Merchants' Bank v. Chandler

By the Court, Dixoisr, C. J. We held in the recent case of Cleveland v. The Marine Bank of Milwaukee and others, 17 Wis., 545, that the creditor of a bank might, without having obtained j udgment at law against the bank, resort to the equitable remedy provided by chap. 148, R. S., and might maintain an action in behalf of himself and all other creditors who might choose to become parties thereto, against the bank joint [437] ly with the stockholders, to reach and appropriate the assets of the bank aüd enforce the liability of the stockholders. If a creditor before judgment may maintain the action, it is difficult to perceive why a creditor after j udgment should be more restricted, or why his action should be dismissed because he has not docketed his judgment or issued execution against the real estate of the bank. There is nothing in the statute requiring either, and we think that the action is not in this respect analogous to the proceeding by creditor’s bill. As to the effect of the judgment against the bank, we incline to the opinion of the three judges in Belmont v. Coleman, 21 N. Y., 96, that it is prima facie evidence of the indebtedness of the bank in an action against the stockholders. Such was clearly the opinion of the court in Slee v. Bloom, 20 Johns., 669, and Moss v. Oakley, 2 Hill, 265. It is not strictly res ad-judicata against the stockholders, but such strong evidence of the indebtedness that it can only be questioned on the ground of fraud or mistake. This we think more in harmony with our own decisions as to the nature and extent of the liability of the stockholders, than the doctrine of the intermediate case of Moss v. McCullough, 5 Hill, 131, in which it was held that the judgment against the corporation was no evidence at all against the stockholders. That case was decided on the ground that the stockholders were mere sureties or guarantors of the debts of the company. "We have held, on the contrary, that the liability of the stockholders is primary and absolute, and attaches the moment the debt is contracted by the bank — that it is a liability of all the stockholders to all the creditors, on the principle of copartnership, the stockholders standing on substantially the same footing as though they were partners or an unincorporated association, save only that the responsibilty of each is limited to a sum equal to his share or shares of stock; and that subject to this limitation they are answerable as original and principal debtors, their liability more nearly resembling [438] tlaat of copartners than any other with which it can be compared. Coleman v. White, 14 Wis., 701. The stockholders, then, being primarily and jointly liable with the bank, there is much reason for holding that the judgment against the bank is evidence of the amount to be recovered in a subsequent action against them. We do not see that there is any defect of parties defendant. All the persons owning stock before the alleged transfer of stock to the bank itself are made parties. If, as claimed by the counsel for the appellant, the transfer of the stock from the individual shareholders to the bank is fraudulent and void, still there is no defect of parties. The original stockholders are before the court, and if those who have not transferred wish ■ to attack the transfer of those who have, it is a matter of defense to be taken by answer and not by demurrer for defect of parties. Order affirmed.