The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1888-05-22

This is an action of replevin to
recover possession of ten shares of
stock of the Haiku Sugar Company
Gneorporated) certificates, numbered
from 49, to 444 inclusive, and 100
shares of stock Of the Pacific Navi-
CATION Company fncorpOrated).
l find the facts Of the case to be
substantially as follows:
The plaintiff is the duly qualified
assignee of \. F. Cooke, bank
rupt, and defendants are in pos
session Of the stock in question.
Mr.. Cooke had been for several
years carrying on freighting busi-
ness with schooners. Others were
interested with him in the owner
ship of the vessels, and later on he
procured a charter Of Incorporation
for his business, it being named as
the " Pacific Navigation Company"
The charter is dated 18th of Novem-
Der, 1888, and Mr. Cooke was elected
president, he being the principal
shareholder. He had been in the
habit of obtaining supplies of goods
and of borrowing money from de-
PENDANTS with which to carry on
this business, and this was contin-
ued after the charter was obtained,
until on or about October /, 1885,
the Indebtedness amounted to over
$4,000. At this date defendants
asked Cooke for security, as the
account was so large, and defendant
gave four notes of the Pacific Navi-
CATION Company, signed by himself
as president, also signed by the sec
rotary, for $1,000 each, payable in
six, twelve, eighteen and twenty
four months, at nine per cent. in
terest, and Endorsed them person.
ally. Defendants demanding further
security, Mr.. Cooke pledged 100
shares of his own in the Pacific
Navigation Company, Endorsed them
over TO defendants and had the
! transfer noted on the stock register
/ of the corporation. This was not
deemed ample to secure defendants,
and Cooke then, rs Mr.. Atherton
| (of defendants firm) testified, ''pre-
posed giving US ten shares of Haiku
stock, we to hold them until debt
was paid. | consented, dividends
TO be credited on notes. We had
not taken security before this.
simply took the shares with the
notes and put them in our safe. -
The Haiku stock was not indOrsed
by Cooke, and no transfer was noted
on the books of the Haiku Sugar
Company.
/ The notes and the certificates of
stock were placed in an envelope
with the following written upon it
/ by Mr.. Cooke: 900 shares Pac.
Nav. Co., cert. No. 4 +; 10 shares
Haiku S. Co., stock cert. Nos. 1876
TO AS. The above certificates of
stock, belonging to a. F. Cooke,
passed over to Castle & Cooke for
security of S12, 900 of Pac. Nav. Co.,
four notes $4,000 each, October l,
/ 1885, 6, u, is and "a" The en-
velope, with its Enclosures, was de-
liYered to Mr.. Atherton.
None Of the notes were paid at
maturity. The accruing dividends
on the Haiku Sugar Company stock
were collected by Castle & Cooke
| (who were also the agents of the
Haiku Sugar Company and by
them credited on the first note, and
this was communicated to Cooke
from time to time. There was ne
definite demand made upon Cooke
as indorser. There was consider
able testimony introduced tending
to show that demand was in effect
waived, but | do not consider that it
is material to the issue to inquire
whether Cooke can now be legally
held as indOrser. The issue is
whether the assignee in bankruptcy
is legally entitled to the possession
of the stock, or whether the defend
ants can hold it.
The stock in the two companies
was not delivered as collateral secur-
ity to Mr.. Cookies Endorsement, but
was intended as independent secur-
ity.
No question is made on the right
of defendants to hold the stock in
the Pacific Navigation Company.
They acquired title to it, as
pledges to secure the notes, by in
dorsement and delivery of the GER
tifcate in the method pointed out
by the Statute, /. e., Section 1883 of
the Civil Code. This statute IS as
follows:
Whenever the capital stock of
any corporation is divided into
shares and the certificates thereof
are issued, transfer of the shares
may be made by Endorsement and
delivery of the certificate. The in
dorsee shall be entitled to a new
certificate upon surrendering the old
one, and no such transfer shall be
valid avoont bafrvaar Tho v,.,rt;oe,