Court Opinion

ID: 6689317
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:36:14.426308+00
Date Added: 2024-06-11T16:01:03.859936
License: Public Domain

ROLLEY, J.
('dissenting). I am not able to agree with the majority opinion in this case. Our Constitution ('section 8, art. 17) provides that:
“No ccrporatiin shall issue stacks or bonds except for money, ■labor done, or money or property actually received. * * *”
The only consideration received by the corporation in this case for the stock issued to the respondent is the respondent’s promissory notes-. While promissory notes may be property in the broad sense of the term', they are not such property as is meant -by that word where it is used.in the above constitutional provision. The word “property,” as there user, means such prop-property as may -be necessary or useful in carrying on the business for which the corporation was organized. The fact that the maker of the notes involved in this case may be solvent, as is pointed out in the majority opinion, is wholly immaterial. If promissory notes are property within the meaning of the above constitutional .provision, it is immaterial whether the maker of such notes is solvent or insolvent.. The effect of the majority opinion on this question is to read into the Constitution a condition whereby corporations may accept promissory notes in payment for capital stock provided the maker of said notes is solvent. This ¡practically nullifies the above constitutional provision, and .leaves the way clear for a corporation to issue any. part or all of its capital stock without putting a -dollar into its treasury or receiving any property that can be used in carrying on the business for which it is organized. This is the very evil against which the Constitution is aimed.
The judgment appealed from ought to1 be affirmed.