Source: https://www.legalcrystal.com/case/88956/hancock-national-bank-vs-farnum
Timestamp: 2019-04-25 04:20:36+00:00

Document:
A plaintiff, after the recovery of a judgment against a Kansas corporation in the courts of Kansas and the return of an execution unsatisfied, can maintain an action in any court of competent jurisdiction against a stockholder of the corporation to recover in satisfaction of his judgment an amount not exceeding the par value of the defendant's stock. Whitman v. Oxford National Bank, ante, 176 U. S. 563 , followed to this point.
The action of the Supreme Court of Rhode Island in failing to recognize such right in the plaintiff in error can be revised by proceeding in error in this Court.
The judgment rendered in the Kansas court is in that state conclusive against the corporation, as well as binding upon the stockholder, and, under the Constitution and laws of the United States, it should have the like force and effect in other states when attempted to be enforced in their courts.
and sustained and judgment entered for the defendant, 20 R.I. 466, to reverse which judgment the plaintiff sued out this writ of error.
This case brings to our consideration the same constitutional and statutory provisions of the State of Kansas which were before us in Whitman v. Oxford National Bank, 176 U. S. 559 . In that case, we decided that a plaintiff, after the recovery of a judgment against a Kansas corporation in the courts of Kansas and the return of an execution unsatisfied, could maintain an action in any court of competent jurisdiction against a stockholder of the corporation to recover in satisfaction of his judgment an amount not exceeding the par value of the defendant's stock. It is unnecessary to re-discuss the questions there considered.
state to the public acts, records, and judicial proceedings of every other state. And the Congress may by general laws prescribe the manner in which such acts, records, and proceedings shall be proved, and the effect thereof,"
"The acts of the legislature of any state or territory, or of any country subject to the jurisdiction of the United States, shall be authenticated by having the seals of such state, territory, or country affixed thereto. The records and judicial proceedings of the courts of any state or territory, or of any such country, shall be proved or admitted in any other court within the United States by the attestation of the clerk and the seal of the court annexed, if there be a seal, together with a certificate of the judge, chief justice, or presiding magistrate, that the said attestation is in due form. And the said records and judicial proceedings, so authenticated, shall have such faith and credit given to them in every court within the United States as they have by law or usage in the courts of the state from which they are taken."
The plaintiff's contention that these federal provisions required a decision different from that made by the state court was distinctly presented and ruled against. The jurisdiction, therefore, of this Court is clear. It may examine and inquire whether any right secured by these provisions was denied by the state court, though if it finds that no such right was denied, the judgment will have to be affirmed, no matter what may be the opinion of this Court as to the correctness of the ruling as a question of general law.
"records and judicial proceedings, so authenticated, shall have such faith and credit given to them in every court within the United States as they have by law or usage in the courts of the state from which they are taken."
of the effect to be given to the records and judicial proceedings of one state in the courts of every other state. In other words, the local effect must be recognized everywhere through the United States.
behind it and contest matters which were conclusively settled by the judgment against the corporation."
"in the absence of fraud, stockholders are bound by a decree against their corporation in respect to corporate matters, and such a decree is not open to collateral attack."
"A stockholder is so far an integral part of the corporation that, in the view of the law, he is privy to the proceedings touching the body of which he is a member."
See also Glenn v. Liggett, 135 U. S. 533 ; Great Western Telegraph Co. v. Purdy, 162 U. S. 329 , 162 U. S. 337 .
Now, as the judgment rendered in the Kansas court is in that state not only conclusive against the corporation, but also binding upon the stockholder, it must, in order to have the same force and effect in other states of the Union, be adjudged in their courts to be binding upon him, and the only defenses which he can make against it are those which he could make in the courts of Kansas. The question to be determined in this case was not what credit and effect are given in an action against a stockholder in the courts of Rhode Island to a judgment in those courts against the corporation of which he is a stockholder, but what credit and effect are given in the courts of Kansas in a like action to a similar judgment there rendered. Thus and thus only can the full faith and credit prescribed by the Constitution of the United States and the act of Congress be secured.
as a record. It is held that the same effect is to be given to the record in the courts of the state where produced as in the courts of the state from which it is taken."
"It may be conceded, then, that the judgments and decrees of the circuit court of the United States sitting in a particular state, in the courts of that state, are to be accorded such effect, and such effect only, as would be accorded in similar circumstances to the judgments and decrees of a state tribunal of equal authority."
See also Metcalf v. Watertown, 153 U. S. 671 , 153 U. S. 676 ; Pittsburgh, Cincinnati &c.; Railway. v. Long Island Loan & Trust Co., 172 U. S. 493 .
We are of the opinion, therefore, that the Supreme Court of Rhode Island has failed to give to the judgment in the Circuit Court of the United States for the District of Kansas that force and effect which it has within the limits of the State of Kansas, and that the failure so to do is an error available in this Court.
The judgment of the Supreme Court of Rhode Island must therefore be reversed, and the case remanded for further proceedings not inconsistent with the views herein expressed.

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