City of Fort Scott v. Schulenberg

The opinion of the court was delivered by Brewer, J.: [656] 1'powe?s“non655 This was an action to foreclose a mortgage, and the defense relied on, and raised by a demurrer to the petition, was the statute of limitations. The facts are these: On August 16, 1869, an agricultui’al society of Bourbon county, a corporation organized under the laws of this state, was the owner of the premises, and upon that day executed a bond and mortgage to the plaintiff. By its terms, this bond became due whenever the society ceased- to use the premises as a fair ground. On May 7, 1872, the premises ceased to be so used, having been that day taken possession of by C. W. Goodlander, a purchaser at a sheriff’s sale. Good-lander held possession until October 18, 1876, when the defendants took possession, having purchased them upon an execution against him. This action was commenced March 7, 1878, five years and ten months after the cause of action accrued. Was it barred by the statute of limitations? Prima facie, it was; for five years bar an action upon a written contract. To avoid this, three matters are presented. First, it is said that, in contemplation of law, the agricultural society (the obligor and mortgagor) concealed itself after May 7, 1873, so that no service of summons could be made upon it, and that, therefore,- the time of such concealment must be deducted from the running of the statute. The allegations of the petition in respect to this concealment are quite lengthy, but are in substance, that the officers and members of t.he society renounced all connection with it, or its business or affiairs, and refused to be considered as officers or members; that no meetings were had or officers elected; that nothing was done or attempted to be done in respect to the society or its business, or toward keeping up its organization, or in recognition of its existence; and that there were [656] no officers upon whom a summons could be served. In short, the picture is presented of a corporation whose charter has not expired by lapse of time or been vacated by judicial decree, ceasing all corporate action. Was this non-user of corporate franchises a concealment within the scope of the statute of limitations? We think not. .It may be doubted whether a corporation can ever be said to abscond or conceal itself, but certainly the mere failure to hold meetings, elect officers or exercise corporate powers, in short, the mere non-user of all the corporate franchises, is not a concealment. It would be more like concealment if the corporation attempted- to hold meetings, elect officers and transact corporate business, without letting the public know when or where the meetings were held, who were the officers, and where the corporate business was transacted. There is more of concealment in secret action than in non-action. An omission to keep the corporation in active life is not a concealment of the corporation. Again, while it- is alleged that there were no officers of the corporation upon whom a summons could be served, yet it is admitted that until May 7, 1872, the corporation had its complement of officers. To avoid the effect of this admission, it is alleged that their terms of office expired before May 7, 1873, and that long before this they had refused to serve as such officers; that they were not reelected, nor were any successors elected. It would seem, from this admission, that there was no time at which service of a summons could not have been made upon the corporation. 2 once when not vacated. In the absence, of an election of a successor or the acceptance of a resignation, the president then incumbent continued ' remain such> and service upon him at any time would have brought the company into court. The society was organized as a corporation under the corporation act of 1866. It is provided by this act that failure to elect officers at the time appointed by the by-laws shall' not operate to dissolve the corporation, but that they may be elected at any other time. (Act of 1866, p. 124, §§7 and 16.) [657] The provision in reference to the appointment of a president' is as follows: “An annual election shall be held for directors at such time and place as the stockholders, at their first meeting, may determine, or as the by-laws of the corporation may. require; and the directors chosen at any election shall, so soon thereafter as may be convenient, choose one of their number president, and shall appoint a secretary and a treasurer of the corporation,” etc. (Sec. 5,. p. 126.) Nowhere in the statute is the term of the president limited to any fixed time, and the provision that he shall be chosen by the directors as soon after their election “as may be convenient,” is directory only, and far too indefinite to fix a specific term. As the corporation is not dissolved by a failure to' elect officers, and as no specific limit is fixed to the president’s term of office, it obviously results that he remains president until a successor is chosen. It is not true-that an office for which there may be an annual election, necessarily becomes vacant by failure to elect at the time appointed. In Angelí & Ames on Corporations, §143, it is said: “Without doubt a statute or a by-law, or even an appointment, may be so restrictive as to terminate an annual office at the end of the year; but an election for a year has never been considered one of this description. A clause in a charter which directed thát aider-men should be chosen annually, was held to be only directory, and not to determine the office at the end of the year after election; but, that the person legally elected and sworn into office should continue until removal.” (McCall v. Byram Manf. Co., 6 Conn. 428; Foot v. Prowse, 1 Stra. 625; Pender v. Rex, 2 Brown, P. C. 294; Weir v. Bush, 4 Litt., Ky., 433; Queen v. Durham, 10 Mod. Rep. 147; People v. Runkel, 9 Johns. 147; Slee v. Bloom, 5 Johns. Ch. 366.) [658] uations, when not suspended. [657] Again, it is alleged that during the years 1875 and 1876, the G. W. Goodlander who purchased and had possession of the premises was mayor of Fort Scott. Hence, because he was a necessary party defendant and the chief executive officer of [658] the city, plaintiff’s counsel contends that the running of the-statute must be suspended while such relation existed. It is nowhere alleged that he interfered to prevent suit, or that he took any action whatever in the premises; but the claim is rested upon the single fact that he was mayor. The claim cannot be sustained. The mayor was not sole manager of the city s affairs. JLhe powers were-i i -i M . vested in the mayor and council, lhe right to bring an action existed all the time. The mayor had no-power, and made no effort, to stay the suit. The question-might be different if the sole power to maintain action on the-part of the city was vested in the mayor. The cases of City of Oakland v. Carpentier, 13 Cal. 540, and Ryan v. L. A. & N. W. Rly. Co., 21 Kas. 365, might perhaps then be in point; but the present ease is neither within the letter nor the spirit of any of the exceptions named in the statute. Surely the courts would not be warranted in engrafting an exception and suspending the running of the statute in a case in which there-was in fact no power and no effort to prevent suit by any party interested adversely to the rights of the city. 4. Action on mortgage, The third point raised is, that the statute did not rua against these defendants because they have always been nonresidents. But the bond is the principal, and the- , -¶ • « -i , , ¶ , ii mortgage only incident thereto: and where action in the former is barred, it is also on the latter. (Watterson v. Kirkwood, 17 Kas. 9; Schmucker v. Sibert, 18 id. 176.) Upon the entire record we see no error, and the judgment-will be affirmed. All the Justices concurring.