Case ID: ohio_13/html/0105-01.html
Source: Caselaw Access Project
Author: {"author": "Birchard, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

*Muskingum Valley Turnpike Company v. Nahum Ward.
    A transfer, by a subscriber of stock in a turnpike company, to a fictitious person, is void.
    A notice to pay installments of subscription to the treasurer of a company, implies that the payment is to be made at his office, and is a sufficient designation of the placo of payment.
    Where the law requires “at least sixty days’ notice” to be given of the time and place of payment, a single notice, given at least sixty days before tho time of payment, is sufficient; it is not intended that notice should bo given sixty consecutive days.
    This is a motion for a new trial, in an action of debt, reserved from Washington county.
    On the circuit a verdict was taken for the plaintiff, subject to the opinion of the court on this motion.
    Tho action was brought to recover of the defendant, as a stockholder of the company, a “ subsequent installment ” of ton per cent, upon his stock, and also the penalty thereon under section 6 of the act to provide for the regulation of turnpike companies. Swan’s Stat. 974.
    The Muskingum Valley Turnpike Company was incorporated in 1838 (36 Local L. 97), and is regulated by the general act relating to such companies. Swan’s Stat. 974. Section 2 of this act provides that not more than five per centum on each share shall be demanded at the time of subscribing, nor more than ten per centum at any subsequent installment; and at least sixty days’ notice shall be given in some public paper in general circulation, printed on or nearest to the route of such intended turnpike road, of the time and place or places of paying in any installment subsequent to the installment paid at the time of subscribing ; provided, also, that no installment shall be called for in less than sixty days from the day of payment of any preceding installment.
    Upon tho trial of this cause on the circuit, the plaintiff, having proved that a “ call ” of ton per centum on tho shares was made by the company on April 7,1840, in order to show that they had complied with the requisitions of *section 2 of the statute entitied “ an act to provide for the regulation of turnpike companies ” (Swan’s Stat. 974), in giving the notice of such calls therein roquired, produced and proved that they had caused to be published for four successive weeks, in a newspaper in general circulation printed on the route of the road, next succeeding its date, the following notice:
    “fourth installment.
    “Notice is hereby given that the stockholders of the Muskingum Valley Turnpike Company are required to pay to the treasurer of said company, on or before the 1st day of July next, a further installment of ten percent, on the capital stock, boing'$2.50 on each share.
    “ By order of the board of directors,
    “ D. P. Bosworth, Secretary.
    
    “ Marietta, April 28, 1840.”
    To which the defendant objected as insufficient, because :
    1. It is not a notice of the “place ” of payment.
    2. It should have been published “sixty days.”
    The defendant then proved that, prior to the making of said call, ho had assigned all his stock in said company, upon the books, to Richard Roe, whom he admits to bo a fictitious person. The defendant claims that this assignment amounts to an abandonment of his stock.
    John Welch, for defendant, in support of the motion, contended
    1. The notice is insufficient; it should specify the place of payment.
    This is expressly required by the statute; it is equally required by the circumstances of the case. The stockholders ai’e usually in such companies numerous, widely spread, and, some of them, at least, very ignorant. Many of them do not know who the treasurer is, or where he keeps his office; or whether he receives money at one place, or at several places. The stockholders are usually scattered all along the route of *the road, sometimes hundreds of miles, and the business being transacted entirely by directors, they know little or nothing about the polity, officers, etc., of tho company, except as places, names, etc., are pointed out to them in a direct notice.
    There is nothing in this notice specifying the place where payment is to bo made, or the person to whom it is to be made, except what is contained in the single word “ treasurer.” The stockholder would have to learn, 1'rom other sources, who the treasurer was, where his office was kept, and the fact that his office was the place where he received installments.
    If the stockholders are to be presumed to know that there was a treasurer, that he kept an office, and where the office was, they would have no need of any notice at all of the place of payment, for they certainly would also be presumed to know that the treasurer’s office was the place of payment. No notice of the place of payment, therefore, was necessary; and the statute must be construed as merely requiring notice of the time of payment.
    2. It should specify the person to whom payment was to be made.
    3. The notice should have been continued for sixty days.
    “ Sixty days’ notice” is equivalent to notice for or during sixty days ; strictly and grammatically equivalent. Such i's its obvious construction", pointed out by its Bubject matter. Such was in fact the intention of the legislature, as will appear by comparing the language of this act with other acts of the legislature requiring a notice to be given.
    The object of requiring time in such notices is not so much to enable the party to meet its requisitions as it is to give him an opportunity to see it. It is usually for both purposes.
    
      Wo have many statutes requiring these public notices to bo given, either in papers or in manuscript. And it seems to mo to be the policy of the legislature, in all cases whore similar language is used, to require the notices to be continued during the period mentioned; and such, I believe, has been the construction *of our courts. Such is our statute, for notice to be given by the commissioner of insolvents. Swan’s Stat. 446, sec. 25. Also, by the sheriff on executions, 472, sec. 9, and 474, see. 14, etc.
    It is seldom that a notice is required to be given in the papers, or by handbill, where it is not intended to keep the notice before the public some time. Where such intention does not exist, that is, where only a single act of publication is required, the language is very different. This will appear by looking at our statutes requiring notices of “ elections,” Swan’s Stat. 302, sec. 1, and 306, sec. 17, where the governor and sheriff are required to insert a notice-days before the election.
    Such also is the language of our statute as to 11 partition,” 614, sec. 3; “petitions to the legislature,” lb. 632, sec. 1; “roads,” lb. 790, sec. 5; and “attachments,” lb. 81, sec. 3.
    In these acts the language is decidedly different. The party, instead of being required to give so many days’ notice, by advertisement, is required to give notice so many days before, by inserting, etc. If such had been the intention similar language would have been used here. ' I think there can not be a single statute found which, by the common consent, has been construed to require only a single act of publication, or which has been so held by the courts, where the language is similar to that of this statute, and where it is not specific and certain, as in the cases of “ elections, partition, roads,” etc.
    It is very seldom that this form of expression, “give so many days’ notice,” is employed in speaking of a notice which, from its nature, necessarily consists of a single act of personal service. The only instance I can find is the statute for “ amercement ” of sheriffs. Swan’s Stat. 484, sec. 31. And here, as in all such cases, the language is controlled by the subject matter; the notice is to be served, and is to be in writing, and therefore can not be continued. In all other.cases, as “certiorari,” Swan’s Stat. 516, sec. 60; “depositions,” lb. 321, sec. 2; “forcible entry,” lb. 4^ see. 3, etc., the language is in the other form, requiring in terms a single act of service.
    *That this suit can not be sustained without proving a compliance with the statute, will not be denied. A compliance must bo averred in the declaration as well as proved at the trial. 9 Ohio, 136.
    The courts arc very strict in requiring a compliance with the requirements o,f statutes requiring notice in such cases, and that “ doubtful words will be construed most unfavorably to the company,” will appear by consulting Wadsworth on Joint Stock Companies, 323, 338; Law Library, March, 1843, 190, 198.
    3. The defendant did not own stock at the time the call was made.
    The act gives the right to transfer their shares. A stockholder who has assigned is not liable, even where he assigns to ui insolvent person. War. Joint S. Co. 321; 7 Term, 36.
    If there was no assignment here, we contend that the act of tho defendant amounted to an abandonment of his shares. A man can abandon his property whenever bo pleases. An assignmont to an insolvent is the same as an assignment to Richard Roe. Either amount to an abandonment.
    The design and policy of the law is, that the stockholder shall stand liable to calls as long as he remains an owner, and no longer. He tacitly agrees, when he subscribes, to respond to calls made while he owns or claims the stock. When stock is thus abandoned, or assigned to an irresponsible or unreal person, the company owns it, or may own it, by declaring it forfeited. The original stockholder is estopped from claiming it, or any of the rights of the company, and can not be subjected to any of its burdens. He is no longer one of the corporators.
    Goddard, Nye & Convers, for plaintiff:
    A shareholder could not discharge himself from his obligations to his associates by a fictitious assignment of his stock.
    *The defendant cites 7 Term, 36 ; but the language of the court shows that the case arose under a very different act of incorporation from that which we are now considering. Lord Kenyon says: “ On looking through the act of parliament, it is clear that the legislature meant that the parties should only be liable to the payment of their shares so long as they individually continue members of this company; that is, so long as they have property which constitutes them such.”
    Again : “ The act says that persons who have subscribed, and their assigns, shall bo deemed proprietors.”
    So, Mr. Justice Ashurst says: “ The only restriction imposed on the power of alienation is, that the owners shall not assign until all the money due at the time of assigning is paid.”
    But if our statute, and that which was before the court of king’s bench, in 7 Term, were identical, the defendant would have advanced but a stop in his case. He might then have shown a power to assign ; but the fact of actual assignment would still remain to be established. To constitute a valid assignment of property of any kind, we suppose there must not only be an assignor, and a thing assignable, but an assignee. An insolvent person may be an assignee. He is still a person. But a fictitious person is no person. An assignment to such is a more nonsensical act.
    Nor, we apprehend, can this pretended assignment be regarded as such an abandonment of his interest in the company as to exempt the defendant from liability for the subsequent installments. His original subscription not only secured to bim rights, but imposed upon him duties; and nothing can be more inconsistent with all our notions of such associations than that the obligations of a shareholder can be thrown off at pleasure.
    As to the notice. The language of the statute is: “ At least sixty days’ notice of the time and place, or places, of paying in any installment subsequent,” etc. The act contemplates the payment of installments at different places or points on the route of the road, and this for the convenience of the stockholders. Now this notice does not, it is true, in terms, ^designate a place or places where payment is to be made; it goes something beyond the act itself in accommodating those who are to be called upon to pay. It designates an officer to whom payment may be made, and the place is either his office, or wheresoever he maybe. The stockholders are presumed to know him, and to know where he can be found. Indeed, it is obvious that a treasurer of a company has a place of doing business, and that need not be indicated in a notice to the members of the company, whose treasurer he is. Notice to pay to him may, therefore, be well construed, as notice to pay at his office.
    As to the objection that the notice was not continued sixty days:
    The notice was dated April 28, 1840. It was published in a newspaper in general circulation, and printed on the route of the road, for four successive weeks next succeeding the 28th April. The first publication was sixty-two or sixty-three days prior to the 1st July, on which the installment was required tobe paid. It was continued the usual period of an advertisement — three or four weeks. It was continued as long as was useful.
    It is argued that the several cases in which, by our statutes, notice is required to be given, may be divided into two classes: 1. That class where the object of the notice is to enable a party to heed the requirements of the law; and, 2. Where the object of the notice is to increase the chances that the fact may be made known to a party. It is, however, admitted that both objects are usually designed. We will not stop to inquire into the propriety of this arrangement of the various notices required by law, and cited from the statutes, but will call attention to a class which has been entirely overlooked, viz: those cases where the legislature have specified the number of insertions.
    
      The auditor shall publish the delinquent list at least four weeks, between the 1st of October and the 1st of December. Swan’s Stat. 112, sec. 30.
    Notice of pendency of petition for divorce shall be published in a newspaper six consecutive weeks. Swan’s Stat. 292, sec. 2.
    ^Notice of the filing of a guardian’s accounts shall be published in a newspaper for throe weeks successively. Ib. 431, sec. 5.
    Notice of the pendency of chancery suits shall be published six consecutive weeks. Ib. 701, sec. 3.
    In all these cases a continued publication is prescribed, for the very purpose of increasing the chances of its being seen by an absent party, whose interests are to be affected. Yery different language this from that employed in the turnpike act, and for the reason, that the object is different. Sixty days’ notice is required here to enable the shareholder to collect his means and prepare for the payment, and this is rendered entirely obvious, by the proviso at the end of section 2, page 975, prohibiting calls from being made faster than at intervals of sixty days.
   Birchard, J.

The reasons urged in support of the motion of a new trial, which we will examine, are:

1. That the defendant was not a stockholder at the time the call for an installment was made.

In support of this position he relies upon the fact that, prior to the call, he had transferred his stock to a fictitious person, which, he claims, is an abandonment of his stock. The assignment to a fictitious person is a mere nullity. It transferred no right, simply because there was no real person to receive it on its passing from the original proprietor. Assuming it to be sufficient evidence of an abandonment, it still does not help the defendant, for an individual can not release himself from the obligation of a contract against the consent of'the obligee; and the defendant’s subscription to the capital stock of the plaintiff is a contract.

A second ground is, that the notice does not designate the place where the money was required to be paid.

The notice was, to make payment “to the treasurer of said company.” The language of the statute (Swan’s Stat. 975) is, “at least sixty days’ notice shall be given, in some public paper in general circulation, printed on or nearest to the road, *of'tho time and place or places of paying in any installment,” etc. The act contemplates that the payments may be directed to be made at different places on the route of the road, and this for the convenience of the stockholders ; therefore, the company are required to designate the places, if payments are directed at different places. If, as in this case, but one place is designated, a substantial compliance with the statute is observed, and is all that is required. What is the effect of a notice to pay to the treasurer of a company? Is it straining language to .say, that it is a notice to pay at his .office? Clearly, that is its legal effect; and would any one feel at liberty to cavil, if this notice had road, “ to pay to the treasurer of the company, at his office,” for the reason that it omitted to state-the township or section upon which that office stood? The object of the legislature is fully accomplished by a notice to the stockholder, which informs him when, where, and to whom he is to make payment. This notice was ample to accomplish all of those objects. The company had a treasurer. His person and place of business was sufficiently designated by his name, in the connection in which it was employed in this notice, to convey all needful information to those subsci'ibers disposed to fulfill their obligations to the company.

The third gx-ound for a new trial is, that the notice was not published continuously for sixty days.

This position stands upon the hypothesis, that “ at least sixty days’ notice” is equivalent to “notice for and during sixty days.” The words are, however, not equivalent. A notice published once sixty days or more befox-e the time of payment, is all that tho statute requires. Tts letter is complied with by that. Wo are not left at liberty to imagine or suppose, in this case, that one thing is expressed and another intended, because whenever the legislatux-e have designed that a continuous notice should be given, they have used explicit terms. Had a contixxuous notice been intended in this class of cases, we should have found words more appropriate to convey that meaning; such as, “notice by publicatioxx, at least sixty days prior to the day of payment, which notice, shall be published *daily, tri-weekly, or weekly to the day of payment;” ox’, “ which notice shall be continued for eight consecutive weeks prior to the day of payment.” The manifest objeet in requiring sixty days’ notice was to give the stockholders reasonable time to prepare funds to meet the demand made upon them. The notice must be, from the power of the words used in the statute, complete, at least sixty days before the day of payment. It could not be thus complete, if, in order to perfect it, the necessity existed of renewing it each week during the sixty days.

Motion overruled, and judgment on the verdict.