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58 Minn. 247

Smith v. Prior

Supreme Court of Minnesota

Decided July 17, 1894

Supreme Court of Minnesota · decided 1894-07-17

Appeal by plaintiff, John Day Smith, from an order of the District Court of Hennepin County, Robert Jamison, J., made March 7, 1894, denying his motion for a new trial. Held: that the complaint does not comprehend the cause of action, which plaintiff sought to establish on the trial. This, we think, is error.

Cited by 3 later decisions — most recently December 1901

3 state decisions

Relies on Hospes v. Northwestern Manuf'g & Car Co.

Good law ✅— No negative treatment on recordhow we know

Decided 1894-07-17

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Mitchell, J.

¶1This was an action by the assignee of an insolvent corporation to recover from its stockholders unpaid stock subscriptions, the allegations of the complaint being merely that no part of the stock owned and held by the several defendants had been paid, except a certain specified sum. The pleading must be construed as declaring on a cause of action due from the stockholders to the corporation and founded on contract.

¶21st. Upon the trial, the plaintiff offered evidence tending to prove that the corporation had accepted, as full payment for the stock, property that was greatly overvalued and grossly inadequate in value to the par value of the shares.

¶3This evidence was properly excluded, as not being admissible under the pleadings. The cause of action thus attempted to be proved was not one in favor of the.corporation, and founded on contract, but one in favor of creditors, and founded on fraud. Hospes v. Northwestern Mfg. & Car Co., 48 Minn. 174, (50 N. W. 1117.) The facts constituting the fraud on creditors should have been alleged. There is nothing in the Hospes Case inconsistent with this rule. In fact, the particular question of pleading here raised was not raised at all in that case.

¶42nd. The plaintiff then asked leave to amend his complaint by setting up the facts which he had thus sought to prove.

¶5Assuming, without deciding, that the proposed amendment went far enough to be available to plaintiff, the change of base was so radical, and the facts sought to be pleaded as a cause of action so entirely different from those alleged in the complaint, that, assuming that it was a matter within the discretion of the court, we certainly *252could not hold that it was an abuse of that discretion to disallow such an amendment on the trial.

¶6It is suggested that the answers of some of the defendants aided the complaint. We think not. They simply alleged payment in full for the stock in property, and in reply to this the plaintiff interposed a general denial.

¶7Order affirmed.

Buck, J., absent, sick, toon no part.

¶8(Opinion published 59 N. W. 1016.)

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