and harass defendant, and collect moneys not due from him, and so to defeat any claims for advances made him; that with that view said receiver brings this action, based solely upon assessments charged to have been made, concealing or withholding any statement of the indebtedness to be paid thereby; whereas, in truth and in fact, as defendant charges, no just indebtedness in any amount, or any amount such as claimed from defendant, exists; that in the proceeding of appointing, or procuring the appointment of a receiver, the defendant was in no sense a party, and especially so as to bind him upon his subscription, and this is his first opportunity to present his rights thereunder. And defendant avers that if the truth were brought before this court it would appear that this action against defendant is oppressive, unnecessary, and unjust, and nothing is due from him, and no really existing claims, at least of any considerable amount, against said company; that the real party in interest in this cause is J. S. Stacy, and said plaintiff Schoonover a nominal party *85only; that defendant cannot fully adjudicate and determine his rights unless Stacy and Wallworth, J. S. Stacy and J. D. Wallworth, and said Shaw, be made parties defendant to this suit, and this amended answer treated as a cross-bill, and full answer under oath made, together with the pretended indebtedness of said construction company set out in full and duly itemized; that in addition to the moneys received from a sale of the properties of said company, this defendant avers that said Stacy has received from various sources, stock subscription, — the assets of the company, as defendant believes, —not less than $10,000, and has not yet accounted therefor; that the same should, by reason of the averments aforesaid, go in extinguishment of any and all claims made against defendant and other stockholders, and that any residue, if there be any, be divided to said stockholders, and all of them; that the defendant is advised and believes that the receiver is bringing suits against other stockholders upon the pretended assessments, all for the purpose of paying said indetedness, pretended to be the claims of Stacy & Wallworth, but in fact the property of said Stacy, all of which said actions, and especially this one, is and are grossly inequitable and oppressive. ”
The defenses set up are claimed to be equitable in .their character, and the answer is made a cross-bill, and relief is prayed thereon. Plaintiff demurred to defendant’s answer, and the demurrer was sustained, except as to the payments pleaded. The correctness of the court’s ruling upon the demurrer is the only question involved in this appeal.
1(ioi‘poratioiu: III. It will be observed that the matters set up in the answer are such as fraud in procuring the appointment of the receiver, the claim that the corporation is not indebted, and that the action is prosecuted to enable Stacy to defraud and oppress defendant, etc., etc. These matters, it will be noticed, bring in question the action of the court appointing the receiver, and ordering the assessments. They were proper matters to be determined when these orders were made. *86and must, therefore, be regarded as res adjudicates. The defendant can interpose, in the action wherein the receiver was appointed, and his rights and interest will therein be fully protected. The controversy, as set out in the answer, involves matters within the jurisdiction of the court appointing the receiver, which may be determined in that proceeding. That court has adjudged that there is indebtedness of the corporation, and that defendant ought to be assessed as a stockholder. Defendant’s answer denies the indebtedness of the corporation and that he ought to be assessed. It will be seen that this defense ought to be made in the proceeding's wherein the receiver was appointed.
Our conclusion in this case is in harmony with, and supported by, Stewart v. Lay, 45 Iowa, 604.
TJie demurrer was properly sustained.
Affirmed.