Bennett v. Valley Mining Co.

120 N.W. 654, 142 Iowa 53
CourtSupreme Court of Iowa
DecidedApril 7, 1909
StatusPublished

This text of 120 N.W. 654 (Bennett v. Valley Mining Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bennett v. Valley Mining Co., 120 N.W. 654, 142 Iowa 53 (iowa 1909).

Opinion

Evans, C. J.

The plaintiff obtained a judgment in • the superior court of Cedar Rapids in March, 1904, against the defendant corporation as principal and against Charles S. Magowan, John T. Christie, and others as sureties. A transcript of the judgment was filed with the clerk of the district court of Linn County. An execution was issued and returned “no property found.” Thereafter, on September 19, an order was obtained from the judge of the district court of Linn County directed to . certain officers of the company, namely, Charles S. Magowan, president, John T. Christie, secretary, George Koontz, treasurer, and C. S. Ranch, director, commanding - them to appear at the office of Rickel, Crocker & •Tourtellot in the city of Cedar Rapids on September 2.1, 1906, then and there to testify touching the character, description, location, and disposition of the property of the defendant, the Valley Mining Company, and then and there to submit to such orders as the judge might make in the premises, and to produce all papers of any description in any wise connected with the said Valley Mining Company.- This order being served upon the parties named, they appeared for examination. Thereupon an examination was had of C. S. Ranch, director, and John T. Christie, secretary. Erom such examination it appeared that the defendant was a foreign corporation organized by Henry Rickel and others in Colorado and under the laws thereof for the general purpose of owning and operating mining properties in Colorado, and its only property consisted of mining property in such State of Colorado. For some time previous to the examination, the president, secretary, treasurer and one director of the [55]*55company resided at Iowa City. Other directors resided in Iowa, Indiana and Ohio. Rickel sold his stock in the company and in part payment therefor took the note upon which judgment was rendered in this case. The plaintiff acquired the note from Rickel, and Rickel acted as his attorney in obtaining such judgment and in these proceedings. The examination disclosed no concealed property, nor any attempt by the defendant or its officers to cover up the property for the purpose of defrauding creditors. The identity of the property owned, as disclosed by the examination, was substantially the same as it was when Rickel was a stockholder and president of the company. The financial condition of the company had changed, in that valuable improvements had been made upon the property, and ir.ich indebtedness had been incurred. The examination also tends to show the insolvency of the corporation. In pursuance of such examination. the judge made an order, as follows:

I hereby order, adjudge and decree that a receiver be' appointed of the property discovered in said proceedings, and that A. W. Coquilette, sheriff of Linn County, Iowa, he and is hereby appointed receiver of such property and all other property that may be owned by the said Valley Mining Company at the date of said examination. It is further ordered, adjudged and decreed that the defendant he, togéther with its officers, hereby enjoined from incumbering, transferring, or selling or in any other manner disposing of the property owned or held by the said defendant, the Valley Mining Company, and it is further ordered, adjudged and decreed that Charles S. Magowan, as president of said Valley Mining Company, and John T. Christie, as secretary, and both of them, execute in the name and on behalf of the said Valley Mining Company a full and complete conveyance of all the property of the said company owned, seized or possessed by it at this time to A. W. Coquilette, receiver, and said receiver is hereby authorized to take possession of all of said property and control the same subject to the order of this court.

[56]*56I. As a basis for the order for an examination of the defendant corporation and its officers, the plaintiff presented to the judge an affidavit averring that the corporation had property which it unjustly refused to apply towards the satisfaction of the judgment. This affidavit was made in accordance with the provisions of section 4073 of the Code. Sections 4077 to 4079 are as follows!

Sec. 4077. If any property, rights or credits subject to execution are thus ascertained, an execution may be issued and the same levied upon. The court or judge may order any property of the judgment debtor not exempt, in the hands of himself or others, or due him, to be delivered up, or in any other mode applied towards the satisfaction of the judgment.
Sec. 4078. The court or judge may also, by order, appoint the sheriff of the proper county, or other suitable person, a receiver of the property of the judgment debtor, or by injunction forbid a transfer or other disposition of the property of the judgment debtor, not exempt by law, or any interference therewith.
Sec. 4079. If it shall appear that the judgment debtor has any equitable interest in real estate in the county ’in which proceedings are had, as mortgagor, mortgagee or otherwise, and the interest of said debtor can be ascertained as between himself and the person holding the legal estate or having any lien on or interest in the same, without controversy as to the interest of such person, the receiver may be ordered to sell and convey the same, or the debtor’s equitable interest therein, in the same manner as is provided for the sale of real estate upon execution.

1. Executions: proceedings for the discovery of property: summary orders. The proceedings provided for in sections 4072 to 4079 are summary and contemplate no pleadings nor formal issue. Their principal purpose is to discover property. Estey v. Fuller Implement Company, 82 Iowa, 678; Reardon v. Henry, 82 Iowa, 134. If the examination results 7 in no discovery of property, the court or judge has no further duty to perform. Valuable [57]*57personal property may sometimes be so intangible, or may be so readily concealed, or so kept upon the person of the defendant, that it is not available to a levy of execution in the ordinary way. Section 4077 has reference to that kind of property. That this section has reference primarily to some form of personal property or chose in action is also made evident by the fact that provision for reaching equitable interests in real estate is made in section 4079. If, when the property is pointed out, it may be reached by the creditor by the ordinary processes, he is not entitled to summary orders ' under this proceeding. Reardon v. Henry, supra.

2. Same: orders affectfng real estate. The examination disclosed that there was no property of the corporation, except real estate, in Colorado. If this is not available to the plaintiff by the ordinary processes, it is only because it is in another jurisdiction. So far as the real estate itself is concerned, it is as much beyond the' jurisdiction of the court or judge in the summary proceeding as it is beyond the reach of execution; and, if it were located within the territorial jurisdiction of the judge, the statute confers upon him no power to order a debtor to convey his interest in real estate either legal or equitable; much less does it confer upon him power to order the president and secretary of a foreign corporation to execute conveyances of real estate which is beyond their power to convey under the articles of incorporation. To order a debtor to convey his real estate in satisfaction of an execution is to deprive him of the right of redemption.

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Related

Reardon v. Henry
47 N.W. 1022 (Supreme Court of Iowa, 1891)
Estey v. Fuller Implement Co.
82 Iowa 678 (Supreme Court of Iowa, 1890)

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Bluebook (online)
120 N.W. 654, 142 Iowa 53, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bennett-v-valley-mining-co-iowa-1909.