Shea v. Mabry

ON PETITION TO REHEAR.

H, H. Ingersole, Sp. J.,

delivered the opinion of the court.

This petition of respondents seeks a rehearing upon several grounds, some of which were argued and considered on the hearing, the others are new.

Upon the former, the several members of the court consistently adhere to the various conflicting views expressed in the opinion already delivered, and in regard to them nothing need be added here. The new points are two:

First. That the complainant ought not to be allowed to appropriate the only known asset of a defunct corporation to the payment of his debt, to the exclusion of other creditors against whom respondents could not plead 'this judgment in bar of future recoveries .sought upon the grounds of this bill.

*345It does not appear that this is the only asset, nor that this is a defunct corporation, nor can we, as petitioners suggest, take judicial knowledge of its death. The condition of private corporations is not a subject of judicial notice, nor does the record show, or even suggest, the existence of other creditors. But if this were an insolvent corporation, and complainant had an attachment lien upon this asset, no reason is seen why, as in the case of Marr v. Bank of West Tennessee, 4 Col., 471, upon proper proceeding, the other creditors could not compel' from him a pro rata distribution with them according to the principal and practice settled in Rains v. Rainey, 11 Hum., 261; nor can we see why the satisfaction of this judgment would not be a release pro tanto to respondents from liability for this misappropriation. But we need not decide upon the hypothetical case put under this objection to the decree. It is enough that the pleadings and proof do not raise the question.

Second. Complainant should not have his decree against respondents for his debt, because it is not known whether, after striking out this item of $28,300 credit in Mabry’s account, he would be in debt to the company, and to ascertain this we are requested to i’emand for an account and proof.

This may be done if the - record is such that a decree for an account would be proper on a hearing of the case before the Chancellor, if not, of course respondents cannot ask it here. The record stands thus: Complainant charges that the company is in•debted to him, and that with the permission of other *346respondents Mabry has misapplied the funds of the company. - Mabry answers that the company “was at the time of the alleged judgment, and the filing of the bill, justly indebted to him, evidenced by State bonds and accounts, in a sum much larger than the sum alleged to have been misapplied, and hence in no event can he be held liable for said judgment.” This is really a plea of set-off, but may possibly be regarded as equivalent to the plea of nil debit and payment. So treating it how stands the record ?

Complainant has proven his allegations and is entitled to his decree unless something contrary appears.

We have here the plea of set-off, or pleas of nil debit and payment, with no proof to support either of them, and nothing in the record to suggest ■ that the-company owes Mabry, but rather to the contrary.. Upon this condition of the record could respondents, before the Chancellor have a reference? It is well-settled that in a proper case for account if an indebtedness appears prima facie in favor of a party, but the amount does not appear, a reference will be ordered to ascertain it, otherwise, however, if a prima facie case is not made out. Surely a mere denial or even an unsupported allegation will not authorize the-reference.

As suggested by the petitioners, “ it is to be regretted that the court has not the clearest possible light i'u which to act in deciding the case,” but as the parties deem it best to give us no more, especially as respondents have not at all contributed to the small stock supplied, we must act with what they have been *347content to afford. Upon this point, however, we see nothing in the record to suggest even that an account would change the result, especially since Mabry, with all of complainant’s proof standing against him, came to the hearing before the Chancellor without any proof whatever.

Applying the law, there is no escape from the conclusion that respondents would' not, even if this-.were the first hearing before the Chancellor instead of the third in this court, be entitled to a reference,, and we are constrained to refuse it and dismiss the-petition.