Court Opinion

ID: 9672741
Source: CourtListenerOpinion
Date Created: 2023-08-24 03:59:28.617189+00
Date Added: 2024-06-11T18:16:18.038089
License: Public Domain

Mr. Justice Smith,
joined by Justices Calvert, Norvell, and GREENHILL, dissenting on motion for rehearing.
The jurisdictions of Vermont, North Carolina, New York, and New Jersey, wherein the cases upon which I rely were decided, had adopted statutes similar to our statutes, Article 6133 to Article 6137, inclusive. The New York statute which was in in effect at the time of the decision in the case of In Re Bank, 22 N.Y. 9, cited in my original dissent, was an Act to enforce the liability of stockholders in certain banking corporations and associations, as prescribed by the Constitution, and to provide for the prompt payment of demands against such corporations and associations. See Laws of New York, Chapter 226, 72 Session, 1849, p. 340. The Act provided in part as follows:
“The term ‘stockholder’ * * * shall apply not only to such persons as appear by the books of the corporation or association to ba such, but also to every equitable owner of stock, although the same may appear on such books in the name of another person; and also to every person who shall have advanced the instalments or purchase money of any stock in the name of any person under twenty-one years of age, and while such person remains a minor, to the extent of such advance; and also to every guardian or other trustee who shall voluntarily invest any trust funds in such stock; and no trust funds in the hands of such guardian or trustee shall be in any way liable under the provisions of this act, by reason of any such investment, nor shall the person for whose benefit any such investment may be made, be responsible in respect to such stock, until thirty days after the time when such person, respectively, become competent and able to control and dispose of the same'; but the guardian or other trustee making such investment as aforesaid, shall continue responsible as a stockholder until such responsibility devolves upon the person beneficially interested therein; and in respect to stock held by a guardian or other trustee, under a transfer of the same by a third person, or under positive directions by a third person for such investment, the person making such transfer, or giving such directions, and his executors and administrators, shall, for the purposes of this act, be deemed a stockholder, and the estate of such person, if he be deceased, shall be responsible for the debts and liabilities chargeable on such stock according to the provision of this act.”
Our statutes, supra, deal with unincorporated joint stock com-*259parties, but I think the principle is the same. In each instance, a married woman is not prohibited from owning stock or becoming a stockholder. Our statute makes no distinction, but expressly provides (Art. 6137) :
“* * *; and, in the event judgment shall be against such unincorporated company or association, it shall be equally binding upon the individual property of the stockholders or members so served, and executions may issue against the property of the individual stockholders or members, as well as against the joint property; but executions shall not issue against the individual property of the stockholders or members until execution against the joint property has been returned without satisfaction.”
The Code of North Carolina which was in effect at the time of the decision in the case of Robinson v. Turrentine et al., 59 Fed. 554 (cited in original dissent), authorized the organization of building and loan associations. See The Code of North Carolina, Volume 2, page 44 (1883). In the Robinson case, supra, the court was construing a statute similar to ours. Rev. Stats., Section 5151 made no exceptions in favor of married women. See Keyser v. Hitz, 133 U.S. 138, 10 Sup. Ct. 290. The determining factor against Mrs. Turrentine in the Robinson case was that no legislation had been passed in North Carolina prohibiting a married woman from becoming a stockholder without the consent of her husband. The court stated that the action was one at law brought by Robinson, Receiver of the First National Bank of Willmington, N.C., against Mrs. Turrentine, a married woman, and that if she was the owner of the stock, she would be liable for the assessment. The opinion presents a very conclusive reason why the married woman should be held liable. Among other things, the court reasoned that if she did not become the owner in case of a transfer by the original owner, then the stock would still belong to the person who transferred the shares of stock to her. The court then poses the question: “Would such person be still liable to the assessment, although the transfer had been made 20 years previously?”
The Constitution of North Carolina in Article 10, Section 6, reads as follows:
“The real and personal property of any female in this state acquired before marriage, and all property real and personal to which she may after marriage become in any estate and property of such female, and shall not be liable for any debts, obligations or engagements of her husband, and may be devised and *260bequeathed, and with the written assent of her husband conveyed by her as if she were unmarried.”
The Act of 1871 (1 Code, Section 1826) reads:
“No woman during her coverture shall be capable of making any contract to affect her real or personal estate except for her necessary personal expenses, or for the support of her family, or such as may be necessary in order to pay her debts existing before her marriage, without the written consent of her husband, uless she be a free trader as hereinafter allowed.”
The court, after quoting these provisions from the Constitution and the statute, held against the contention of Mrs. Turrentine that the sale of the bank stock to her was itself a contract which affected both her real and personal estate, and that in the event of the failure of the bank, her separate estate may be taken by reason of the statutory assessment to which the holders of bank stock are liable. In denying this claim, the court stated that such contention failed to note the distinction between a contract and the remote consequences of a contract. The court said:
“* * <: ipjjg defendant, by her purchase of bank stock, did not become liable to the assessment which is the subject matter of this action. More than 10 years after that purchase, a series of events culminating in the insolvency of the bank, and the appointment of a receiver of its property, occurred. These events rendered it possible for the assessment by the comptroller of the currency to be made. At the time of the contract of the sale of the stock, she in no proper sense by it ‘affected her real or personal estate.’ It was or may be affected by the operation of subsequent events. Nor does the liability under the assessment come within the words of section 1826. ‘No woman,’ etc., says the statute, shall be capable of making ‘any contract to affect,’ etc. The contract by which the stock was purchased was a simple contract of sale. Its only purpose was to transfer the title of the stock from vendor to vendee. It affected simply that stock, which was not at the time of the sale, a part of the personal estate of the defendant, but became so by reason of the sale. The contract to affect a married woman’s real or personal property, intended by the statute, is a contract charging such property with a debt or liability specifically ascertained at the time that it is entered into.
“A still more conclusive reason against defendant’s conten*261tion arises from the construction which the supreme court of North Carolina has placed upon the statute in Farthing v. Shields, supra. It is well settled, says Shepherd, J., in that case, that ‘a feme covert is at law incapable of making any executory contract whatever;’ and the learned judge (now chief justice of North Carolina) gives the meaning of the statute in these words: ‘No woman, during her coverture, shall be capable of making any engagements in the nature of an executory contract, by which her statutory real or personal estate is to be charged in equity, without the written consent of her husband,’ with the exceptions mentioned in the statute. It can hardly be contended that the purchase by Mrs. Turrentine of the stock in question was an engagement in the nature of an executory contract, by which her statutory estate was charged in equity. I am, then, of the opinion that there is nothing in the state constitution or laws by which a feme covert is prohibited either from owning bank stock or from purchasing it without the written consent of her husband.”
The majority agrees that the courts are not to engraft exceptions upon a statute when the law-making power has not done so, but holds that if the statute encompasses married women then it must also include minors. The majority projects the reasoning a step further and says, in effect, that to include minors would be to broaden the statute by implication. I do not agree that the phrase (of Article 6133) “any and all of the stockholders or members” includes minors. The legislature was not thinking of minors when it enacted the series of statutes, supra, authorizing the organization of joint stock companies. I do not believe that the privilege of owning stock in a joint stock company extends to minors in the broad sense that a married woman may own stock. A minor is capable of being a donee of stock, and when the gift of such stock is to the advantage of the minor, a formal acceptance is not necessary since the law implies an acceptance; but if the gift is not to his advantage, or becomes a burden to the minor before he becomes sui juris, the law implies a repudiation. See Austin v. Burden, Texas Civ. App., 297 S.W. 648 (no writ history). In that case the married woman was held liable to the double assessment of state bank shareholders, even though she had transferred her stock to a minor granddaughter long before the bank failure. In the case of State ex rel. Walker v. Rogan, 93 Texas 248, 54 S.W. 1018, this Court held that the statutory privilege of any person desiring to purchase public school land did not extend to minors. This doctrine does not extend to married women, and the Court, in the case of Lee v. Green, Texas Civ. App., 58 S.W. 847 (1900), writ re*262fused, expressly refused to extend the doctrine announced in State ex rel. Walker v. Rogan, supra. See the case of Anderson v. Neighbors, 94 Texas 236, 59 S.W. 543, wherein it was inferentially held that the statute involved in the Rogan case did comprehend married women; also see Anderson et al. v. Neighbors, Texas Civ. App., 61 S.W. 145, writ refused, with written opinion in Neighbors v. Anderson, 94 Texas 487, 62 S.W. 417. These cases are important in that they completely refute the theory advanced in the majority opinion that if the statute encompasses married women it necessarily follows that it also includes minors.
A minor, upon reaching his majority, may recover from an insolvent association all moneys theretofore paid by him into the association free from all claims for premiums, fines, and losses. This was held in the case of Prudential Building & Loan Association v. Shaw, 119 Texas 228, 26 S.W. 2d 168. But this is not true in the case of a married woman. In the case of Pitts v. Elser, 87 Texas 347, 28 S.W. 518, this Court held that “* * * A married woman who voluntarily pays her money or other personal property upon a contract made by her, or in any way that would bind a man, cannot recover it back simply upon the ground that she is a married woman. * * *” The Court further held that “* * * In this state the right of a married woman to acquire and hold property, real and personal, either by gift, devise, descent, or purchase, is as absolute as that of her husband. * * *” One distinction between a married woman and a minor must be remembered, i.e., that an infant or minor is incapable of giving his assent to become a shareholder. Hence, liability cannot attach. On the other hand, the disability of coverture of a married woman does not preclude her purchase or assent to the gift of shares in an unincorporated joint stock company.
In this connection, it is interesting to note that in 1903 the legislature of North Carolina amended the state statutes thereby authorizing and empowering married women and minors of the age of twelve years and upwards to become stockholders in associations. See Footnote 1, Public laws of North Carolina, Session 1903, Chapter 728, an Act to amend Chapter 7, Volume 11, of the Code of North Carolina. It is competent for the legislature to depart from the rules and analogies of the common law and to make married women and their estates liable, as other shareholders in joint stock companies are liable. I think that was done when the legislature of Texas enacted the statutes under which this suit was brought. I know of no provision in our *263Constitution which would preclude such action by the legislature. Certainly there must have been no such prohibition in the North Carolina Constitution as to either married women or children. It is my thought that the Legislature of North Carolina included married women in the amendment of 1903, not because it was necessary to create liability, but for the plausible reason that the legislature was in agreement with the earlier decisions of the courts of North Carolina holding married women and their separate estates liable under similar circumstances to the instant case.
I would grant petitioner’s motion for rehearing and affirm the judgment of the Court of Civil Appeals.
Opinion delivered December 10, 1958.