Court Opinion

ID: 4928711
Source: CourtListenerOpinion
Date Created: 2021-09-24 01:02:31.831424+00
Date Added: 2024-06-11T08:14:23.262114
License: Public Domain

Tenney, J.
It appears from the report of the case and the documents therein referred to, that the defendant held nine*576teen shares of the capital stock of the corporation, by assignment from Ephraim Woodman, who was the owner of the same shares as an original stockholder. After the transfer to the defendant, they were sold for the purpose of raising the amount of the assessments thereon. The avails of the sale being insufficient to cover the assessments and the costs of the sale, this action is brought for the recovery of the balance.
For the maintenance of the action, the plaintiffs rely upon-the Act of incorporation, sect. 1, whereby the company have the power to “make by-laws for regulating their affairs, not repugnant to the laws of the State,” and upon the by-laws, article 2.
It is not denied by the defendant, if the provision of the by-law referred to is of binding obligation upon him, that it confers the right to commence and maintain this action. But it is insisted, that it is repugnant to the laws of the State, as contained in the Revised Statutes, chap. 76. The sixth section of that chapter provides, that all corporations instituted in this State, may by their by-laws, when no other provision is specially made, determine the mode of selling shares for the non-payment of assessments.
In the case of the Kennebec and Portland Rail Road Company v. Kendall, 31 Maine, 470, this court decided, that a provision in the by-laws, substantially similar to that under which this action is attempted to be sustained, was not authorized by the charter, which empowered the company to make and collect such assessments on the shares of said capital stock, as may be deemed expedient, in such manner as shall be prescribed in their by-laws, and that it was repugnant to the laws of the State, in chap. 76, sect. 1, R. S. The clause in the first section of the plaintiffs’ charter, relied upon, confers no greater power, than that possessed by the company in the case cited. It was settled in the same case, that the unauthorized vote of the corporate members had no effect upon a contract by the corporation with one of them to his prejudice, and that he was not bound by a by-law, which was re-. *577pugnant to the general laws of the State,-notwithstanding he was a stockholder at the time the by-law was adopted by the company.
But it is insisted that the defendant’s assignor, by subscribing the by-laws, was bound thereby in the nature of a contract to pay assessments upon his shares, in the mode prescribed in the by-laws, article 2; and that the defendant, being his assignee of the same shares, is equally liable. We are not called upon to determine what would have been the legal obligations of the defendant’s assignor, if he had made no transfer of his stock, by virtue of his assent to a provision of the by-laws, which the charter did not contemplate. Whatever were his liabilities to pay assessments under a contract specially entered into, and which, was one that the corporation could not impose upon him, by a corporate vote, they were in their nature personal, and could not be passed to his assignee by the assignment alone.
There is nothing in the charter, the by-laws, or the contract of assignment, which can create any obligation on the defendant, upon the ground that he agreed to assume the liabilities of his assignor. He made no contract with the corporation, and did not bind himself in any manner, touching assessments to be made upon the shares. He would be bound by the bylaws, which the corporation had power to make, and by no other. He is not therefore bound to pay assessments in any mode, which the charter did not authorize, whatever might be the rights of the compan}!- to enforce the payment against his assignor, under his contract, if any he made.
The plaintiffs not being entitled to recover against the defendant, according to the agreement of the parties, the verdict is to be set aside, and a nonsuit entered.