Daily globe. [volume] (St. Paul, Minn.) 1878-1884, 1883-05-09
TRANSFERS OF BANK STOCK.
Important Opinion of the Attorney Gen.
eral.

lmpOrJduC OpInlOu Oh bn6 Attorney USn-
eral,
In answer to the request. of the public
examiner, Attorney General Hahn has
given the following opinion, which all per-
sons holding bank shares, or who have
held and surrendered them, and all officers
Of the state banks, would do we'll to read
carefully and make note of
STATE OF MINNESOTA, ATTORNEY GENERALS
OFE1oE, SAINT PAUL, May 4, 1883.-Hon.
II. M. Knox, Public Examiner.-Dear
Sir: 1 have carefully examined the
questions submitted by you relative to the
transfer of shares of bank stock in the
light of secs. IA and 81 of chap 50, gen.
stats 1873.
These sections assume that a book or
books will be kept by all banks in which
all transfers of stock will be entered, the
particular manner of the transfer being
left to be agreed upon in the articles or
prescribed in the by laws. AS between the
parties the delivery of the certificate, with
an assignment and power endorsed, passes
the entire title, Notwithstanding that by the
terms of the charter, or by the laws of the
corporation the stock is declared to be
transferable only on its books.
These provisions do not incapacitate
the shareholder from parting with his in
terest; and his assignment not on the
books passes the title to the stock: subject
to such liens and claims as the
corporation may have upon it, or the cred
itors of the bank may have.
Bank of Utica, VS.. Smalley, Cowen,
40; Mcneil, VS.. Tenth National Bank, 46,
N. Y, 331; Isham VS.. Buckingham, 40 N.
Y, 222; 5 Cal. 1873, 40 Ind. 5; % ILL.,, 388;
8 Gray, 37s; 2 Wheaton, 800.
1t is provided by sec. 81 that a list of
stockholders, showing date of transfer ETC.,
shall be kept, and copy filed and record
ed as therein provided. By it, also, stock
holders are made individually liable in an
amount equal to double the amount of
stock owned by them for all the debts
of such bank, such liability
to cotinsue for one year
after such sale or transfer of stock. In
der somewhat similar provision it was
held by the court of appeals of N. Y, in
johnson VS.. Underhill, SO N. Y. 203, that
person having once been stakeholder, it
could not avail him in suit brought
against him by creditor of the corpora
ton, ''to show that he had sold and assigned
LIS SGOCh W duOIH0r, VI nGu given TO G0dG
"other all the usual and necessary means of
making valid and effectual transfer of it
''to himself upon the books of the company,
''if in truth such transfer had never taken
'place thereon"
1t seems to me clear that sec. 81 meant,
not only to make all stockholders liable for
debts to the amount and during the time
therein specified, but ''also to provide the
means to the creditors of easily learning
''who were the stockholders at any time,
"and of easily showing the fact; and
''still further to hold any one ever a
"stockholder to a continued liability, un-
''less there should be put upon the proper
shook the entry which should show when
she ceased to be stakeholder, and to
'whom he had transferred his stock"
The remedy for a failure of the bank Of
fcials to comply with sections IA and 81,
as we'll as for violation of any other pro-
vision of the same chapter, is twofold:
Firstly section 43 any person so vio-
lating such provisions is liable to fine of
from $50 to $500 for each offense.
Secondly section A they forfeit their
franchise and on demand of the state au-
ditor it is made the duty of the attorney
general to commence an action for the pur-
pose of annulling the existence of the cor
poration. Yours truly,
Signed w. ]. HAHN,