§ 5651. When corporation may petition for dissolutionWhen a majority of the directors, trustees, or other officers having the management of the concerns of any corporation, or stockholders representing not less than one-third of the capital stock of any corporation, organized under the laws of the state, discover that the stock, property and effects of the corporation have been so far reduced, by losses or otherwise, that it will not. be able to pay all just demands to which it may be liable, or to afford a reasonable security to those who may deal with it, or deem it beneficial to the interests of the stockholders that the corporation be dissolved, or when such directors, trustees or other officers are authorized, by a majority of the stockholders, to apply for a judgment as hereinafter provided, or when the objects. of the corporation have wholly failed, or are entirely abandoned, or it is impracticable to accomplish such objects, they may apply to the court of common pleas of the county, or the superior court of the city or county, in which the principal place of conducting the business of the corporation is situate, by petition for the dissolution of such corporation, pursuant to the provisions of this chapter. 72 v. 138, § 1.

Dissolution of corporations.-The modes by which a corporation in Ohio may be dissolved are: 1. By the death of its members; 2. Surrender of its

franchises; and 3. A judgment of forfeiture for non-user or abuse. Trustees, etc., v. Manufacturing Co., 9 Ohio, 203. But now, by the provisions of sections 5651, 5673 and 5674, an additional mode is provided.

Ouster for abuse of franchises rests in sound discretion of the court. State ex rel. v. People's, etc., Assn., 42 Ohio St. 579.

Ouster is not retroactive as to transactions in good faith. Society Perun v. City of Cleveland, 43 Ohio St. 481.

Directors may be required to pay the costs of such proceeding. Godley v. Pugh, 29 Ohio St. 438.

Where a canal company has the right to use the bed and waters of a river only for canal purposes, upon ouster from its franchises and dissolution by order of court, the trustees winding up its affairs have no power to convey such rights, but they revert to the proper owners. Day v. R. R. Co., 44 Ohio St. 406.

Upon application under this section, a receiver cannot be appointed until after the order has been made dissolving the corporation. Section 5587 does not apply to such a proceeding. Bacon et al. v. N. W. Stove Co., 5 C. C. 289.

Proceedings under these sections cannot be appealed from the court of common pleas to the circuit court. Brown v. Sayler, 54 Ohio St. 246. See Cronin v. Potter's Co-op. Co., 29 B. 52 (C. P.), and Building Co. v. Rehn, 6 N. P. 185 (Sup. Ct. Cin.).

§ 5652. What petition must contain

Such application shall contain a statement of the reasons which induce the applicants to desire a dissolution of the corporation, and there shall be annexed thereto

1. A full, just and true inventory of all the estate, both real and personal, in law and equity, of the corporation, and of all the books, vouchers and securities relating thereto.

2. A full, just and true account of the capital stock, if any, of the corporation, specifying the names of the stockholders, their residence, when known, the number of shares belonging to each, the amount paid in upon such shares, respectively, and the amount still due thereon.

3. A statement of all the incumbrances on the property of the corporation, and of all engagements entered into by it, which have not been fully satisfied or canceled, specifying the place of residence of each creditor, and of every person to whom such engagements were made, if known, and if not known, the fact to be so stated, and the sum owing to each creditor, the nature of each debt or demand, and the true cause and consideration of such indebtedness. 64 v. 153, § 3; S. & S. 243.

An Ohio corporation has no right to refuse to make true disclosure of its

condition in an action by stockholders under these sections; an order upon the officers requiring them to file an inventory, etc., invades no legal right. Armstrong, Receiver, v. Herancourt Brewing Co., 53 Ohio St. 467, reversing 6 C. C. 468. See also Fitch v. Sprague Carriage Co., 19 C. C. 296.

§ 5653. Affidavit to be attached to petition

To every such petition there shall also be annexed an affidavit of the applicants, that the facts stated in the application, and the accounts, inventories, and statements contained therein or annexed thereto, are just and true, so far as they know, or have the means of knowing. 64 v. 153, § 3; S. & S. 243.

§ 5654. Notice of the pendency of the petition

Upon such petition, accounts, inventories, and affidavits being filed, an order shall be entered requiring all persons interested in the corporation to show cause, if any they have, why it should not be dissolved, before some referee or master commissioner appointed by the court, and to be named in the order, at a time and place therein to be specified, not less than three months from the date thereof; and a notice of the contents of such order shall be published once in each week for three weeks successively, in some newspaper published and of general circulation in the county wherein the principal place of business of the corporation is situate. 64 v. 153, §§ 4, 5; S. & S. 243, 244.

§ 5655. Hearing before the master

On the day appointed in the order, the referee or master shall proceed to hear the allegations and proofs of such parties, take testimony in relation thereto, and, with all convenient speed, report the same to the court, with a statement of the property, effects, debts, credits, and engagements of the corporation, and of all other matters and things pertaining to its affairs. 64 v. 153, § 6; S. & S. 244.

§ 5656. When a judgment for dissolution to be rendered

When the report is made, if it appears to the court that the corporation is insolvent, or that a dissolution thereof will be beneficial to the stockholders and not injurious to the public interest, or that the objects of the corporation have wholly failed, or been entirely abandoned, or that it is impracticable to accomplish such

objects, a judgment shall be entered dissolving the corporation, and appointing one or more receivers of its estate and effects; and the corporation shall thereupon be dissolved and shall cease. 64 V. 153, §7; S. & S. 244.

§ 5657. Who may be appointed receiver

A director, trustee, or other officer of the corporation, or any of its stockholders, may be appointed a receiver; and a receiver shall, before entering upon the duties of his appointment, give such security to the state, and in such penalty, as the court shall direct, conditioned for the faithful discharge of the duties of his appointment, and for the due accounting for all the money received by him. 64 v. 153, § 8; S. & S. 244.

Such receiver shall be vested with all the estate, real or personal, of the corporation, from the time of his having filed the security hereinbefore required, and shall be trustee of such estate for the benefit of the creditors of the corporation and its stockholders; and he shall have all the power and authority conferred by law upon trustees to whom assignments are made for the benefit of creditors. 64 v. 153, $$ 9, 10; S. & S. 244.

See note to section 3593.

If the receiver does not attempt to recover property fraudulently conveyed before dissolution, a creditor may bring suit, making the receiver party, and the court will make all orders as if the receiver had begun the action. Monitor Furnace Co. v. Peters, 40 Ohio St. 575.

§ 5659. Unpaid subscriptions to be collected

If there be any sum remaining due upon any share of stock subscribed in the corporation, the receiver shall immediately proceed and recover the same, unless the person so indebted is wholly insolvent, and for that purpose may commence and prosecute an action for the recovery of such sum, without the consent of any creditor of the corporation. 64 v. 153, § 11; S. & S. 244.

§ 5660. Duties of receiver

The receiver shall, immediately on his appointment, give notice thereof, which shall contain the same matters required by law in notices of trustees of insolvent debtors, and in addition thereto it shall notify all persons holding any open or subsisting contract

of the corporation to present the same to him, in writing and in detail, at the time and place in such notice specified, which shall be published for three weeks in some newspaper printed and of general circulation in the county wherein the principal place of business of the corporation is situate. 64 v. 153, § 12; S. & S. 244.

$5661. Transfers pending the action void

All sales, assignments, transfers, mortgages, and conveyances, of any part of the estate, real or personal, including things in action, of every description, made after the petition for the dissolution of the corporation is filed, in payment of or as security for any existing or prior debt, or for any other consideration, and all judgments confessed by such corporation after that time, shall be absolutely void as against the receiver appointed on such petition, and as against the creditors of the corporation. 64 v. 153, § 13; S. &. S. 244.

A mortgage cannot be assigned by officers of the company after proceedings for dissolution are begun. Hinman, Receiver, v. Ryan, 3 C. C. 529.

§ 5662. Duties of creditors and other persons

After the first publication of the notice of the appointment of a receiver, every person, having possession of any property belonging to the corporation, and every person indebted thereto, shall account and answer to the receiver for the amount of such debt, and for the value of such property; and all the provisions of law in respect to trustees of insolvent debtors, the collection and preservation of the property of such debtors, the concealment and discovery thereof, and the means of enforcing such discovery, shall be applicable to such receiver, and to the property of the corporation, except as otherwise provided herein. 64 v. 153, §§ 14, 15; S. &. S. 245.

§ 5663. Meeting of creditors

The receiver shall call a general meeting of the creditors of the corporation, within four months from the time of his appointment, at which all accounts and demands for and against the corporation, and all its open and subsisting contracts, shall be ascertained and adjusted, as fully as may be, and the amount of money in the hands of the receiver declared; and he may settle