Clark v. Bever

Citations

• 139 U.S. 96
• 11 S. Ct. 468
• 35 L. Ed. 88
• 1891 U.S. LEXIS 2364

Syllabus

<p>In 1872, an Iowa railroad corporation, being indebted to a construction company in the sum of $70,000 which it was unable to pay in money, had a settlement with the latter, whereby the debt was paid in shares of the stock of the railroad company of the par value of $350,000. The stock was taken at 20 cents on the dollar, but was not, at the time, worth anything in the market. Greene, a member of the construction company, received 910 shares as his part. Subsequently, in 1876, the railroad and its appurtenances were sold under a decree foreclosing a mortgage given to secure the bonds of the railroad company. Clark, a holder of bonds issued by the railroad company in 1874, obtained judgment for the amount due him, Upon which execution was issued and returned in 1880, no property. Greene having died, Clark brought suit against his admin- • istrator in one of the circuit courts of Iowa, sitting in probate, to hold his estate liable for the difference between what was paid for .the stock, and its face value, upon the ground that the stock of the corporation' was a trust'fund for creditors, and that as between creditors and stockholders, the latter was bound to account for its face value. Upon, the petition of Clark, the case was removed to and tried in the Circuit Court of the United States, where a verdict was returned by direction of the court for the defendant. Held,</p> <p>(1) That as the proceeding involved a judicial determination of the liability of Greene’s estate for the claim in question, with parties before the court to contest all questions of law and fact, it was a “ suit ” within the meaning of the act of Congress providing for the removal of suits from the state courts. It is not competent for a State, by legislative enactment conferring upon its own courts exclusive jurisdiction of proceedings or suits involving the settlement ancl distribution of the estates of deceased persons', to exclude the jurisdiction in such matters of the courts of the United