author: NORRIS. J.

text:
    CONTEMPT — MUNICIPAL CORPORATIONS.
    [Coshocton (5th) Court of Appeals,
    July, 1912.]
    Shields, Powell and Norris, JJ.
    (Judge Norris of the seventh district sitting in place of Judge Voorhees.)

      State ex rel. John R. Maple v. Gail S. Hamilton, Mayor.
    1. Officials not Parties to Original Action to Restore Police Official to Office not Punishable for Contempt for Refusal to Pay Salary During Suspension.
    The relator was removed from his office of chief of police by the mayor of the city. In a mandamus proceeding brought for that purpose by the relator, the mayor was ordered to restore him to his office of chief of police in the city with all the privileges, prerogatives and emoluments thereunto belonging, which order was finally affirmed by the Supreme Court. The mayor restored the relator to his office of chief of police. Subsequently the relator, not having been paid his salary and fees during the period covered by his suspension, filed a motion in the circuit court asking for a rule against the mayor, director of public safety, city auditor, and treasurer of such city, requiring them and each of them to show cause why they should not be attached for contempt for not paying the relator his salary and fees during such period of suspension. Held: That the director of public safety, city auditor and city treasurer, not having been parties to the original action and proceeding in which the order was made, can not be attached for contempt in disobeying an order made therein, and that the mayor, having restored the relator to his office, had performed all the duty devolving upon him.
    2. Members of Bar Named to Prosecute Such City Officials not Entitled to Attorney Fees.
    In a subsequent hearing, it appearing that on the application of the relator, three members of the bar were named by the court to prosecute such contempt proceeding against the above named city officials, and the question was presented as to whether or not the three attorneys named should be allowed and recover as costs in the case fees either against the defendant or the city. Held: That the case is not one in which attorney fees as costs can be allowed;
    [Syllabus by the court.]

      Bert F. Voorhees. for relator.

      John J. Adams, city solicitor, for respondent.

      Affirmed, no op.. State v. Cassingham, 88 O. S. 603.

   NORRIS. J.

On July 3, 1909, the mayor of Coshocton issued an ordier removing John R. Maple, the relator, from his office of chief of police of the city of Coshocton, and appointed another in his place.

The relator, on August 7, 1909, filed a petition in the court of common pleas, asking for an order that he be restored to said office of chief of police with all the privileges, prerogatives and emoluments thereunto belonging. The court of common pleas ordered the relator restored to said office, and on appeal the same judgment was rendered in the circuit court, and the judgment of the circuit was affirmed, no op., Hamilton v. State, 85 Ohio St. 469, and the case remanded to the Circuit court for execution.

After the decision of the Supreme Court, to-wit, on January 1, 1912, the mayor of Coshocton restored the relator to his office and he has since that time been holding the office and acting as chief of police. Since January first the relator has been tendered his salary as such chief of police, but has not been paid or tendered his salary as such, chief of police during the period from-August 1, 1909, to January 1, 1912.

On May 21, 1912, the relator filed a motion in this court asking for an order against George W. Cassingham, mayor, R. F. Timmons, director of public safety, Evan 0. Evans, city auditor, and Harold Hershman, treasurer of the city of Coshoc-ton, requiring them and each of them, to show cause why they should not be attached for contempt for disobeying the peremptory writ of mandamus issued in this case by this court in the following particulars as specified:

“1st. For not complying with the order of the court contained in the alias peremptory writ of mandamus heretofore issued in this case May 21, 1912.
“2d. For not restoring to the said John R. Maple as chief of police of the city of Coshocton, Ohio, all the privileges, prerogatives and emoluments incident thereunto belonging, and all property and rights of which he was deprived and disposed of by réason of the order and wrongful acts aforesaid, as they were commanded to do, by the alias peremptory writ of mandamus issued herein May 21, 1912.
“Said emoluments and prerogatives incident to the office of the chief of police of the city of Coshocton, Ohio, consists of his salary of $840 per year payable semi-monthly, from August 1, 1909, to May 15, 1912, amounting to $2,345, and fees of the chief of police of the city of Coshocton, Ohio, in state cases prosecuted and convictions had before the mayor of the city of Coshocton, Ohio, from August 1, 1909, to May 23, 1912, the amount of which fees is unknown to relator, not having access to the records of the said mayor of the city of Coshocton, Ohio, but the amount is claimed and alleged as a fact to be $750.”

It is further stated that the relator has been tendered a warrant for his salary as chief of police from January 1, 1912, to date, which was refused by the relator. An affidavit of the relator was filed in support of the motion stating, among other things, that he gave each of the defendants on May 21, 1912, written notice of the issuance of the writ of mandamus on May 21, 1912.

Cassingham, the mayor, answered that he has fully restored the relator to his office and he has since been discharging the duties thereof, and he further answers with reference to the first claim by the relator, which is not neeessai’y now to consider.

The director of public safety answers, stating that he was never a party to any action in the circuit court or any other court, in which a writ of mandamus was issued directing him to do anything with reference to restoring John E. Maple to his office or the emoluments thereof, and further that it is no part of his duty to restore the chief of police, and further answered that another, during the interim, was acting as chief of police and was paid the salary, etc.

The city auditor makes substantially the same answer, so far as it is necessary to consider the same.

The city treasurer moves to dismiss the proceedings because the same do not specify any facts showing any disobedience or resistance of an order of the court, and further does not show that be has refused to pay any warrant issued in behalf of the relator, and that he has no right to pay the salary of the chief of police except on warrant.

Considerable testimony was offered on both sides in the case, much of which it is not necessary now to consider. The director of public safety, the city auditor and city treasurer were not parties to the proceeding and were never made parties thereto except by the filing of the motion and affidavit charging them with contempt of court in not obeying the mandate and decree of the court.

The relator’s claim is that they did not, each in his particular office, perform the necessary acts to pay the relator his salary as chief of police while this action was pending in the courts, and while another was acting in his stead, and also pay him certain fees which he claims he was entitled to.

A legal question is raised by the answers which we do not consider it necessary for us now to pass upon, as it is not properly before us, and that is whether or not the relator is entitled to a salary during the time he was unlawfully kept from his office and another was acting in his stead and was paid the salary. We do not think this question was settled by any judgment rendered in this case up to this time.

This court is asked to punish certain officers of the city for contempt in disobeying its order, but the order was only directed to the mayor, ordering him to restore the relator to his office with the emoluments, etc. The mayor has done all that he can do in carrying out that order. He has restored the relator to his office. He has nothing to do with paying him his salary or his fees. The proceeding was brought only against the mayor. No other officer was named. No other officer was served with any order in this case. The only notice of any kind that the other defendants had in this case is a notice of the order which relator claims he served on May 21, 1912.

What was the order? To restore the relator to his office with emoluments, prerogatives and perquisites. The director, auditor and treasurer, had nothing to do with restoring him to his office. What were the emoluments, etc., to which relator is entitled? Relator does not even himself know to what fee he makes claim, and it would seem from the authorities cited that the law is no,t entirely clear under the facts in this case as to what salary the relator is entitled. The eity solicitor contends, and doubtless advised the other officers, that relator was not entitled to the salary during the time he was not performing the duties of his office.

Were these officers of the city to decide this question at their own peril, and if they decided against the relator and were wrong, to be punished therefor, as being in contempt of the court?

We think first that the order was too indefinite, as held:

“In order that a commitment may issue under any circumstances, as already stated, the precise thing to be done by the party proceeded against, must be stated in the judgment or order.” Ross v. Butler, 57 Hun. 110 [10 N. Y. Supp. 444]; Pritett v. Pressley, 62 Ind. 491.

Again, the order was ’never served upon the director, auditor and treasurer. It is claimed they were given notice of such order.

“Before a party can be brought into contempt for not complying with an order of court, such order must be served on him.” Hennessy v. Nicol, 105 Cal. 138 [38 Pac. Rep. 649]; Perrine v. Bank, 53 N. J. Eq. 211 [33 Atl. Rep. 404]; Tebo v. Baker, 77 N. Y. 33; Willand, Ex parte, 73 E. C. L. 544.

But can these officers be punished for not obeying an order ■issued in a case to which they were not parties ? Each of these parties had the right to litigate the question as to relator’s salary and fees. This is not an action brought against the eity which might bind the officers of such municipal corporation. It was merely an action against the mayor of the eity and the order was directed to him. None of the other parties sought to be punished have had any day in court except to answer this charge made against them in this court.

We think the case of Second Nat. Bank v. Becker, 62 Ohio St. 289 [56 N. E. Rep. 1025; 51 L. R. A. 860], decisive of this question, if authority we need. Quoting from the concluding portion of the opinion in that case:

“As has already been noticed, they were not parties to the original action against Becker, nor before the court, either by process or appearance, when the order was entered in that action requiring them to redeliver the attached property to the sheriff or pay the judgment then rendered in favor of the bank against Becker. The court was therefore without jurisdiction to make the order that was then entered against them. That order was the foundation of the subsequent proceeding for contempt. In that proceeding they were only notified to show cause why they had not redelivered the property in compliance with the previous order. No suit was brought against them on the undertaking, nor opportunity given them to plead or make defense to any claim of liability thereon, or be heard according to the usual course of legal proceedings. It can scarcely be claimed that this was due process of law. ’ ’

"VVhat is the foundation of this proceeding for contempt? it is an order issued to the mayor only. The other parties have never had an opportunity to be heard as to any defense they might have against the claim made by relator. We do not think that to now hold them guilty of contempt would be due process of law. The mayor, having complied with the order so far as he is able, is not guilty of contempt. The motion of the relator must therefore be denied and the rule discharged.

The case was further heard on the application of relator for an allowance of attorneys’ fees as costs in the case. Upon the application of relator three members of the bar were named by the court to prosecute the proceedings for contempt.

The question arises as to whether or not the three attorneys appointed should- recover, as costs in the case, attorneys’ fees either against the defendants or the city of Coshocton. The city of Coshocton was never a party to any of the proceedings. It is claimed that inasmuch as this is a case in which the authority and dignity of the court itself was involved, that attorneys’ fees may be collected of the city notwithstanding the judgment in this case.

We think some confusion has arisen with reference to contempt proceedings. There are two classes of what are denominated acts of contempt. They are defined in 9 Cyc. as follows:

“A criminal contempt is conduct that is directed against the dignity and authority of the court.”

This is the contempt provided for in Sec. 12136 G. C., and was the contempt charge in the case of Myers v. State, 46 Ohio St. 473 [22 N. E. Rep. 43; 15 Am. St. Rep. 638], cited by counsel. In that case the court especially appointed counsel to prosecute the ease to protect its own dignity and authority in the administration of justice.

“Civil contempt exists in failing to do something ordered to be done by a court in a civil action for the benefit of the opposing party therein.”

That is provided for in Sec. 12137 G. C., where it says: ‘ ‘ Certain acts may be punished as for the contempt. ’ ’

That is the statute invoked in State v. Crites, 48 Ohio St. 460 [28 N. E. Rep. 178]. The case at bar comes under that statute and is of that class of cases. The complaint is that the defendants failed to do something for the benefit of the relator, i. e., failed to pay any salary and fee. Again, in 9 Cyc. 35:

“Proceedings for contempt to enforce a civil remedy and to protect the right of parties litigant should be instituted by the aggrieved parties, or those who succeed to their rights, or some one who has a pecuniary interest in the right to be protected. If, however, the purpose of the proceeding is to vindicate the authority of the court and is criminal in its nature, the state is the real prosecutor.”

The learned editor cites numerous authorities in support of the above quoted text. Among others, Lester v. People, 150 Ill. 408 [23 N. E. Rep. 387; 37 N. E. Rep. 1004; 41 Am. St. Rep. 375]. Secor v. Singleton, 35 Fed. Rep. 376; Latimer v. Barmor, 81 Mich. 592 [46 N. W. Rep. 1].

In People v. Compton, 1 Duer. (N. Y.) 512, it is stated that a solid and obvious distinction exists between contempt cases strictly and those acts denominated contempts, which are punished as such only for the parpóse of enforcing a civil remedy. To the same effect is Secor v. Singleton, 35 Fed. Rep. 376:

“It would seem to follow that an injunction obtained to protect merely a private right is so far within the control of the party obtaining it, and is so far a matter of individual concern, that only those persons who have a present interest in the right to be protected can be heard to complain of its violation."

We can find no authority authorizing the recovery of attorneys’ fees in this kind of a case. The policy of this state has been generally against the recovery of attorneys’ fees as a part of the judgment or costs. In Coe v. Railway, 10 Ohio St. 372 [75 Am. Dec. 518], pages 409, 410, the court says:

“However desirable and just it may appear, in particular cases, to charge upon the defendant or his property, the fees of the counsel who represent the plaintiff, such is not the policy of this state. Even the small docket fees once allowed, were abolished by the legislature. We know of no rule or principle which will entitle us to deviate from that policy in this ease.’’ See Hocking Valley Coal Co. v. Rosser, 53 Ohio St. 12 [41 N. E. Rep. 263; 29 L. R. A. 386; 53 Am. St. Rep. 622]; Levans v. Bank, 50 Ohio St. 591 [34 N. E. Rep. 1089].

The statute on the subject found in the following sections of the code: Sec. 11624 G. C., costs allowed to plaintiff when he recovers the money, judgment or specific real or personal property; Sec. 11626, in certain cases costs are allowed the the defendant: Sec. 11628 provides that other cases costs may be allowed in such manner as 1 ‘ right and equitable. ’ ’ such manner as “right and equitable."

What is “right and equitable" in a mandamus case? In Sec. 12298 G-. C., it is provided that a mandamus case where a judgment for defendant, all costs shall be allowed against the relator as above found. This is a proceeding in the original case which was a mandamus case. The defendants were required to show cause in that ease wrhy they should, not be punished as for contempt. The court has found that they were not guilty and has ordered them discharged. It seems to us that tbe conclusion is irresistible that the relator should pay the costs, and it is so ordered.

The late case of Brundige v Ashley, 62 Ohio St. 526 [57 N. E. Rep. 226], is a much stronger case for the allowance of attorneys’ fees than this, yet such allowance was denied by the Supreme Court. The only eases in which attorneys’ fees can be asked as costs in this state are in partition cases as provided by statute and in certain, trust eases where all parties have a common interest in the trust fund. These cases are well stated in the case of Hopple v. Hopple, 14 Dec. 285 (4 N. S. 255), of which the case of Olds v. Tucker, 35 Ohio St. 581, and Mason v. Alexander, 44 Ohio St. 318, 337 [7 N. E. Rep. 435], are examples. How can the costs, including attorneys’ fees, be charged against the city in this ease anyway? It never was a party to either of the proceedings.

Shields and Powell, JJ., concur.


source: Caselaw Access Project

author: HOUCK, J.

license: Public Domain

text:
    EJECTMENT — MORTGAGES.
    [Stark (5th) Court of Appeals,
    January Term, 1916.]
    Ferneding, Powell and Houck, JJ.
    Isaac Stripe v. National Fireproofing Co.
    (Judge Ferneding of the 2nd district sitting in place of Judge Shields.)
    1. Jurisdiction In Foreclosure under a Cross Petition, not Obtained without Service.
    Jurisdiction to render judgment on a cross petition is not 'conferred by the service had on the petition praying for foreclosure of a mortgage, where the cross petition was not filed for several months after the entering of a decree of sale on the petition, and did not ask for the sale of the same land as that described in the petition but had reference to a different parcel of land, and the relief sought was not the same hut of a different nature, and the codefendant whom it is sought to hold under the service upon the petition did not enter his appearance under the cross petition.
    2, Rights of Mortgagor and Mortgagee After Condition Broken in Ejectment.
    But a suit in ejectment does not lie upon the petition of a mortgagor, or his heirs and devisees or supposed successors in title, where the condition of the mortgage has been broken: from which it follows that the defective service in the instant case is without avail to the plaintiff who claims title through the mortgagor.
    Error.

      J. W. Craine and J. W. Jeffers, for plaintiff in error.

      Pomerene, Ambler & Pomerene and Krat&ch & Maier, for defendant in error.
   HOUCK, J.

This is an error proceeding in which it is sought to reverse the judgment of the common pleas court of this county. The parties stand here in the same relation to each other as in the court below. The action was one in judgment, and a jury being waived in the court below was submitted to the court on the petition of the plaintiff and the first defense in the second amended answer of the defendant, the National Fireproofing Company, and the amended reply thereto, and an agreed statement of facts. The court below found for the defendant and error is now prosecuted to this court seeking a reversal of the judgment below. The facts necessary for a proper determination of this controversy obtained from the agreed statement of facts are as follows:

“John Stripe was the owner of the northwest quarter of Section No. 31, Township No. 12, Range No. 8, Stark county, Ohio. On June 1, 1864, to secure certain notes John Stripe .executed and delivered to Daniel J. Wise a mortgage on the south half of said northwest quarter. Later Daniel J. Wise sold and transferred his notes and mortgages to John H. Wise. John H. Wise died, and these notes and mortgages came into the possession of Oliver P. Shanafelt as his administrator. On April 7, 1877, John Stripe and wife, for the purpose of securing nine promissory notes, executed and delivered to Hiram Stripe a mortgage on the entire northwest quarter, excepting I.33 acres. This mortgage was the second mortgage on the south half and the first mortgage on the north half of said northwest quarter. On the eighteenth day of April 1878, Hiram Stripe transferred his notes and mortgage to Hiram R. Wise. On he fifteenth day of March, 1878, John Stripe and .wife, to secure certain notes, executed and delivered to John Miller a mortgage on the entire northwest quarter, excepting said 1.35 acres, which mortgage was the third mortgage on the south half and the second mortgage on the north half of said real estate.
“Oliver P. Shanafelt, as administrator, on the thirteenth day of May, 1884, commenced an action to foreclose his mortgage on the south half of said northwest quarter, making John Stripe, Hiram R. Wise, John Miller, et al, defendants with summons excepting John Miller. John Stripe having filed an answer to the petition of Oliver P. Shanafelt, as administrator, said administrator having filed a reply to said answer, the cause eame on for hearing on said petition, answer and reply, and on the second day of January; 1885, a decree was rendered in favor of the plaintiff, Oliver P. Shanafelt, as such administrator. At the time of this decree, which was January 2, 1885, Hiram B. Wise had not filed an answer or cross petition in this case, although the case was started May 13, 1884, and Hiram R. Wise was duly served with summons. On September 11, 1885, being eight months and nine days after the trial and decree entered in favor of the plaintiff, Oliver P. Shanafelt, Hiram R. Wise filed bis cross petition praying to have his mortgage foreclosed not only on the south half but on the north half of said northwest quarter. No summons was issued under this cross petition, nor did John Stripe enter his appearance. On March 1, 1886, the south half of said northwest quarter was sold under the decree rendered in favor of Oliver P. Shanafelt, administrator, and on March 3, 1886, said decree was confirmed and deed ordered, the purchaser being Hiram R. Wise. On March 1, 1886, Hiram R. Wise obtained a judgment and decree under his said cross petition. On August 17, 1891, Hiram R. Wise assigned and transferred whatever interest he had in his decree to George W. Crouse and on December 14, 1895, the north half of said northwest quarter -was sold under the Hiram R. Wise decree to George W. Crouse, and on December 16, 1895, the sale was confirmed by the court and said Crouse entered into possession of said premises and continued thus until he sold same to the defendant, the National Fireproofing Company, which was in the actual possession of same at the commencement of the suit in ejectment. That John Stripe on November 16, 1892, executed his last will and testament in which he attempted to devise the real estate in question to certain heirs, and the plaintiff now claims title thereto by said devise and certain deeds conveying the same to him. That said John Stripe departed this life on July 18, 1894, and at said time was in the actual possession of the real estate in question.”

We find from the facts in this case but two questions are presented for determination by the court, and that they are decisive of this controversy. The first question is, Did the court have jurisdiction over the person of John Stripe in face of the fact that no summons was served on him and there being no waiver of service of summons by him on the cross petition of Hiram R. Wise? The facts clearly show that the petition upon which service was had did not include the real estate sought to be sold under and by the cross petition of Hiram R. Wise, but embraced an entirely different parcel of land, and the relief sought in the cross petition was of a different nature and not the same, and therefore certainly could not bind John Stripe when he had not been served with summons and had not otherwise entered his appearance with reference to the relief sought in the cross petition.

We feel that our Supreme Court has finally determined this question in the case of Southward v. Jamison, 66 Ohio St. 290 [64 N. E. Rep. 185], the first syllabus being as follows:

‘ ‘ So long as a cross petition in an action is strictly confined to matters in question in the petition, the summons issued on the petition questioned would be sufficient notice to sustain a judgment rendered on the cross petition; but when the cross petition sets up mattei’S which are not drawn in question in the petition, and seeks affirmative relief against á codefendant of a nature different from that sought in the petition, a summons to the party to be charged issued on the petition will not confer jurisdiction to render judgment on the cross petition, especially when the cross petition is filed after the defendant thereto is in default for answer to the petition, and a summons on the cross petition in such ease is necessary.”

But we do not think this question is decisive of the real problem to be solved in the ease at bar. We hold that it must be determined upon the rights of mortgagor and mortgagee after conditions broken, which brings us to the second question in this inquiry. What are the legal rights of the mortgagor and mortgagee of real property after condition in the mortgage is broken? Was the remedy of plaintiff, if he had any, ejectment? We think not. Section 11903 Gr. C. provides:

“In an action for the recovery of real property it shall be sufficient if the plaintiff sets up in his petition that he has a legal estate therein and is entitled to the possession thereof, describing it with certainty as to identity, and that the defendant unlawfully keeps him out of the possession.” * * *

The plaintiff must allege and prove that he has a legal estate in the real estate of which he seeks to gain possession. Did Isaac Stripe have a legal estate in the real estate question at the time of the commencement of this suit? Certainly not. He had the title, if any, that John Stripe had in same, and what title did John Stripe have at the time of his disease? Simply the equity of redemption growing out of his rights as mortgagor after the condition in the mortgage had been broken. What are the rights of a mortgagor in the mortgaged premises after the condition in the mortgage is broken?

“A mortgage on real estate is regarded in equity as a mere security for the performance of its condition of defeasance and where that condition is a payment of a debt, the security is regarded as an incident of the debt.” Swartz v. Leist, 13 Ohio St. 419.
“The mortgage in equity regarded as a mere security for the debt, the legal title to the mortgaged premises remains in the mortgagor as against all the world, except the mortgagee, and also as against him until condition broken, but after condition broken the legal title as between mortgagor and mortgagee is vested in the mortgagee.” Allen v. Everly, 24 Ohio St. 97; Hibis v. Insurance Co. 40 Ohio St. 543, 559; Martin v. Alter, 42 Ohio St. 94.
“In. our own state the right to foreclose a mortgage after condition broken either by a strict foreclosure or by a foreclosure and sale of the mortgaged property, continued down to the adoption of the code of civil procedure in 1853. By Sec. 374 of the code (which is now Sec. 11588 G. C.) it is provided that: ‘When the mortgage is foreclosed, a sale of the premises shall be ordered.’ This prohibits a strict foreclosure in this state, and now, after condition broken if the mortgagee appeals to the courts to enforce his mortgage he must elect between two remedies. He may sue for the recovery of the possession of the land in a real action in the nature of ejectment, using his mortgage to prove his title; or, he may sue for a foreclosure of his mortgage and a sale of the mortgaged premises. After condition broken, the title is vested in the mortgagee as beween him and the mortgagor, and as the right of the mortgagee to recover the possession of the land by ejectment always existed at. common law and has not been taken away by statute, it still exists in this state.'' Kerr v. Lydecher, 51 Ohio St. 249 250.

Applying the above principles of law to the conceded facts in this case we can reach but one conclusion, and that is that the judgment of the common pleas court is right and should be affirmed.

Judgment affirmed'.

Powelf and Ferneding, JJ., concur.


author: NIMAN, J.

text:
    PENSIONS.
    [Cuyahoga (8th) Circuit Court,
    June 3, 1912.]
    Marvin, Winch and. Niman, JJ.
    State ex rel. Rothgery v. Firemen’s Pension Fund (Tr.)
    Pensioned Fireman Can Not be Discharged for Offense Before Retirement.
    A fireman who has been retired and regularly put upon the pension roll in accordance with the laws of the. state and the regulations of the trustees of the firemen’s pension fund, can not thereafter be discharged from the fire department fo.r violating one of its rules before his retirement, and his pension be reduced.
    Error.

      Geier, Farrell & Edwards, for plaintiff in error.

      E. K. Wilcox, for defendants in error.
   NIMAN, J.

This is an action brought in this court by the relator to secure a writ of mandamus to compel the board of trustees of the Firemen’s Pension Fund of the city of Cleveland to authorize the payment to him of the sum of $2,895, with interest, claimed to have been unlawfully withheld from him from June 1, 1906, to April 1, 1912, and to authorize the payment to him from April 1, 1912, of a pension in the amount which he claims to be entitled to recover.

The board of trustees of the Firemen’s Pension Fund of the city of Cleveland exists under and by virtue of an enactment of the state legislature, which is now found in See. 4615 G. C. By Sec. 4600 G. C., it is provided:

“In any municipal corporation, having a fire department supported in whole or in part at public expense,- the council by ordinance may declare the necessity for the establishment and maintenance of a firemen’s pension fund. Thereupon a board of trustees, who shall be known as ‘trustees of the firemen’s pension fund,’ shall be created, which shall consist of the director of public safety, and, in villages of the fire chief, and five other persons, members of such department. But upon petition of a majority of the members of the fire department, such director or fire chief may designate a less number than five to be elected trustees.”

By various other sections provision is made for the creation of a pension fund, and Sec. 461.2 G. C. proceeds:

"Such trustees shall make all rules and regulations for the distribution of the fund, including the qualifications of those to whom any portion of it shall be paid and the account thereof, but no rules or regulations shall be in force until approved by the director of public safety or the fire chief of the municipality, as the case may be. ’ ’

Under the authority conferred by the section last quoted, the board of trustees of the firemen’s pension fund of the city of Cleveland adopted certain rules and by-laws, a part of See. 3, which is as follows:

“Any member of such fire department who has been in the service of said paid fire department thirty years, the last twelve years consecutively, may, upon making written application to the person or persons in charge of the fire service of such city, retire at his own option without medical examination, and the board of trustees shall authorize the payment to such member, so retired, monthly from the pension fund, of a sum equal to eleven-sixteenths of his salary at the time of retirement.”

The relator became a member of the paid fire department of the city of Cleveland on October 11, 1871, and served continuously for more than thirty-three years. On April 21, 1905, he availed himself of the rule- quoted and asked to be relieved from active duty and to, have his name placed on the firemen’s pension roll. On June 1, 1905, due action having been taken, his name was placed upon the pension roll, and under the rule he received a pension monthly equal to eleven-sixteenths of his salary.

Subsequently, however, he was discharged from the fire department for violating one of the rules of the department before' Ms retirement. The board of trustees of the pension fund took such action that Ms name was placed upon the pension roll at a rate equal to six-sixteenths of Ms salary per month from the time of his .discharge on February 10, 1906, instead of eleven-sixteenths which he had received up to that time.

In taking this action the board claims to be sustained by that part of Sec. 3 of the rules and by-laws which provides:

“That any member who may be discharged .from the fire department after having served not less than eighteen consecutive years, shall be placed on the pension roll at six-sixteenths of his salary at the time of his discharge, provided such discharge is for any other offense than dishonesty, intoxication or a criminal act.”

We are, therefore, required to determine whether the board of trustees of the fireman’s pension fund had power to change the status of the relator as a beneficiary under the pension fund, after he had retired at his own option, and after his name had been placed upon the pension roll at the rate provided for one in his class.

Reference to the rule under wMch the r'elator retired, and had his name placed upon the roll at a rate equal to eleven-sixteenths of his salary, discloses a requirement that “the member so retired without special disability shall always receive the same amount of pension as when retired.”

If this part of the rule be given effect according to its clear terms, the rights- of the relator were fixed when his name first went upon the pension roll.

In the absence of this reqMrement of the rule, we tMnk that when the relator retired under the rules, and the payment of his pension was authorized and his name placed upon the pension roll, all questions affecting Ms status were determined, and the subsequent act of the board of trustees, based upon Ms discharge after retirement, was without authority, and could not affect his status as already fixed.

In People v. Greene, 181 N. Y. 308 [73 N. E. Rep. 1111], a question similar to that presented here was involved and it was there held, quoting from the syllabus:

“Whatever may be the nature or form of the charges which will prevent the retirement on a pension of a member of the police force of the city of New York, who is a veteran, has served twenty years and has made application therefore under Sec. 3555 of the charter (L. 1901, ch. 466) providing that he must be relieved if ‘there are no charges against him pending,’ an anonymous communication, containing no statement of an act, default or neglect upon his part which would constitute a breach of duty, although certain statements were made therein which by argument or inference might reflect upon him as a public officer, in the possession of the commissioner two weeks before the application for retirement was fixed and upon which no charges were formulated, can not be regarded as a charge ‘pending’; and the subsequent formulation of charges, his trial thereon and removal, can not affect his status as a retired member of the force.”

All the facts necessary to entitle the relator to retire at his own option, without medical examination, were present. Upon his exercise of the option given him, the mandatory language of the rule required the board of pension trustees to authorize the payment to him monthly from the pension fund of a sum equal to eleven-sixteenths of his salary at the time of retirement, “and he shall always receive the same amount of pension as when retired.”

There are sufficient funds to the credit of the pension fund to pay the relator the pension he is entitled to receive at the rate of eleven-sixteenths of his salary per month.

The powers and duties of the board of trustees of the pension fund with respect to the payment of the pension, to which the relator is now entitled, are purely ministerial. There is nothing calling for the exercise of discretion, or judgment upon the propriety of the thing to be done.

The writ of mandamus may issue as prayed for by the relator.

Marvin and Winch, JJ., concur.


text:
    BILLS, NOTES AND CHECKS.
    [Stark (5th) Court of Appeals,
    January Term, 1916.]
    Shields, Powell and Houck, JJ.
    John Bederman, et al. v. Otisville State Bank.
    Rule as to Liability to Purchaser for Value Before Maturity not Changed by Statute Having Reference to Qualified Endorsements.
    The gualified endorsement of a note “without recourse” simply precludes the endorsee from holding the endorser liable to him in the event the maker fails to pay the note, and the statute having reference to gualified endorsements in no way changes the well established principle of law that the purchaser of commercial paper for value before due, in the absence of fraud or knowledge of any infirmity in the instrument or defect in the title thereto, deprives the maker of any defense.
    [Syllabus by the court.]
    ERROR.

      Welty (6 Burt, for plaintiffs in error.

      McCarty & McClintoch, for defendant in error.
   HOUCK, J.

This is an error proceeding and comes into this court from - the common pleas court of Stark county.

In the court below judgment was rendered in favor of defendant in error, the plaintiff below in the sum of $896, with interest on $95 thereof from June 26, 1912, to May 4, 1914, making a total of $906.75. This judgment was based upon the verdict of a jury in that sum. The action below was based upon a promissory note in the sum of $800, dated June 22,1911, and payable September 1, 1912, and for interest on two other certain notes of even date therewith like amount, payable September 1, 1918, and September 1, 1914, respectively. The three notes in question were payable to Caulking & Augsbury, or order, and were signed by all of the plaintiffs in error, 'the defendants below.

The plaintiff below, defendant in error, claimed in its petition to be an innocent holder in due course, and as such exempt from any defenses which might have been set up against the original payees, alleging that it was the owner and holder of said notes, purchased before due and for a good and valuable consideration paid therefor. The defendants below, plaintiffs in error, in their answer denied that the bank was a holder in due course, and alleged fraud and want of consideration in the making of said notes. A reply was filed by the plaintiffs below denying all of the material allegations in the answer of the defendants.

A petition in error is filed in this court seeking a reversal of the judgment below. The plaintiffs in error seek a reversal, first, because they claim that one of the makers of the note, Harry Richey, was induced by the agent of the original payees of the note to sign the same by reason of fraudulent representations or statements made to him by said agent, and upon which statements he relied. It is claimed that the defendant, Richey, at the time he signed said note was induced to sign the same by statements made by the agent of the original payees,- that said agent stated to him that the paper that he was about to sign, and which afterwards proved to be the note in question, was a certificate of stock, and that he was unable to read the same by not having his spectacles with him, and that he relied upon the statements of said agen-t in the premises, and thereby was induced to sign the note in question.

Assuming that all of these statements are true, are they sufficient in law to release said Richey and his comakers from the payment of this notes We think that the facts here disclosed have fully'- been determined in the ease of DeCamp v. Hamma, 29 Ohio St. 472:

“Where one voluntarily signs a promissory note supposing it to be an obligation of a different character, but has full means of information in the premises and neglects to avail himself thereof, relying on the representations of another, he cannot set up such ignorance and mistake as a defense against an innocent holder for value before maturity. If, however, his signature was procured without negligence on his part, and through artifice or fraudulent representations, the rule is different, and the jury should be left under' appropriate instructions to determine these facts.”

Plaintiffs in error contend that the court below erred in giving certain requests before argument which were presented on behalf of the plaintiff below, the defendant in error. We have examined these requests, and we find that they are correct propositions of law applicable to the particular facts in the instant case, and therefore find no error in this particular.

Plaintiffs in error earnestly contend that the trial court committed prejudicial error in its refusal to charge the jury before argument as follows:

‘ ‘ If you find from the evidence that as between Caulkins & Augsbury and the defendants herein that said notes were wholly without consideration, and you find that the notes were transferred by said Caulkins & Augsbury to the plaintiff without recourse, then I will say to you that such instrument was a mere assignment of such interest as Caulkins & Augsbury had in and to said note or notes, and that if said notes were procured by said Caulkins & Augsbury from 'the several defendants wholly without consideration, then I will say to you as a matter of law your verdict should be for the defendants.”

Plaintiff in error takes the position that- this qualified endorsement of the payee made them mere assignors of the title to the note, and hence made the defendant in error, the Otisville State Bank, a mere assignee of such title as was in the payees. This brings the real question involved in this case squarely before us for consideration and determination as to the respective rights of the parties to this action.

It will be observed that in this case the note or notes in question were indorsed before due to the defendant in error, the plaintiff below, and that the indorsement was a qualified one, being “without recourse.” It is urged by counsel for plaintiffs in error that the indorsement in the case at bar is clearly a qualified indorsement within the meaning of See. 8143 G. C., and by reason of this fact the defendants below, plaintiffs in error, are entitled to all of the legal defenses against such in-dorsee that they would have had or might have had against the original payees, notwithstanding the facts that the indorsement was made before the note became due. In order to solve this question it is necessary to determine the meaning of and the legal force and effect of a qualified indorsement as provided in Sec. 8143 G. C., which is as follows:

“A qualified indorsement constitutes the indorsee a mere assignor of the title to the instrument. It may be made by adding to the indorser’s signature the words ‘without recourse’ or any words of similar import. Such an indorsement does not impair the negotiable character of the instrument.”

If the contention of counsel for plaintiffs in error is bound, then the theory and rule as to the rights heretofore existing in favor of an innocent purchaser in good faith, and in the absence of or knowledge of fraud, of a promissory note before the sence of or knowledge of fraud, of a promissory note before due is set aside, abrogated and held for naught. What are the legal rights of a qulified indorsee under the circumstances indicated? The indorser transfers the note to the indorsee “without recourse,” and in our opinion it simply precludes the indorsee from holding the indorser liable to him in the event the makers fail to pay the note. It is simply a contract between the in-dorser and indorsee which in no way inures to the benefit of or increases the legal rights of the makers, or either of them, against the indorsee. In other words, we think that a fair interpretation of the section of the General Code in question in no way changes the well established principle of law that a purchaser of commercial paper for value, before due, in the absence of fraud and knowledge of any infirmity in the instrument, or defect in the title thereto, bars the makers of any defense.

Taking this view of the whole case, and finding no error in the record prejudicial to the rights of the plaintiffs in error, we are of the opinion that the judgment below is right, and should be affirmed.

Judgment affirmed.

Powell and Shields, JJ., concur.


author: GRANT, J.

text:
    CORPORATIONS — PROCESS.
    [Fulton (6th) Court of Appeals,
    December 28, 1914.]
    Grant, Winch and Meals, JJ.
    (Sitting in places of Judges Kinkade, Richards and Chittenden.)
    George W. Griffin v. Edward F. Rowley, Recvr.
    Invalidity of Constructive Service in Proceeding to Assess Stockholders’ Liability not Material when Legal Service Had in Subsequent Action to Recover Amount Due.
    The Invalidity of service by publication upon a resident of Ohio, in an action to assess the statutory liability of stockholders of an insolvent corporation, constitutes no defense where legal service has been obtained in a subsequent action to recover the amount found due.
    Error.

      Ham <& Stahl, for plaintiff in error.

      B. S. Holbrook and G, B. Banker, for defendant in error.
   GRANT, J.

To avoid confusion and for the purpose of clearness, in this opinion the order of parties will be designated as it was in the court of first instance; that is to say, in the reverse position of that stated in the caption here.

Prior to January 25, 1914, the Union Central Savings Bank Company, whose receiver the plaintiff is’ was a corporation of the state of Ohio. Also prior to that date, that corporation became indebted to the Central Savings Bank Company, also a ’corporation, and to others, its creditors. At that date also, and when such indebtedness arose, the defendant was a stockholder in the United Central Savings Bank Company. At that date the Central Savings Bank Company had reduced its claim to judgment, and an execution having been sued out against the debtor upon it, and this having been returned unsatisfied, the creditor in question began a suit in the court of common pleas of Lucans county to compel satisfaction of its claim by the stockholders of the debtor corporation, under the statutory liability at that time existing by the constitution and laws of Ohio in that behalf provided.

In the petition in that cause and in an amendment to it, the creation of the debt named, the rendition of judgment thereon, the failure of the debtor to satisfy the execution issued upon it, the insolvency of the delinquent corporation, the fact that the defendant, among others, was a stockholder at the time and when the credit was extended, and other proper averments were aptly made. The plaintiff in that action sued on its own behalf, and for the benefit as well of all other creditors of the alleged insolvent debtor. To that petition the corporation was made a defendant, as also were its officers and shareholders, including the defendant. No personal or actual service, however, was at any time had upon him in the action, nor was any attempted to be had upon him. On the contrary, he was named in the proceeding as a defendant nonresident of Ohio, upon whom such service could not be had within the state, and thereupon and for that stated reason, constructive service upon him as such nonresident defendant, and as a resident of the state of Indiana, was attempted and purported to be had, by publication, in the form allowed by statute for that purpose having been first made.

This allegation of nonresidence and the consequent inability to have actual and personal process upon him, was not true in point of fact, the defendant being at the time a resident of Fulton county, Ohio, having an actual and visible domicile there, and having had at no time a residence in the state of Indiana.

The prayer of the petition in that case was for an ascertainment by the court of the several amounts due from the defendant corporation to the plaintiff in the action and to the other creditors on whose behalf it sued, for the like ascertainment of the stockholders of the corporation, and for an order requiring each of these to pay his ratable share necessary to satisfy the debts due to the plaintiff and its creditors, in accordance with the liability of each created by statute. A receiver also was asked for, to collect the amounts so to be found forthcoming from the shareholders of the insolvent corporation.

By an interlocutory order in that canse a referee was appointed, who was directed to try the issues both of law and fact and to report his findings and decision thereupon, the corporation itself having duly entered its appearance in the action.

The referee reported his findings of fact and conclusions of law arising in the proceeding, those material to the present inquiry being to the effect that the defendant here, George "W. Griffin, was a stockholder in the defaulting corporation to an original amount of $500, upon which there was a then present liability of $608.91, under the statutes of Ohio.

Upon the coming in of this report, the court approved it, with certain modifications, unimportant in the present controversy. The confirmation was followed by a finding of the court that the defendant had become liable to the creditors of the defunct corporation in the sum already named, that being the amount of his holding with the interest which had accrued since the liability attached, and that this should be collected by the process about to be awarded, “or so much thereof as may be necessary to -secure the payment of the amounts heretofore found due the several creditors, together with the costs,” etc., the finding in this respect and so far, being in terms contingent as to the amount to be paid by the defendant, although it was arithmetically certain that such amount must be the entire amount.

It was then by the court “ordered, adjudged and decreed” that the plaintiff in that action and its co-creditors “ recover” from the several shareholders the amounts set opposite their names, that set opposite the name of the defendant here being the full amount of his assessment already mentioned, “or so much thereof as may be necessary to pay the aforementioned debts * * * and it is ordered that execution issue therefor.”

This is the formal language usually employed in the rendition of a money judgment in personam. Nevertheless, the same contingency is reserved in terms as to the amount of it as is done in the basic finding, although here again it was obviously certain that the contingency of a less amount than the full amount could not, under the circumstances, happen. It is supposed that the awarding of the execution was wholly redundant, the right to that accruing as of course, if there was a personal money judgment.

A receiver in the action was appointed thereupon, to collect the various sums “hereinbefore found to be due from said respective stockholders, or so much thereof as may be necessary to pay the said claims against said corporation,” the language denoting liability still being less than absolute as to the amount to be required from the defendant, although in fact such amount could in no manner be uncertain.

In the decree now being recited, the only language as to defendants’to the action nonresidents of Ohio, is the following: “As to the defendants who are nonresidents and upon whom service was had by publication, which service is hereby approved and confirmed * * *.” And, “Said defendants so found to be nonresidents are * * * George W. Griffin.” This language seems to assume, but not make, a finding of non-residency, in what state or jurisdiction does not appear.

As to the assumed, but not found, defendants nonresidents of some place, ten in all, and upon whom service by publication is assumed to have been properly had, the receiver is authorized by the decree to pursue by action “outside of the state of Ohio, or wherever jurisdiction may be had, for the purpose of collecting the several amounts so found due.”

That judgment and decree is still unreversed and operative to effect, so far as the record here discloses.

Acting under the authority thus conferred, the plaintiff here — who is the receiver named in the decree — commenced the present action against the defendant, in this, the county of his residence, declaring for substance on the proceedings and judgment in the original suit in Lucas county, and praying judgment in the amount there purported to have been fixed as the liability of Mr. Griffin as the aforementioned stockholder, under the statute then in force, and interest. In this action the defendant was personally summoned. He answered, admitting the proceedings in Lucas county and the findings of that court thereupon, in substance, and admitting — by not denying — that Griffin was a shareholder, as alleged. By an amendment to the answer, he was expressly admitted to have been such, and in the amount found in the other suit.

The answer,» aside from its admission, concerned itself with two things: first, that the defendant was sued in the Lucas county cause, not by his full and proper name of George W. Griffin, but by the name of G. W. Griffin only, which was the fact; and, second, that the finding of that court to the effect that the defendant was a nonresident of Ohio and therefore amenable to constructive service by publication as such, was wholly false and that no service in the action was ever had upon him, or jurisdiction acquired over him, that could be made the basis of the present action. The assault upon the Toledo judgment in this respect was vigorous to the verge of violence. Many, many times in the answer, what the Lucas common pleas did, and decreed, found and adjudged, is characterized by the limiting word “pretended.” But the substance of that document is as we have stated. The allegation is that the defendant was not only at all times a resident of Ohio, but that the fact ought to have been well known, and probably was well known, or at least could easily have been ascertained, by the instigators of that action. A separate defense of the statute of limitations also was pleaded in the answer. To the name of answer in the pleading now referred to the title cross petition was added. But the prayer of it was wholly defensive in character and amounted to no more than asking for a dismissing of the petition. A reply to the answer was made, not materially changing the issues made, or attempted to be made, in the ease.

After much intervening litigation, not necessary or useful to recite here, the cause came on for trial to a jury in the court below. A motion by the defendant for judgment on the pleadings was denied.

The plaintiff introduced a full transcript of the record and proceedings of the court of Lucas county, of the tenor and effect already narrated, and rested.

The defendant then moved for a judgment in his favor on the plaintiff’s case, and this was refused. He then produced evidence the tendency of which was to prove his residence was always in. Obio and that the plaintiff in the case of first instance had full opportunity to know the fact, and rested.

Thereupon the defendant renewed his motion for a judgment in his favor, as upon undisputed evidence decisive of the case but reserved a right to go to the jury upon the evidence if the motion should be denied. It was denied.

The plaintiff then moved for judgment upon the evidence, in his favor and asked that the jury be directed to return a verdict for him.

Before this latter motion was passed upon by the court, the defendant presented a series of written instructions and requested that they be given to the jury as the law governing the case. These amounted to the direction of a verdict for the defendant, on the ground that since he was not a nonresident of Ohio at the time he was alleged to have been so in the proceedings had in Lucas county, the notice published for him was inert to confer jurisdiction and that any judgment in that cause purporting to bind him was void for want of jurisdiction to make it — it not being claimed that any process upon him personally, by summons, was obtained in that action.

These requests were severally refused, and the court proceeded to direct the jury to return a verdict for the plaintiff for the sum claimed by him which was done, accordingly.

Appropriate exceptions were saved to these actions of the trial court, adverse to the defendant. A motion for a new trial was seasonably made and overruled, to which an exception also was taken, and judgment upon the verdict was rendered.

And these several rulings of the trial court are assigned as so many errors to be corrected here by a reversal of the judgment below and complained of in the present proceeding.

The people of Ohio, by their adoption of the constitution of 1851, issued their imperative mandate to the legislatures and courts of the state, requiring the one to pass adequate laws securing to creditors of corporations their dues by fixing an individual liability upon their stockholders and the other to advance the remedies thus provided. The constitutional purpose was to supply by law that conscience which a soulless body could' not have, and tiras to check tbe improvident habits which corporations not tiras restrained surely would have.

Having this view of the mischief aimed at in view, the legislature of Ohio’, in obedience to the command, have passed laws progressively appropriate to the purpose and it is the duty of the courts to administer these upon occasion, in the spirit of the constitutional provision for safeguarding the rights of corporation creditors.

Disregarding as not useful here, the genesis of the legislation referred to, and coming at once to that which can usefully be brought to bear upon the present contention, it is to be said that by the provisions of what became in the revision of 1880,-Sec. 3260 E. S. (Sec. 8690 G-. C.) the individual liabilities of stockholders might be enforced by a creditor of a corporation at the suit of the latter against all the shareholders, jointly. The contingency of nonresidence or failure to obtain service of process upon any for any other reason, does not seem in that act to have been contemplated; in any event, it was not provided for.

The scope of remedy was materially widened by the amendment found in 91 O. L. 88, as follows:

“Section 3260. (How Such Liability Enforced; Inability to Summons Stockholders, Etc.) A stockholder or creditor may enforce such liability by action jointly against all the holders or owners of stock, which action shall be for the benefit of all the creditors of the corporation, and against all persons liable as stockholders and in such action there shall be found and determined the amount payable by each person liable as stockholder on all the indebtedness of the corporation, in which adjudication no costs shall be taxed to nor collected of any stockholder to an amount which, together with the amount to be paid on said indebtedness, will exceed the amount of the stock on stockholders, not served with summons except those who may file in the court a sworn statement that a stockholder or stockholders or the legal representatives of a deceased stockholder have not been summoned, giving their residence, if known, and that it is impracticable to secure the services of summons upon such stockholder or such legal representative of a stockholder, and remitting from the claims of the plaintiff or of other creditors consenting, so much as may be found payable by such stockholders, not served with summons except those who may be insolvent or nonresident of the state, and judgment shall be rendered against the stockholders who have been served with summons, for the pro rata amount for which they would be liable if all solvent stockholders resident of the state were served with summons; and when a creditor has prosecuted against a corporation an action of (at) law begun before any action to enforce the stockholders’ liability and has recovered final judgment only after such an action to enforce the stockholders liability has been prosecuted to a final decree in the court in which the action was commenced, such judgment creditor may bring a like action against the stockholders of the corporation to enforce such judgment at any time within four years after the recovery of his said judgment, but the stockholders shall not be liable for any amount in excess of that provided in section thirty-two hundred and fifty-eight.”

Without remark as to the respects in which the enlargement is evidenced by this enactment, except to say that the power to pronounce personal judgment against liable shareholders is restricted by it to such as “have been served with summons,” and that it does not undertake to absolve such as have not been so served — although for aught that appears they may be parties to the action — we pass to the act of April 16,1900, which further broadened the field of remedy and crystallized the law of procedure in the following language:

“Section 3260. Whenever any creditor of a corporation seeks to charge the directors, trustees, or other superintending officers of a corporation, or the stockholders thereof on account of any liability created by law, he may file his complaint for that purpose in any common pleas court which possesses jurisdiction to enforce such liability.
“Section 3260m The court shall proceed thereon, as in other cases, and, when necessary shall cause an account to be taken of the property and obligations due to and from such corporation and may appoint one or more receivers.
“Section 3260&. If on the coming in of the answer or upon the taking of such account, it appears that such corporation is insolvent, and has not sufficient property or effects to satisfy such creditor, the court may proceed to ascertain the respective liabilities of the directors, officers and stockholders, and enforce the same by its judgment, as in other cases.
“Section 3260c. In all cases in which the directors or other officers of a corporation or the stockholders thereof, are made parties to an action in which a judgment is rendered, if the property of such corporation is insufficient to discharge its debts, the court shall give notice to nonresident stockholders as provided in Sec. 5048, 5049, 5050, 5051 or 5052 R. S., and shall first proceed to compel each stockholder to pay in the amount due and remaining unpaid on 'the shares of stock held by him, or so much thereof as is necessary to satisfy the debts of the company.
‘ ‘ Section 3260d. If the debts of the company remain unsatisfied, the court shall proceed to ascertain the respective liabilities of the directors or other officers and of the stockholders, and to adjudge the amount payable by each, and enforce the judgment, as in other cases. The court may authorize and direct the receiver to prosecute such action in his own name as receiver, as may be necessary in other jurisdictions to collect the amount found due from any officer or stockholder.
“Section 3260e. Whenever any action is brought against any corporation, its directors or other superintending officers, or stockholders, according to the provisions of this chapter, the court, whenever it appears necessary or proper, may order notice to be published, in such manner as it shall direct, requiring all the creditors of such corporation to exhibit their claims and become parties to the action, within a reasonable time, not less than six months from the first publication of such order, and, in default thereof, to be precluded from all benefit of the judgment which shall be rendered in such action, and from any distribution which shall be made under such judgment.
“Section 3260/. Upon a final judgment in any such action against an insolvent corporation, the court shall cause a just and fair distribution of the property and assets of such corporation or the proceeds thereof to be made among its creditors.”

This states the statute in substantially its present form, as Secs. 8693 to 8697 G. C. It is the law applicable to this case and a proper consideration given to it must coerce our conclusion upon the merits of the petition in error here.

The nature of the action thus authorized is stated by Spear, J., in Kulp v. Fleming, 65 Ohio St. 321, 339 [62 N. E. Rep. 334; 87 Am. St. Rep. 611], as follows:

“True, our method of enforcing the liability of stockholders is by a proceeding in the nature of a suit in equity which contemplates the bringing in of the corporation, of all the creditors, and of all the stockholders, and a decree which will adjust and finally settle the rights and liabilities of the parties. This is made practicable because the corporation is a creature of our law, the stockholders principally residents of the state, and a multiplicity of suits may thus be avoided. ’ ’

The sweepingly equitable scope of the proceeding is not diminished by the subsequent legislation, which allowed as defendants the directors and officers of the corporation, as well as the corporation itself and its stockholders, the basic purpose plainly being, as is suggested by the language just quoted, to preclude many suits where the remedy may be made effectual by one suit.

The first words of this quotation signify that the learned judge was differentiating the Ohio law and policy in this regard from the possible legislation of other states in respect of the subject, suggesting caution in the application of adjudications else-Avhere bottomed, perhaps on materially different statutory provisions. But the point now emphasized is that the proceeding is equitable in quality, as well as highly remedial in ultimate design. Possibly this inference may be further stretched in the same direction by observing that the name of the initial pleading in the proceeding is called a “complaint” and not a petition, and so far departing from the provisions of our procedure statute fixing the nomenclature of papers.

Under this act the corporation is a necessary party if its solvency is called in question. Such of its directors and officers as are sought to be charged in the action with a liability, must also be parties. And so must such stockholders as are being sued in the action as for unpaid subscriptions for their holdings, and doubtless such other shareholders upon whom the judgment should definitely be fastened in a fixed sum of money to such effect as would cut off personal defense of nonownership of stock, or payment of the liability being enforced, or an allowable set-off to it. Some further clue to the line of cleavage between those things in the suit as to which the shareholder must be considered to be vicariously represented by the corporation, and those which may be used to fix a money obligation, beyond the reach of an independent personal defense, may be found in the syllabus of Kulp v. Fleming, supra, as follows:

“A provision of statute that the stockholders of a corporation shall be individually liable to creditors for the debts of the company does not alone create the liability. It is rather a legislative requirement that whoever becomes a stockholder shall thereby assume an individual liability, and thus gives legal effect to the acts of the parties. The actual liability becomes operative by the act of a shareholder in becoming such, being founded on his proposal to become liable which arises from the membership and individual agreement to abide by the organic law of the corporation, and the acceptance thereof by the creditor by extending credit. Such obligation is contractual.”

Some things which the court can do in a suit thus authorized, and which were done in the suit prosecuted to effect in Lucas county, are things in which the shareholder is conclusively in court by representation only. His representative in that respect is the corporation. In those respects he surrendered his right to appear or to have process, personally, when he subscribed for his stock, ipso factor. By doing that, in legal effect he issued to the corporation his letter of attorney, irrevocably sending his company to act and answer in his stead in those respects. Among the things in regard to which the corporation is deemed conclusively to represent him, are the questions of its own insolvency, the distribution of its assets, the necessity of fastening the statutory liability upon its shareholders and the amount of such liability, as a result flowing from their status as such, to be visited upon each. And this is equally so whether the individual stockholder is a party to the action or not. In either case he is in court in the artificial personality of his company, Swing v. Rose, 75 Ohio St. 355 [79 N. E. Rep. 757]. The case at bar perhaps may be assimilated to that case upon the consideration that the signing of the premium notes in the one, was the equivalent in legal contemplation of the subscription for the stock in the other.

The landmark which is now. sought to be made visible is suggested in the language quoted in the opinion in the case just cited from Commonwealth Mutual Fire Ins. Co. v. Hayden, 61 Neb. 454. 457 [85 N. W. Rep. 443], apparently approvingly:

“We do not mean that it (the judgment of assessment) is conclusive as against any individual sued as a stockholder, that he is one, or if one, that he has not already been discharged by payment to some other creditor of the corporation the full measure of his liability, or that he has no claims against the corporation, or judgments against it which he may, in law or equity, as any debtor, whether by judgment or otherwise, set off against a claim or judgment; but in other respects it is an adjudication binding him.”

The beadroll of authorities called by our Supreme Court in support of this proposition seems to settle the law for us in this respect, as we think.

It appears to be equally clear that there are still other things that the court is competent to adjudicate, by permission of the statute last quoted, to binding effect and for the purposes of the suit, without the personal presence of the individual stockholder, in court at the command of a summons to judgment, and as to the conclusiveness of which it is immaterial whether he is there or absent. And it was competent for the Lucas county court to pass upon such matters, regardless of whether its writ had effectually run as to him individually or not. These things may be said to sound in rem; if the expression may be allowed, they are quasi in rem.

They include the appointment of a referee to take an account of the assets and liabilities of the corporation adjudged to be insolvent, and the number and persons of its stockholders and the amount of the holdings of each, as well as the appointment of a receiver in the action and the using of him to force the collection of the assets in any appropriate manner, including the assets in the form of a statutory liability of the individual stockholders, when ascertained and fixed by adequate judgment, rendered, after jurisdiction is acquired. These things have to do with the assets of the corporation and not of themselves with the personal obligation of the shareholder, although they may be a part of the necessary train of causes which are to eventuate in fixing such a liability. But primarily and of themselves, they look to the husbanding of the corporation’s present resources and the sequestration of such as are yet in gremio legis only to the ultimate payment of its debts. If in the suit the shareholder is in court in person, at the foot of a summons to judgment, as well as being there sub modo under the aegis of his company, then the court may proceed further and pass a judgment upon him finally, in such wise that its writ of execution may run against him for collection by any of the processes known to the law. Such a judgment, proceeding under a jurisdiction acquired by personal process, cuts off and determines any personal defenses which the debtor may interpose, such as nonstoekholdership, payment of the liability, or a set-off against it; for then he will have had his day in court and his opportunity to be heard. But unless he is so in court in obedience to its process, he is not concluded as to these rights of defense, because in such event there has not been due process of law as to him in those respects, and the law of the land has not in his case been observed.

In most instances of the enforcement of the statutory liability of stockholders, the former of the two alternatives is the fact. The shareholders are generally residents in the same jurisdiction with the locus of the corporation and the writ of the court will run to the domicile of all of them. They are therefore usually before the court by process of its summons, so that a final adjudication can be had as to all in one action, and a multiplicity of suits and of costs is avoided. This is the reason given by Judge Spear for the form of proceeding taking its present shape, to the end that the rights and obligations of all may be worked out in a single action, if that is practicable, and so far as it may be practicable, the whole squaring with the equitable theory which is the reason of the statute.

But if, for any cause,' personal service is not had on a given shareholder, so that a money judgment, upon which execution may issue, can not be rendered as to him, no good reason is perceived why the court may not still pass upon these matters as to which he is represented vicariously by his corporation and those which are in rem merely, to all proper legal effect, and so far conclude him. In such case his personal rights of defense the law preserves to him against his day in court, when he is there by due process to answer, with his consequent opportunity to be heard. For, after all and in the last analysis, these two things are the sum total of his rights. In the underlying suit in Lucas county, the court had jurisdiction to do what it purported to do in the matters in which the stockholders were conclusively represented by the corporation and as to those which were quad in rem only. And when these were adequately attended to; that is to say, when the insolvency of the corporation, the amount of its debts, the number and persons of its shareholders and the shares held by each, were fixed — when these merely mechanical operations were performed, arithmetic and the statute did the rest. It was then a mere thing of computation. An adding machine could render the judgment from these data, as well as the court, to the great saving of judicial mental tissue.

And upon a critical reading of the judgment rendered in the case in Lucas county, it may perhaps be doubted whether more was there attempted to be done. For in all cases in the decree where a money liability is undertaken to be fastened upon individual defendants, the figures reached by the perfunctory mechanical process just noted are limited to such part thereof as might be necessary to liquidate the demands of the corporate creditors. And this result is not disturbed in the law’s eyes by the self-evident fact that it was all along certain to take an amount sure to do this, to-wit: the amount of each shareholder’s stock, plus interest.

And what the court in that judgment did in respect of service upon the defendant by publication, in like manner is in the twilight zone of literal uncertainty. The court assumed a publication and confirmed the assumption. And it did no more, having regard only to the wording of its decree. It did not find the fact of publication. Attention has already been called to the court’s language in both these respects.

But, let it be granted that this view is wholly a mistaken view, and that the court in Lucas county undertook to go beyond the point of adjudication to which, as has been shown, it lawfully could go, and what follows? What did the plaintiff take by it? And what did the defendant lose by it? The answer in either case must be, nothing. It would be destructive of every just principle of jurisprudence to allow that a legal right or a correlative legal obligation can arise from a falsehood. And the nonresidence of the defendant in the state of Ohio was admittedly a falsehood. A cart load of solemn adjudications in the form of findings could not make it a truth. Immunity from collateral attack could not make it true. The allegation of it was altogether inert and conferred no right and called for the performance of no legal duty. It is not now perceived why this result should not be found in this case.

And if the nullity of this attempted service by publication be admitted, so that in the judgment in Lucas county the law saved to the defendant his right still to have his day in court, and his right to wage his personal defenses to the creditors’ claims against him, it does not follow, inevitably, as we think, that he must go free of his real obligation in that respect, when the right to enforce it is legally asserted. If the nugatory character of the attempted constructive service be allowed to work an immunity against a personal judgment in that case, does that fact operate as a judgment against his being made to pay a just debt when properly haled to court for the purpose of making, him discharge an unperformed legal duty? We must think not.

But the decree in the case in Lucas county did one thing more, and that it did have a right to do. It authorized the court’s receiver “to bring suit or suits against any or all of said defendants outside the state of Ohio or wherever jurisdiction may be had, for the purpose of collecting the several amounts so found due.” This sentence is to be read, manifestly, we think, as if a comma were placed after the word “defendants.” As to the defendants assumed to have been found to be nonresidents of the state, the decree has already authorized the receiver, specifically “to take all such actions he may deem necessary to collect the amount so found due” from them. The authorization to bring suits extended to all defendants in other jurisdictions, whether resident or not in Ohio. And this is strictly pursuant to the Ohio statute.

Acting in accordance with the authority this conferred, the receiver brought the present action in Fulton county — the residence county of the defendant — where the defendant was summoned in the action.

Due process of law includes two essential things — notice and an opportunity to be heard. The defendant, therefore, has had due process of law. The defendant would have been entitled to no more if the purported nonresidence assumed in the Lucas county ease had been a fact. In all the essential things as to him the law of the land has been observed — that law which, as Webster defined it in the Dartmouth College case, “which hears before it condemns, which proceeds upon enquiry, and renders judgment only after trial. ’ ’ In this ease all the substantive defenses to which he was entitled have been open for the defendant to make; that is, all the defenses as to which the corporation must not be held to represent him, and all matters which were not matters of computation alone, arising from the fact of insolvency, the amount of debts and the number of shareholders and the amounts of their holdings. Is it a question that he is a stockholder? His answer in this case admits it. Has he paid his share of the indebtedness thence arising? It is not claimed that he has. Has he a set-off? He does not fessert it in his answer. Having no defense to make on the merits of the case, shall he be exempt from a liability otherwise complete because of the assumed misdirected act of the Lucas county court in finding him a resident of a state in which his rights could have been in no way differently treated than if the finding had been that he resided in Ohio ? Upon the footing of substantial justice and the administration of a law to which he assented by becoming a stockholder, it is hard to see that be should. He is deprived of no right by being sued in his own county in Ohio rather than in Indiana, his putative residence, if the record in the Lucas county case imports verity. And no additional burden is placed upon him. That he has a summons instead of a notice is to the prejudice of no right of his. In McVickar v. Jones, 70 Fed. Rep. 754, it is said:

“The twelfth cause of demurrer is grounded upon want of an averment of notice to the defendant of the judgment or claim against him before commencement of suit. The notice, to persons sought to be charged, required by the Kansas statute before execution shall issue against the stockholder, would seem to have reference to the motion made in open court, that execution issue against the stockholder, and not to the original claim, or the proceedings anterior to the judgment. Under the statute the creditor may elect to proceed by motion and notice, with a view of obtaining execution direct against the stockholder, or by his action upon the judgment, giving, of course, the usual notice required in instituting proceedings at law; and no reason is seen why the stockholder can not avail himself of all matter by way of defense in an action at law which would be open to him as objections against a motion for execution, where the creditor elects to proceed under such motion rather than by action. Looking to the statute, therefore, it can not be found that it either expressly or impliedly contemplates notice of the claim to the stockholder before commencement of an action at raw, where the creditor elects such proceeding as his remedy. ’ ’

Holding, as we do, that the action of the court in Lucas county — whatever it may literally have been — in regard to notice to the defendant as a putative resident of Indiana, was null and of itself conferring no right on the receiver that he would not have had without it, leaving the receiver, both by its decree and the express authority of the statute, with full power to pursue the defendant stockholder into “other jurisdictions,” one of which “other jurisdictions” might be, and in this case is, Fulton county, Ohio, — which the receiver has done in the present action — finding these things, we say, and to our apprehension the two questions mainly argued before us, namely, the effect of the assumed constructive service by publication and whether the answer here is a direct or a collateral attack on the Lucas county judgment, become relatively unimportant. The former disappears by elimination, and the latter loses all coercive force through entire irrelevancy. In short, neither is longer in the case.

That leaves the receiver in the position of obeying the order of the court whose officer he is, in pursuing the defendant by suit in the jurisdiction of his residence, declaring in that suit on the judgment rendered in Lucas county which conclusively furnished the basis of his action as to all things in which in the suit of origin the corporation represented the defendant and as to the matters adjudicated which sounded in rem, leaving open to the latter all defenses which he could have made in the Lucas county ease had he been there present visibly in person at the behest of the court’s summons. This pursuit to another jurisdiction was permitted also by the statute.

It has been made, and the defendant is having that which he complains that he did not have in,Lucas county — his day in court and due process of law. When thus brought to the bar his defenses are not that he is not a stockholder, or that he has paid his dues to the creditors of the defunct corporation, as he agreed to do when he became a stockholder in it, or that he has a set-off to their claim. His answer is concerned with the alleged invalidity of the Lucas county adjudication, upon the ground already fully discussed, that he was attempted to be sued in that jurisdiction by the initial letters of his first and second names and that the action is barred by the statute of limitations. None of these, it is to be observed, touches the matter of the defendant’s real obligation to the creditors of his company, to enforce which both actions were brought.

As to the first of these defenses our views are already given.

In regard to the misnomer assigned, we think there is nothing in the point.

As to the statute of limitations, the court below properly disregarded it, in our opinion.

The petition before us does not in terms assign either of these two things as matter of error, unless they come within the complaint of “other errors.” But we mention them as being by that possibility in this case. As already narrated, at the conclusion of all the evidence the defendant moved “for judgment on the undisputed evidence, ’ ’ but with a named reservation of his “rights to go to the jury upon the evidence if the court holds against me. ’ ’

The motion was then overruled. The plaintiff then made a motion for a judgment in his favor on the same ground, and also moved for a directed verdict.

Before this motion was acted on by the court the defendant presented certain instructions in writing, and requested that these be given in charge to the jury before argument. These amounted to the direction of a verdict for the defendant. They were refused and there was no argument.

The court then directed a verdict for the plaintiff. All proper exceptions were saved, and a motion for a new trial was thereafter made and denied.

The motion by the defendant for a judgment on the evidence in effect submitted the issue to the court to be found, nor did the attempted reservation, without more, withdraw the submission, and the court found the issue to be with the plaintiff.

If our view of the law as already expounded is correct; if the attempted constructive service was inert, taking no legal right from defendant and fastening no liability upon him, then the trial court was right in directing the jury to return a verdict for the plaintiff.

If, on the other hand, our view in this respect is mistaken and the assumed finding of the Lucas county court as to such service operated as a judgment against the defendant, it still remains an integral part of that judgment until reversed in that cause or some cause having such reversal for its direct purpose. The present action is not of that nature.

Upon either footing the defendant must fail.

We are quite aware that in somewhat laboriously reaching this conclusion the fact that we have in words paid so little attention to the very voluminous briefs filed in the case, will be thought a cause of grief if not grievance to the compilers. With cyclonic energy and with the zeal of crusaders, with characteristic industry and with the learning which has had the effect that Festus imputed to Paul, the utmost corners of the judicial earth have been ransacked for law, and from all the immense armories of legal resource authorities have been marshaled before us in the wildest profusion.

“Mastering the lawless science of our law—
That eodeless myriad cf precedent,
That wilderness of single instances.”

It has not quite been “Love’s Labor Lost,” for we have examined these with attention always, and with those parts of some of the briefs which in wealth of language transcend ¿he picturesque at times and approach the frontiers of the lurid, the court has been affected even to admiration. The very prodigality of eases cited has precluded a more particular allusion to them in the course of this opinion. But they have been considered, and the result of the consideration is embodied in vhat we have now said. So much is due to the labor and erudition of counsel in the case.

We have heard in one of the briefs the tocsin sounded that this case may “pathfind its way” to a higher court. The outcry has no terrors for a court whose humble but sole ambition is to be right, even at the expense of being set right by any tribunal having authority to do that. Certainty of being right is not the monopoly of any mortal. We aspire only to that “learned and modern ignorance” which the great historian of Rome’s fall characterizes as the mark of great minds.

The result of our consideration is that we find no intervening error of substance in this record, injurious to the rights of the defendant, and we are unable to say that substantial justice has not been done in the case.

The judgment complained of is, therefore, affirmed.

Winch and Meals, JJ., concur.