Ripley v. Evans

49 N.W. 504, 87 Mich. 217, 1891 Mich. LEXIS 769
CourtMichigan Supreme Court
DecidedJuly 28, 1891
StatusPublished
Cited by11 cases

This text of 49 N.W. 504 (Ripley v. Evans) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ripley v. Evans, 49 N.W. 504, 87 Mich. 217, 1891 Mich. LEXIS 769 (Mich. 1891).

Opinion

Long, J.

On the 25th day of July, 1887, the Michigan Cushman Telephone Company, a corporation, was organized under the laws of this State, and was doing business as such corporation between the 1st day of August, 1887, and the first day of', December, 1887. Between those dates it was engaged in constructing a line of telephone within the State of Michigan, and for that purpose, and for a part of the material to be used in said construction, purchased of the plaintiff a quantity of telephone poles, which were during the time aforesaid delivered and used ,in the construction of said line. The telephone poles were worth and were contracted for by the said corporation at the sum of $490.50. On the 25th day of February, 1889, a judgment was duly obtained in the circuit court for the county of Eaton, by the plaintiff, against the corporation, for the sum of $490.50, and costs taxed at $22.60. The judgment was rendered for the debt due the plaintiff for said telephone poles,-and no part of the judgment has ever been paid. At the time of the organization of said corporation, and ever since, the principal office of said corporation has been in the city of Charlotte, Eaton county, Mich. On the 2d day of May, 1889, the plaintiff caused an execution to be issued out of said circuit court, which was delivered to the sheriff of said county, and was after-wards returned wholly unsatisfied.

On the 17th day July, 1889, an order was entered in the said circuit court on the application of the plaintiff, requiring the secretary of the Michigan Cushman Telephone Company to file in said circuit court and cause a statement under oath, disclosing the name, residence, and amount of stock held by each of said stockholders of said corporation. On the 25th day of October, 1889, the secretary of said corporation, in pursuance of said - order, filed a statement, which showed that the defendant in [220]*220this case, John Evans, together with four others, held each $10,000 in nominal amount of stock in said corporation. On or about the 15th day of November, 1889, the plaintiff filed a petition for judgment against the individual stockholders, and -a citation was thereupon issued and served upon each of said stockholders, requiring them to show cause why judgment should not be rendered against them for the amount so recovered against said corporation. The respondent in this case and two other stockholders appeared in said cause, and filed separate answers to said petition. The default of the other two defendants was entered. The answer of this respondent alleged:

1. That at the time of the issuing and the return of said execution, and at the time of the filing of said answer, the said corporation had a large amount of property subject to levy and sale on execution, and more than sufficient to satisfy- the same, which should be exhausted before judgment could be rendered against the individual stockholders.
2. That the law does not authorize a judgment to be entered .against the individual stockholders for the debt described in the petition.
3. That the statute (Act No. 129, Laws of 1883) under the provisions of which said petition was filed, so far as it attempts to make the stockholders of said corporation individually liable for materials furnished for said corporation, is unconstitutional and void, for the reason that the title of said act does not cover that portion "or section of said act which purports to make stockholders individually liable for materials furnished for such corporation.
4. That the object of such act is not sufficiently stated in its title.
5. That there is no law authorizing the proceedings by petition in a court of law to hold stockholders individually liable for debts contracted by such corporation, for materials furnished to such corporation.

The cause came on for trial before a jury in the circuit court for the county of Eaton, on the 23d day of [221]*221July, A. D. 1890, and' judgment was’ rendered against this respondent for the whole amount of the judgment recovered by the plaintiff against said" corporation, being for the sum of $532.15. On the 25th day of November, 1890, an order apportioning said judgment was duly entered in said court and cause. On the trial of the cause the defendant offered to prove the amount of property owned by the Michigan Cushman Telephone Company at the time the execution against the corporation was returned unsatisfied. Upon - objection being made to the introduction of this proof,-the'counsel for defendant stated to the court that he purposed to show by the secretary of the company that, at the time the execution was issued and returned, there was $8,000 worth of property belonging to the company, consisting of a line of telephone poles and wires extending from Lansing to Detroit, and situate in the counties of Ingham, Shiawassee, Genesee, Oakland, Wayne, and Clinton, but no property within the county of Baton, where the action was brought, -except the franchise of the company. The court sustained plaintiff's objection to this testimony. Counsel for defendant then offered to show that, at the time the execution was issued, this property was subject to levy and sale on execution, and that the company still owned said property situate in the above-named counties. This was ruled out by the' court.

The errors relied- upon for which it is claimed judgment should be reversed are:

1. The introduction in evidence by the plaintiff of the execution, the petition requiring the secretary 1 of the company to file the statement showing the name, residence, and amount of stock held by each stockholder, and the statement filed by the secretary.
2. The refusal of the court to allow the defendant to show the amount of property held by the corporation at [222]*222the time the. execution was issued and returned unsatisfied.
3. The refusal of the court to allow the defendant to show by the witness Samuel Pollock that he, as sheriff, made no attempt to levy the execution upon the franchise of the corporation, or to find any other property, and, if he did, to show what he did do.
4. The ruling of the court in refusing to direct a verdict in favor of the defendant.

The reasons given for this last proposition are.

1. The statute under which the Michigan Oushman Telephone Company was organized is unconstitutional and void, so far as it undertakes to make stockholders individually liable for the debts of the corporation for materials, for the reason that said act is broader than the title, and is in conflict with section 20 of article 4 of the Constitution of the State of Michigan.
2. The said act makes an unlawful and unconstitutional discrimination in favor of persons furnishing material for such corporations.
3. By the terms of the act under which the Michigan Cushman Telephone Company was organized the remedy to enforce the individual liability of stockholders is by bill in chancery.
4. The act of 1877, being the act authorizing these proceedings and under which this petition is filed, is unconstitutional and void, for the reason that it gives a remedy to one class of persons, which by the terms of the act is denied to all others.
5.

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Bluebook (online)
49 N.W. 504, 87 Mich. 217, 1891 Mich. LEXIS 769, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ripley-v-evans-mich-1891.