Davis v. Mills, 194 U.S. 451 (1904)

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Davis v. Mills

No. 235

Argued April 19, 1904
Decided May 16, 1904
194 U.S. 451

CERTIFICATE FROM THE CIRCUIT COURT

OF APPEALS FOR THE SECOND CIRCUIT

Syllabus

Section 554 of the Montana Code of Civil Procedure, limiting actions to enforce a special statutory director’s liability to three years, applies to liabilities incurred before its passage under a different statute and goes with them as a qualification when they are sued upon in other states.

If such a statute of limitations allows over a year in which to sue upon an existing cause of action, it is sufficient. A statute of limitations may bar an existing right as well as the remedy.

This case came here on a certificate of which the following is the material portion:

The plaintiff is a citizen of Montana, and the owner by assignment of three causes of action (for goods sold and on a promissory note) against the Obelisk Mining & Concentrating Company, a Montana corporation. The indebtedness of the company upon these causes of action accrued July 31, 1892, July 1, 1892, and December 12, 1892, respectively. The defendants are and always have been citizens and residents of Connecticut, and at all the times mentioned in the complaint were trustees of the said Obelisk Mining Company. The statutes of Montana provide that, within twenty days from the first day of September, every such company shall annually file a specified report, and if it

shall fail to do so, all the trustees of the company shall be jointly and severally liable for all of the debts of the company then existing, and for all that shall be contracted before such report shall be made.

Section 460 of chapter 25 of the fifth division, Compiled Statutes of Montana, which was in force when the cause of action arose. Reenacted as section 451 of the Civil Code of Montana, which went into effect July 1, 1895.

The Obelisk Company failed to file certain of the required reports, and the causes of action sued upon here, against the defendants as trustees, to recover debts of the company, accrued September 22, 1893, or prior thereto. This action was brought to enforce the joint and several liability of the defendants under the statute on July 30, 1897.

When the cause of action accrued, the Compiled Statutes of Montana contained these sections:

SEC. 45. 1. In an action for a penalty or forfeiture, when the action is given to an individual, or to an individual and the territory, except where the statute imposing it prescribes a different limitation; 2, an action against a sheriff or other officer for the escape of a prisoner arrested or imprisoned on civil process shall be commenced within one year.

SEC. 50. If, when the cause of action shall accrue against a person, he is out of the territory, the action may be commenced within the time herein limited, after his return to the territory, and if, after the cause of action shall have accrued, he depart from this territory, the time of his absence shall not be a part of the time limited for the commencement of the action.

Both of those sections were repealed by the Code of Civil Procedure, section 3482, which went into effect July 1, 1895. On the last-named date, the Civil Code of Montana went into effect, containing section 451, above cited. The Code of Civil Procedure contains a separate title, numbered II and containing four chapters (sections 470 to 559), which deals exhaustively with "the time of commencing actions." It contains these sections:

SEC. 515. Within two years:

1. An action upon a statute for a penalty or forfeiture, when the action is given to an individual, or to an individual and the state, except when the statute imposing and the state, except when the statute imposing it prescribes a different limitation

SEC. 541. If, when the cause of action accrues against a person, he is out of the state, the action may be commenced within the term herein limited after his return to the state, and if, after the cause of action accrues, he departs from the state, the time of his absence is not part of the time limited for the commencement of the action.

SEC. 554. This title does not affect actions against directors or stockholders of a corporation, to recover a penalty or forfeiture imposed, or to enforce a liability created by law, but such actions must be brought within three years after the discovery by the aggrieved party of the facts upon which the penalty of forfeiture attached or the liability created (sic).

Upon the facts above set forth, the question of law concerning which this Court desires the instruction of the Supreme Court, for its proper decision, is:

May a defendant, in an action of the kind specified in section 554 of the Code of Civil Procedure of Montana, avail of the limitation therein prescribed, when the action is brought against him in the court of another state?