Court Opinion

ID: 7043331
Source: CourtListenerOpinion
Date Created: 2022-07-24 06:52:28.891456+00
Date Added: 2024-06-11T16:11:26.071725
License: Public Domain

Worden, J.
This was an action by the appellee, against the appellants, upon a subscription by the defendants to the capital stock of the company. The subscription was made to the preliminary articles of the plaintiffs association.
The complaint alleged facts showing that, after the sub-sci-iption was made, the plaintiff’s organization as a corporation was perfected.
The defendants pleaded, among other things, nul tiel corporation. Trial by the court, resulting in a finding and judgment for the plaintiff". Judgment affirmed on appeal to general term.
But two questions are made here: 1. Was the evidence sufficient to sustain the finding? and, 2. Was the amount found too largo?
It is claimed by the appellants that the evidence was not sufficient to establish the existence of the corporation. The contract of the defendants, being a subscription to the preliminary articles of association, did not purport to be with an existing corporation. The corporation was to be brought into existence thereafter. The contract, there*390fore, did not estop the defendants to deny the existence of the corporation. The Indianapolis Furnace, etc., Co. v. Herkimer, 46 Ind. 142.
Under the issue joined, it devolved upon the plaintiff to show that the corporate organization had been perfected. But it was agreed upon the trial, and for the purposes thereof, “that fifty per centum of the assessment of the defendant’s subscription to the capital stock of said company had been paid, and that the assessment and calls for all the balance, in five different instalments of ten per centum each, have been duly and legally made, in accordance with the by-laws of said company, and the laws of the State of Indiana, the last ©f which assessments was made more than one year ago; and that defendants were duly notified thereof, and a demand duly made upon them by the proper authority that they pay their said assessments, which they promised to do, but have not done.”
It seems to us that this agreement involved a clear admission of the full and complete organization of the corporation, and, therefore, of the existence of every fact necessary to such organization.
The assessments and calls could not have been legally made in accordance with the by-laws of the company and the laws of the State of Indiana, unless . the corporation had been legally organized. There could have been no bylaws adopted by the company before its corporate organization, nor could there have been, before such organization, any “proper authority” to notify the defendants of the assessments, and demand payment thereof..
We are of the opinion that the agreement involved a full and complete admission of the existence of' the corporation, and that the finding, in this respect, was fully sustained by the evidence.
The amount of the finding does not exceed the amount of the calls and the interest thereon from the time they should have been paid. There was no error in allowing *391interest. The statute requires the capital stock to be paid into the treasury of the corporation within eighteen months from the incorporation of the same.
The judgment below is affirmed, with costs. ■