The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1854-11-28


Pickering II must be noticed that the upon
action against subscriber for payment OF call which
resisted the ground that his subscription
dona and that suchcondtion had not been fulfilled The
charter Was that the capital should be $500 00O and
the shares 500o of 500 each. The directors had at
tempted TO 90 with the business of the company when
only 6s7 shares had Subscribed The Court held
the defendant not responsible for the call and the Inns OF
reasoning was in substance this: subscriber has
right tothe benefit of the expectation and possibility that
the whole Of the capital allowed by the charter may not
be necessary for the object contemplated IT, then,
each share * course 500 should Il occur that $3.50
will suffice for the object subscriber for hundred
shares will only bs called upon to Pay 5000 Or ssoa
each subscriber for 100 shares must pay his
utmost limit iswould be against the condition Of his
subscription Again, every subscriber has right to
calculate upon fund computed to be commemorate
with the object and that each shares soud
be liable to tax Of $10O to produce that effect power
them beyond the 500, would be power 70 expend
500 000 which might be totally insufficient and might
be wholly wased and lost Now, it appears TO me- that
II Ia inaccurate TO that these prove that
ducon of the number Of shares expressed in charter
violation Of that charter II d correct TO say that
thew prove that 1t is violation or .fulHlment Of
condition in the contract between subscriber and the
company the terms Of which contract found in the
charter. Then the condition Of tho contract may
Of the subscriber, with tho assent Of the Com.
pany. And hence We are, in each particular case to
tract, and whether, il it was, L has been waived.
Id this point OF view the question was regarded by the
Court in the case Of Lexington and " Cambridge Go.
last the Court says that the contract there could
or certain amount Of capital nxed by the charter and
there il language used In the contract prescribing the
number Of the shares or the amount q the capital
shares by reduction Of the value Of those already Is
sued, by affecting the amount Of the profits Of the
holders we'll the actual sum represented stands
upon similar footing q reduction OF shares which
tends to increase his liability endanger his advance
But the question st in each instance, Is one Of con
tract and authorization Upon this question Of forfeit
uIe OF the charter have examined the following cases,
and the result in my Judgment il that 1t is ct least very
determine this charter to be forfeited by the adoption
Of this stock part Of the stock Of the company BY
the vss the Union s Rss
I; The State vs. The Essex Bank, Vermont Rep 49,;
Planters Bank The Bank Of Alexandria 10 Gill and
John 346 Atty Gen The Petersburg Railroad Co.,
8 Treden, 456 The People Oakland County Bank,
Douglass, 2S2 State Of Mississippi The Commercial
Bank Of Manchester smedes ana Marshall, zSS See
Sec 776 note There remains point upon this branch
of the case which the observations of counsel have
been to extent directed and that as to the effect
of the possession of a certificate merely, with or
without q power to transfer annexed to or accom-
panying it. It Is conceded, as rule very general
exercising any control in the management of the
affairs Of such companies. registration. on the
sometimes contained in the charter-sometimes pre-
scrbed in blaws and in State directed by
statute as to various interpretations 1t is sufficient
here refer to the general statute to moneyed
porations-(2R s., $685. $685. 81 and 49, and the Cen
oral Railroad act adopting them claws Of $780, CHI l4o
s So and to the case Of Roosevelt VS. Brown-1 Ker
mans, Court of Appeals 1872 Again. as general rule
II may stated that such registration is essential to
lease apparent from responsibility to the calls
B. Rep POS; wynne vs. Price De Gex, and Smales $40;
Addery VS.. storms Hill 626; Worral vs. Judson S
sSarss to psr truth am
dence and declaration OF right Of property to the
shares expressed in it, The power to transfer, which
may be annexed te it, is imma!eral as to the own
title. 1t serves the Office OF enabling him to invest
another party with his absolute right of property
and to obtain his recognition BY the company as such
the right and interest to another and so success
sively. But this be accomplished by any instru
ment on the cerfcate-( Commercial Bank Of Buffalo
Korright % Wendell the certificate is the
substantial ground and evidence Of title and interest
and the power to transfer but adjunct will think,
appear from the following deciaons:-ln Doloret VS.
Rothschd, Il Sim. and st. $780, bill was sustained
which the plaintiff had subscribed In pare Barrere
III En- L. and Eq. Rep. 1881 party who took GER
thcete Of stock without complying With bylaw re-
K Co. vs. Edwards, e Exch. Rep. 1lS,) person under
similar circumstances considered shareholder from
vs. Daniel, q Railway Cases 7as,) and The same vs.
Medina, Qbid 1857 the purchaser Of scrip certificates
who sought to get himself registered bp sSs
The Eastern r. W. Co.. (6R W. and canal cases l52
1861 Chancellor Wgram stated it as ndisputabie
proposition that the holders Of scrip certificates in the
stock Of q company could sustain bill to prevent the
misa pplication Of the capital There nchoate
right in such to become general shareholders
In - VS. The Marblehead Co., no Mass Rep 476,)
the delivery Of certificate with endorsement upon it
for valuable consideration was held sufficient and en-
titled the holder to the interest and title when the calls
paid In full. In Ashley Blackwell e Eden Rep,
300 where it held that company was responsible
forged power the Lord Keeper said that the letter Of
attorney part Of the title but only authority
to transfer The title admission into the compa
conditions Of the partnership The letter Of abe attorney
is only the authority to the company to transfer And
held ss & s a
nexed in blank could retain the securities for moneys
advanced tbs PLEDGE Of the stock although the
owner had paid such Pledge in full The possession Of
the documents gave the Pledge equitable title,
which, BY filing up the power he could convert into
sion that between immediate parties, mere delivery
OF certificate as security upon obtaining loan Of
would be equitable pledge of the stock squiva
ss ss su %sa' &C., y,
Choat simons, $685. Welsh Usher, Hills oh. lCa
think without powers Of transfer are equitsby share
holders members Of this company with right to
thenticate their title by procuring transfer on the
transfer Il Wi only be dsaity Of e1Ssnc. to
make out their right The result then is that the plain
tis entitled under the certificate and power taken
by them from Mr.. Stevens the President Of the
pany to be admitted shareholders in the capital Of
this company in common with all other shareholders
whose rights admitted shall be admitted and that
their right in proportion to such whole number Of
holders allotted upon capital of three million Of dol
lars It will be seen that this of the rights Of the
parties excludes any right to for damages to
any action except upon the ground Of common own
ershp, unless indeed the company refuse admission
Whether in such case a suit for damages, a nda-
mus proper do not considers Since this opinion
written have been referred to the Of expare Has
singer q Ashmeads Rep 287) That is strikugly
in point and the line Of reasoning, several particulars
similar to that have pursued.
6.-The last subject Of consideration raised by the
counsel s whether these plaintiffs not far charge
able with notice of the character of this stock that
upon that ground alone they must fail in this action 1t
appears that Mr. Ketchum, one Of the plaintiffs,
director and officer Of the company at the time of the
fraudulent entry of the stock and since and insist
ed that he was bound to know the operations Of the
company the position Of the books and that his know
ledge is that of the firm 1t Is, as understand admit
ted that he stockholder. The general law whicA
have treated applicable to this gives every part
equal right to the control and OF books
and charges every partner with knowledge Of their
contents Beides this right belong every corpora