Argument for Plaintiff in Error. The inferior court of Iowa, in which this action was brought, gave judgment for the defendant. The plaintiff appealed to the Supreme Court of Iowa, which affirmed the judgment, upon the ground that the action was barred by the statute of limitations. 83 Iowa, 430. The plaintiff sued out this writ of error; and assigned for error that the Supreme Court of Iowa did not give full faith and credit to the decree of assessment of the court of Illinois, as required by art. 4, sect. 1, of the Constitution, and section 709 of the Revised Statutes of the United States. Mr. Thomas J. Sutherland, (with whom was Mr. William P. Black on the brief,) for plaintiff in error. I. The question of full faith and credit was fairly set out, and involved in the pleadings and decision of the Supreme Court, as well as in the district court of Iowa. Chicago Life Ins. Co. v. Needles, 113 U. S. 574; Powell v. Brunswick County, 150 U. S. 433; Sayward v. Denny, 158 U. S. 180; Maxwell v. Newbold, 18 How. 516; Murdock v. Memphis, 20 Wall. 590; Bolling v. Lersner, 91 U. S. 595; Crowell v. Randell, 10 Pet. 368; Texas & Pacific Railway v. Southern Pacific Co., 137 U. S. 48; Kaukauna Co. v. Green Bay & Canal Co., 142 U. S. 254. II. The Federal question was erroneously decided, and the decision of the Supreme Court of Iowa rests upon no ground broad enough to sustain its judgment independent of its decision of the Federal question. -- There is but really one point in the whole opinion. The Iowa court gave judgment against the plaintiff, and applied the statute of limitations of Iowa, of ten years, as a bar to the plaintiff's action, because the board of directors- the defendant's own agents had not made a valid call or commenced an action against the defendant, for ten years before this action was begun. This is the sole ground of the decision, and the court could only have arrived at such a decision by holding that the decree of assessment of the Illinois court coupled with the demand of the receiver for payment, made Opinion of the Court. in pursuance of the decree, could not, and did not, create a cause of action. It was clearly only colorable, and no proper ground on which to defeat the plaintiff and ignore the Federal question, or decide it adversely to the claim of the plaintiff. The decree of the Illinois court which had jurisdiction of the subject-matter and of the parties, was, and is, conclusive upon the merits of the controversies, determined by that judgment between the parties and their privies, in every court in the United States, and can not be collaterally questioned. Christmas v. Russell, 5 Wall. 290; Maxwell v. Stewart, 22 Wall. 77; Anderson v. Anderson, 8 Ohio, 108; Mason v. Messenger, 17 Iowa, 261; Smith v. Smith, 22 Iowa, 516; Burlington & Missouri Railway v. Hall, 37 Iowa, 620. Mr. S. L. Glasgow for defendant in error. MR. JUSTICE GRAY, after stating the case, delivered the opinion of the court. By art. 4, sect. 1, of the Constitution of the United States, "Full faith and credit shall be given in each State to the public acts, records and judicial proceedings of every other State. And Congress may, by general laws, prescribe the manner in which such acts, records and proceedings shall be proved and the effect thereof." In the exercise of the power so conferred, Congress, besides providing the manner in which the records and judicial proceedings of the courts of any State shall be authenticated, has enacted that "the said records and judicial proceedings, so authenticated, shall have such faith and credit given to them in every court within the United States, that they have by law or usage in the courts of the State from which they were taken." Act of May 26, 1790, c. 11; 1 Stat. 122; Rev. Stat. § 905. The plaintiff relied on the order of assessment, made by a court of the State of Illinois, as a judgment of that court, entitled to the effect of being conclusive evidence of the plaintiff's right to maintain this action against the defendant. The Supreme Court of the State of Iowa denied it that effect. Opinion of the Court. The question whether that court thereby declined to give full faith and credit to a judicial proceeding of a court of another State, as required by the Constitution and laws of the United States, was necessarily involved in the decision. This court therefore has jurisdiction of the case, but must judge for itself of the true nature and effect of the order relied on. Armstrong v. Treasurer of Athens County, 16 Pet. 281, 285; Texas & Pacific Railway v. Southern Pacific Co., 137 U. S. 48; Grover & Baker Co. v. Radcliffe, 137 U. S. 287; Carpenter v. Strange, 141 U. S. 87; Huntington v. Attrill, 146 U. S. 657, 666, 683-686, and cases cited. By the original contract between the parties, made in the State of Iowa on February 16, 1869, Purdy, the present defendant, agreed to take fifty shares, of the par value of $25, in the plaintiff company, and to pay five per cent (which he did) and "the balance as the directors from time to time may order;" and the company agreed to issue the shares to him as soon as forty per cent had been paid. On November 19, 1869, Purdy and other subscribers for shares filed in a court of the State of Illinois a bill in equity to compel the company to issue shares to them, and to set aside as fraudulent a contract by which the company had agreed to transfer all its capital stock to one Reeve; and upon that bill, on November 16, 1872, obtained a decree, setting aside that contract, and ordering shares to be issued to the subscribers as prayed for, and a new board of directors to be chosen. By that decree, all the objects of the suit were accomplished, so far as Purdy was concerned; and he does not appear to have had any notice of, or part in, any further proceedings. That bill did not ask for the appointment of a receiver, or for any order of assessment upon stockholders. The subsequent proceeding, begun September 19, 1874, alleging mismanagement and fraud of the new officers and the insolvency of the company, was by other stockholders, and although entitled a "supplemental bill," and permitted by the court to be filed in the former cause, was a distinct proceeding, in which Purdy had and took no interest. The orders of the court upon this proceeding, appointing on October Opinion of the Court. 7, 1874, a receiver, and on July 10, 1886, making a "call or assessment" upon the stockholders of the company, were entered without any notice to him, or consent on his part. He was not personally a party to this proceeding, nor named therein. The receiver was appointed almost two years, and the assessment ordered more than thirteen years, after Purdy had ceased to have any connection with the litigation. There can be no doubt that, as heretofore declared by this court, "after a decree disposing of the issues and in accordance with the prayer of a bill has been made, it is not competent for one of the parties, without a service of new process, or appearance, to institute further proceedings on new issues and for new objects, although connected with the subject-matter of the original litigation, by merely giving the new proceedings the title of the original cause. If his bill begins a new litigation, the parties against whom he seeks relief are entitled to notice thereof, and without it they will not be bound." Smith v. Woolfolk, 115 U. S. 143, 148. The question therefore is of the effect, as against Purdy, of the order for an assessment, made by the Illinois court in a proceeding to which the corporation was a party, but to which he personally was not. The order of that court was in effect, as it was in terms, simply a "call or assessment" upon all stockholders who had not paid for their shares in full. It was such as the directors might have made before the appointment of a receiver; and in making it the court, having by that appointment assumed the charge of the assets and affairs of the corporation, took the place and exercised the office of the directors. Scovill v. Thayer, 105 U. S. 143, 155; Hawkins v. Glenn, 131 U. S. 319, 329; Lamb v. Lamb, 6 Bissell, 420, 424; Glenn v. Saxton, 68 California, 353; Great Western Tel. Co. v. Gray, 122 Illinois, 630, 636, 640; Great Western Tel. Co. v. Loewenthal, 154 Illinois, 261. The order of assessment, whether made by the directors as provided in the contract of subscription, or by the court as the successor in this respect of the directors, was doubtless, unless directly attacked and set aside by appropriate judicial Opinion of the Court. proceedings, conclusive evidence of the necessity for making such an assessment, and to that extent bound every stockholder, without personal notice to him. Hawkins v. Glenn, 131 U. S. 319; Glenn v. Liggett, 135 U. S. 533; Glenn v. Marbury, 145 U. S. 499. But the order was not, and did not purport to be, a judgment against any one. It did not undertake to determine the question whether any particular stockholder was or was not liable in any amount. It did not merge the cause of action of the company against any stockholder on his contract of subscription, nor deprive him of the right, when sued for an assessment, to rely on any defence which he might have to an action upon that contract. In this action, therefore, brought by the receiver, in the name of the company, as authorized by the order of assessment, to recover the sum supposed to be due from the defendant, he had the right to plead a release, or payment, or the statute of limitations, or any other defence, going to show that he was not liable upon his contract of subscription. In each of the three cases last cited above, the defence of the statute of limitations was entertained and passed upon. Hawkins v. Glenn, 131 U. S. 332; Glenn v. Liggett, 135 U.S. 547; Glenn v. Marbury, 145 U. S. 506. The whole effect of the order of assessment being to fix the amount which any stockholder liable under his contract of subscription should pay, and to authorize the receiver to bring suits against stockholders for the same, but not to determine whether the present defendant, or any other particular stockholder was liable for anything, the Iowa court, by sustaining the defence of the statute of limitations, did not deny to the judicial proceeding of Illinois the full faith and credit to which it was entitled. The statute of limitations of the State of Iowa provides that "the following actions may be brought within the times herein limited respectively after their causes accrue, and not afterwards, except when otherwise specially declared." "4. Those founded on unwritten contracts, those brought for injuries to property, or for relief on the ground of fraud VOL. CLXII-22 |