Stone v. Chisolm

Last updated
Stone v. Chisolm
Seal of the United States Supreme Court.svg
Argued January 5, 1885
Decided February 2, 1885
Full case nameStone v. Chisolm & Others
Citations113 U.S. 302 ( more )
5 S. Ct. 497; 28 L. Ed. 991
Court membership
Chief Justice
Morrison Waite
Associate Justices
Samuel F. Miller  · Stephen J. Field
Joseph P. Bradley  · John M. Harlan
William B. Woods  · Stanley Matthews
Horace Gray  · Samuel Blatchford
Case opinion
MajorityMiller, joined by unanimous

Stone v. Chisolm, 113 U.S. 302 (1885), was a writ of error to reverse a judgment of the Circuit Court for the District of South Carolina, which dismissed the complaint in which the plaintiff asked for recovery in the sum of $1,050 with interest from July 1, 1883 Sixty bonds or obligations of the Marine and River Phosphate Mining and Manufacturing Company of South Carolina which became totally insolvent. [1]

Contents

The court found that in order to ascertain the existence of the liability in a given case requires an account to be taken of the amount of the corporate indebtedness, and of the amount of the capital stock actually paid in, facts which the directors, upon whom the liability is imposed, have a right to have determined, once for all, in a proceeding which shall conclude all who have an adverse interest, and a right to participate in the benefit to result from enforcing the liability. Otherwise the facts which constitute the basis of liability might be determined differently by juries in several actions, by which some creditors might obtain satisfaction and others be defeated. The evident intention of the provision is that the liability shall be for the common benefit of all entitled to enforce it according to their interest, an apportionment which, in case there cannot be satisfaction for all, can only be made in a single proceeding to which all interested can be made parties.

The case could not be distinguished from that of Honner v. Henning , 93 U. S. 228, the reasoning and result in which was reaffirmed.

It is immaterial that in this case it does not appear that there are other creditors than the plaintiffs in error. There can be but one rule for construing the section, whether the creditors be one or many. To the question certified, therefore, it must be answered that an action at law will not lie, and that the only remedy is by a suit in equity. The judgment was accordingly affirmed.

See also

Related Research Articles

In law, a judgment, also spelled judgement, is a decision of a court regarding the rights and liabilities of parties in a legal action or proceeding. Judgments also generally provide the court's explanation of why it has chosen to make a particular court order.

Interpleader is a civil procedure device that allows a plaintiff or a defendant to initiate a lawsuit in order to compel two or more other parties to litigate a dispute. An interpleader action originates when the plaintiff holds property on behalf of another, but does not know to whom the property should be transferred. It is often used to resolve disputes arising under insurance contracts.

Drennen v. London Assurance Co., 113 U.S. 51 (1885), was a fire insurance case regarding two policies of fire insurance, issued March 10, 1883, by the London Assurance Corporation, of London for the property of the firm of Drennen, Starr & Everett, a business in the city of Minneapolis, Minnesota. The loss occurred on July 29, 1883.

Hess v. Reynolds, 113 U.S. 73 (1885), was Supreme Court case determining whether a probate case from Michigan should be moved to federal court and, if so, which federal court should hear it. The court issued a writ of error on the judgment of the Eastern District of Michigan federal court for remanding a case back to the state court and determined that was indeed the appropriate federal court to hear the case.

Findlay v. McAllister, 113 U.S. 104 (1885), was a suit brought against Thomas McAllister and 14 other defendants, to recover damages as follows:

Ackley School District v. Hall, 113 U.S. 135 (1885), was a suit to recover principal and interest claimed to be due the defendant on negotiable bonds issued by the plaintiff.

Dakota County v. Glidden, 113 U.S. 222 (1885), was a motion to dismiss a suit issued in aid of a railroad. Judgment for the plaintiff. The defendant brought a writ of error to reverse it. Subsequently, to the judgment, Dakota County, Nebraska settled with the plaintiff and other bondholders, by giving them new bonds bearing a less rate of interest, and the old bonds, which were the cause of action in this suit, were surrendered and destroyed. These facts were brought before this Court by affidavits and transcripts from the county records, accompanied by a motion to dismiss the writ of error.

Attachment is a legal process by which a court of law, at the request of a creditor, designates specific property owned by the debtor to be transferred to the creditor, or sold for the benefit of the creditor. A wide variety of legal mechanisms are employed by debtors to prevent the attachment of their assets. For example, a declaration of bankruptcy will severely limit the ability of creditors to attach the property of the debtor. Many jurisdictions have a homestead exemption or other property exemptions which limit the ability of creditors to attach the debtor's primary residence, vehicle, and/or personal effects..

Avegno v. Schmidt, 113 U.S. 293 (1885), was a case in which the United States Supreme Court held that title to property confiscated during the American Civil War was properly held by the mortgagor.

Baylis v. Travelers' Insurance Company, 113 U.S. 316 (1885), was a case where after close of testimony in a trial, the defendant moved to dismiss on the ground of the insufficiency of the evidence to sustain a verdict. This motion was denied and the plaintiff asked that the case be submitted to the jury to determine the facts on the evidence. The court refused this, and plaintiff excepted. The court then ordered a verdict for plaintiff, subject to its opinion, whether the facts proved were sufficient to render defendant liable to plaintiff on the cause of action stated. Plaintiff moved for judgment on the verdict, and defendant moved for judgment on the pleadings and minutes of trial. Judgment was rendered for defendant upon an opinion of the court as to the effect of the evidence and as to the law on the facts as deduced from it by the court. Held that the plaintiff was thereby deprived of his constitutional right to a trial by jury, which he had not waived, and to which he was entitled.

Chicago & Northwestern R. Co. v. Crane, 113 U.S. 424 (1885), was a suit brought by a taxpayer and resident in the Town of Polk City, Iowa, on behalf of himself and all other resident voters, taxpayers and property holders, commenced suit in a state court of Iowa against two companies, praying for a peremptory writ of mandamus to compel the reconstruction and operation of the old line after the Chicago and North Western Railway, an Illinois corporation. changed the line and made it avoid the city, constructing a branch to the latter. C&NW Railway was leased the line by the D&M Railroad Company, an Iowa Corporation, who had received from a township in Iowa, in consideration of its agreement to construct and maintain a railroad to a city in the township, the proceeds of a special tax and a conveyance of a large amount of swamp lands. It constructed the railroad and operating it for a time before leasing it to C&N Railway.

<i>Ultramares Corp. v. Touche</i>

Ultramares Corporation v. Touche, 174 N.E. 441 (1932) is a US tort law case regarding negligent misstatement, decided by Cardozo, C.J. It contained the now famous line on "floodgates" that the law should not admit "to a liability in an indeterminate amount for an indeterminate time to an indeterminate class."

Chase v. Curtis, 113 U.S. 452 (1885), was a suit brought under the provisions of §12 of the Act of the Legislature of New York of February 17, 1848, as amended June 7, 1875, where trustees of corporations formed for manufacturing, mining, mechanical, or chemical purposes are made liable for debts of the company on failure to file the reports of capital and of debts required by that section, is penal in its character, and must be construed with strictness as against those sought to be subjected to its liabilities. Suit was brought to recover from the trustees of such a corporation the amount of a judgment against the corporation, the judgment roll is not competent evidence to establish a debt due from the corporation to the plaintiff.

A claim in tort against a corporation formed under that act, as amended, is not a debt of the company for which the trustees may become liable jointly and severally under the provisions of the Act. In a proceeding to enforce a liability created by a state statute, the courts of the United States give to a judgment of a state court the same effect, either as evidence or as cause of action, which is given to it in like proceedings in the courts of the state whose laws are invoked in the enforcement.

The complaint in this action, after alleging that the plaintiff in error was a citizen of Pennsylvania, and the defendants citizens of New York, proceeded as follows:

"Wherefore the plaintiffs demand judgment against the above-named defendants in the sum of $40,828.97, with interest on $40,500.00 from the 30th day of July, 1874, and on $328.97 from the 3d day of October, 1874, besides the costs and disbursements of this action."

To this complaint the defendants severally demurred on the ground that it did not state facts sufficient to constitute a cause of action. The demurrer was sustained and judgment rendered in favor of the defendants dismissing the complaint, to reverse which this writ of error is prosecuted.

The statute on which the action is founded is as follows:

"SECTION 1. The twelfth section of the 'Act to authorize the formation of corporations for manufacturing, mining, mechanical, or chemical purposes,' passed February 17, 1848, as said section was amended by chapter 657 of the Laws of 1871, is hereby further amended, so that section 12 shall read as follows:"

"§ 12. Every such company shall, within twenty days from the first day of January, if a year from the time of the filing of the certificate of incorporation shall then have expired, and if so long a time shall not have expired, then within twenty days from the first day of January in each year after the expiration of a year from the time of filing such certificate, make a report, which shall be published in some newspaper published in the town, city, or village, or, if there be no newspaper published in said town, city, or village, then in some newspaper published nearest the place where the business of the company is carried on, which shall state the amount of capital, and of the proportion actually paid in, and the amount of its existing debts, which report shall be signed by the president and a majority of the trustees, and shall be verified by the oath of the president or secretary of said company, and filed in the office of the clerk of the county where the business of the company shall be carried on, and if any of said companies shall fail so to do, all the trustees of the company shall be jointly and severally liable for all the debts of the company then existing, and for all that shall be contracted before such report shall be made. But whenever under this section a judgment shall be recovered against a trustee severally, all the trustees of the company shall contribute a ratable share of the amount paid by such trustee on such judgment, and such trustee shall have a right of action against his co-trustees, jointly or severally, to recover from them their proportion of the amount so paid on such judgment, provided that nothing in this act contained shall affect any action now pending.

It is finally insisted that a judgment against the corporation, although founded upon a tort, becomes ipso facto a debt by contract, being a contract of record or a specialty in the nature of a contract. But we have already seen that the settled course of decision in the New York Court of Appeals rejects the judgment against the corporation as either evidence or ground of liability against the trustees, and founds the latter upon the obligation of the corporation on which the judgment itself rests. And it was decided by this Court in the case of Louisiana v. New Orleans, 109 U. S. 285, that a liability for a tort, created by statute, although reduced to judgment by a recovery for the damages suffered, did not thereby become a debt by contract in the sense of the Constitution of the United States forbidding state legislation impairing its obligation, for the reason that the term 'contract' is used in the Constitution in its ordinary sense as signifying the agreement of two or more minds, for considerations proceeding from one to the other, to do or not to do certain acts. Mutual assent to its terms is of its very essence."

The same definition applies in the present instance, and excludes the liability of the defendants, as trustees of the corporation, for its torts, although reduced to judgment.

The court found no error in the judgment of the circuit court, and it was accordingly affirmed.

St. Louis, Iron Mountain & Southern Railway Co. v. Berry, 113 U.S. 465 (1885), was a writ of error to review the action of the Supreme Court of Arkansas in refusing to restrain officers of that state from levying a tax on property of the plaintiff in error.

Provident Institution for Savings v. Mayor of Jersey City, 113 U.S. 506 (1885), was a bill in equity filed in the Court of Chancery of New Jersey by the appellant, to foreclose two mortgages given to it on a certain lot in Jersey City, New Jersey by Michael Nugent and wife, and another person.

Chicago Life Insurance Co. v. Needles, 113 U.S. 574 (1885), was a decision by the United States Supreme Court. It involved the writ of error regarding a denial of a motion and final judgment rendered perpetually enjoining Chicago Life Ins. Co. from further prosecution of its business. From that judgment, a writ of error was prosecuted to the supreme court of the state, where, among other things, was assigned for error the refusal of the court of original jurisdiction to adjudge that the said statutes of Illinois were in violation of the Constitution of the United States. The judgment of the inferior court was in all things affirmed by the supreme court of the state, and from that judgment of affirmance the present writ of error is prosecuted.

Cooper Manufacturing Co. v. Ferguson, 113 U.S. 727 (1885), was a suit regarding the legitimacy of a sale of a steam engine and other machinery in the State of Ohio.

The collection of judgments in Virginia may be accomplished under a number of routes provided under Virginia law, depending on the amount of the judgment and the particular assets that the judgment creditor wishes to pursue.

Civil procedure in South Africa is the formal rules and standards that courts follow in that country when adjudicating civil suits. The legal realm is divided broadly into substantive and procedural law. Substantive law is that law which defines the contents of rights and obligations between legal subjects; procedural law regulates how those rights and obligations are enforced. These rules govern how a lawsuit or case may be commenced, and what kind of service of process is required, along with the types of pleadings or statements of case, motions or applications, and orders allowed in civil cases, the timing and manner of depositions and discovery or disclosure, the conduct of trials, the process for judgment, various available remedies, and how the courts and clerks are to function.

Liberty Oil Co. v. Condon National Bank, 260 U.S. 235 (1922), was a decision by the Supreme Court of the United States dealing with civil procedure and the nature of taking an appeal from the United States District Court.

References

  1. Stone v. Chisolm, 113 U.S. 302 (1885).