ARK.] MCCOY V: LOCKRIDGE. 197 • Loth{R-foOE. .4-3188 Opinion d6liverOd'Novernber 200933: 1. LIMITATION OF ACTIONSCONCEALMENT OF CAUSE OF ACTION. Where a coporatien was dissolved and its assets , distributed among its stockholdei g 'WithOut` nOtic6 being pUblished, the 'statute of limitations ditFnot- begin to:ruiv therefrom tin favor of the stockholders •against corporate creditors ,having no actual notice of the dissolution. . • , 2. LIMITATION OF A CTIONS-DISSOLUTION OF CORPORATIONNOT Where, after dissolution of a cOrporation, an execution against it in favor of a judgment creditor_ wa's returned "riziag;LbAnte," the creditór was put on notice Which, If lollowed up,'Would have
198 McCoy v.-. LOCKRIDGE: -[188- disclosed the dissolution of the corporation and distribution of its assets. 3. LIMITATION OF ACTIONS—CONCEALMENT OF CAUSE OF ACTION.—An action by a judgment creditor of a corporation against its stockholders, commenced September 21, 1931, was not barred by the five years' statute where the dissolution was made April 9, 1926, but was fraudulently concealed until 1931, when execution against the corporation was returned nulla bona. 4. YENUE—CODEFENDANTS.—The liability of stockholders • for the • debts of a dissolved eorporatiOn being joint arid several, a stock-hold61. may be-sued in a county other than his residence when joined witli a resident stockholder. 5. APPEARANCE—WAIVER 0 , F. JURISDICTION.—Where, after the court overruled a motion to ' dismiss for want of jurisdiction, defendant 'agreed in writing to a hearing by the chancellor in vacatirin, he waived objection to the venue of the action. Appeal from Arkansas ChancerY Court, Northern District; Harvey R. Lucas, Chancellor ; affirmed. STATEMENT BY THE COURT. • This ailpeal, is prosecuted from a decree holding certain stockholders, to'whom 'the assets of the corporation were distributed on its dissolution and surrender of its charter, liable to the payment of certain- debts of the corporation. This is the third appeal of the matters involved, a full statement of the cases alipearing in Stuttgart Rice Mill Co. v. Lockridge, 185 Ark. 340, 47 S. W. (2d) 596, and Wilson v. Lucas, 185 Ark. 183, 47 S. W. (2d) 8. Appellee Lozier Lockridge, a rice farmer, delivered his rice to the Stuttgart Rice Mill Company under what the court held to be a toll milling contract constituting the Stuttgart Ripe Mill Company his agent. He brought suit for damages against the_ rice mill company arising out of a breach of the contract and recovered damages in the . sum' of approximately $4,400. On appeal this court modified the decree and remanded the cause with directions to enter judgment for $483.96. The suit for damages was originally brought on December 23, 1923; and on the last day of March, 1926, the rice mill company sOld . all its 'property, and on the 5th day of April, 1926, conveyed the same to the Arkansas Rice Growers' Co-Operative Association, taking a mortgage to secure
ARK.] MCCOY •1.1. LOCKRIDGE. 199 the payment of the purchase money notes . aggregating the sum of $97,875. Immediately after the sale the rice company distributed iis assets , among its stockholders and on the 6th, day of , April, 1926, surrendered its charter. One of the daily newspapers in Stuttgart in the . issue of Tuesday, the 9th day Of March, 1926, on the front page of said paper published a news item under the following heading: „ . "Co . -Op Associaiion Buy . s All Stuttourt Rice Mill Property,". , after which folloWed a news item setting forth the sale and details thereof. The Grand Prairie News, a weekly paper in , said city, curried an o item , qn the11th :of March, 1926, on the front page :thereof headed as follows: "Rice • Growers Buy. Stuttgart Mills, Take Over Mills A: and B Here and C a . t D . eWitt, Including:Properties," after which followed a news fitem :setting forth. details thereof. The organization of The Arkansas Rice :Growers? Co-Operative Association.; its..purchase .of all the property, real and personal, of:the Stuttgart Rice Mill Company and the fact that .the rice mill coinpany had quit business wa g, a . Matter of cemmon knoWledge ;:and appellant knew,at the time -that the Rice: Groivers': ; As-so.ciation had on or. about .the 1st day of March, 1926, purchased all the :property of. the Stuttgart Rice Company. "Lozier Lockridge, the above-named plaintiff, had no ' actual knowledge: that the Stuttgart Rice. Mill Company had surrendered its:charter ; that it bad distributed its assets among-its stockholders.without making:a pro-_ vision for the payment of su . Ch judgment- as he might recover against it; that neither the:Stuttgart Rice Mill Company, nor any director or agent therefor, gave-any public statement, either, through the newspapers ,or by word of mouth with reference to surrendering its charter and distribution of its assets. That a copy of the resolution dissolving the corporation was filed with the Secretary of State, a copy of which is attached hereto, made a part hereof." Certified copies , of: the.resolution
200 - -MCCOy-1).-LOCKRIDGE. [188 Of the * StOckholders 'dissolving the corPoration, were signed bY P. R. MCCoy as seeretary of the corporation, One being filed in the'-offied . .of the 'Secretary , of State and c one in the office of the coUnty clerk 'of . Arlfansas Ceunty at DeWitt, ArkanSa.s. NO notice of the dissolution of the corpbration and the distribution of * its assets among its stockholders' Was published by the Stuttgart Rice Mill CbmPany, and, after the rendition of the original decree, May 11, 1931, in favor of Lockridge and befOre the filing of this cause, September 21, 1931, an exeCution was . 1Ssited• against the Stuttgart Ride Mill Cbmpany, alicCthe SaMe Wag rettrned' by the sheriff Marked "nOthidg' fOund." - Attached to the 'agreed statenient of facts vas a copy of the ''resolution 'of -disSblution Showing that it was adopted' at "a * stockhOlders " meeting on March 17, 1926, and certified to the office of the Secretary of State on the 9th day of:April, 1926. . Each Of appellants fileaded the '3 and 5 year 'statute of- limitations and McCoY denied having been a stOckholder and also that, he had reeeived any of -the assets:of . the corporation.'on dissolution: Wilson moved to dismiss: the suit againSt him, claiming r the court had no _jurisdiction . tO try it, 'his residence, being .in County, .where he *was' served .With summons, while the residence of :McCoy .was in Stuttgart, and that there was no joint liability between them. . Appellee dlaimed that the' suit' Was on a *judgment and only the 10-year statute of limitations- was appliL cable thereto. , The mbtion to,dismiss , was overruled, and judgment was rendered , against both of appellants, and this appeal is from that 'decree. -CockrillArniistead ; and 1-47 . A. Leach, for appellant. Joseph Morrison, for' apellee. (after Stating the facts).- No notiCe of the disSbhition of 'the cOrporation or • the distribution of its assets among its' steckholderS was published by the Stuttgart Rice Mill Cbmpan; 'and it was admitted that appellee had no actlial notice thereof, the agreed
ARK.] McCoy V. LKKRIDGE. 201 statement . of facts , containing Abe follo.wing.stipulation: "No . notice of the dissolution of the corporation..nor..of the distribution . of its Assets a . mon . g its stockholders.: . was published by the Stuttgart Rice Mill Company.; • that afterth • e re • ndition of the . orio inal decree, in,f,a . vOr Of Lozier Lockridge and before tile ., ling og, this .cause .(4 action he caused an execution• to..be issued against the Stuttgart Rice Mill CompAny and tliat tbe • , same: was by the sheriff of Arkansas County retlirned 'marked 'nothing foun ,. d • '. . • -Appellee's cause. of ° action against appellants,.stockholders, could not have• arisen until the . attempted dis7 solution of the corporation by,. tne adpption. . of .the stockholder's resolution on .March.17, 1926; and . its cer-tifi .cation.to the office of the Secretary of State on April 9,1:926. It is admitted that .after the rendition of .the original decree on • May :11, .1931, , and before this suit was filed . on September- .21, 1931, appellee caused .an execution to be issued. -thereon against the Stuttgart Rice Mill Company and , same was returned by the, Sher-1 . ff marked- "nothing found,". - - It was also Shown that appellee had' no knowledge of any facts that iwould Constitute actual 'i t iotice of the .at-. tempted dissolution of the corporation before- the return of the exeoution "nulla bone' ;' but a proper following up of that information would have diseleSed the Actual conditions and thus appellee Was Charged . with 'notice from then on. The exact date of the execution is not shown in the record, but - it is clear, from the. agreed statement of fact quoted above, that this execution was issued • and returned by the. sheriff•-marked, "Nothing found" sometime between May, 11, 1931, the. date of the original decree, and Septeinber 21, 1931, the date this suit was-filed: Such fraudulent-concealment : would . prevent the nail, ning of the statute of limitations, until the fraud was discovered, and- under the agreed statement of fact -here-- in appellee cannot be *said fa - have been -. charged With notice thereof until after • thd Walla - bond tettitit_iot the execution, which would , have advised aPpellee _of the
true condition had the information`been folloived up. In Wright v. Lake, 178 Ark. 1184," 13 S. W: (2d) 826, it was said: "It is well settled in this State that where there has been a 'fraudnlent concealment of a cause of actión, the statute of limitations doe g not begin to rtin until after the fraud is discovered." (Citing cases). The cause of action wa g 'net barred bY the five-year statute of liinitations, *and the chanCellor did not err in so holding. Neither was error committed in overruling the motion to dismis for wthit of jurisdiction, appellant WilT son being summoned in Pulaski County, where- he' resided. This court had held in the'caSe of Wilson v. Lucas, supra, that the liability of 'stockholders to -the payment of the corPoration's debts after dis g olution Was joint and several, and the a:ssets thereof 'received by "them constitute a trust fund for payment primarily of the debts of the dissolved corporation. Moreover, after the court overrUled the motion to dismiss for want of jUris: diction. appellant agreed in writing to a hearing by the chancellor of the suits in vacation and necessarily waived any further right to complain of the jurisdiction of the court. Pacific Mutual Life Ins. Co. v. Toler, 187 Ark. 1073, 63' S. W. (2d) *839. We find no substantial error` in ,the record, and the decree is affirmed. • MCHANEY, J., dissents.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.