Young v. Hughes

65 P. 987, 39 Or. 586, 1901 Ore. LEXIS 110
CourtOregon Supreme Court
DecidedAugust 12, 1901
StatusPublished
Cited by5 cases

This text of 65 P. 987 (Young v. Hughes) is published on Counsel Stack Legal Research, covering Oregon Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Young v. Hughes, 65 P. 987, 39 Or. 586, 1901 Ore. LEXIS 110 (Or. 1901).

Opinion

Mr. Justice Moore

delivered the opinion.

This is a suit by certain stockholders of a corporation, for themselves and on behalf of all others similarly situated, to establish .and enforce a lien upon a fund in the hands of the representative of a deceased trustee. It is alleged in the complaint, in effect, that the Gold Mountain & Dry Gulch Gold & Silver Mining Company, a corporation, sold its mining property, for which its secretary, Seth R. Hammer, received the sum of $5,000, to be distributed to its stockholders in certain proportions ; that on December 2, 1898, Hammer died intestate, having in his possession of said money the sum of $1,812.12 and certain office furniture, the property of the corporation; that on December 5, 1898, the defend[588]*588ant, John Hughes, was duly appointed administrator of the decedent’s estate, and, having qualified and entered upon the discharge of his trust, wrongfully took possession of said money and furniture, which, upon a demand therefor, he refused to deliver to plaintiffs; that more than one hundred stockholders of said corporation, residing in this and other states, have not received their share of said fund, and their number and diverse citizenship render it impracticable that they should be made parties ; that there is no person now authorized to demand, take possession of, or sue for the recovery of said money or property in the name of the corporation, or to act for or on its behalf or that of its stockholders; and that it is necessary that some qualified person should be appointed to take charge of said money and property for the benefit of plaintiffs and the other stockholders, so that he may convert the property into money, and distribute it, with such fund, to those entitled thereto, according to their respective rights. The summons was served upon the defendant, John Hughes, only, who alone answered, denying the material allegations of the complaint, and averring that prior to the commencement of the suit he offered to.deliver to the plaintiffs any property belonging to the corporation which they could identify as such ; but, they failing and refusing to identify any of the corporate property, he took its seal and dating stamp into court for them. The reply having put in issue the allegations of new matter in the answer, a trial was had, resulting in a decree awarding the plaintiffs and other stockholders who had not received their share of the proceeds of sale the sum of $1,201.62 of the money in Hammer’s possession at the time of his death, appointing Amos Strong receiver to hold said sum -for, and to distribute it to, the-unpaid stockholders, and that plain[589]*589tiffs recover of Hughes, as administrator, their costs and disbursements ; from which decree he appeals.

1. A careful examination of the testimony convinces us that the court properly found that the plaintiffs and other stockholders had a preferred lien upon a part of the money received by Hammer upon a sale of the mining property remaining in his possession at the time of his death. A. N.,Bush, an accountant in the bank of Messrs. Ladd & Bush, at Salem, Oregon, testifies that for many years Hammer had been a customer of their bank, that he was acquainted with his mode of doing business with banking institutions, and that it was his general custom to deposit money held by him for others in such a manner as to show who were the equitable owners thereof. The testimony shows that upon Hammer’s death a box belonging to him, and kept in the vault of said bank, was found to contain certificates of deposit payable to himself or order in the sum of $1,050, and there were also found in his office like certificates in the sum of $350. It also appears that, while the mining property of the corporation was sold by its officers in pursuance of authority conferred upon them by a majority of the stockholders, several .of the minority were dissatisfied with the price received therefor, and this fact probably explains why a part of the money remained in Hammer’s possession at the time of his death. These displeased stockholders had threatened to sue the corporation, causing Hammer to fear that their menaces would be executed, and that they might possibly secure a greater proportion than had been paid to the others, to circumvent which he probably changed the money he had received in trust to his private account. Several witnesses called by the plaintiff testified that he informed them that he changed the money into these certificates for that purpose. It is conceded [590]*590by every witness that Seth R. Hammer was scrupulously honest, and. if, in his last illness, he had been able to communicate with those who visited with and ministered to him, he would doubtless have fully explained the nature and extent of his trust, and accounted for every dollar he held for the stockholders. His sudden sickness, however, superinduced a comatose state that resulted in death before he could make the necessary explanations.

R. B. Cannon, president of said corporation at the time its mining property was sold, states in his deposition, in effect, that, being more conversant with its business than any other person, he made, soon after said sale was consummated, a list of its stockholders at that time ; that the list was prepared for Hammer’s benefit and convenience, to enable him to pay the stockholders the several sums due each; that the writing on said list in ink was done by him, and represents the sums paid for stock, and the figures in pencil thereon were made by Hammer, and represent the sums to be paid to the several stockholders ; and that when Hammer paid any of the money so received he made on said list, opposite the stockholder’s name, an “X,” as evidence of such payment. The list in question was attached to the deposition. The deponent further says that Hammer was to receive for his services in disbursing the money left with him the sum of $250, provided there was that much left after paying the stockholders the sums due them. Amos Strong, as plaintiffs’ witness, testified that soon after the mine was sold he saw Cannon making said list by taking a transcript from the books ; that the stockholders who had paid cash for their stock were listed separate from those who had secured such stock by performing labor, or in any other manner; that eighty cents per share was to be paid to those-who had paid cash for their stock and twelve and one half cents per share to all others, and that this pro[591]*591portion was determined at a meeting of the stockholders ; that about October, 1898, he saw said list in Hammer’s office, and, looking over it. with him, he observed that he had marked an X ” thereon as evidence of the payments he -had made to the stockholders, using the list entirely to keep his accounts upon in relation thereto; and that the witness secured the list from Hughes, and attached it to the interrogatories which were sent to Cannon. An examination of said list shows that it does not contain any memorandum of two hundred shares issued to the plaintiff H. W. White, upon which he demands, and the court apparently allowed, the sum of $169 ; nor-is any entry made in the stock ledger of such stock. The only credit he has thereon is of twenty shares assigned to him by R. H. Miller.

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Bluebook (online)
65 P. 987, 39 Or. 586, 1901 Ore. LEXIS 110, Counsel Stack Legal Research, https://law.counselstack.com/opinion/young-v-hughes-or-1901.