Court Opinion

ID: 5439330
Source: CourtListenerOpinion
Date Created: 2022-01-08 17:59:17.467795+00
Date Added: 2024-06-11T08:31:57.406022
License: Public Domain

By the Court, McKinstry, J.:
The rights of the parties to this action must be determined by reference to certain provisions of the Civil Code, as the same read when the corporation, plaintiff, was formed.
Sec. 293 of that Code provided: “Each intended corporation named in sec. 191, before filing articles of incorporation, must have actually subscribed to its capital stock, for each mile of the contemplated work, the following amounts, to wit:
“ 1. One thousand dollars for each mile of railroads.”
Sec. 290 of the same Code requires that the “ articles of incorporation shall set forth, amongst other matter, “ if there is a capital stock, the amount actually subscribed, and by whom”
*129The Code prescribes no particular form for the subscription paper from which it may appear that one thousand dollars a mile was subscribed toward the “ intended ” railroad.
But it is plain that the amounts subscribed, and by whom, must be fully set forth in the articles of incorporation. Those who sign and file the articles, and thus bring the corporation into existence, act for the real subscribers. If the statement contained in the articles, as to the amount subscribed, and by whom, is incorrect, one of two results must follow—either the attempt to give existence to the corporation is abortive, or the corporation which comes into life is estopped from claiming that any other person than those named as subscribers, became a member, when the articles were filed, or that any person therein named was a subscriber for a larger sum than that mentioned in the articles. In either event, this action cannot be maintained.
Whether one not named as subscriber in the articles of incorporation, but who had in fact previously subscribed, could have the articles declared null, or, on the other hand, claim the right to be admitted as an associate member, is not an immediate question. The requirement of the Code is absolute and peremptory. The articles must set forth the amount subscribed and by whom. The instrument from which the corporation derives its being must be held to limit the power of the corporation, so that it can bind as stockholders as of the date of its filing only those named in the articles and to the amounts therein mentioned.
Judgment aifirmed.