Court Opinion

ID: 4929400
Source: CourtListenerOpinion
Date Created: 2021-09-24 01:05:18.189648+00
Date Added: 2024-06-11T08:14:24.731784
License: Public Domain

Tenney, J.—
The plaintiff recovered judgment against the " Georges Canal Company” at the .Feb. term, 1850, of the late District Court, in the county of Lincoln, and upon an execution issued thereon, January 3, 1851, and placed in the hands of a deputy sheriff of that county, he returned under date of January 4, 1851, that by virtue of that execution, he had made diligent search for corporate property or estate of the "Georges Canal Company,” but had been unable to find any. On March 1, 1851, he made further return upon the execution according to the provisions of c. 76, § 19, of the R. S. The present action is brought against the defendant, for the purpose of recovering of him individually, as a stockholder in that company, the amount of this execution, on the ground of his liability to pay a sum equal to the .capital stock belonging to him, in addition to the capital stock, it being agreed that he has been the owner of two shares in the company since its incorporation, and has paid thereon.the sum of one hundred dollars, the price of the two shares.
The defendant relies upon the fact, as a defence of this action, that he paid before the institution of this suit, a like sum to the creditors of the company and received, indorsed, the orders drawn in their behalf for their just indebtedness,.and that he surrendered the orders to the treasurer of the company, and received his receipt - therefor dated April 30, 1849, and contends that by the provision of sections 18, 19 and 20, of the chapter referred to, he is relieved from all liability.
The right of creditors of the company to resort to individual property, rights and credits of stockholders, arises in case *25of a deficiency of attachable corporate property or estate, — "provided in every such case, the officer holding the execution shall first ascertain and certify upon the execution, that he cannot find corporate property or estate.”
It is only in such a contingency, shown by such proof, that the property, rights and credits of a stockholder, are liable to be taken on an execution against the company ; or that an action on the case against such stockholder to recover of him individually the amount of his execution and costs, not exceeding the amount of the stock held by. such stockholder, can be maintained. If the evidence, prescribed by the statute, of the want of corporate means to pay the execution against the company be wanting, the stockholder may pay the execution; but it must be regarded a voluntary payment, and he may become an equitable or legal creditor of the company, by taking the place of the one whose claim he has satisfied. But the execution not being against the stockholder, he cannot be liable to pay .the same, unless the steps pointed out in the statute have been followed. Andrews v. Callender, 13 Pick. 484. And it follows, that a payment made without liability to make it, does not, under the Revised Statutes, c. 76, § § 18, 19 and 20, take from a creditor the right to resort to his property, when such creditor has shown by the proper evidence that the corporate means have failed, and he has caused the requisite notice to be given in order to fix his liability.
In the case before us, the defendant paid no debt of the company after a certificate on an execution against it, that corporate property or estate could not be found, and notice to him of his liability j and the payment’which was made, was unavailing to release him from his previous liability, by virtue of the Revised Statutes.
The defendant also relies upon the statute of June 2, 1851, c. 210, which provides, that whenever any stockholder named in the eighteenth, nineteenth and twentieth sections of the seventy-sixth chapter of the Revised Statute's, shall have paid and satisfied any just and legal debt or debts of such corporation, and shall produce a certificate under the hand of the *26treasurer of such corporation, that he has paid such debt or debts, and that the same has not been refunded t-o him, such stockholder shall thereby be exempted from further liability, &c., whether such debts shall or shall not have been demanded by an officer holding an execution against said corporation for such-debts. It is manifest, that the Legislature intended to relieve a stockholder, who should bring'himself within the provisions of this Act from further liability, without the returns upon an execution, by an officer holding the same, required by R. S. c. 76, § $ 18, 19 and- 20. But from the language of the Act it is equally manifest, that its operation was designed to be prospective only. The payment referred to, is a payment to be made after the passage of the statute, and cannot embrace payments previously made. The tense used, “ shall have paid and satisfied,” is what Noah Webster denominates, “ the prior future, indefinite,” and which he defines- to be “ an action, which will be passed at a .future time specified.” Webster’s Grammar of the English language in his Quarto Dictionary, 1st edition.
The language will be found, on examination- of the object of the Act, to be singularly precise and exact. The payment contemplated is not to be made to the treasurer, but to a creditor ; and the former is not supposed to have actual knowledge of. the payment, but to give the certificate upon evidence thereof, which is satisfactory to him. And to relieve a stockholder from the liability, the statute requires two things ; one, that he has paid and satisfied a just and legal debt of the corporation, and the other, the production of a- certificate thereof, under the hand of the treasurer. Between a- creditor seeking his remedy in this mode, and such stockholder, the treasurer’s certificate is not made conclusive evidence of the payment, though it may be evidence that the company assent to it j and by established principles of evidence, it may be inadmissible as proof of payment. The treasurer’s certificate must be subsequent in time to the payment to a creditor; hence the appropriateness of the language, which signifies that the stockholder shall have paid and satisfied debts of the corporation, whets he shall apply to the treasurer for a certificate and obtain, it.
*27The defendant contends that he has brought himself within the provisions of the Act of June 2, 1851, even on the ground that it was intended to be exclusively prospective in its operation, by the certificate of the treasurer of the company, dated Get. 8, 185L It would be competent for the defendant to prove that he had paid the just and legal debt of the corporation, by other evidence than the certificate of the treasurer, even if that should be deemed inadmissible for such purpose. And it is equally competent for the plaintiff to show at what time, and in what mode such payment was made, especially if it does not contradict or vary the statements contained in the treasurer’s certificate. The time and manner of the payment relied upon in the defence of this action are not specified in the certificate; and the evidence introduced by the plaintiff, whieh is regarded as admissible, shows clearly that the payment was the same which was made before the receipt of the treasurer of the company, dated April 30, 1849, and does not bring the defendant within the provisions of the Act of June 2, 1851, and the plaintiff is entitled to recover in this action.
Is a creditor, who prevails in an action like the present, entitled to recover his costs, if by such recovery, the defendant is subjected to the payment of a sum greater than his capital stock in addition thereto ? Tt is implied, that after the individual stockholder has received the notice referred to in chap. 76, sect. ,19, he may make payment of the sum for which he is liable, before tire levy of the execution upon his property, or the institution of a suit against him. And if he omit to make payment, and eosts are incurred, it is for his own delinquency, and eosts will follow the recovery of damages, under the general provision, that in a suit at law the prevailing party shall recover costs.
Several other questions presented by the case, become unimportant to a final decision of the cause, and an examination of them becomes unnecessary. Defendant defaulted.
Shepley, C. J., and Howard, Rice and Appleton, J. J., concurred.