Screwmen's Benev. Ass'n v. Monteleone

123 So. 116, 168 La. 664, 1929 La. LEXIS 1851
CourtSupreme Court of Louisiana
DecidedMay 20, 1929
DocketNo. 29824.
StatusPublished
Cited by8 cases

This text of 123 So. 116 (Screwmen's Benev. Ass'n v. Monteleone) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Screwmen's Benev. Ass'n v. Monteleone, 123 So. 116, 168 La. 664, 1929 La. LEXIS 1851 (La. 1929).

Opinion

THOMPSON, J.

The plaintiff agreed to sell, and the defendant agreed to purchase, the property situated at the corner of Exchange alley and Bienville street, this city. The price was $21,000 cash. When title was offered, the defendant refused to take it on the ground that the plaintiff was not the owner of the property; that the title was not good and merchantable, and was suggestive of litigation.

' Thereupon this suit was filed to compel specific performance.

The answer of the defendant elaborates the reasons for declining to accept title.

On a trial, there was judgment ordering defendant to take title, and he appeals.

The plaintiff was incorporated by act passed before Abel Dreyfuss on December 16, 1876. Its object and purpose was declared to be to promote the welfare of its members by united and harmonious action on their part in all matters relating to their calling or occupation, and to afford mutual assistance to each other.

The corporation was a nonstock corporation. Membership was acquired by application and initiation upon payment of-a cex*tain fee, and the membership was retained by payment of monthly dues and the observance of a certain line of upright and moral conduct.

A board of officers was provided for, to be elected annually, and which board was required to meet monthly and to have control of the affairs of the corporation.

The first article of the charter limited the existence of the corporation to 20 years from December 16,1876.

The property involved was acquired by the association on October 23, 1882. Although *668 the purchasing association was named in the act of sale as the Screwmen’s Benevolent Association of New Orleans instead of the Screwmen’s Benevolent Association of Louisiana, the evidence leaves no doubt but that the act of purchase was that of the plaintiff corporation.

It is shown that the plaintiff corporation took possession of the property and has occupied the same from the date of purchase down to the filing of the present suit.

There was another corporation chartered before a notary of this city bearing the same corporate name as that of the plaintiff, but the evidence shows that said corporation was composed of colored people, and had no connection with the plaintiff association. Of course, the colored association makes no pretense of claim, and could under.no circumstance claim the property here involved.

Admitting for the moment that the corporation ceased to exist as a de jure, corporation on December 16,1896, by reason of the expiration of its charter, and conceding for the moment also that it- was not, after said period, a de facto corporation, we do not agree with counsel that, when the charter expired, the property became the joint property of the members then living.

The association was leg'ally incorporated, and was a separate and distinct intellectual being, different from all of the members who joined or became affiliated with it. All property acquired became the property of the association, and no individual member acquired any separate and independent ownership 'in the property so acquired.

When once a legal and valid existent corporation becomes the owner of property, such property remains the property of the corporation until disposed of in the manner provided by the charter or by the law.

Neither the stockholders of a stock corporation nor the members of a nonstock corporation ever become the owners in common of the property of such corporations.

Corporations legally organized are unlike, in this respect, unincorporated associations. G. C. 446.

In the case of National Oil Works v. Korn Bros., 164 La. 800, 114 So. 659, this court held that a corporation did not lose its identity because another corporation obtained ownership of all of its capital stock, and that, remaining a legal entity, the corporation continues to own its property until the same is transferred pursuant to law.

The same is true with respect to a corporation whose charter has expired, has been forfeited, or for any other cause has been dissolved.

Therefore the property here involved continued to be the property of the corporation separate and distinct from the members, and-will remain so until disposed of or transferred in some manner provided by law.

The more serious question, and the one we find more difficult of solution, is whether, after the charter expired, the corporation maintained a status and character of a corporation de facto.

After December 16, 1896, the end of the period of existence as expressed in the charter, the membership continued to meet annually and elect officers as provided in the charter. The association also continued its monthly and weekly meetings, received and initiated members, collected dues, and made sick and benefit disbursements for the members.

The association occupied, as a place in which to hold its meetings, the property purchased by the association during its legal existence.

In other words, the association continued to function in the same manner and under the same name without interruption as though its *670 life had been legally extended after the expiration of the time limit of 20 years, as provided in the charter.

The precise question has never been brought before the courts of this state so far as we have been able to find, and counsel have not pointed out any cases in which the question was at issue.

There are cases, however, which bear some degree of analogy to the question presented.

It has been held that, where there has been a bona fide attempt to organize a corporation, and which was followed by actual user of the corporate franchise, the corporation acquires a de facto status, and the validity will not be inquired into at the suit of an individual; the matter being one for the consideration of the state. Weil v. Leopold Weil Bldg., etc., Co., 126 La. 938, 53 So. 56.

And in New Iberia Sugar Co. v. Lagarde, 130 La. 387, 58 So. 16, it was said that the law encourages and shares in the universal desire for the stability of business transactions, and very wisely provides that, when a corporation has attained an existence de facto, the regularity of its corporation shall not be questioned by indirect attacks by parties who are not concerned in the strictness of its incorporation.

“If the state acquiesces in the usurpation of corporate powers, individuals cannot complain.”

It has likewise been held that, where a corporation has forfeited its corporate life by committing or omitting some act which the charter declares shall ipso facto forfeit the charter, the corporation continues to live as long as the state does not claim the forfeiture. Atchafalaya Bank v. Dawson, 13 La. 497.

In the case of Board of School Directors v. Meridith, 140 La. 275, 72 So. 960, it appears that the Pine Grove Academy of Caldwell parish was incorporated by an act of the Legislature in 1838 (Act No. 76 of 1838) and given a perpetual existence, but in 1860 (Act No. 195 of 1860) the Legislature reincorpo-' rated or amended the charter of the academy, but limited its life to 25 years.

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123 So. 116, 168 La. 664, 1929 La. LEXIS 1851, Counsel Stack Legal Research, https://law.counselstack.com/opinion/screwmens-benev-assn-v-monteleone-la-1929.