Court Opinion

ID: 6571173
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:29:17.247427+00
Date Added: 2024-06-11T15:56:54.849016
License: Public Domain

At a subseqent day of the term, the opinion of the court was delivered by
HutchinsoN, J.
The plaintiffs have brought their action of as-sumpsit against the defendant, claiming to recover of him, as a member of the corporation and a subscriber to the stock, therein, the amount of the assessments upon his shares, to defray the expense of erecting their bridge. The declaration contains several special counts for those assessments, and one general count for m onies laid out and expended in building their said bridge. The whole claim of the plaintiffs is two hundred dollars. This action was tried upon the general issue in the county court, and a bill of exceptions there allowed, presents several questions, for the decision of this Court.
That the plaintiffs have been regularly incorporated by the legislature, and have become regularly organized ; and that they have erected their bridge to the acceptance of the board, appointed by the statute for that purpose, are questions put at rest by the exceptions allowed. That the defendant subscribed for ten shares in thé stock ofthe company, must be considered as established by the verdict. The defendant’s liability to pay the assessments as they have been made by the company, and his liability to have the same recovered from him by an action of assumpsit, form the questions now in dispute.
The act of incorporation and the record books of the company are referred to and made a part of the case. The act passed in November, 1824. This gives the company power to enact bye-laws ; but none were enacted till January, in the year 1827 ; and none at that time containing any provision for collecting taxes or assessments. The act makes the stock of the company personal property, and directs how attachments of it may be made ; but says nothing about the collecting of assessments, and nothing about the forfeiture of shares upon any contingency whatever.'
The time and place for holding the first meeting of the company were appointed by the act; and the same were holden accord*398ingly, on the 3d of January, A. D-, 1825. At that meeting the company voted, that their bridge stock be divided into two hundred shares, of twenty dollars each ; and that the stock-holders should be entiled to one vote for each share they might possess. They also voted the money raised by the sale of said shares should be expended, by three directors thereafter to be chosen, in building a bridge across the Onion river, agreeably to said act; and, that the several instalments be paid in cash and grain equally. The company then voted to adjourn said meeting till Friday evening, the 7th of said January. At this adjourned meeting of January 7th, Thaddeus Tutile, the defendant, attended, and subscribed.his name, thereby becoming a subscriber for the ten shares, the assessments upon which are now claimed by the plaintiffs.
The meetings of the company were kept alive by adjournments from time to time; directors were chosen, and assessments made, and other business of the company attended to, as suited their convenience, until the bridge was completed. The several assessments, the first of which was made March 7th, 1825, and the last as late as July, 1826, amounted to the sum of twenty dollars upon each share.
At one of said meetings, holden February 7th, 1825, the said company voted that the directors should build the bridge, as soon as one hundred and fifty shares of the stock should be taken up ; and, that the treasurer make calls from time to time, on the shares, as the business might require.
The bridge was completed and accepted according to the act, October 19 th, 1825.
Under the charge of the court, the plaintiffs recovered the first assessment, notified in the S&ntinel, and the last also, that was voted in the meeting of the company. The other assessments were rejected from the verdict, for want of proper notice.
It appears that these assessments were to be paid, one half in cash, and the other half in grain ; and no regulation or contract appears about the place of payment, or of the delivery of the grain ; noplace of common deposit for the company agreed upon,to render a demand unnecessary ; and if a demand were necessary, none appears to have been made in the season for it, nor even before this action was commenced. This difficulty is not removed by any notice in the warning of the meeting, that any assessments would be made-. This, considering the mode of doing their business, the keeping their meetings alive by adjournments, and that known, of course, to the stock holders, may create no other difficulty, but increase the necessity of a demand before suit.
*399With regard to the assessment made by the directors, and _ . J by a vote of the company m open meeting, there is a still greater necessity for a demand and notice. This can never be considered as payable till notice, either personal or in some way pointed out by the vote or by-laws of the company. But the charge of the court authorized a verdict for the plaintiffs for two assessments,upon such notice as was proved, without any personal demand, or any thing equivalent thereto, notwithstanding half was payable án grain. This we consider erroneous ; therefore the judgement of the county court is reversed, and a new trial is granted.
Whether the plaintiffs will elect to prosecnte this action further, or become non-suit and commence a new, we know not. In either case,it might be beneficial to the parties to' know upon what grounds the plaintiffs may now have recovered, if presented in the case.
The strong ground of defence against this action, in case notice and demand were sufficiently proved, is, that there is no express promise proved, and that a corporation cannot recover upon an implied promise. To this point are cited several authorities from Massachusetts and New Hampshire. With regard to these authorities, two things are worthy of notice. 1. The cases themselves are not so broad as the principles laid down by the courts to govern them ; and 2. Those turn wholly upon the provisions of the statutes under which the several corporations were acting. Those statutes pointed out a remedy for the non-payment of assessments; to wit, the forfeiture of the shares. And, surely, when a man subscribes for stock in a corporation, and the laws in force, whether the general laws of the state, or those specially regulating the concerns of such corporation, provide for the forfeiture of the stock for non payment of assessments, and no other mode is provided to enforce'payment, it is fair to conclude add adjudge the corporation destitute of any other remedy but to take the forfeiture of the shares. In this state, neither the general laws nor the act by which the plaintiffs were incorporated, nor any bye-laws of the company, create any forfeiture of the shares for the non payment of the assessments. Therefore, this case comes not at all within the principles and reasons of the authorities cited from Massachusetts and New Hampshire.
Moreover, the stock of this company having been divided into two hundred shares at twenty dollars a share, before Tuttle, the defendant,subscribed, and he, by his subscribing, having acquired a title to ten shares of that stock,so divided,he may well be considered as accepting the proposition to take the ten shares at that price,or at such a price, not exceeding twenty dollars a share, as would be *400the proportion of said ten shares of the whole expense of building the bridge; and to pay for the same in such reasonable time or times as ^16 expenditures might; require. The consideration may be considered as executed. The defendant bought the ten shares. ° This gave him a right to vote in all the meetings of the company, and to have his vote count as ten of the two hundred votes. This gave him a right to ten dollars of every two hundred received as tolls at the bridge when erected. For this right he ought to make payment according to the mutual understanding of him and the company. Assumpsit was the only remedy to compel payment, which then existed, or has ever existed ; and he must have signed to render himself liable to existing remedies, while his signing gave him the property. At any rate, the legal effect of his subscribing for the stock is to render him thus liable.
Charles Adams, for plaintiffs..
Bailey and Marsh, for defendant.
This comes fully within the equity of a case of assumpsit for use and occupation on a parol lease. This lies as well in favor of a corporation as of an individual. — See 13 Com. Law Rep. 347. — The Mayor and Burgesses of Stafford vs. Till, 4 Bing. 75.
The general principle of sales, or letting for use, applies as well to corporations, of matters which they have a right to sell or let for use, as to individuals, enjoying the same right: where there is no other specific remedy, the promise will be implied to pay for what is purchased or hired.
Here was a sale. The ten shares became vested in the defendant. He may be compelled to pay for them. But he must not be compelled to pay otherwise, than according to the terms of payment proposed by the vote of the company before the defendant became a purchaser ; that is, half in money and half in grain. And a demand must be made before suit, unless the vote contained astipulation about the time and place of payment, by which a demand would be rendered unnecessary.
New trial granted.