Court Opinion

ID: 8189779
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:12:39.355608+00
Date Added: 2024-06-11T16:40:33.896563
License: Public Domain

ThMLiN, J.
(concurring). In addition to the ground for •affirmance consisting of constructive fraud upon future creditors in the transaction by which it is claimed Smith ceased to be a stockholder prior to the incurring of the debt in question, I desire to rest my concurrence also upon another ground going to lack of power in the embryo corporation to purchase in its own shares and so release from that status the pei*sons who had theretofore become shareholders. The corporation never had fifty per centum of its capital stock subscribed, consequently there could be no first meeting, no directors, and no officers; but the signers of the articles of incorporation were by law intrusted with the direction of the affairs of the corporation. Sec. 1173, Stats. (1898), as amended by eh. 507, Laws of 1905. The signers of the articles did not, for the ■corporation, buy in Smith’s shares. -Who else at this stage had authority to represent the corporation for this purpose ? Walters v. Porter, 3 Ga. App. 73, 59 S. E. 452. If the corporation was not represented in the transaction, how could the transfer have any effect whatever ? Is the corporation, even through the signers of its articles, at this stage of its existence, empowered to dispose of its assets to a shareholder in purchase of his shares ? I think not. The following sections of the statute may be of interest in connection with these queries: Secs. 1774, 1775, 1776, 1767, 1751.
A motion for a rehearing was denied February T, 1910.