St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1895-07-20
JUDGE KELLY RENDERS A DE-
CISION AFFECTING STOCK
SUBSCRIPTIONS TO
WOOD HARVESTER WORKS.
FRED NEURU,S ESTATE is LA
BILE FOR AMOUNT OF HIS
SUBSCRIPTION.
HELD TO BE A CONTRACT.
An Interesting Memorandum At
tached to the Decision of the
Judge.

Judge Kelly yesterday filed an or
der that is of more than ordinary in
terest in view of the fact that it
bears on the question of the legality
of stock subscriptions to the Walter
A. Wood Harvester company. The
case under consideration was an ap-
peal by the Administrative of the
order of the probate court allowing
the claim of the harvester company
for an unpaid subscription on. it's
stock. Judge Kelly denies the mo-
ton Of the appellant for a new
trial, attaching to his order a mem
orandum from which the following
is taken:
several manufacturing corporations in
Minnesota, and also $3.50, 600 by the
Waiter A. Wood Moving and Reaping
Machine company, of New York or it's
stockholders. Appellants. counsel con-
tends that the contract between the
appellant and the harvester company
was not valid, because without count
ing the subscription by the corpora
tons the one and a half millions of
subscriptions were not obtained and
until that amount was obtained the
subscription was not binding; that the
Minnesota manufacturing corpora tons
are not authorized to subscribe for
stock in other corporations, and be-
cause the Wood Moving and Reaping
Machine company, of New York, were
prohibited by law from doing so.
1t is not denied that the corporations
paid in full and received the stock.
IT IS A CONTRACT.
1t is settled in this state that a sub
scription by number of persons to the
stock of a corporation to be thereafter
formed by them constitutes a contract
between the subscribers to become
stockholders when the corporation is
formed upon the conditions expressed
in the agreement, and as such it is
binding and irrevocable from the date
Of the subscription; it is in the nature
of a continuing offer to the proposed
it, becomes as to each subscriber a
contract between him and the corpora
ton.
1t follows that as the subscription
paper became, as between Neuru and
the Other subscribers binding and
irrevocaIlc from the date of the SUBJ
scription," the appellant ought not now
to De heard to deny the legal capacity
of airy Of the other subscribers to make
such subscriptions, especially after
each whose legal capacity is thus chal-
lenged has fully paid up and performed
the contract on his part.
COnceQlng, Tor the argument, IRdL
the manufacturing companies which
subscribed to this paper had not the
power conferred by law to do so, Neuru
knew that when he signed with them,
for the law charges every man with
such knowledge.
Nevertheless he and they entered ir-
TO this contract 'irrevocable between
themselves" and they have fully per-
formed, and the stock bargained for
oy Neuru has received the benefit Of
that performance.
1t is also insisted that such subscrip-
tons as were ultra wires did not be-
come operative and binding until after
performance, and that, therefore, calls
made before performance were invalid.
do not think this position is well
taken. If calls We're made upon the
faith of all these subscriptions. and
those calls were paid, then manifestiy
the subscriptions were good. No mat
ter if they might have been legally re-
fused by some, so long as none did
refuse they are as effectual as though
legal from the beginning. BY rela-
ton back the payments made valid alb
initio every cali made upon the
faith of the subscription. This pro-
ceeding must be considered as one call
for the whole subscription. The re-
spondent cannot split up it's demand
into as many actions as there were
"cells"