Rucks-Brandt Construction Corp. v. Silver

1944 OK 215, 151 P.2d 399, 194 Okla. 324, 1944 Okla. LEXIS 454
CourtSupreme Court of Oklahoma
DecidedMay 16, 1944
DocketNo. 31029.
StatusPublished
Cited by23 cases

This text of 1944 OK 215 (Rucks-Brandt Construction Corp. v. Silver) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rucks-Brandt Construction Corp. v. Silver, 1944 OK 215, 151 P.2d 399, 194 Okla. 324, 1944 Okla. LEXIS 454 (Okla. 1944).

Opinion

ARNOLD, J.

This action was commenced on December 12, 1934, by C. C. Silver. He was afterwards declared incompetent and is represented herein by guardian ad litem, C. R. Nixon. We will refer to C. C. Silver as plaintiff.

The suit was brought jointly against the Rucks-Brandt Construction Company, Rucks-Brandt Construction Corporation, B. F. Rucks, William M. Thompson, and R. Brandt. Thompson was eliminated as a party. The action is in the nature of a creditor’s bill. At the conclusion of the trial by the court on April 21, 1941, judgment was entered for the plaintiff against the defendants jointly for $4,439.78, provoking appeal by the Rucks-Brandt Construction Corporation, R. Brandt, and B. F. Rucks. The plaintiff has cross-appealed.

The record discloses that on December 30, 1931, the State Industrial Commission entered an award in favor of plaintiff and against the Rucks-Brandt Construction Company and its insurance carrier, the Southern Surety Company, for $9,000 for permanent total disability occasioned' by an injury sustained while he was engaged in a hazardous employment as defined by the Workmen’s Compensation Law; 85 O. S. 1941 § 1, et seq. On the 2nd day of May, 1932, the secretary of the State Industrial Commission advised the Rucks-Brandt Construction Company that it would be necessary for it to make payment of the award since the Southern Surety Company had failed or that it would be necessary to have the award filed in the court clerk’s office and execution issued thereon.

On May 10, 1932, Rucks-Brandt Construction Company executed a chattel mortgage for $10,000 to the First National Bank & Trust Company of Tulsa, Okla. On May 17, 1932, the award was certified to the district court of Tulsa county. On the same day an affidavit for garnishment was filed by the plaintiff, and on said date an order in garnishment was issued to the city of Tulsa to reach certain funds owed by the city of Tulsa to the Rucks-Brandt Construction Company. However, this order was not served on the city. On the same day the Rucks-Brandt Construction Company obtained a district court order enjoining the sheriff from levying execution on the award. On May 18th the application for injunction was filed in the office of the court clerk. On May 18 th the Rucks-Brandt Construction Corpora-pany received a warrant in the sum of $7,904.30 from the city of Tulsa as payment on a contract for the construction of a bridge over the Arkansas river near the city of Tulsa. On the same day this warrant was deposited in the Fourth National Bank of Tulsa, Okla., in the name of “R. B. Company.” Thereafter the Rucks-Brandt Construction Corporation was perfected, and on May 25, 1932, authorized to do business in Oklahoma. The officers of the new corporation were William M. Thompson, R. Brandt, and B. F. Rucks. These are the same officers as the officers and directors of the Rucks-Brandt Construction Company. On the same date the defendant assigned its contract with the city of Tulsa to the new corporation, and it is apparent that all its property was also assigned to the new company. Between June 8 and October 6, 1932, the city of Tulsa paid to the Rucks-Brandt Construction Corporation on the contract made by it with the Rucks-Brandt Construction Company for the construction *326 of the Arkansas river bridge the total sum of $68,870.16.

On June 7, 1932, the injunction obtained by the Rucks-Brandt Construction Company was dissolved. On June 15 th the Rucks-Brandt Construction Company filed a second injunction suit against the plaintiff and the sheriff of Tulsa county. On September 23rd the Rucks-Brandt Construction Company filed its appeal in the Supreme Court from the order and judgment of the district court of Tulsa county dissolving the injunction issued June 15th. On July 18, 1933, this court affirmed the judgment dissolving the injunction and entered judgment for the defendant, who is the plaintiff in the action now before us. See Rucks-Brandt Construction Co. v. Price, 165 Okla. 178, 23 P. 2d 690. On May 5, 1934, the United States Supreme Court denied certiorari in that, case. 291 U. S. 679, 54 S. Ct. 526, 78 L. Ed. 1067. The record discloses that out of the funds received from all of the transactions above referred to the defendants R. Brandt and B. F. Rucks received together the sum of $10,428.56.

The above facts were alleged in the amended petition which was filed on order of court and the cause was tried upon the allegations on the theory that the action constituted a creditor’s bill.

Plaintiff contends here, as alleged by him in his petition, that the transfer of the funds and property of the defendant company left it wholly without funds and property with which to pay the plaintiff, and that the procurement of the injunction and the formation of the corporation were all done in furtherance of a fraudulent design and scheme by the defendants to defeat the payment of the award made by the'State Industrial Commission, and that he is entitled to a judgment against the corporation for the amount of the award, together with interest thereon, less proper credits for payments theretofore made by the insurance carrier and against the defendants Rucks and Brandt for a sum equivalent to the funds and property so received by them.

The defendants argue three general propositions. They first assert that this is an action based on fraud and is, therefore, barred by the two-year statute of limitation. 12 O. S. 1941 § 95, subd. 3. Next they say this action is one against the officers and directors of a corporation and cannot be maintained until there is a dissolution of Rucks-Brandt Construction Company. Their third proposition ’ is based on the amount of the judgment and will be discussed in connection with the allegations in the cross-petition in error.

In reality this is an action to have the Rucks-Brandt Construction Corporation adjudged to be the same entity as its predecessor and assignor, Rucks-Brandt Construction Company, and to trace and apply upon plaintiff’s award funds and property which were assigned and transferred to the other defendants, Rucks and Brandt, by the defendant debtor company. It is apparent from the record that all the funds and property belonging to the debtor company were transferred to the successor corporation upon its creation with the intent to defraud, delay, and defeat the plaintiff, though there might have been other incidental reasons for the creation of the corporation. Such transfers were void and the individual defendants had full knowledge, of the purposes for which such transfers were made, and are, under all the circumstances maintaining, liable to this plaintiff to the extent of the funds and property received by them from the corporation. 24 O. S. 1941 §§ 5, 6, 7, 8.

By the provisions of 12 O. S. 1941 § 841, a judgment creditor is afforded equitable relief by an action to reach money, contract, claims or choses in action due or to become due the judgment debtor where execution has been issued and returned “no property found.” In Miller v. Melone, 11 Okla. 241, 67 P. 479, we held that a petition alleging a valid judgment and fraudulent transfer of property by the judgment debtor was a creditor’s bill and ancillary.

85 O. S. 1941 § 42 provides for the *327 filing of an award by the State Industrial Commission in the office of the court clerk of any county in the state and the law relating to judgments of district courts is adopted and made applicable thereto. See Hickman v.

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Bluebook (online)
1944 OK 215, 151 P.2d 399, 194 Okla. 324, 1944 Okla. LEXIS 454, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rucks-brandt-construction-corp-v-silver-okla-1944.