Schaake v. Eagle Automatic Can Co.

This cause was originally submitted and decided in Department. *Page 474 The opinion then filed contains a very full statement of the case and disposes of most of the points discussed by counsel. We adhere to the conclusions there announced, and readopt that opinion, except in so far as they are modified by what is here said. We were in error in holding that the complaint was uncertain or ambiguous in the particulars pointed out in the opinion. Upon a more careful examination of its allegations, we perceive that they are to this effect: That 2,888 shares of the stock of the Pacific Sheet Metal Works, valued at $288,800, was the whole consideration given for all the property of the Eagle Automatic Can Company, and that $190,000 of this amount was given for machines, the cost price of which was $160,000. This presents no ambiguity or uncertainty, and there is no other ambiguity or uncertainty of which the defendants can complain. So far as there is any want of certainty in the complaint, it exists only in relation to matters peculiarly within the knowledge of the defendants. The only fault of the complaint pointed out by the special demurrers is, that certain natural persons — stockholders of the Eagle Automatic Can Company — are joined as defendants, against whom there appears to be no cause of action. The plaintiff has a cause of action against the Eagle Automatic Can Company for an accounting. The stockholders of that company and others to whom the Pacific Sheet Metal Works issued stock in exchange for the property transferred by the Eagle Automatic Can Company are proper parties to this action, because they have received the fund to which the plaintiff must look, and to which he has a right to resort, for the satisfaction of what may be found to be due him from the Eagle Automatic Can Company. They are for that reason interested in the accounting, and ought to be bound by it. The Pacifc Sheet Metal Works, for similar reasons, is a proper party. It connived at the diversion from the treasury of the Eagle Automatic Can Company of the fund applicable to the payment of plaintiff's claim, and if he cannot secure payment from those who received the consideration for the sale of the Eagle Automatic Can Company's property, the Pacific Sheet Metal Works ought to make it good. So far as these parties are concerned, therefore, we hold *Page 475 that there was no misjoinder. But as to those stockholders of the Eagle Automatic Can Company who are not alleged to have received any of the stock issued by the Pacific Sheet Metal Works, we think no cause of action is stated, and their demurrer on that ground should have been sustained. This, however, did not justify the entry of a final judgment in favor of all the defendants. All that it authorized was a dismissal of those defendants, with a judgment for their costs, with leave to the remaining defendants to answer to the merits. The judgment of the court, therefore, is not sustained by the record. It is accordingly reversed and the cause remanded, with directions to the superior court to dismiss the action as to those stockholders of the Eagle Automatic Can Company who are not alleged to have received any of the stock issued by the Pacific Sheet Metal Works, and with leave to the remaining defendants to answer to the merits. The following is the opinion rendered in Department Two, February 20, 1901: —