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Objections not made in the court below will be considered waived. McCarthy v. Neu, 91 Ill. 127; Railroad Co. v. Chester, 62 id. 235; Wickenkamp v. Wickenkamp, 77 id. 92.
The court said that though a return of nulla bona was made a prerequisite to the issuing of notice of garnishment, still the failure to make such a return was an irregularity that might be waived. Cruikshank v. Cogswell, 26 Ill. 366; Center v. Gibney, 71 id. 557; Stevens v. Dillman, 86 id. 233; Truitt v. Griffin, 61 id. 26; Clifford v. Eagle, 35 id. 444; Tisdale v. Minonk, 46 id. 9; Evans v. Bouton, 85 id. 579.
The affidavit filed on October 11 was unnecessary, as section 8 of chapter 32 makes no provision therefor. Evans v. Bouton, 85 Ill. 581.
It being impossible to comply strictly with either chapter 11 or 62, it is reasonable to say that those chapters should give way pro tanto, dispensing with the affidavit. 23 Am. & Eng. Ency. of Law, 430, 479; Kepley v. People, 123 Ill. 367; Culver v. Bank, 64 id. 528; Devine v. Board of Comrs. 84 id. 590.
The liability of stockholders for unpaid subscriptions is contractual, wherefore statutes imposing such liability should receive a liberal construction. 23 Am. & Eng. Ency. of Law, 869, 870; Gauch v. Harrison, 12 Ill. App. 457.
Pleading over after demurrer overruled waives all objections to former proceedings, and the pleader cannot assign error in regard to any ruling thereon. Harmon v. Thornton, 2 Scam. 352; Snyder v. Gaither, 3 id. 91; Vanderbilt v. Johnson, id. 48; Barnes v. Brookman, 107 Ill. 317.
Creditors may recover in garnishment proceedings against a stockholder, even where the corporation has no right of action against such stockholder. Telegraph Co. v. Gray, 122 Ill. 630.
A contractual relation exists between the creditor and stockholder. 23 Am. & Eng. Ency. of Law, 870; Eames v. Doris, 102 Ill. 350; Schalucky v. Field, 124 id. 621; Morawetz on Private Corp. sec. 872.
KRAFT, WILLIAMS & KRAFT, for appellee:
If the plaintiff fails to put in issue the garnishee's answer, but asks for judgment thereon, (as was the fact in this case,) the garnishee is entitled to be discharged unless his answer clearly charges him. People v. Johnson, 14 Ill. 342; Kergin v. Dawson, 1 Gilm. 86; Railroad Co. v. Killenberg, 82 Ill. 296; Pierce v. Carleton, 12 id. 358.
It is the right of the garnishee to inquire into the propriety of the judgment against his debtor upon which he is garnisheed, and if no valid judgment was rendered. against the judgment debtor none can be given against the garnishee. Pierce v. Wade, 19 Ill. App. 185; Pierce v. Carleton, 12 Ill. 358; Chanute v. Martin, 25 id. 49; Cariker V. Anderson, 27 id. 358.
The affidavits cannot be filed after suit has been commenced. Gibbon v. Bryan, 3 Ill. App. 298; Schaumtoeffel v. Belm, 77 Ill. 567; Willer v. French, 27 Ill. App. 76; Burns v. Nash, 23 id. 552; Stolberg v. Ohnmacht, 50 Ill. 442; Evans v. Bouton, 85 id. 579; Bartell v. Bauman, 12 Ill. App. 450; Abbott v. Kruse, 37 id. 549.
The affidavit should be the foundation, and precede any proceedings against appellant as garnishee. It is jurisdictional and cannot be filed after suit is commenced, even pursuant to leave of court, as was done in this case. Stolberg v. Ohnmacht, 50 Ill. 442; Evans v. Bouton, 85 id. 579.
Mr. JUSTICE CARTWRIGHT delivered the opinion of the court:
Judgment was recovered in this proceeding in the circuit court of Cook county against appellee, as garnishee, for an alleged balance due from him as a stockholder of the World's Fair Excursion and Transportation Boat Company, upon stock of that corporation held by him. The Appellate Court reversed the judgment without remanding the cause, and granted a certificate of importance, in pursuance of which the case is brought to this court.
The suit was brought under section 8 of the act concerning corporations for pecuniary profit. Gustav A. Fehr, on June 22, 1893, commenced suit in assumpsit against the corporation, and at the same time, by his præcipe, directed the clerk to issue a summons as in case of garnishment, against appellee and others, stockholders in said corporation, under said section of the statute. The garnishee summons was issued and served, and judg ment was entered in the suit in assumpsit July 26, 1893, for $327.45 and costs. Interrogatories were filed August 11, 1893. Execution was issued against the corporation, and returned nulla bona November 7, 1893. Appellee failing to answer the interrogatories, a conditional judgment was entered against him August 26, 1893. On October 11, 1894, by leave of court, an affidavit was filed by Gustav A. Fehr, setting forth the existence of the corporation, the indebtedness to him, the insolvency of the corporation, and that appellee and others were owners of capital stock on which there was a balance unpaid. This affidavit was filed as an amendment to the proceedings, and the garnishees were ruled to answer upon the amended proceedings and interrogatories theretofore filed, within twenty days. Appellee again failed to answer the interrogatories within the rule, and another conditional judg ment was entered. A scire facias having been issued and served, appellee and another of the garnishees appeared and filed a general demurrer to "the declaration and record of said cause and the matters and things therein contained." This was overruled, and the garnishees were required to answer within ten days. On December 15, 1894, appellee appeared with the other garnishee, and showed cause why the conditional judgment should not be made final, as follows:
"(1) Because this court is without jurisdiction of the subject matter as to these respondents, by reason of the non-compliance by the plaintiff of the requirements of section 8 of chapter 32 of the Revised Statutes of Illi
nois, entitled 'An act concerning corporations,' under the provisions of which section plaintiff claims the right to proceed against these respondents. (2) Because the interrogatories which plaintiff seeks to require these respondents to answer were not filed within the time by law allowed, and therefore these respondents are not bound to answer same. (3) Because, at the time of the service of process herein, each of these respondents were respectively the owners of five shares of the capital stock of the said plaintiff corporation, each of which shares of stock was of the par value of $100, and for which shares of capital stock these respondents were respectively original subscribers, and these respondents had, by agreement entered into with the said corporation, each paid to the corporation, in full payment and satisfaction for each and all of their five shares of stock, the sum of two hundred and fifty dollars ($250) each, and that after the payment of the sums of $250 by each of these respondents there remained nothing due or unpaid to the said corporation for the said shares of stock of these respondents. (4) Because neither of these respondents, nor any person for either of them, at no time prior to the services of process herein, ever held nor transferred any capital stock other than that above referred to."
Various objections are made to the sufficiency and regularity of the proceedings, but we shall oply consider those stated in appellee's answer, as we regard others as having been waived. So far as the record shows, nothing else was brought to the attention of the circuit court, and the statement of specific objections to the proceedings and entry of judgment must be regarded as a waiver of other objections, if there were any which might have been made.
The first objection so specified was non-compliance with the requirements of section 8, and under this objection it is urged that an affidavit should have been filed when the suit in assumpsit was commenced, substantially
as provided in the act in regard to garnishment after judgment and execution, showing that the corporation had no property within the knowledge of affiant, and that the garnishees were indebted to it, etc. It is claimed that such an affidavit was a prerequisite to the issuing of process, and that the filing of such an affidavit subsequently, even pursuant to leave of court, did not give the court jurisdiction. It is also argued that the statute does not authorize the commencement of a proceeding against the stockholders at the time when the original suit is instituted against the corporation. These objections will be considered together.
Section 8 above referred to provides, among other things, as follows: "Each stockholder shall be liable for the debts of the corporation to the extent of the amount that may be unpaid upon the stock held by him, to be collected in the manner herein provided. * * * Whenever any action is brought to recover any indebtedness against the corporation, it shall be competent to proceed against any one or more stockholders at the same time, to the extent of the balance unpaid by such stockholders upon the stock owned by them, respectively, whether called in or not, as in cases of garnishment." The statute plainly provides for proceeding against stockholders as in cases of garnishment when the action is brought against the corporation. In Coalfield Co. use, etc. v. Peck, 98 Ill. 139, a proceeding had been instituted under section 8, after judgment and execution, and it was insisted that the only garnishee proceeding meant by the statute was that of garnishment as in original attachment. It was there said that there were two modes known to our law by which, through garnishment, a debt owing by another to a judgment debtor might be reached. and made subject by the judgment creditor to the payment of his judgment, one of which was provided for in the Attachment act and the other in the act in regard to garnishment, where there had been a judgment obtained