Robert C. (Robert Cushing) Cumming.

The annotated corporation laws of all the states, generally applicable to stock corporations ... in three volumes online

. (page 63 of 92)
Online LibraryRobert C. (Robert Cushing) CummingThe annotated corporation laws of all the states, generally applicable to stock corporations ... in three volumes → online text (page 63 of 92)
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own benefit against the debtor stock sub-
scribers of a corporation; bat, to subject un-
paid stock subscriptions to the payment of
corporate debts, all debtor stock subscribers
and all creditors of the corporaticm within
the Jurisdiction of the court should be made
parties. Id.; German Nat Bank y. Farmers
& Merchants' Bank, Sup. Gt Neb.; s. c,
74 N. W. Rep. 1086.

'^ Ascertained/' means what, in const., art.
ziii, f 4.
The word "ascertained" as used in this
section means Judicially ascertained; and to
Judicially ascertain the amount due from a
corporation to its creditor, there must be a
finding and Judgment or decree of a court as
to such amount German Nat Bank y.
Farmers & Merchants' Bank, 54 Neb. 593;
8. c, 74 N. W. Rep. 1086.

Contribution between stockholders.

Where a stock subscriber discharges a
debt of an insolyent corporation for which
all the stock subscribers thereof are liable,
he may maintain an action for contribution
against his co-stock subscribers. He is not
estopped from maintaining such a suit be-
cause he participated in a distribution made
of the assets of the corporation by the stock-
holders thereof, the debt disdiarged by him
not being proyided for in such distribution.
Bennison y. Mc€k>nnell, 8up. Ot Neb.;
8. c, 76 N. W. Rep. 412.

Within the common-law rule, there was no
indiyidual liability of stockholders in a cor-
poration for its debts. The aboye section
(Const, art XIII, 9 4) limits the liabiUty
of stocldiolders for the ccHrporate debts.
8uch liability is measured by the stock-
holder's unpaid subscription. A Toluntary
assumption of the debt of a corpora-
tion, or a yoluntary payment of its debt
or the two in combination, will not alone
confer on a stocldiolder the right to contribu-
tion from the other stockholders. An agree-
ment by stockholders to indemnify one for
the personal assumption or payment of a
corporate debt or to contribute, may be en-
forced. Oorder y. Connor, Sup. Ct Neb.;
8. c, 77 N. W. Rep. 383.

Orerraluation of property in payment of
stock subscription.
Owners of property have a right in dis-
posing of it to place such valuation thereon
as they see fit; and if, with such property
at an overyaluation, they pay for capital
stock issued to them by a corporation, the
excess above the real value of the property
cannot subsequently be treated by creditors
of the corporation as never having been
paid, in the absence of fraud, misrepresenta-
tion, suppression of the truth, and the viola-
tion of the obligationB of law or morality,



egress or implied. A purchaser of capital
stock from one who has fully paid for the
same in property, cannot be held liable ts
creditors of such corporation, aoleHj on the
theory that the property, recognised as a
proper medium of payment had been ac-
cepted as payment by the corporation at too
high a valuation. Troup v. Horbach, Sup.
Ot Neb.; s. c, 74 N. W. R^. 826.

Liability of stockholders for oyervalnation
on stock subscription.

In an action to hold liable to creditors of
a corporation certain of its stockholders, be-
cause, as found by the court the property
conveyed by such stockholders in payment
for their stock was greatly overvalued, a
Judgment against the stocldiolders was im-
properly rendered in view of the further
finding that the defendants acted in good
faith, and without any attempt to defraud
such corporation or its creditors; the evi-
dence being sufficient to sustain both find-
ings. Penfield v. Dawson Town & Gas Co.,
Sup. Ct Neb.; s. c, 77 N. W. Rep. 672.

Bight to vote; illegal election.

Prima facie, at least the right to vote
stock in a corporation does not exist until
such stock has been registered in the name
of the perscm seeking to vote it. A stock-
holder may obtain an injunction to restrain
persons claiming to have been elected as
directors, from acting as such, where the
election was illegal and void. Reynolds v.
Bridenthal, Sup. Ct Neb.; s. c, 77 N. W.
Rep. 658.

Neb. Stats., § 324; Anno. Corp. L., Neb.,
p. 9; Constitution, art Xin, 9 5.

Liability of directors for false reports.

The directors of an insolvent national
bank are personally liable, at the suit of one
purchasing stock of such bank, for damages
sustained by reason of the insolvency of the
corporation, where the plaintiff is Induced
to make such purchase by false representa-
tions of solvency, contained In reports made
by the bank to the comptroller of the cur-
rency, and attested by the directors, and
published in pursuance of law, even though
the directors were unaware that such re-
ports and representations were false or un-
true, and were made without intention to
defraud. Gemer v. Mosher, 78 N. W. Rep.
384.

Neb. Stats., § 353; Anno. Corp. L., Neb.,
p. 15.

Examination of books.

Assuming it to be the right of a stock-
holder in a corporation to examine the books
thereof. It is not as a matter of law, his
duty to do so, after becoming a stockholder,
for the purpose of ascertaining whether or
not he has been defrauded in the purchase
of sudi Ptook; ho not helng aware of any



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8



NEBRASKA.



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fact leading to a Buspidon that he may have
been 8o defrauded. Garner y. Mosher, 78
N. W. Rep. 884.

Neb. Stats., 9 487; Anno. Corp. L., Neb.,
Pwl7.

Appointment of receiTer on application of
•tockliolder.
A receiver will not be appointed for a
corporation at the instance of a stockholder
merely because of a difference of opin-
ion between him and the officers or the
holders of a majority of the stock as to the
proper policy of managing the corporate af-
fairs; but one will be so appointed when it
Is shown that the officers and the holders of
a majority of the stock are fraudulently mis-
managing the corporate business, converting
its property to their individual use, and
abusing their powers to the injury of other
stockholders. The wrongdoers being in con-
trol of the corporation, both through its
stock, and by being the officers thereof, it is
not essential for a complaining stockholder
to show, as a condition of maintaining his
suit, that he first made a demand on the
officers to proceed on behalf of the corpora -
tion itself to remedy the wrongs complained
of. Ponca Mill Ck). v. Mikesell, 66 Neb. 98;
75 N. W. Bep. 46.

Actions; summons and pleadings.

In suing a corporation it is not necessary
that in the summons it be described as such.
A petition — at least after answer to the
merits — is not open to attack because it
does not allege the corporate character of
the defendant G^erman Ins. Go. v. Freder-
ick, Sup. Ot Neb.; s. c, 77 N. W. Rep.
1106.



Actions; pleadings.

In an action by a corporation, if its name
imports a corporation, it is not essential to
aver in terms its corporate existence, or to
plead the act of incorporation. A general
denial does not place in issue the pleaded
existence of the corporation. Fletchw v.
Ck>-operative Pub. Co., 78 N. W. Rep. 1670.

Confession of Judgment.

Under the Nebraska statute corporations
for pecuniary profit may sue and be sued,
complain and defend, in cofirts of law and
equity, and therefore the statute conferring
power upon any person to confess Judgment
applies to such corporations, and enables it
to confess Judgment for an amount actually
due, if the transaction is without fraud.
Solomon v. O. M. Schneider Co., Sup. Ot.
Neb.; s. c, 77 N. W. Rep. 66.

Action to recover price of stock.

To maintain an action at law for the pur-
chase price of corporation stock, plaintiff
ordinarily must plead and prove a delivery
or tender of such stock before bringing the
suit Bartlett v. Scott, 66 Neb. 477; s. c,
76 N. W. Rep. 1102.

intra Tires.

Where a corporation borrows money and
executes a mortgage on its real estate to
secure the payment thereof, a third person
cannot assail the transaction on the ground
of ultra vires, or that the corporation ex-
ceeded its power. Reels v. Nat Fair and
Driving Park Assn., 64 Neb. 227; s. c, 74
N. W. Rep. 681.



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NEVADA.



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NEVADA.



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NEVADA.



LAWS OF 1899.



CHAPTEB 5.

Compilation of Laws.

AN ACT to provide for the compiling and

publishing of the laws of the State of

Nevada. (Approved February 15, 1890.)

The above act provides for a compiled and
annotated copy of the laws of the State of
Nevada, to be completed by September 1,
1899, and approved by Justices of the su-
preme court. It will probably be published
about January 1, 1900, too late for considera-
tion in this annual.

CHAPTEB 9.

Increase in Number of Shares.
AN ACT to enable corporations to divide
their capital stock into shares of lesser
denomination.



Section 1. All corporations organized anil
existing under the laws of this State, desir-
ing to divide the capital stock of the corpora-
tion into shares of smaller denomination
than originally issued, may do so by a
majority vote of the trustees of the corpora-
tion at any regular or called meeting of the
trustees, and may issue the stock of such
corporation in accordance therewith, after
having filed in the office of the secretary of
State a certificate setting forth the amount
or denomination in which they propose to
divide such shares, verified by the affidavit
of a majority of such trustees.

§ 2. This act shall not be construed as en-
abling any corporation to change the amount
of its capital stock.

See Anno. Corp. L., Nev., p. 10.



DECISIONS,

(Include 58 Pac. Bep. 192.)



Foreign corporations.

Held, under Laws 1889, p. 47 (Anno. Corp.
L., Nev., p. 16, 9 1074a), which requires a for-
eign corporation doing business or owning
property within the State to appoint an
agent on whom process can be served, and
in case of failure, allowing service to be
made on the secretary of State, that an alle-
gation that defendant owns certain speci-
fied mining claims in the State, is a suffi-
cient showing that it owns property within



the State. Brooks v. Nevada Nickle Syndi-
cate, Sup. Ct Nov., 53 Pac. Bep. 597. If the
conveyance as alleged is merely a mortgage,
it is a sufficient allegation that the corpora-
tion is doing business, and in case of its
failure to designate an agent, process may
be served on the secretary of State. Id.
The fact that the company has no such
agent may be shown by the record. Id. The
certificate of the sheriff is not sufficient to
show that the company has no such agent.
Id.



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NEW HAMPSHIRE.



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NEW HAMPSHIRE.



LAWS OF 1899.



CHAPTER 60.

Trading Stamps.

AN ACT to prevent the use of trading

stamps, coupons and other deyices on the

sale or exchange of property.

Section 1. No person or company shall, in
the sale, exchange, or disposition of any
property, giye or deliyer, in connection there-
with or in consideration of said sale, ex-
change, or disposition, any stamp, coupon,
or other device which entitled the purchaser
or receiver of saia property, or any other
person, to demand or receive from any per-
son or company, other than the person mak-



ing said sale, exchange, or disposition, any
other property than that actually sold or
exchanged; and no person or company, other
than the person so selling or disposing of
property, shall deliver any goods, wares, or
merchandise upon the presentation of such
stamp, coupon, or other device.

S 2. Any person or company who violates
any provision of the foregoing section shall
for each offense be punished by fine of not
less than twenty nor more than five hun-
dred dollars.

8 8. This act shall take effect April 15,
1889.

(Approved March 9, 1899.)



DECISIONS.

(Include 44 Atl. Rep. to Oct 4, 1899.)



Pledge of corporate stock to corporation.

The statutes of this State authorize the
corporation to take security by mortgage,
pledge or attachment of any property, real
or personal, for the payment of debts due
the corporation. Gen. Stats., ch. 133, S8 6, 7.
The stock of the corporation is property, and
is not excepted from this authority. Such
statute warrants a pledge by a stockholderof
stock of the corporation as security for a
daim of the corporation against him. The
policy of the law to regard secret liens with
disfavor does not apply to such a transaction.
A by-law providing for a stockholder's pledge
of his stock to the corporation is not within



the prohibition of Oen. Stats., ch. 134, S 13.
against restraint on the sale of corporate
stock. Costello v. Portsmouth Brewing Co.,
43 Atl. Rep. 640.

Stockholder's debts to corporation.

When a stockholder contracts a debt to
the corporation, with notice of a by-law im-
posing a lien on his stock for the payment
of the debt, and the corporation cancels his
stock, and applies it in payment of the debt,
as the by-law provides, on a demand and
refusal to pay after the debt is due, his title
to the stock is lost, with the right to divi-
dends thereon. Id.



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NEW JERSEY.



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NEW JERSEY.



LAWS OF 1899.



CHAPTEB 88.

Wages of Employes.

AN ACT to provide for the payment of
wages in lawful money of tlie United
States every two weeks.

Be it enacted by the Senate and General
Assembly of the State of New Jersey:

Section 1. Bvery person, firm, association or
partnership doing business in this State, and
every corporation organized under or acting
by virtue of or governed by the provisions
of an act entitled " An Act concerning cor-
porations" (Revision of one thousand eight
hundred and ninety-sixj. in this State, shall
pay at least every two weeks, in lawful
money of the United States, to each and
every employe engaged In his. their or its
business, or to the duly-authorhsed repre-
sentative of such employe, the full amount
of wages earned and unpaid in lawful
money to such employe, up to within twelve
days of such payment; provided, however,
that if at any time of payment, any em-
ploye shall be absent from his or her regu-
lar place of lalior and shall not receive his
or her wages throtigh a duly authorized rep-
resentative, he or she shall be entitled to
said payment at any time thereafter upon
demand; any employer' or employers as
aforesaid who shall violate any of the pro-
visions of this section, shall be deemed
guilty of a misdemeanor and shall be
punished by a fine of not less than twenty-
five dollars and not more than one hundred
dollars for each and every offense, at the
discretion of the court; provided, complaint
of such violation be made within sixty days
from the day such wages became payable
according to the tenor of this act; the pro-
visions of this section shall not apply to any
employe or employes engaged in agricultural
work or as watermen.

I 2. It shall not be lawful for any such
person, firm, association, partnership or cor-
poration, as aforesaid, to enter into or make
any agre^neht with any employe for the
payment of the wages of any such employe
otherwise than as provided in section one of
this act, except it be to pay such wages at
shorter intervals than every two weeks;
every agreement made in violation of this



act shall be deemed to be null and void, and
the penalties provided for in section one
hereof may be enforced notwithstanding
such agreement; and each and every em-
ploye with whom any agreement in viola-
tion of this act shall be made by any such
person, firm, association, partnership, coriK)-
ration or the agent or agents thereof, shall
have his or her action and right of action
against any such person, firm, association,
partnership or corporation, for the full
amount of his or her wages in any court
of competent jurisdiction in this State.

S 3. The factory inspector of this State
and his deputies shall make complaint
against any employer or employers afore-
said who neglects to comply with the pro-
visions of this act for a period of two weeks
after having been notified in writing by said
Inspector or his deputies of a violation of
this act; and it is hereby made the duty of
county prosecutors of the pleas to appear in
behalf of such proceedings brought here-
under by the factory inspector or his depu-
ties.

S 4. All acts and parts of acts Inconsistent
with the provisions of this act are b'ereby
repealed.

i 5. This act shall take elfect immediately.
^Approved March 16, 1899.)



CHAPTEB 54.

General Assignment Law.

AN ACT concerning general assignmentK
(Revision one thousand and eight hundre<i
and ninety-nine).

Be it enacted by the Senate and Genera)
Assembly of the State of New Jersey:

Section 1. Every conveyance or assign-
ment made by a debtor of his entire estate
m trust to an assignee or assignees, for the
creditors of such debtor, sliall be made for
their equal benefit in proportion to the'.r
several demands, to the net amount thrt
shall come to the hands ut said assignee for
distribution, and all preferences attempted
to be made in such assignment of one
creditor over the other, or whereby any ono
creditor shall be first paid or have a great t
proportion in respect of his claim than



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NEW JERSEY.



General assignment.



another, shall be deemed fraudulent and
Yoid, and shall render such assignment yoid.

§ 2. Every debtor residing in this State
making a conyeyance or assignment of his
entire estate, in trust, to an assignee or
assignees, for the creditors of such debtor
(the said debtor being hereinafter referred
to as the assignor, and the said conyeyance
or assignment as a general assignment),
shall acknowledge the same, or cause the
same to be proved according to law, so that
the same may be recorded as a deed of land,
and shall annex to such general assignment
an inventory, under oath or aflirmatlon, of
his estate, real and personal, together with a
list of his creditors and the amount of their
respective claims according to the best of bis
knowledge, but such inventory shall in no-
wise be conclusive as to the quantum of the
assignor's estate, real and personal, but the
assignee shall be entitled to any other
property which may belong to the assignor
at the time of making such general assign-
ment; in case such assignor shall wilfully
violate any of the provisions of this section,
the said general assignment shall not
thereby be rendered invalid or be excluded
from the operation of this act, but in such
case such assignor shall remain liable to
his creditors for any remaining indebtedness
after distribution by the assignee, and shall
not receive any of the benefits hereinafter
provided for assignors in the twenty-second
section of this act

S 8. The said assignee, upon receiving
such general assignment mentioned In the
preceding section of this act, shall forthwith
record the same, If the same has been ac-
knowledged or proved according to law, in
the county where such assignor resides,
and in any other counties or States where
he may deem it necessary to record the
same, and shall also forthwith give pub-
lic notice by advertising at least once a
week for four weeks successively, in one of
the newspapers printed in this State, circu-
lating in the neighborhood where such cred-
itors reside, making known thereby that such
general assignment has been made, and when
made, and setting forth a general descrip-
tion of any business carried on by the
assignor and the place where the same was
so carried on, and that all claims of credit-
ors against said estate must be presented
under cTath or affirmation to the said
assignee within three months from the date
of said general assignment or tt^e same
will be barred from coming in for a divi-
dend of said estate; and the said assignee
shall also, within thirty days after the date
of said general assignment mail a copy of
said notice, with postage prepaid, to every
creditor of said assignor, addressed to such
creditor at his usual post-office address, so
far as said assignee can ascertain the same;
and the said assignee shall forthwith exhibit
to the surrogate of the county wherein such
assignor resides, under oath or affirmation.



a true inventory and valuation of said estate
so far as has come to his knowledge, and
shall, after exhibiting such Inventory and
valuation, forthwith enter into bond to the
ordinary of this State, in such amount and
with such sufficient security as the orphans'
court of the said comity, or any Judge
thereof, may aiH;»rove, for the faithful per-
formance of his trustv which bond shall be
filed in the office of the surrogate of the
said county; until such inventory, valuation
and bond shall be filed the said assignee
shall not proceed to the discharge of his
trust under the said general assignment
furth^ than may be necessary for the
preservation of the assigned estate; pro-
vided, however, that the said orphans' court,
or any Judge thereof, before such inventory,
valuation and bond shall be filed, may, by
order, authorize the said assignee to per-
form such other acts in the ajdministration
of said trust as said court or Judge may
deem necessary for the protection of said
creditors, upon such terms as said court or
Judge may impose; in case of failure to
give such notice, or mail the same as above
provided, the said orphans' court may extend
and fix the time for the presentation of
claims and the giving and mailing notice
thereof as aforesaid.

S 4. At the expiration of the said period
of three months from the date of said
general assignment or in case of an ex-
tension of time for the presentation of
claims by said orphans' court as aforesaid,
then at the expiration of such extended
time, the said notice having been duly given
and mailed as aforesaid, the said assignee
shall file with the surrogate of the said
county a true list, under oalh or affirmation,
of all such creditors of said assignor as shall
have proved their claims as such before him,
with a true statement of their respective
claim, and due proof of the publication of
the notice of said general assignment, and
the mailifig of such notice as provided in
the third section of this act, which proof
shall give in detail the names of the per-
sons to whom, with the respective ad-
dresses to which, and the time when such
notices were mailed, and within ten days
after the filing of said list and statement
the said assignee shall mall notice, with the
postage prepaid, of the filing thereof to
every creditor of said assignor who has
proved his claim, addressed to such creditor
at his usual post-office address, so far as
said assignee can ascertain the same, and
shall, within the said ten days, also file
with said surrogate due proof of the mail-
ing of the last-mentioned notice as above
prescribed: in case of failure to file the
said list and statement or to file proof of
the publication and mailing of said notice
provided In the third section of this act, or
in case of failure to mail the said notice of
the filing of said list and statement, or to
file the proof thereof, the said orphans'



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NEW JERSEY.



General assignment.



court may extend and fix the time for the
performance of any or all of the duties of
the assignee aboye prescribed, which he
may have failed to perform.

I 5. Byery creditor presenting a claim
under the proyisions of this act to an
assignee, shall set forth in his claim any
mortgage or pledge of property of the
assignor, or lien tibereon, which he holds,
or which stands as security for his debt, or
upon failure so to do, shall be deemed to
haye walyed and abandoned such mortgage,
pledge or lien, as against the said assignee;
any creditor whose debt stands secured by
any such mortgage, pledge or Hen, shall
haye a right to diyidends only upon the
balance of his debt after deducting the
yalue of his said mortgage, pledge or lien,
which yalue may be ascertained by agree-
ment between him and the assignee, or by
the said orphans' court upon application of
said creditor or said assignee, and after such
ascertainment the said mortgage, pledge or
lien, if the same shall not haye been realized
on, shall stand as security only for the
amount which shall haye been so ascer-
tained; any creditor may present not only



Online LibraryRobert C. (Robert Cushing) CummingThe annotated corporation laws of all the states, generally applicable to stock corporations ... in three volumes → online text (page 63 of 92)