was using this drain for purposes other than carrying off this seepage; that they have an ice closet, or ice chest, or what you may call it, in the cellar, and the drippings from this run into this drain. It amounts to as much as four or five gallons a day. I do not know what effect it would have upon this drain, how extensive a flow of four or five gallons of water would be for twenty-four or twenty-five hours; that is a matter of which I have no experience; but as a matter of strict right the plaintiffs have no right to use this drain to carry off that water. It also appears from inspection that the defendants are about laying down a cement pavement, through the other defendant, The Charles Kuhl Artificial Stone Co. Upon an inspection of the premises day before yesterday, I notice that this drain keeps considerably under the surface until it reaches the east 25 feet of this 150 feet, at which point it approached the curb, and then as it comes to the outlet it raises to the surface. I also observe that there are drains connecting from other houses, in front of them, running across the premises out into the gutter, which drains appear right on the surface, as the ashes, or charcoal ashes, or whatever composition these men have, are laid there. They seem to have no difficulty at all with these drains; the drains are laying there and the ashes are padded around the drain pipes. If those drain pipes can be tolerated by the Artificial Stone Co. there is no reason why this drain pipe should be in their way at the east end as it approaches the outlet. On that point itself, if it were in equity, the facts would not sustain it. It appears that 22 feet of this drain pipe at the east end was taken out by the defendants some two years ago; the plaintiff was content to suffer this without any complaint or seeking any remedy in court. But within the last few weeks a number of feet west of this have been taken out-I believe eight feet, if my memory serves me right. Mr. Porter: The only part of the pipe that was taken out, was taken out two years ago. Court: Then if there was none additional taken out there is nothing to be said about that. If damages had been asked, I would have allowed damages as to the 22 feet. No damages allowed; but the decree can be drawn up in such a way as not to interfere with the relaying of the 22 feet at the expense of the plaintiff, who must do it within the next seven days, if the parties do not intend to take an appeal, so that the work of the stone pavement can go on without delay, and the defendants will be restrained from permitting the drippings of water from any other source than natural, or permitting drippings from this ice box or any other artificial source to run into this drain. The 22 feet to be relaid by the defendant. I had in my mind that some additional number of feet were taken off recently; as to that I would allow you damages, or to compel them as far as I am ordered to do so to pay for the restoration of that. The costs of this case will be divided, because evidence is that the plaintiff allowed the drainage of that ice box to run through this drain. If the parties desire to appeal, a bond of $200.00 will be taken. J. H. Charles Smith, for plaintins. Porter & Rendigs, for defendants. 133 Turnbull v. Pomeroy Salt Co. et al. CORPORATIONS-STOCKHOLDER'S LIABILITY. [Meigs Common Pleas, April Term, 1890.] EDWARD TURNBULL V. POMEROY SALT CO. ET AL. 133 1. A petition which sets out facts showing a liability of certain defendants as stockholders in an insolvent corporation, for unpaid stock, and also facts which show an individual liability, in addition, under a statute, states two distinct causes of action; and they are therefore properly separated and numbered as such. 2. When there are two or more counts in a pleading, separately stated and numbered, and no reference is made by either to matter in any other, on demurrer to one count, it must stand or fall by its own averments, and can not be helped or hurt by facts in another count, however sufficient to that end in themselves. 3 Where by a count of the petition it appears that the plaintiff is a creditor, and sues for himself and all other creditors of a manufacturing corporation, organized under the laws of Ohio, to subject unpaid stock subscriptions to payment of the corporate debts; that long before, the corporation had assigned all its property to the plaintiff for the benefit of its creditors; that this had been wholly exhausted, the fund arising therefrom distributed, leaving large sums due to the plaintiff and other creditors; that he had filed his final account as assignee, which had been approved by the probate court having jurisdiction of the assignment, but was not discharged from the trust-on demurrer, held: a. That in his right as a creditor of the corporation, he could maintain the action. b. That it was well brought, although the debt alleged to be due from the corporation to the plaintiff had not been reduced to judgment, and without averring either a previous demand by the plaintiff, or call by the company, for the unpaid subscriptions. 4 In a suit by a creditor for himself and the other creditors of an insolvent corporation, to recover unpaid stock subscriptions, as against a general demurrer, in order to show the liability of alleged stockholders, it is sufficient to state that they hold stock of the corporation; the amounts by them severally held; that it never was fully paid, and that on the stock held by each, a specified sum is due and unpaid; regardless of whether the alleged holders be original takers, or transferees of the stock by them respectfully owned. 5. Where a creditor brings an action to enforce an individual statutory liability, against the stockholders of an insolvent Ohio corporation; for the purposes of reference to a master in chancery, to ascertain and report who are and have been stockholders, with a view to further relief, as respects parties defendant, it is in the first instance sufficient if the petition shows that the plaintiff has brought in all who were stockholders when the corporation became insolvent, and at the time suit was begun, or given valid reasons for not so doing; although other persons may be found, who, by reason of once having been stockholders, must be made parties before a final decree will be entered. 6. An act passed May 1, 1854, to authorize manufacturing corporations to increase their capital stock in certain cases, after specifying the steps to be taken for that purpose, limits such increase "to an amount not exceeding the actual outlays and expenditures" of the company, "in the legitimate business thereof;" provides that "every such increase of capital stock shall be made up by the actual payment of the amount thereof, in money, into the funds" of the company; that no increase "shall be allowed or recognized in law, unless the same shall have been actually paid up in money," in "good faith;" and that the stockholders of a company increasing its "capital stock agreeably to the provisions of this act, shall be held individually liable, for all debts due and owing by such company." A later act, passed April 12, 1865. enacts that stockholders of "any manufacturing company which has heretofore increased" its capital stock "under the act" above referred to, "shall be individually liable for all the debts of such company, to an amount over and above the stock owned by him or her in such company, and any unpaid installments thereon, to a further sum equal in amount to such stock"-which, as to both forms of liability, is still in force. In an action by the creditor of an insolvent manufacturing corporation to enforce, as against its stockholders, the additional liability arising from an increase of the capital stock of such corporation, under said act of 1854; where the petition expressly shows that an increase of stock was in fact made by the stockholders of the corporation, under that act, in 1856, from $25,000, to $75,000; that a record of the vote therefor, and the amount of such increase was duly made and filed in the recorder's office of the county in which the said corporation is located; that upon this increase of stock it carried on its business of making and selling salt, until May, 1887; that the debt on which plaintiff sues, is evidenced by a note of the corporation, made September 26, 1884; on demurrer, because there was no allegation that the increase did not exceed the outlays and expenses of the corporation, in its legitimate business, nor that it was made up by actual payment of the amount; in money, into the corporate funds, held: 1. That the stockholders, whether original takers, or transferees, are estopped, on the facts stated, to make these questions. 2. That the two acts, are in pari materia; that the effect of the later enactment is to validate a de facto increase of capital stock, of the character alleged, made prior to its passage, under the act of 1854, so far as the rights of creditors are concerned, whose claims arose since the last act was passed, to the extent at least which it creates liability for them, based upon a previous increase of stock. 3. That the individual liability of the stockholders of the corporation, defendant, for its debts, arising under the said statutes, from the increase of its capital stock, is enforceable in equity, at the suit of any creditor, on behalf of himself and all other creditors, when, in addition to other necessary facts, it is averred that the corporation is wholly insolvent, and has no property whatever subject to execution. This is an action by a creditor, for himself and all other creditors of a manufacturing corporation, organized under the laws of Ohio, against it and its stockholders, seeking to collect unpaid stock subscriptions, and to enforce an additional statutory liability. The petition is in two counts. In the first, the plaintiff sets out, in addition to what is above stated, that the company, defendant, is located in Pomeroy, Meigs Co., O.; that September 26, 1884, it made and delivered to him its promissory note of that date, for $6,650, at 6 months, with interest, which is wholly unpaid; that the company is insolvent, and has no property of any kind subject to execution; that May 26, 1887, it made an assignment of all its property, real and personal, to the plaintiff, for the benefit of all its creditors, under the voluntary assignment laws of Ohio; that he was afterward, by the probate court of said county, duly appointed, and so qualified, as such assignee; that he thereupon took possession of all the property, of said company, chattel and real, converted the same into money, applied the funds so obtained in payment of the expenses and costs of his trust, and on the debts of the corporation; that as assignee he rendered his final account to said probate court, which was duly approved and settled by it, November 8, 1888; that after the application of the funds derived from all the property of the company, as aforesaid, there is still due from it to its generai creditors, more than $29,500. It is then alleged "that the following named individual defendants are now stockholders, and all the stockholders of the said defendant, corporation, the Pomeroy Salt Company, in the following amounts of stock, to-wit Horace M. Horton, in the sum of $11, 128." etc.; in the same way naming each, and the amount of his stock, "that the several amounts of stock last aforesaid have never been fully paid for, either by the said stockholders, or their respective assignors, or any prior owner of said stock, or any one for them, or either of them: but that, upon their respective amounts of such stock of the said corporation, the last aforesaid 133 Turnbull v. Pomeroy Salt Co. et al. detendants yet owe to the said defendant, the Pomeroy Salt Company, the following sums payable by each of them respectively, on demand, to-wit: Horace M. Horton, $7,418," etc.; naming each, and the sum unpaid, in the same way; "that said sums are due and unpaid by each of them respectively." The second count says the plaintiff "brings this action against all the stockholders of the said defendant, the Pomeroy Salt Company, and sues them on his own behalf and also on behalf of all the other creditors of the company; but if it should prove to be the fact that there are other stockholders of the said corporation, when they are ascertained, the plaintiff demands that they be made defendants herein." It is then averred that said Salt Company was organized on or about December 11, 1851, with a capital stock of $25,000, for the purpose of manufacturing salt; that on or about February 11, 1856, the said "corporation and the stockholders thereof, under and by virtue of a statute of the state of Ohio ✶✶ entitled 'an act to authorize manufacturing companies to increase their capital stock in certain cases, passed May 1, 1854, by a vote of the majority of the stockholders thereof, to increase the stock of said corporation from $25,000 to $75,000, at a meeting thereof held on the eighth day of November, A. D. 1856, did increase its capital stock from $25,000 to $75,000, divided into 750 shares of $100 each; and that a record of said vote, and of the said increase was duly made, and filed in the recorder's office of the said county of Meigs;" that the said "company has been such corporation, with its capital stock so increased, carrying on the said business of making and selling salt, from the said eleventh day of February, A. D. 1856, to the twenty-sixth day of May, A. D. 1887; * * that said corporation is located in the city of Pomeroy, county of Meigs, and state of Ohio." The count then shows its debt of $6,650, with interest, to the plaintiff, on the note above referred to; that the "company is wholly and entirely insolvent, and has no property whatever, subject to execution out of which said claim can be made, or any part thereof; * * * that the following named defendants are the present stockholders of the said defendant, the Pomeroy Salt Company, and were ail the stockholders at the time it became insolvent, and that they then owned, and now own, the stock of the same in the following amounts, to-wit: Horace M. Horton, in the sum of $11,128, etc., naming each one, and his stock in the same way. Reasons are then alleged, as of non-residence, for not bringing in some, named as stockholders, with other averments, immaterial to the questions to be decided. The prayer is, for a master in the case, to ascertain and report who are the stockholders of said corporation, liable to its creditors herein, the amount of stock held by each, who were the stockholders when each claim proved, accrued, the transfers of stock, if any, who are insolvent, what sums are unpaid and due on stock, the amount of the company's debts, etc., etc., and for general relief. To each count of the petition, genera! and special demurrers, and motions were interposed, on which it was submitted. SIBLEY, J. There are two matters presented by this case, in their nature preliminary to more important questions, relating as they do, solely to points of practice. The plaintiff grounds his title to relief on what is set out as two separate causes of action. It was urged in argument, that the facts alleged in the two counts of the petition show but a single cause of action-a debt payable contingently from one or both of two funds. But Warner v. Callender, (20 Ohio St., 190, 195), in effect, rules the other way. There, as here, the alleged causes of action were: (1) to subject unpaid stock subscriptions, and (2) the statutory liability of stockholders, to the claims of creditors of an insolvent corporation. Below, a demurrer was interposed to the petition or the ground of a misjoinder of causes of action. The ruling on that was before the court for review, and they say in terms "that these causes of action were properly joined in the same action." Though the assertion of claim on "two funds" is spoken of, no intimation is given that the facts set out in form as two causes of action constituted in law but one. Yet that must have been considered, for if they showed but one cause of action, there was no question of misjoinder in the record. The recent case of Barrack v. Gifford (ante 470 O.S., 180) assumes the same view. Accurate analysis of the two grounds of claim will lead to the same result. The first count proceeds upon the obligation to pay for stock subscribed for in a corporation; the second, upon liability additional to that, created by statute. The two causes of action, are the acts wrongful in legal contemplation, (1) of not paying for the stock, and (2) of failing to perform the statutory duty. Veeder v. Baker, 83 N. Y., 156; Bliss, on Code Pl., sec. 113. The other point is, whether in aid of a demurrer to one count of a pleading, the court will notice facts stated in another, there being no reference by either count to what is contained in the other. Mr. Pomeroy has laid down the principle, decisive here, giving the cases in its support. He says that a cause of action, attacked by demurrer, “must stand or fall by its own averments, and cannot be helped out by any facts, however sufficient in themselves, alleged in another paragraph or count." Remedies, section 574; Bliss Code P., section 121. Nearly all the grounds which the Code enumerates are specified in some of the demurrers to both counts of the amended petition. Most of them, however, were not relied on in argument, and require notice only as the final ruling may involve their decision. The first count is demurred to upon two grounds which merit attention, viz.: That by reason of his relation to the Salt Company, as its assignee in insolvency, the plaintiff is disabled to maintain this action; and if this be not so, that the facts stated show no right of action in equity against those who are sued as stockholders of the company. The fact that the plaintiff has not been discharged from the office of assignee, although his trust has been completely executed, except as it may touch the unpaid subscriptions sought in this suit to be collected, will not bar his right to proceed as a creditor in this action. No authority which supports the contention that it would, has been cited, and the reason of the thing is clearly the other way. His double relation of trustee and creditor, to the fund possibly to be derived from the alleged stock subscriptions, is not shown to be an obstacle to a suit as creditor, rather than assignee. It certainly imposes no obligations more incompatible in the one case than the other. Equity can deal with his rights and duties both as creditor and assignee. Moreover, it cannot be doubted that any other creditor might maintain the action, and that upon the final hearing relief would be granted to all parties, as herein sought, if the proofs called for it. Why not then in this suit? The plaintiff is no less a creditor because he is assignee. The trust so far as can be perceived, neither abridges nor suspends his individual rights. But, on the case made |
