Court Opinion

ID: 6235465
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:31:30.397649+00
Date Added: 2024-06-11T08:58:02.219644
License: Public Domain

Mr. Justice Woodward
delivered the opinion of the court, May 7th 1877.
In the condition of the Passyunk Building Association existing when this bill was filed, the necessity for a proceeding in equity to adjust and secure the rights of its members was manifest. ' Dissensions had grown up, arrears of monthly dues were increasing, and no meeting had been held during the preceding six months. Payments on account of loans they had obtained were refused by the debtors of the association, and its cash means were alleged to be wholly in the possession of James McCloskey, its president, and the individual defendant in this suit. The collusive neglect or refusal of the managers of a corporation to proceed against officers who have wasted or misapplied its funds, justifies the individual stockholders in filing a bill in their own names: Robinson v. Smith, 3 Paige 233. And if stockholders are so numerous as to make it impossible or very inconvenient to bring them all before the court, a part may file a bill in behalf of themselves and all others standing in the same situation: Langolf v. Seiberlitch, 2 Pars. 64. This bill was filed by the plaintiff alone, and not on behalf of other stockholders, and its special purpose was to recover the amount of the monthly payments ho had made. The prayer for relief, however, asked for an accouAt between McCloskey and the association, and the payment of any amount that should be found in McOloskey’s hands. Whether equity can be administered under the pleadings as they stand, or amendments may be required to introduce new parties and enlarge the prayer for relief, will be for the consideration of the Common Pleas after the record shall be remitted.
While the pleadings and the facts disclosed in the master’s report presented at least the frame of a case warranting the intervention of a court of equity, the decree was for the payment of a sum of money that could have been made the subject of a legal action. It was an entire departure from the theory on which the suit was based. The bill had asked, 1. That an account should be taken between McCloskey and the association, and that he should be decreed to pay what, if anything, should be found due on such account; 2. That the association should be decreed to pay to the plaintiff the sum due to him as a withdrawing member, and that an account should be taken between the association and the plaintiff for that purpose; and 3. “ Such other and further relief as should be deemed meet.” The terms of the decree required McCloskey to pay the plaintiff the sum of $620, with interest from the 9th of September *4451873, and costs of suit. This was too divérgent from the case which the pleadings presented, as well as from the relief specifically-sought,to be supported under the prayer for general relief. “ The rule on this subject is, that although, where the prayer does not extend to embrace all the relief to which the plaintiff may at the hearing show a right, the deficient relief may be supplied under the general prayer; yet such relief must be consistent with that specifically prayed, as well as with the case made by the bill:” King, President, in Thomas v. Ellmaker, 1 Pars. 98.
If, individually and directly, McCloskey was liable to the plaintiff for the amount of this claim, the liability could have been enforced in an action at law. The claim involved no such question growing out of disputed accounts as would give a court of equity jurisdiction. “ It may be laid down as a general doctrine that in matters of account arising from privity of contract, courts of equity have a general jurisdiction where there are mutual accounts (and a fortiori, where those accounts are complicated); and also when the accounts are on one side only, but a discovery is sought, and is material to the relief. And, on the other hand, where the accounts are all on one side, but no discovery is sought or required, courts of equity will decline to take jurisdiction:” 1- Story’s Eq., §§ 458-9. So far as the claim of the plaintiff here was established by the decree, it consisted of a single cash item of $620 against the association. Discovery was neither sought nor required, nor, as the decree stands, could it have been material to the relief. It is a manifest perversion of the machinery of a court of equity to employ it for the production of such a result as this proceeding reached.
It was objected at the argument that the requisite notice by the plaintiff of his intention to withdra-sy from the association was not shown to have been given. The fact of notice was asserted in the bill and denied by the answer and by Mr. McCloskey’s testimony before the examiner. The master did not pass on the question. His decision was rested on the ground that “sufficient evidence was produced for the purpose of tracing a large sum of money to the possession of McCloskey.” The report was inadequate to meet the exigencies of the cause, and the question of notice, with the other questions presented, will go before a master hereafter to be appointed.
The decree is reversed, the master’s report set aside, and the record remitted for further proceedings.