Court Opinion

ID: 6273084
Source: CourtListenerOpinion
Date Created: 2022-02-18 15:51:25.743322+00
Date Added: 2024-06-11T08:59:58.068736
License: Public Domain

Opinion by
Beaver, J.,
The plaintiffs in their bill allege that the defendant was one of a number of subscribers to an application for a charter under the incorporation act of April 29,1874, P. L. 73, for a corporation to be called “The National Wrapping Machine Company.” That he, with others, had “ certified that $30,000, being ten per centum of the capital of the intended corporation, which was $300,000, had been paid in cash to the treasurer of the said corporation.” The bill alleges in section 5 that “ the application for the charter so certified by the subscribers was false in this : it stated that the sum of $30,000 had been paid in cash to the treasurer of the corporation and, upon information and belief, the plaintiff alleges that in truth and in fact said sum had not been paid in cash to the said treasurer and had not been paid into the treasury of said intended corporation, and the amount actually paid into the treasury of the intended corporation, at and prior to the date of the subscription of said certificate did not exceed the sum of $5,000, and the plaintiff charges, upon information and belief, that no part of said ten per centum of said capital, but the sum of $5,000, was ever paid into the treasury of the said corporation, but the same remains unpaid.” The bill further alleges the plaintiff’s liability to pay the difference between the amount actually paid into the treasury and the sum of $30,000, being ten per centum of the intended capital, and prays: “ Second. That the unpaid balance of said ten per centum, or so much thereof as may be necessary to pay the said judgment and costs and debts of other creditors who may become parties hereto and establish their claims, may be decreed to be paid over by the said defendants and every of them to your orator, and such other creditors, in payment and satisfaction of their claims, or to a receiver of your honorable court, for the use of your orators and such other creditors.”
The master, after elaborate findings of fact and conclusions of law, recommended a decree “ that the defendants pay to a receiver to be hereafter appointed such sums of money as may *139be necessary to pay all the creditors of defendant corporation who join this bill and prove their claims before the receiver, not to exceed, however, the sum of $29,000.”
The court below, under the dictum in Patterson v. Franklin, 176 Pa. 612, that “the light to complain is in the individuals who suffer, and the right of action extends only to the individual loss of the particular person injured, if a right of action exists,” declined to approve the decree but, in an opinion filed, indicated that the bill might “ be maintained for the purpose of compelling the defendants to pay their unpaid subscriptions,” the master having discovered in the course of the testimony and having found as a fact that the appellant had subscribed for $500 of the stock of the company which had not been paid. There was no application to amend the bill, no direction to amend it, and it was not, in fact, amended, after the decree above quoted.
The allegation as to the certificate of the appellant of the payment of ten per cent of the capital stock, of its nonpayment and of the defendant’s liability to pay the difference between the amount actually paid in and ten per cent of the stock, and the prayer based thereon, justified a decree, making him liable to pay so much as might be found due from him. Although the court refused to make a decree covering the full amount of the difference between ten per cent of the capital stock and the actual amount of cash paid into the treasury, this did not prevent it from making a decree for the payment of a less amount. The allegations of the bill and the prayers for relief justified the decree for the payment of the amount of stock subscribed for by the appellant, namely, five shares, at $100 per share, making $500. The facts necessary to sustain the decree were distinctly found by the master, upon careful examination of all the testimony in the case, and were approved by the court. We have no disposition, therefore, under our rule, to interfere with it, inasmuch as there was ample evidence to sustain the finding.
The final decree, however, directs the appellant to pay the sum of $500, with interest from March 18, 1888. Under the provisions of section 11 of the Act of April 29, 1874, P. L. 73, relating to corporations, “ All subscriptions to the capital stock shall be paid in such instalments and at such times as the di*140rectors may require, and if default be made in any payment, the person or persons in default shall be liable to.pay, in addition to the amount so called for and unpaid, at the rate of one half of one per centum per month for the delay of such payment.” So far as appears by the testimony, no call was made by the directors. The penalty for nonpayment was not, therefore, payable, and interest should not have been charged against the appellant, except from the date of the decree, which was equivalent to a legal demand. No legal demand having been made upon the appellant for the payment of his subscription to the capital stock of the corporation, interest was not payable and should not have been charged against him.
The decree of the court below is, therefore, affirmed, except as to the payment of interest, which should commence May 26, 1899, the date of final decree, instead of March 18, 1888. The costs of this appeal to be paid by the appellant.