Canton Placer Mining Co. v. State

WOOD (Fred B.), J. pro tem.* On August 14, 1956, during the course of proceedings for the dissolution of Canton Placer Mining Company, a corporation, a decree was rendered which found a balance on hand of $79,006.02 and ordered $65,000 “distributed ... by way of partial distribution” to the stockholders, according to their respective stock holdings, specifying the amount each was to receive, declaring that said sum of $65,000 “shall be and is apportioned . . . and ordered paid out” in the several amounts therein set forth.

The decree also found that certain of the stockholders had disappeared or died and ordered that “liquidating dividends awarded ... [to them] . . . shall be deposited forthwith pursuant to the provisions of section 5009 of the Corporations Code in the hands of the State Treasurer .... for a period of three years under the provisions of section 5011 of the [615]Corporations Code . . . and if any such dividends shall he unclaimed within said period of three years then said liquidating dividends so unclaimed shall be reclaimed by the corporation and distributed under Court order in this proceeding, pro rata among the other stockholders who are shareholders of such corporation at the time of this distribution.” No appeal has been taken from this decree.

After the expiration of three years, the corporation petitioned for refund of the deposits which remained unclaimed. Respondents (the Controller, the Treasurer and the State) interposed a general demurrer to the petition. It was overruled with leave to answer. Upon their declining to answer, an order was made granting the petition. Respondents thereupon appealed from the order.

Their sole attack is upon that portion of the 1956 decree which directed the refund, after three years, for distribution “pro rata among the other shareholders of such corporation at the time of this distribution. ’ ’ They concede that this is a proceeding in rem and that the decree binds them insofar as it is legally effective and final. They claim that the provisions for distribution after the lapse of three years were erroneous, interlocutory and ineffective. We are not persuaded. Our analysis convinces us that those provisions of the decree were in exact compliance with the then applicable provisions of law and are not now subject to attack, direct or collateral.

The following mandate of section 5011 of the Corporations Code applied and governed: “If no claimants have made satisfactory proof of title within three years from the time of deposit pursuant to section 5009 or 5010, the property so unclaimed shall be distributed pro rata among those others who were shareholders at the time of distribution and their successors . . .” (§ 5011 was added by Stats. 1955, ch. 1792, p. 3306 at p. 3308, effective July 8, 1955, and continued operating until repealed by Stats. 1957, ch. 1020, p. 2257 at p. 2258, effective September 11, 1957.) It was a restoration of the text of that section as it had existed from enactment of the code in 1947 (Stats. 1947, gh. 1038, p. 2309 at p. 2396) until repealed in 1953 (Stats. 1953, ch. 1686, p. 3415). The substance of its text appeared in the Civil Code as a part of section 403d thereof, from 1931 to 1947. (See Stats. 1931, eh. 862, p. 1762 at p. 1828; Stats. 1933, ch. 533, p. 1358 at p. 1413 ; Stats. 1941, ch. 509, p. 1820 at p. 1821; repealed, upon enact