Court Opinion

ID: 4932316
Source: CourtListenerOpinion
Date Created: 2021-09-24 01:09:33.613997+00
Date Added: 2024-06-11T08:14:31.961991
License: Public Domain

Danforth, J.
This is ah action to recover the assessments made upon five shares of the stock of the plaintiff company. The plaintiff has declared and relies upon two separate written contracts entered into by the defendant. The first is an agreement simply to take five shares of the stock. In the writing we find no words showing a promise to pay for the shares, other than is implied in the word ‘ take,’ either in the contract or the conditions annexed to it. The fourth resolve referred to in the argument of counsel, and annexed to the contract, does not in any degree change the force of the agreement so far as it imposes or fails to impose a personal liability. In this resolution are no words of promise; it is at most an assent that assessments may be made under the condition therein expressed.
*565This contract, like all others, is to be construed so as to give effect to the intention of the parties to it. Upon this point there is no conflict of authorities so far as we are aware, either in this country or in England, though there is a difference of opinion as to the inference to be drawn from the language in certain forms of subscription.
It is held by many courts that a subscription to stock like the one signed by the defendant, or indeed any subscription, creates an-obligation of actual payment, unless such an obligation is excluded by its terms. Troy & Boston R. v. Tibbitts, 18 Barb. 297. On the other hand, by a series of decisions commencing as early as the case of Andover & Medford Turnpike Corporation v. Gould, 6 Mass. 40, when this State was a part of Massachusetts and continuing through our own reports down to the present time, it has been uniformly held that such a subscription as the present imposes no personal obligation to pay, and that the only remedy for the collection of assessments is that provided by the charter. Many of these decisions, and sufficient for our purpose, are referred to in the case of K. & P. R. R. Co. v. Kendall, 31 Maine, 470. The same principle is also recognized in P. & K. R. R. v. Dunn, 39 Maine, 594, and in many other cases, both in this and other States, which it is unnecessary to cite.
The language of the contract now before us so nearly conforms to many of those which have received a judicial construction in our own courts as almost inevitably to lead us to the conclusion that it was made with express reference to those decisions.
The parties must have known of those decisions, and the meaning then given to the language they have used. There is here no question as to any principle of the law of contracts ; it is only as to the meaning of words. Those used by the parties had been distinctly defined by the proper authority. We must assume, then, that they used these words with express reference to such definition, and as expressing the meaning there given to them. To now overrule those cases, and hold that the words of their agreement do not mean what the law as authoritatively expounded at the time of *566making it declared they did, would be to make a new contract for the parties, one to which they have not assented, and thereby violate one of the fundamental principles of law as well as justice, and add another reason for the prevailing belief in the uncertainties of the law.
Whatever, therefore, might have been our opinion of this question, were it a new one, we see no sufficient reason for overruling a series of decisions so numerous and so uniform as those under which this contract was made.
But it is contended that those cases rest very much upon the particular charters under which the questions at issue had their origin. It is true that in many instances at least, the charters provided for a forfeiture of the stock only, and not for any personal liability, while the charter in this case provides that the subscriber shall be liable for the balance remaining due after a sale of his shares. But how does this affect the construction to be given to the contract? The charter does not purport to make a contract between the parties ; it simply provides a remedy for the corporation against a delinquent stockholder. In subscribing for stock the subscriber inserts just such terms and conditions as he sees fit, and he can be holden to no others. If the contract provides for a personal liability, that liability may be enforced by an action, as in any other contract. If it contains no promise of payment, as in this case, the only remedy is that provided by the charter. The liability by the contract is one thing, that by the charter is another, and is separate and distinct from the former. If the plaintiff would enforce a claim under a promise on the part of the defendant, he must have the proper evidence of that promise. If he would pursue the remedy provided by the charter, it must be followed according to its terms. In this case, as we have seen, the subscription paper contains no promise whatever. It is simply an assent on the part of the defendant to become a stockholder, and, as such, imposes no personal liability. As, then, the parties did not choose to impose any personal liability by their contract, none exists except that iniposed by the charter. In that we find none except for the balance *567after a sale of the shares. Such a claim is not asserted in this action.
Nor can we assume, as contended, that by an assent to a partial or conditional liability, the defendant is to be holden to an absolute one. Nor will the law under such an assent hold him for the whole. If he is to be holden under his contract, we must take that contract as it is; if under the charter, we must take that as we find it. At the time this charter was granted, it was well known that by the law as administered in this State, no obligation to pay was imposed npon the owner of stock without an express provision therefor. It is unaccountable, then, that the legislature should have imposed a limited liability when an unlimited one was intended. This provision in the charter would seem to be against rather than in favor of the plaintiff’s position. It follows that this action cannot be maintained upon the contract alone, or in connection with the charter.
Nor can it be sustained under chapter 206 of the Special Laws of 1869. That act does not purport to change or modify any contract to which the company is a party, but only to give an additional remedy. Now if tliis statute is to have the force claimed for it as against this defendant, it imposes a full liability to pay all the assessment when his contract imposed none, or under the charter only a limited one. As the act was passed subsequent to the contract it cannot thus affect it. Nor does it alter the case if we view it as an amendment to the charter. Whatever effect an amendment of the charter may have npon the company, it cannot affect its contracts already made.
A member of the company can contract with it the same as any other persons, and such contracts are governed and protected by law as other contracts are. If, then, the act imposes upon the defendant any liability under his contract which did not exist at the time it was made, it is so far void. If it does not, it affords no aid to the plaintiff in this case.
In the second contract relied upon by the plaintiff, the defendant’s promise to pay the assessments, is expressly made to depend *568upon the execution and delivery of certain bonds therein described. This is a condition precedent, the performance of which on the part of the' plaintiff is necessary to the maintenance of the action. The testimony fails to show that any such bond has been delivered or tendered to the defendant, but such delivery or tender is denied by him. - Plaintiffs nonsuit.
Appleton, C. J.; Cutting, Barrows, Virgin, and Peters, JJ., concurred.