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corporation, on any other ground than would operate to restrain it in the case of an individual;' nor to decide between rival boards of directors or trustees;' nor to restrain directors from exercising the duties of their offices, on the ground that they have been improperly appointed;' nor to remove directors from their offices;* nor, at the suit of a private corporation, to restrain "legislative action," on the part of municipal corporations, such as the passing of a void ordinance; since if void it will be harmless."
· American Water Works v. Ven- 8 El. (N. s.) 682. So, a bill in equity ner, 18 N. Y. Supp. 379. Nor to en- praying for an injunction will not lie join a municipal corporation from to determine which of two parties is suing for infractions of ordinances entitled to the office of school direcbefore a justice of the peace, from tor. Gilroy's Appeal, 100 Pa. St. 5. whose decision an appeal lies : Dev- Neither will an injunction be granted ron v. Municipality No. One, 4 La. to restrain borough officers from enterAn. 11.
ing upon their official duties under • Nolde’s Appeal (Pa.), 15 Atl. the appointment of a town council Rep. 777 (not off. rep.); ante, 98 764, alleged to be illegal, though they 766.
have not exercised or attempted to · Hattersley v. Shelburne, 10 Week. exercise the duties of such offices. Rep. 881. See also, Imperial Hydro- Updegraff v. Orans, 47 Pa. St. 103. pathic Hotel Co. v. Hampson, 23 Ch. Imperial Hydropathic Hotel Co. Div. 1. It should be stated, however, v. Hampson, 23 Ch. Div. 1; ante, that in this case the question was de
Ø 764. cided upon the merits, which neces- • Des Moines Gas Co. v. Des Moines, sarily involved the assumption of 44 Iowa, 505; 8. C. 24 Am. Rep. 756. jurisdiction in the court. Where a That the general doctrine is in consalary is attached to the office, courts formity with this decision, see Dill. of equity will not, as a general rule, Mun. Corp., 98 1, 318; 2 High Inj, enjoin the payment of the salary to $ 1246; Chicago v. Evans, 24 Ill. 52; the incumbent pending a contest. Smith v. McCarthy, 56 Pa. St. 859; Field v. Com., 32 Pa. St. 478; Re Montgomery Gaslight Co. v. MontRamshay, 18 Ad. & El. (n. 8.) 173; 8. C.
gomery, 87 Ala. 245, 257; 8. c. 6 South. 83 Eng. C. L. 173, 174; Reg. v. Dar- Rep. 113; 4 L. R. A, 616. lington Free Grammar School, 6 Ad.
ATTACHMENTS AGAINST CORPORATIONS.*
SECTION 7790. Corporations are persons” 7795. Attaching creditors entitled to within the attachment laws.
preference in distribution. 7791. Corporations not attachable in 7796. Attachments by directors.
actions against shareholders. 7797. What property attachable. 7792. Grounds of attachment against 7798. Bond for attachment. corporations.
7799. Liability to attachment of cor7793. Lien of attachments against cor
porations formed by the conporations.
current legislation of differ7794. Attachments not leviable after
ent States. appointment of receiver.
§ 7790. Corporations are “Persons” within the Attachment Laws.- Where the term “persons" is used in a statute, corporations will be included in this designation, when the cir. cumstances in which they are placed are identical with those of natural persons expressly included in such statutes, unless the language of the statute indicates that the term was employed in a more limited sense, or the subject matter of the act points to this conclusion. Upon this analogy, the view now universally adopted is that corporations, both foreign and
1 United States v. Amedy, 11 ple v. Utica Ins. Co., 15 Johns. (N. Y.) Wheat. (U. S.) 392; United States 358; 8. c. 8 Am. Dec. 243; McIntire v. State Bank, 6 Pet. (U. S.) 29; v. Preston, 10 Ill. 49; 8. c. 48 Am. Dec. Beaston v. Farmers' Bank, 12 Pet. 321 ; State v. Woram, 6 Hill (N. Y.), (U. S.) 102, 134; Planters' &c. Bank 33; 8. C. 40 Am. Dec. 378; Ahern v. v. Andrews, 8 Port. (Ala.) 404; Balti- National Steamship Co., 8 Abb. Pr. more &c. R. Co. v. Gallahue, 12 Gratt. (N. 8.) (N. Y.) 283; Cary v. Marston, (Va.) 655; 8. C. 65 Am. Dec. 254; 56 Barb. (N. Y.) 27; United States Bank v. Merchants' Bank, 1 Rob. Tel. Co. v. Western Union Tel. Co., (Va.) 573; Western Union Tel. Co. v. 56 Barb. (N. Y.) 46; ante, $$ 11, 7364, Richmond, 26 Gratt. (Va.)1, 20; Peo- 7366; post, 98 7804, 8059. • As to proceedings against foreign corporations by attachment, see post, $ 8059, et seq.
domestic, are "persons" within the meaning of statutes giving remedies by attachment and garnishment.' The words "debtor" and "creditor" employed in a statute giving the remedy by attachment are justly held to have been intended by the legislature to be employed in their largest sense, so as to include all persons, individual or corporate, capable of being debtors or creditors. Therefore, a statute which provides for this remedy against the property of absent debtors, includes within its terms foreign corporations when debtors, unless they are expressly excepted therefrom.'
§ 7791. Corporations not Attachable in Actions against Shareholders.—The remedy by attachment, although in this country statutory, is a legal, and not an equitable remedy; and we have seen that, under the principles of the common law, a corporation is a distinct person from that of each of its stockholders. It follows, from this principle, that an attachment cannot be levied upon the property of the corporation, in an action against a shareholder; for the shareholder does not possess such a certain and distinct individual property in the tangible property of the corporation as to make his interest therein attachable. “ The estate and rights of a corporation belong so completely to the body, that none of the individuals who compose it has any right of ownership in them, nor can
Bray v. Wallingford, 20 Conn. See also Rex v. Gardner, 1 Cowp. 79; 416, 418; Knox v. Protection Ins. Co.,
8. C. 2 Inst. 703. 9 Conn. 430; 8. C. 25 Am. Dec. 33; : Union Bank v. United States Mineral Point R. Co. v. Keep, 22 Bank, 4 Humph. (Tenn.) 369; South III. 9; 8. c. 74 Am. Dec. 124, 128; Bal- Carolina R. Co. v. McDonald, 5 Ga. timore &c. R. Co. v. Gallahue, 12 531. That foreign corporations are Gratt. (Va.) 655; 8.c.65 Am. Dec. 254; liable to attachment in Louisiana, see Bushel o. Com. Ins. Co., 15 Serg. & Martin v. Branch Bank, 14 La. 415; R. (Pa.) 173; South Carolina R. Co. Hazard v. Agricultural Bank, 11 Rob. 1. McDonald, 5 Ga. 531. Compare (La.) 326. See also Planters' &c. Burns v. Provincial Ins. Co., 35 Barb. Bank v. Andrews, 8 Port. (Ala.) 404. (N. Y.) 525; 8. c. 13 Abb. Pr. (N. Y.) • Bushel v. Com. Ins. Co., 15 Serg, 425. So, it is a " person” within the & R. (Pa.) 173. That the right of a meaning of statutes relating to the assessment and collection of taxes.
conveying land, is attachable, — see People v. Utica Ing. Co., 15 Johns.
Wright v. Douglass, 2 N. Y. 373. 8. c. 8 Am. Dec. 243. • Ante, & 1071, et seq.; $ 4471, et seq.
(N. Y.) 358, 382;
dispose of any part of them.”i If, therefore, an attachment is sued out in a proceeding in which the stockholders are made parties, but the corporation not, and is levied upon the effects of the corporation, no lien is acquired by virtue of the levy."
8 7792. Grounds of Attachment against Corporations.Such being the principle upon which corporations are subject to the attachment laws, the grounds of attachment against them will be the same as against individuals, unless the statute governing the remedy makes a distinction. To illustrate, in Arkansas an attachment will lie against a corporation which has shipped out of the State a material part of its property without leaving enough therein to pay its debts. Iu Ohio, according to a decision of the State Circuit Court, the property of a corporation may be attached on the ground of intent to defraud creditors, where it has been placed in the hands of a receiver appointed by an order which is void because made before an order dissolving the corporation, especially after motion to vacate the attachment on the ground of such void appointment. To this statement there are exceptions, in the case of national banks, and perhaps in the case of other corporations which are not allowed to prefer their creditors.
8 7793. Lien of Attachments against Corporations. — Unless there is a statute, such as the late Federal bankruptcy act, dissolving attachments levied upon the property of corporations within a prescribed period before their assets pass into the hands of an assignee, receiver, or other trustee for the purpose of a general distribution among their creditors, the attaching creditor will acquire, by virtue of his levy, the same lien upon the assets levied upon, and with it the same right of preference, which he would acquire if his debtor were
1 Williamson v. Smoot, 7 Mart. (La.) 31 ; 8. C. 12 Am. Dec. 494 ; citing Civ. Code La., art. 11.
: Lillard v. Porter, 2 Head (Tenn.), 177.
a natural person. Nor will the subsequent appointment of a receiver, or other official liquidator, divest this lien.' Nor does the operation of the doctrine that the assets of a corporation are a trust fund for its creditors change this rule, even in a case where, at the time when the creditor sued out his attachment, he knew that the corporation was generally insolvent.' This is more especially true where the proceeding for a general liquidation takes place in a foreign jurisdiction.'
§ 7794. Attachments not Leviable after Appointment of Receiver. — But after the property of the corporation has passed into the hands of a domestic receiver, assignee, or other trustee, official or voluntary, under a valid appointment, for the purpose of a general liquidation and ratable distribution among its creditors, then it cannot be attached; for one creditor will not be allowed, by this process, to get an advantage over other creditors while the property is thus undergoing administration for the benefit of all; and, besides, in some cases, as in that of a statutory receiver, the legal title may have passed out of the corporation and into the receiver, assignee, or other trustee;' and moreover the property is in custodia legis;o and in some jurisdictions the comity of States has ex
Breene v. Merchants' & Mech. Illinois to reach property held by it. Bank, 11 Colo. 97; 8. c. 17 Pac. Rep. City Ins. Co. v. Commercial Bank, 68 280; Hibernia Nat. Bank v. Lacombe, Ill. 348. The Illinois court reasoned 84 N. Y. 367; 8. c. 38 Am. Rep. 518; that even if the bank had forfeited White &c. Man. Co.v. Pettes Import- its charter under the laws of Rhode ing Co., 30 Fed. Rep. 864.
Island, the obligation of its contracts White &c. Man. Co. v. Pettes survived, and its property, not in the Importing Co., 30 Fed. Rep. 864. hands of a bona fide purchaser, might
When, therefore, real estate, sit- be subjected to the payment of its nated in the State of Illinois, belong. debts, by suit commenced by attaching to a banking corporation of the ment, there being nothing in the State of Rhode Island, was attached comity existing between States renby a creditor of the corporation, it dering it improper on the ground was held that a decree of a court in that by local laws its effects are in Rhode Island, finding the bank in- the hands of a receiver. City Ins. solvent, appointing & receiver, and Co. v. Commercial Bank, 68 III. 348. restraining it from further transact- • Ante, $ 6898. ing business, afforded no ground for o Wiswall 0. Sampson, 14 How. quashing the writ of attachment, as (U. S.) 52; Edwards v. Norton, 55 the bank was liable to be sued in Tex. 405, 410; Hackley v. Swigert, 5