Ducotey v. Wilkenda Land Co.

The Park Trust Company claims that under the finding the receiver of the Land Company is estopped to deny that Charles H. Davis held sixty shares of the stock of the Land Company at the date of its attachment, and that the trial court erred in drawing its conclusion from the facts found that the Land Company was not so estopped, and in holding that it was only liable to the Park Trust Company to the extent of the stock then owned by Davis, to wit, one share.

The question that presents itself at the outset is whether the Wilkenda Land Company is so involved in the giving of the certificate in question by its secretary as to make it responsible in any way for the representation made in the certificate. Attachments of "rights or shares in the stock of any corporation" are authorized under General Statutes, § 5869, set forth in the footnote.^*

The statute provides that the secretary of a corporation shall furnish the officer making the attachment "with a certificate, under his hand, in his official capacity, specifying the number of rights or shares" held by the defendant, and it provides for the punishment by fine of a secretary who fails to furnish such a certificate.

In view of the remedial purpose of this statute and the necessity of such a construction as to make it effective, we construe the provision as making the representation contained in the certificate of its officer a representation of the corporation, and if there arises from such representation an equitable estoppel in favor of the plaintiff in the attaching action, then the corporation would be bound by the representation.

The representation of the certificate, standing alone, did not make Davis, the debtor, the owner of shares in a corporation which he did not in fact own, even as to the plaintiff in the attaching action. The mere fact that the plaintiff is misled as to the actual holding of the defendant in the corporation, and disappointed as to the result of its attachment, does not estop the corporation after judgment and make it responsible to the plaintiff in the attaching action for more than the actual holding of the defendant therein.

The question before us, therefore, is whether, under the subordinate facts found, the court was justified in its conclusion that the corporation was not estopped from denying the truth of its representation, in the certificate given to the attaching officer, that Davis owned sixty shares of stock, and therefore, that after judgment in the attaching action it was only holden for the actual shares of stock that Davis held at the time of the attachment.

The representation in the certificate given the attaching officer was not true, the officer and the plaintiff believed it, but the vital question is, did the plaintiff change its position to its loss because of the representation made by the certificate of the corporation? InTownsend Savings Bank v. Todd, 47 Conn. 190, we say, on p. 218: "A party setting up an estoppel must always show, as an essential part of his case, that he will be subjected to loss if he cannot set up the estoppel. There is no presumption in his favor." Also, on p. 219: "An estoppel in pais operates wholly on equitable principles," and was "never intended to work a positive gain to a party, but its whole office is to protect him from a loss which but for the estoppel he could not escape." We reasserted these principles in Webb v.Moeller, 87 Conn. 138, 142, 87 A. 277. These principles are at the basis of the Connecticut law of estoppel, and apparently are generally observed.

As to the "change of position" of the party claiming an estoppel, which is essential to its creation, Corpus Juris, Vol. 21, p. 1135, § 136, speaks as follows: "In order to create an estoppel in pais the party pleading it must have been misled to his injury; that is, he must have suffered a loss of a substantial character or have been induced to alter his position for the worse in some material respect." From the finding it appears that the Park Trust Company believed from the date of the attachment in December, 1918, until May 26th, 1922, that it held under attachment sixty shares of the stock of the Land Company owned by Davis, and relying on such belief took no further action looking toward the collection of the note than taking a judgment against Davis on January 22d 1923. There is no finding that "relying on such belief" the Park Trust Company failed to attach any other property of Davis, or of the endorsers on his note. Any expense incurred after May 26th, 1922, was incurred with knowledge of the actual interest of Davis in the Land Company. As we said in Townsend Savings Bank v. Todd, supra, there is no presumption in favor of the party seeking to establish an estoppel that he has changed his position to his loss; he must prove that fact as an essential part of his claim. He cannot rely on presumptions or conjectures.

The Park Trust Company urges that if it had not been misled in December, 1918, it might possibly have then found other property of Davis or of the endorsers to have attached, although it has not proven that any such attachable property was then in existence. To give such an effect to mere possibilities would be substituting "hazy and indefinite notions" for the established equitable principles above set forth. In this connection, in Hanna v. Florence Iron Co., 222 N.Y. 290,302, 118 N.E. 629, the court spoke as follows: "The principles of estoppel . . . are reasonably well defined and plain, and we ought not to substitute for them some hazy and indefinite notions whereby in the supposed interests of justice a convenient theory of estoppel is predicated upon facts which do not fairly sustain it." The court was fully justified in its conclusion that the receiver of the Wilkenda Land Company was not estopped to show that at the time of the attachment Davis owned only one share of its stock, and that to that extent only was it liable, after judgment against Davis, to the Park Trust Company.

There is no error.

In this opinion the other judges concurred.