Clay v. Union Wholesale Publishing Co.

98 S.W. 575, 200 Mo. 665, 1906 Mo. LEXIS 378
CourtSupreme Court of Missouri
DecidedDecember 22, 1906
StatusPublished
Cited by10 cases

This text of 98 S.W. 575 (Clay v. Union Wholesale Publishing Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Clay v. Union Wholesale Publishing Co., 98 S.W. 575, 200 Mo. 665, 1906 Mo. LEXIS 378 (Mo. 1906).

Opinion

FOX, J.

This cause is now pending in this court upon appeal from a decree and judgment rendered by the circuit court of Pettis county, Missouri. The nature and character of this proceeding as well as the defenses thereto, as disclosed by the record proper, may thus be briefly stated:

This action was originally instituted by M. W. Clay, who brought the suit on behalf of himself and all other persons similarly situated, who might join in the proceeding's and contribute to the costs and ex- ■ penses thereof. The suit is brought by Mr. Clay as a stockholder of the Union Wholesale Publishing Company against the corporation and Y. D. Snyder, president, and F. W. Stewart, secretary, in accordance with the provisions of sections 1338, 1339, and 1340, Revised Statutes of Missouri 1899', alleging that the defendants are using the corporation as a means of defrauding various persons, and that the directors of the company have violated their duties and abused their powers, as directors, trustees and officers of the cor[668]*668poration, and have been gnilty of gross misconduct in the management of the business and are threatening to convey the remainder of the company’s property. The relief prayed for was that the directors, managers and officers be compelled to account for their official conduct in the management and disposition of the funds, property and business of said company; that the court order and decree the payment by them to' the company, or any receiver appointed therefor, of all sums of money and the value of the property which may have been acquired by themselves or transferred to others, or lost or wasted by the violation of their duties and the abuse of their power as such directors and officers, and that said directors and officers be suspended from exercising their offices, and that one or more receivers be appointed to take charge of the real estate or personal property owned, held or claimed by the Union "Wholesale Publishing Company, to account for the same to the stockholders of said company and to preserve and keep the same intact for the persons who may be found entitled thereto, and. that defendants, and each of them, be restrained and enjoined from conveying, transferring or alienating any of the property, assets or affects of said Publishing Company to any person whatever, and for such other and further relief as plaintiff, and those who might join in the action, might be entitled to in equity and good conscience.

Several persons came forward and intervened in the cause, among whom were E. D. Mott, J. B. Jeffers and - J. M. Jeffers. These three interveners filed separate petitions alleging a similar state of facts and asked similar relief, namely, the interveners alleged that Y. D. Snyder and F. W. Stewart, by -false and fraudulent representations, induced each of tho interveners to purchase stock of the par value of one thousand dollars, representing that the same was fully [669]*669paid up, and that the business of the corporation was legitimate and successful. And' further alleging that ' the business of the corporation was fraudulent and that illegal and dishonest contracts were being entered into, which the defendants did not intend to carry out, and had not the means of carrying out, and that the defendants Stewart and Snyder were mismanaging and misappropriating' the assets of the company and diverting money to their own use and jeopardizing the interests of the stockholders. The interveners prayed for an injunction against the defendants enjoining them from disposing or transferring the assets of the company, and that an accounting be had and a receiver appointed for said company, and such other and further orders and judgments as to the court might seem just and proper. The intervening petitions of the three interveners are practically alike.

The defendants filed an answer to the petition of Moses W. Clay, alleging that Mr. Clay represented to Snyder and Stewart that he was a man of large means and that he desired to become engaged in the business of selling books, etc., and would subscribe for ten thousand dollars of the capital stock of the company, and that he, with Snyder and Stewart, organized the Union Wholesale Publishing Company; and that Mr. Clay was one of the first directors and that he took an active interest in the same, and conducted and had the management of its affairs and controlled the policy of the same. The answer further alleged that Mr. Clay had failed to pay for his stock and that he had been notified by the directors in June, 1901, to pay for the. same within sixty days or the same would be forfeited, and that after the expiration of said notice said Clay having failed to pay for the stock, the same was forfeited and that said Clay has no interest in the corporation of any nature whatsoever.

[670]*670The answers filed to the intervening petitions were general denials.

G. F. Haskins, Frank C. Moyer, J. E. Phillips and John Zenner, also intervened in this cause, hut their intervening petitions were dismissed before judgment was rendered, and hence did not enter into the determination of the present case.

At the close of the hearing of this case the court rendered the following decree:

“Now, on this day the taking of the testimony heretofore concluded, and the court having heretofore heard the argument of the counsel for the respective parties, the court doth order, adjudge and decree as follows:
“First. The court doth find the issues for the plaintiff and E. D. Mott, J. M. Jeffers, J. B. Jeffers, intervening petitioners, and doth order and decree that the temporary injunction heretofore issued herein be made permanent. And that the defendant, the Union Wholesale Publishing Company, its directors, officers and agents, be and the same are hereby -forever restrained and enjoined from conveying, transferring or‘ alienating any of the property, assets or effects of said company to any person whatever, or from in any wise or to any extent controlling or attempting to exercise any control whatever over any books, accounts, property or assets of said company.
“Second. The court doth order and decree that C. M. Mulkey be and he is hereby appointed receiver of all the property and assets of said Union Wholesale Publishing Company, and the said receiver, or his successor, is hereby authorized to take charge and possession of all the books, accounts, property, real and personal, belonging to said Union Wholesale Publishing Company, and to account for the same to the court, for the benefit of the creditors and shareholders of said [671]*671company, and to preserve and keep them until duly ordered sold by the court, and all said property of said company is hereby vested in said C. M. Mulkey, receiver, or his successors, and the court doth further order and decree that said C. M. Mulkey shall duly qualify as such receiver within fifteen days from this date by filing his bond as such receiver, with at least two freeholders, in the sum of $10,000, and that failing so to do a vacancy in such receivership shall exist, to be filled in vacation on motion of either party or the judge of the court; and said receiver is hereby ordered to make immediate report and file a schedule of all the properties and assets of said company as soon as he shall take possession of the same, and further obey such orders of the court touching the premises, as the court shall make from time to time, in term or vacation.
“Third.

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Bluebook (online)
98 S.W. 575, 200 Mo. 665, 1906 Mo. LEXIS 378, Counsel Stack Legal Research, https://law.counselstack.com/opinion/clay-v-union-wholesale-publishing-co-mo-1906.