Court Opinion

ID: 7195052
Source: CourtListenerOpinion
Date Created: 2022-07-24 17:01:29.884992+00
Date Added: 2024-06-11T16:16:18.159359
License: Public Domain

*1022On the Merits.
The suit is brought, to recover dividends for many years on thirty-six shares of stock in the defendant company.
The ownership of the stock by the decedent is fully proved, and it is also proved that the dividends have been declared, have never been paid, and stand as due on the books of the company.
The prescription of three and of ten years is pleaded.
Dividends on stock are, like irregular deposits of money in a bank, payable only on demand, and until demand and refusal, prescription does not begin to run against, the person entitled. De St. Romes vs. Levee, 20 Ann. 381; Brown vs. Pike, 34 Ann. 576; State vs. R. R. Co., 6 Gill (Md.) 363; R. R. Co. vs. Hickman, 28 Penn. St. 329; Bank vs. Gray, 2 S. W. Rep. (Ky.) 329.
The defendant finally invokes the provision of its charter passed iu 1882 declaring: “Any dividend not called for within three years from the date of its being made payable shall revert to the company. ”
Defendant is, in effect, the successor of a former corporation bearing the same name whose charter expired in 1883. The stock of the new company was issued to the old company and distributed amongst its stockholders in lieu of their stock in the latter, and the new company assumed all the debts and obligations of the old of whatsoever nature.
The provision above quoted was not contained in the charter of the old company, and, of course, the new company could not destroy, abridge or forfeit rights acquired by the stockholders of the old, without their consent. The provision, therefore, cannot affect dividends which had accrued under the old organization and which the new company bound itself to pay. .
It is claimed, ho wove, that as concerns the dividends declared by the new company, the provision must be enforced.
Wo consider that the provision is binding on all stockholders of the old company who consented to the merging of their stock into the stock of the new company, from the time of such consent, whether given expressly or by implication from acts adopting the change.
Wo hold that by bringing this action for dividends declared by tlie new company, thejilaintiff, and those represented by him, give such consent, and will be bound hereafter by all valid provisions of the charter. But it fully appearing that they were ignorant of the existence of their lights and of all the proceedings had, until shortly before the institution of tliis suit, we. cannot hold that this consent shall rotroact in such manner as to operate a forfeiture of rights of the existence of which they were ignorant.
Judgment allirmod.