Court Opinion

ID: 8042791
Source: CourtListenerOpinion
Date Created: 2022-09-09 03:42:01.129411+00
Date Added: 2024-06-11T16:37:23.105706
License: Public Domain

Coleman, J.,
concurring:
I concur with the conclusion of both my esteemed associates that a corporation organized under the law of this state cannot have capital stock both with and without par value. And this seems to be the only question presented, notwithstanding the statement of the learned junior justice. This seems true for two reasons:
*204First, it is the only point made by the counsel for the petitioners, as indicated by the following language in his brief;
“It is the contention of petitioner that the corporation law of the State of Nevada, being subdivision 4 of section 4, as amended by the 1923 legislature, authorizes the formation of corporations having stock both with and without par value. This is the only question involved and presented to the court. * * * ”
Secondly, for the further reason that it does not seem that any other question can be presented, in view of the allegations of the petition and the law. The chief justice has quoted the section of the law which authorizes the formation of corporations and he has quoted the provision of the certificate of incorporation which designates the character of the stock to be issued, from which it appears that it is sought to incorporate a company with 25,000 shares of common stock to be without par value; also, 10,000 shares of the par value of $10 per share. If this does not contemplate a corporation of both par- and nonpar-value stock, I am unable to understand the English language.
It is generally recognized that the purpose, at least the reason given for influencing the legislature in enacting laws authorizing the creation of corporations with nonpar-value stock, is that the unwary investor may not be misled by the fact' that the stock of a corporation has a par value. In the face of this, it seems too evident to call for comment that the spirit of the law would be violated if a corporation can be organized with what may be designated nonpar-value stock and at the same time have a preferred stock with a par value.
Personally, I am of the opinion that the legislature never intended to authorize the incorporation of a company with such powers, and hence concur with the conclusion reached by the chief justice.