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ful. In fact, if there is any evidence what- | corporation at the commencement of its exever to show that appellant was a stock-istence." While the name W. S. Kessinger holder, we are required to give it effect, since we must give respondent's evidence its fullest probative force in view of the finding of the trial court.

may not show that W. L. Kessinger was one of the shareholders, yet it is a circumstance which may be taken into consideration when it is shown by the testimony of the directors [3] It is true, as appellant claims, that, that W. L. Kessinger was quite faithful in in a case like this, where it is sought to his attendance on the meetings of the direccharge with liability as a stockholder a per- tors and acted in that capacity. In such son who denies being such, the books and case the use of the letter "S." as the midrecords of the corporation, which do not dle initial instead of the letter "L." in the contain his signature or other similar act charter could be reasonably considered a to which he is a party, if unsupported by mere clerical error, especially in the absence other evidence, are not admissible to prove of any showing that there was a person by his membership in the corporation. Hins-the name of W. S. Kessinger. But defenddale Sav. Bank v. New Hampshire Banking ant's liability does not have to rest, and canCo., 59 Kan. 716, 54 Pac. 1051, 68 Am. St. not rest, solely upon this narrow basis of Rep. 391. While the records of the corpora- conjecture. In addition to his attendance tion are evidence of all corporate proceedings on directors' meeting, proved by the sworn therein recorded, they cannot be used against testimony of one of the directors, it was also a stranger to connect him with the corpora- testified to that defendant paid $550 on the tion, and, until defendant has been shown first assessments, that this was the amount to be a stockholder by other evidence, he is paid in by each of the original stockholders, a stranger, and the records of the corpora- and that after Charles L. Kurtz became section would be binding on it but not on him. retary and treasurer of the company the deThe question of membership in the corpora- fendant, Kessinger, made payments to him tion is the principal fact in dispute, and that aggregating $400 on stock owned by Kessinmust be shown by evidence binding on the ger. It was also shown that the assessments party sought to be charged. 2 Thompson on against the stockholders were similar in Corporations, §§ 1919, 1924. amount and on the same dates as those made on, and paid by, Kessinger, and that the assessments were made on, and paid by, Kessinger on the basis of ownership by him of $5,000 of stock in the corporation. It was also testified to that no part of the stock owned by defendant was ever transferred on the books of the company to any other person.

[8] While it is true, as contended, that a person cannot be shown to be a stockholder by the declarations of officers of a corporation, yet this does not forbid such showing by the sworn testimony of such officers.

[4] But in this case there is more than the mere records of the corporation to establish defendant's membership therein. It was shown in evidence that the stock book and other records of the corporation, showing its original organization, and which would contain the signatures of those taking stock, were lost and could not be found. No receipt of defendant for a certificate or certificates of stock could be introduced because no certificates of stock were issued to any one, as none of the stock was fully paid up. Hence the absence of such binding and primary evidence was fully accounted for, and this lets in secondary evidence as to defendant's connection with the corporation. [5, 6] The evidence necessary to show that defendant was a stockholder does not have to be in writing. It may be shown by proofing such membership. That is, the records of his conduct. 3 Thompson on Corp. § 3656. Persons who participate, in the character of stockholders, in the meetings of the corporations and in the conduct of its business, paying calls assessed against them in respect of stock and in various other ways, will be estopped from denying that they are stockholders whether proceeded against by the corporation itself or by a receiver for its creditors after its insolvency. 2 Thompson on Corp. § 1904.

[7] The articles of association filed with the Secretary of State for a certificate of incorporation contained the name of W. S. Kessinger. 2 Thompson on Corp. § 1936, says: "The charter of a corporation, issued by an officer of the state under a general law, is prima facie evidence that the per

[9] It will be noticed that, in the cases holding that the records cannot be used to establish a person's membership in the corporation, it is said the records are inadmissible, in the absence of other evidence show

cannot be used, independently of everything else, to establish the, defendant's connection with the corporation. But when his membership is shown by other and competent evidence, then the books may be introduced to explain acts done by the defendant, to show what those acts mean and the inevitable inference to be drawn from them when they are compared in point of time, similarity, and purpose with the acts of the other stockholders. For instance, if it be shown by the testimony of a director, as was done in this case, that defendant attended directors' meetings with faithfulness and regularity and acted as a director, that he paid calls and assessments on his stock, then the minutes and records are admissible against him, not only to explain the force and meaning of

dissolved for the purpose of enabling any creditors of such corporation to prosecute suits against the stockholders thereof to enforce their individual liability, if it be shown that such corporation has suspended

payments with those of other stockholders, | when a corporation has been dissolved, or is but also on the principle that, having attend- insolvent, or in imminent danger of insolvened the meetings in person and participated cy. Section 1310, same statutes, provided therein, he is presumed to have knowledge that a corporation should be deemed to be of what was done; and consequently anything done with his knowledge and implied consent is admissible to bind him. In 2 Thompson on Corporations, § 1921, it is said: "In some cases, then, the test to be applied to the question whether the corporate rec-business for more than one year. Section ords are admissible would seem to be wheth- 1315, same statutes, provided that the stocker the party against whom they are offered holders of corporations like the one in quesstands in such relation to the corporation tion should be liable to the creditors thereof that he is chargeable with knowledge of the for any unpaid subscriptions, and in addition records; whether, as to him, the books are in thereto for an amount equal to the par value the nature of public books, he being connect- of the stock owned by them; such liability ed with them in interest, etc." The same to be considered an asset of the corporation author says, in section 1922, that the rec- in the event of insolvency, and to be colords are admissible against those acting as lected by a receiver for the benefit of all members. And in section 1925, the same au- creditors. By still another section of said thor says: "Where evidence has been given statutes, 1302, it is provided that, if an exfixing the character of the defendant as a ecution shall have been issued against the subscriber or stockholder, the books and property of a corporation, like the one in records of the corporation are admissible for question, and no property can be found, such the purpose of proving that an assessment corporation shall be deemed to be insolvent. by the directors has been made, and the It then goes on to provide that a receiver amount of the same; and indeed they are the may be appointed who can sue for unpaid best evidence of such facts." So that, when subscriptions and for the additional liability. Kurtz testified that defendant was present Appellant assumes that section 1302 is the and acted as a director and paid calls and only section authorizing such a suit by a assessments to him, the minutes and records receiver and that the obtaining of a judgof the corporation were admissible to explain ment and the issuance and return of an exthe meaning and effect of such acts on his ecution unsatisfied is an essential prerequipart, and the basis of stock on which his site to the right to have a receiver appointassessments were paid. Most of the records ed and to his right to sue. But the office of of the corporation offered in evidence were the judgment and unsatisfied execution is properly excluded by the court because they merely to furnish conclusive proof of insolwere offered before there was any evidence, vency. But the statutes authorize a receivaliunde, that defendant was a stockholder, er to be appointed when a corporation is but the few records offered, after such tes- either dissolved or insolvent. By section timony was given, were properly admitted. 1310 it shall be deemed dissolved when it There was evidence to support the finding has ceased to do business for more than a of the trial court that defendant was a stock-year; by section 1302 it shall be deemed to holder.

be insolvent if a judgment has been obtained and an execution against it returned unsatisfied. In the petition for receiver it was alleged that the corporation was insolvent and dissolved because it had ceased to do business for one year, and the court found this to be true.

[10,11] It is next urged that the district court of Logan county, Kan., had no jurisdiction to appoint plaintiff as receiver in the case of Hay, Adm'r, v. Buckeye Land & Town Co. The ground of this objection is that there was no allegation, in the petition for receiver, that a judgment had been ren- In Stocker v. Davidson, 74 Kan. 214, 86 dered against the corporation and an execu- Pac. 136, 118 Am. St. Rep. 315, it was held tion thereon had been returned unsatisfied. that section 1315, above mentioned, made It is true that, unless there is a statute ex- the stockholder's liability as a corporate astending to creditors at large the right to set collectible in the event of insolvency have a receiver appointed, the only creditors without restriction. It was urged in that who can maintain such an action must be case that there had been no prior judgment either judgment or lien creditors. 5 Thomp- and no execution, as required in section 1302. son on Corp. § 6839. But in this case the and therefore there was no right to sue until statutes of Kansas gave this authority. By after judgment and execution issued and section 4701, General Statutes of Kansas was returned unsatisfied. But the court held 1901, in force at the time this receiver was that the provision mentioned in section 1302 appointed, the district court or judge there- was merely one method of ascertaining the of had power to appoint a receiver in a fact of insolvency; that there are other number of cases, viz.: First, in an action ways to establish bankruptcy, and, whenever by a creditor to subject any property or bankruptcy is lawfully established, the right funds to his claims; and, fifth, in cases, pro- to enforce the stockholder's liability accrues.

from creditors the right to enforce liability against stockholders and gives it directly to a representative of the corporation itself for the benefit of all creditors. Stocker v. Dayidson, 74 Kan. 214, 86 Pac. 136, 118 Am. St. Rep. 315. Consequently, if a corporation is dissolved or has ceased business for a year, no judgment or execution is necessary. Merrill v. Meade, 6 Kan. App. 620, 49 Pac. 787. The district court of Logan county, Kan., had jurisdiction to appoint the receiver.

and sound judgment, since, if it were satis- the absence of a statute, the judgment must factorily established by any lawful means first be obtained and an unsatisfied executhat a corporation was insolvent or dissolv- tion returned. But section 1310 is a comed, it would seem to be an empty require-plete negation of this theory of the liability ment that, before the stockholder could be of stockholders. The statute takes away made to pay, the useless form of obtaining a worthless judgment and the issuance of a futile execution must be gone through with. The citation from Waller v. Hamer, 65 Kan. 168, loc. cit. 172, 69 Pac. 185, made by appellant, in no way conflicts with the decision in the case of Stocker v. Davidson, since the remarks cited were not upon this point, but were directed to the point that all stockholders within the jurisdiction of the court who had not paid should have been made parties. The same is true of the remarks cited from the case of Woodworth v. Bowles, 61 Kan. 569, loc. cit. 576, 60 Pac. 331. The court was not talking about whether a judgment and unsatisfied execution were essential or not, but that the plaintiff in that case could not sue as a stockholder, since the statute had provided a remedy and method by which a receiver could sue for the benefit of all stockholders. In Henley v. Stevenson, 67 Kan. 4, 72 Pac. 518, the point decided was not whether an unsatisfied judgment and execution was the only method of establishing dissolution or insolvency, but whether a creditor could proceed by motion for execution against a single stockholder upon his individual liability as such.

The case of Harrison v. Remington Paper Co., 140 Fed. 385, 72 C. C. A. 405, 3 L. R. A. (N. S.) 954, 5 Ann. Cas. 314, so far from holding that, before a receiver can be appointed in any case, there must be a judgment and an unsatisfied execution returned, holds that the statutes of Kansas provide two remedies against stockholders, one (under sections 1310 and 1315) upon the suspension by the corporation of its business for one year, and the other (under section 1302) where there had been a return of an unsatisfied execution against it.. And this view is sustained in Remington v. Hudson, 64 Kan. 43, loc. cit. 45, 46, 67 Pac. 636. See, also, Cottrell v. Manlove, 58 Kan. 405, loc. cit. 408, 49 S. W. 519, where it is said that, under the provisions of the first remedy, "there is no occasion to await the recovery of a judgment against the company, but action may at once be brought against its stockholders."

[12] But, even if its action was erroneous, it was not void since it had jurisdiction of the parties and the subject-matter. Its act, therefore, is not open to collateral attack. 34 Cyc. 164. Even if the bill seeking the appointment is defective or fails to show grounds for equitable relief, every one is concluded by the appointment except in a direct proceeding. 34 Cyc. 165, 166. Even if the appointment was erroneous, it was not void and cannot be collaterally attacked. Cook v. Bank, 73 Ind. 256, loc. cit. 259. When a court of competent jurisdiction appoints a receiver, however irregular and erroneous it may be, it is not subject to attack in a collateral suit. Neun v. Blackstone Ass'n, 149 Mo. 74, 50 S. W. 436. See, also, Hatfield v. Cummings, 152 Ind. 280, 50 N. E. 817, 53 N. E. 231, where it is held that persons who are stockholders of a corporation while litigation is pending which results in the appointment of a receiver therefor are bound thereby, and the validity of the appointment of a receiver when made by a court of competent jurisdiction is not subject to collateral attack.

[13] Again, the absence of a prior judgment and execution clearly appeared upon the face of the petition in this case. That being so, the objection that plaintiff has no capacity to sue was waived by a failure to demur for that reason. R. S. Mo. 1909, § 1800; Gregory v. McCormick, 120 Mo. 657, 25 S. W. 565; Alexander v. Wade, 106 Mo. App. 141, 80 S. W. 19; Mechanics' Bank v. Gilpin, 105 Mo. 17, 16 S. W. 524.

[14] It is next contended that this suit cannot be maintained because no suit had been instituted in Kansas by the receiver to deThe petition in the Kansas suit for the ap-termine the amount of the indebtedness and pointment of receiver alleged that the cor- the amount for which each stockholder poration was insolvent and had been dissolv- should be liable. There is nothing in the ed because it had suspended business for Kansas statutes prescribing that such a more than one year, and the court found this suit must first be brought. The only reason allegation to be true. The theory upon or necessity for such procedure is that it is which is founded the proposition that a judg- the duty of the receiver to collect unpaid ment must be obtained and an unsatisfied ex-stock subscriptions and the additional liabiliecution returned before the stockholders can ty of such stockholders, and hold them as a be proceeded against is that the corporation itself, and not the unpaid subscriptions, is looked to by creditors for the payment of their debts; credit is given to the corpora

fund to pay creditors, and to equalize the liabilities of the creditors as between themselves. But the law does not require that all this be done in the suit against the stock

The equalizing of the liabilities between the, liable would not have amounted to anything stockholders can be done by the receiver in more than the decree that is already renderthe receivership case under the direction of ed. In fact, it would have been only a duplithe Kansas court after the receiver has col- cation of that decree, since the only defendlected the fund. The only authority cited ant upon whom service could have been obby appellant on this point is Waller v. Ham- tained was the corporation, and, as it was a er, 65 Kan. 168, 69 Pac. 185. In that case it party to the interlocutory decree, all the was stated in the plea that there were other stockholders were bound thereby, the same as stockholders, naming them, who had not if they had been personally served in a secpaid into the corporation the par value of ond suit. the stock owned by them, nor any portion of their statutory liability. The demurrer to the plea admitted the truth of this. The court held that, in order to "conveniently and adequately carry out" the provisions of the statute, at least all of the stockholders within the jurisdiction of the court should have been joined. But the facts in this case are far different. Here, the Kansas court in its decree made an elaborate finding showing the names and number of creditors, their addresses, and the respective debts due them, amounting in the aggregate to $14,660.15, all bearing interest from May 15, 1902, at the rate of 6 per cent. per annum; also showing the names of all the stockholders, their addresses, the number of shares held by each, and the par value thereof. All of this was fully set out in the petition in this suit. It was further stated and shown that three of said stockholders, naming them, were insolvent and dead on the 11th of January, 1902, the date of the institution of the suit on the Hay note; that all the other stockholders, except the defendant, had paid their subscriptions to the capital stock in full, and in addition thereto sums aggregating $2,000 and more; that at the time of the commencement of said suit for receiver, and during all the times since then, none of the stockholders were citizens or residents of or personally present in Kansas, but all were outside the jurisdiction of said district court and of all other Kansas courts; that the defendant, W. L. Kessinger, was at said time, and ever since has been, and is now, a resident and citizen of Missouri, and was and is the only stockholder within the jurisdiction of the courts of this state.

[15] The above findings of the Kansas court and the facts alleged were again shown in this case. But if they were not, the findings in the decree rendered by the district court in the receivership are prima facie evidence against foreign stockholders who are not parties thereto. Pfaff v. Gruen, 92 Mo. App. 560, loc. cit. 583, 69 S. W. 405; Swing v. Furniture Co., 123 Mo. App. 367, loc. cit. 393, 100 S. W. 662; 3 Thompson on Corp. § 3404; Hawkins v. Glenn, 131 U. S. 319, 9 Sup. Ct. 739, 33 L. Ed. 184; Glenn v. Liggett, 135 U. S. 533, 10 Sup. Ct. 867, 34 L. Ed. 262. Under the circumstances of this case, where the stockholders had paid up without suit, and none of them lived in Kansas, and only the defendant in Missouri, a suit to determine the amount of the indebtedness and the

The case of Evans v. Nellis, 187 U. S. 271, 23 Sup. Ct. 74, 47 L. Ed. 173, cited by appellant, is not an authority applicable to the facts in this case. In that case the court held that the receiver had no authority to sue, not because he had not by a preliminary suit determined the amount of indebtedness due and the amount due from each stockholder, but because the facts constituting and fixing liability all arose prior to the passage of the Kansas statute giving the receiver a right to sue; that the case was governed by the statute as it existed prior to the one giving the receiver the power to bring suit for the benefit of all concerned. The statute authorizing the receiver to sue made the liability of the stockholder an asset of the corporation which could be sued for and recovered by the receiver for the benefit of all creditors; while the prior statute made the liability of the stockholder an asset which the creditor alone could recover for his individual benefit. The liability of the stockholder in the Evans v. Nellis Case having arisen under the prior statute, and the right to sue under the subsequent statute not being derived from nor evolved out of the prior statute, of course the receiver could have no power to sue.

But it is urged that the stockholders' liability may exceed the indebtedness of the corporation; some may have paid more on account of this liability than others; the receiver is authorized to collect only the amount necessary and no more; if so, then how can it be known how much is needed from each stockholder unless a preliminary suit is first brought? The answer is that the statute provides that the receiver under the direction of the court, not in the suits against the various stockholders but in the receivership case, will adjust these difficulties and inequalities. Said statute reads as follows: "All collections made by the receiver shall be held for the benefit of all creditors, and shall be disbursed in such manner and at such times as the court may direct. Should the collections made by the receiver exceed the amount necessary to pay all claims against such corporation, together with all costs and expenses of the receivership, the remainder shall be distributed among the stockholders from whom collections have been made, as the court may direct; and in the event any stockholder has not paid the amount due from him, the stockholders making payment shall be entitled to an assignment of any

ceiver against such stockholder, and may enforce the same to the extent of his proportion of claims paid by them." In this case it will be noticed that defendant is in no danger of having to pay more than his proportionate share, since the judgment against him is $5,710, while the unpaid debts amount to $14,660.

Lastly it is claimed that the demand is barred by the statute of limitations. The defendant was sued upon two separate liabilities, to wit: First, for an unpaid balance of $4,050 on his original subscription to the capital stock; second, on his double liability under the Kansas Constitution and statutes in the sum of $5,000. The suit was begun July 27, 1905, and judgment rendered for the $4,050 due on the unpaid stock subscription with interest from date of suit till judgment aggregating $5,710. The decree of the Kansas court ascertaining the indebtedness and the names of the shareholders, and ordering the receiver to proceed against the stockholders was made in November, 1903, less than three years before suit was brought. There is no showing that any call for unpaid subscriptions had been made prior to this date which were not complied with.

[16] In Glenn v. Liggett, 135 U. S. 533, loc. cit. 542, 10 Sup. Ct. 867, 870 (34 L. Ed. 262), it is said: "Statutes of limitation do not commence to run as against subscriptions to stock, payable as called for, until a call or its equivalent has been had, and subscribers cannot object, when an assessment to pay debts has been made, that the corporate duty in this regard had not been earlier discharged."

* *

[17] Section 4449, General Statutes of Kansas 1901, provides that, "if when a cause of action accrues against a person he be out of the state, the period limited for the commencement of the action shall not begin to run until he comes into the state. As defendant was a nonresident of the state of Kansas and was not personally in Kansas, he could not, if sued in Kansas, have successfully pleaded the Kansas statute of limitation. Section 1895, R. S. Mo. 1909, permits the Kansas limitation statute to bar a suit in Missouri founded on a cause of action originating in Kansas only when the action is barred in Kansas. Wojtylak V. Coal Co., 188 Mo. 260, loc. cit. 95, 87 S. W. 506.

[18] Under the Kansas statutes, the creditor could not have a proceeding instituted against the stockholders until a receiver was appointed and ordered by the court to proceed against them. In 2 Thompson on Corp. § 2002, it is said that the statute begins to run from the date when the stockholders can, without obstruction, be proceeded against, and this period will be different according to the nature of the liability to which the law subjects the shareholder. And in section 2003 of the same work, it is said

that the statute does not begin to run until a call has been duly made, and in section 2005, it is said that "where the call is made by an order of court, to be notified and enforced by its receiver, the statute does not begin to run until the date of the order." Under this view, the suit was not barred either by the statutes of Kansas or of Missouri.

There is nothing in the record to justify us in disturbing the judgment of the trial court. It did not render judgment against defendant for the double liability authorized by the Kansas statute, but only for the amount of the unpaid subscription with interest as authorized by section 3590, General Statutes of Kansas. But no complaint is made by the receiver because of the failure to include such double liability.

The judgment is therefore affirmed. All concur.

HICKEY. CHICAGO, B. & Q. R. CO. (Kansas City Court of Appeals. Missouri Oct. 6, 1913. Rehearing Denied Nov. 3, 1913.)


To recover damages for a delay in the shipment of live stock, the shipper must prove that the delay was caused by the negligence of the carrier, and mere proof of delay will not support an inference of negligence.

[Ed. Note.-For other cases, see Carriers, Cent. Dig. §§ 957-960; Dec. Dig. § 228.*] 2. CARRIERS ( 213*) - CARRIAGE OF LIVE STOCK-DELAY-CARRIER'S LIABILITY.

A delay in shipment of live stock caused quirements of Act June 29, 1906, c. 3594, 34 solely by the carrier's compliance with the reStat. 607 (U. S. Comp. St. Supp. 1909, pp. 1178, 1179), that the cattle shall be unloaded and fed every 28 hours, unless the owner requests that they be kept without food for 36 hours, does not render the carrier liable.

[Ed. Note.-For other cases, see Carriers, Cent. Dig. §§ 920-922; Dec. Dig. § 213.*] 3. CARRIERS (§ 213*) CARRIAGE OF LIVE


Where the regular scheduled time of a cattle train was more than 28 hours to the point of destination, and the train could not reach a junction point in time to give the cattle the rest and food required by Act June 29, 1906, c. 3594, 34 Stat. 607 (U. S. Comp. St. Supp. 1909, pp. 1178, 1179), and then catch a train which would take them to their destination in time for the market on the day of their arrival, and the shipper filed no request to have the cattle carried for 36 hours without food, in which time they could have been carried to their destination, the failure to file such request, and not the negligence of the carrier which caused a delay before reaching the junc tion point, was the cause of the failure of the cattle to reach their destination in time for the market on that day.

[Ed. Note.-For other cases, see Carriers, Cent. Dig. §§ 920-922; Dec. Dig. § 213.*] 4. CARRIERS (§ 213*) CARRIAGE OF LIVE STOCK DELAY IN SHIPMENT - CARRIER'S LIABILITY.


Where there was no regular cattle train leaving a junction point after the time required

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