Court Opinion

ID: 5460900
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:36:03.693997+00
Date Added: 2024-06-11T08:32:52.761970
License: Public Domain

Sutherland, J.
dissenting. My high respect for the judicial discrimination and learning of the judge who tried this case, at the circuit, has induced me to give the case a very *167careful examination, before coming to the conclusion, that the complaint should not have been dismissed on either of the grounds stated in the opinion of the learned judge; but after such examination I can not avoid the conclusion that the complaint Was inadvertently dismissed on either of such grounds.
It may be conceded, that Bailey v. Bancker, (3 Hill, 188,) and Andrews v. Murray, (33 Barb. 354,) establish the rule stated by the judge, that “an action Will not lie by one stockholder against a fellow stockholder, to enforce a personal liability for a debt of the companyand it may be also conceded that Adderly v. Storm, (6 Hill, 624,) In Re. Empire City Bank, (18 N. Y. Rep. 199,) and the other cases cited by the judge, settle or establish the other rule or principle stated by him, that the statutory liability of a stockholder rests upon or attaches to the registered owner of the stock, no matter who has the equitable interest or ownership ; but does it follow, though the plaintiff, long before this action was commenced, had, by assignments, transferred all his stock, so that, at least as between him and the assignees, he had no stock when the action was commenced, that he could not maintain this action, because the stock which he had so assigned had not been transferred on the books of the company? In other words, if it be conceded that the statictory liability remained upon or attached to the plaintiff, as the registered oioner of the stock, when the action was commenced, does it follow that his complaint was properly dismissed because he was a stockholder, though it appeared, and was conceded, that long before the action was commenced he had transferred all his stock, so that, as between him and his transferees, the equitable title and ownership of the stock was in them, and not in him, when the action was commenced, and at the time of the trial ? I think not.
It may be, that as between the plaintiff and the corporation, the assignments did not transfer or pass his stock, so as to affect any lien of the corporation on the stock, for a lia*168bility to the corporation. (See Sec. 5 of By-Laws, and Leggett v. Bank of Sing Sing. 24 N. Y. Rep. 283.) And, as I have said, it may be conceded that, as between the plaintiff and a creditor of the corporation, the plaintiff, notwithstanding the assignments, remained liable as a stockholder, because his stock had not been transferred on the books of the company. But considering, that the plaintiff brings this action to enforce a statutory liability, I think the assignments protected him from the application of the technical rule or principle that one stockholder can not sue another stockholder of the same corporation. There is really no reason for applying this rule in the plaintiff’s case.
[New York General Term,
November 7, 1864.
I think, notwithstanding the by-law, that the case shows that the plaintiff had transferred all his stock, so as to render it unreasonable to apply, in his case, the rules or principles of law upon which his complaint was dismissed.
I think there should be a new trial, with costs to abide the event of the action.
Judgment affirmed.
Leonard, Geo. G. Barnard and Sutherland, Justices.]