Minchener v. Carroll , 135 Ala. 409 ( 1902 )

TYSON, J.

This is an application for a writ of mandamus against one Carroll as treasurer of the Alabama Mutual Fire Insurance Company, a corporation chartered under the laws of this State. The purpose of the writ is to compel the ireasurer to pay a judgment which the petitioner has against the corporation. It is made to appear by the averments of the petition, that the corporation is an insurance company and issued a policy of insurance, to the. petitioner upon which there was a loss. That petitioner recovered a judgment against it, upon which execution was issued and returned nulla bona. That he has made demand upon the corporation and its treasurer to pay his claim, which has been refused. That the corporation has ceased to do business and is not now'mgaged in the business for which it was organized and that at the time it ceased to do business its reserve fund amounted to $3,000. That the company has no other fund with which to pay said judgment. This reserve fund, it is averred, was created as authorized by the charter by the corporation settling aside one-eighth of all premiums and assessments received by it as a reserve fund to he invested in such bombs, notes, mortgages, personal property or real estate as the hoard of directors may determine. No part of it, however, could he used for any purpose except in settlement of claims against the corporation, and for that purpose only after the other assets, premiums and assessments, have been first exhausted.

It is further averred that this fund has never been invested in bonds, securities or other property, and that it ivas placed by the corporation in the hands of the respondent, as its treasurer, and has not been paid out in settlement, of claims against the company, but it is still in his hands, unless it has been expended in a ivav not authorized by the charter.

The foregoing are the substantial averments of the petition. It is entirely clear that the charter imposes no duty upon the corporation to appropriate this fund to the payment of petitioner’s claim. The conditions imposed by the charter by which it shall be applied to the payment of claims against the company are not shown to exist. No exhaustion of the other assets, premiums and assessments is averred. For aught appearing, the corporation may have more than sufficient assets, other than funds in its treasury, or premiums and assessments due to it to pay all of its liabilities.

The averments that the corporation has ceased to do business aiid that it has no other fund with which to pay the petitioner’s claim is not an averment that it has no other assets, or that it has no premiums due to it on policies issued by it, or that it has exhausted its right to levy assessments for the purpose of paying its liabilities. As to whether it has such assets, we are not informed and indeed cannot be without the fact being shown by proper averment. We cannot presume their existence without doing violence to the plainest rules of pleading. In other words, we cannot intend or presume the existence of a material fact necessary to be averred. Thus we see that the facts averred impose no specific duty upon the corporation under its charter to apply this money, if it has it, to the satisfaction of petitioner’s claim.

It is practically a universal rule, in order to entitle a party to the writ of mandamus he must show that he has a clear legal right to demand the performance of a specific duty. In other Avords, it is essential that the relator have a clear legal right to the thing demanded and it must be the imperative duty of the respondent to perform the act required.—19 Am. & Eng. Ency. Law, (2d ed.), p. 725 and note 4.

Furthermore, it is not averred with any degree of definiteness or certainty that any portion of this reserve fund was in the hands of the company’s treasurer when this petition was'filed. The averment is that he has it, unless it has been expended in a way not authorized bv the charter of the corporation. Mandamus is not the proper remedy in cases of misappropriation.—14 Am. & Eng. Ency. Law (1st ed.), 184.

Thus far we have treated of the petitioner’s rights, upon the facts, to compel the corporation to. pay to him his claim out of the fund sought to he subjected. We will now show that he lias no such right to compel, the respondent, its treasurer, to do so. The fact that petitioner has failed to show a clear legal right to the fund is just as effective to defeat his right to the writ against the respondent, as it would be, had he sought the writ against the corporation. Besides the respondent, as treasurer, cannot control tire business of the corporation and has no authority to pay its debts, except by order of its directors. líe has no authority to apply this fund, in the absence of directions from the board of directors, unless the charter authorizes him to do so, to the payment of this debt. Ordinarily it is his duty merely to receive, safely keep and disburse under the supervision of the directors the funds of the company. 17 Am. & Eng. Ency. of Law (1st ed.), 132. If the charter imposes the specific duty upon the respondent as treasurer of applying any portion of this fund to payment of petitioner’s debt, it is not shown by the aver-ments of the petition. And in the absence of such a showing, we cannot presume its existence.

The other members of the court concur in an affirmance upon the sole ground that it is not averred with any degree of definiteness or certainty that any portion of the reserve fund was in the hands of the respondent when the petition was filed.

Affirmed.