Oswego & Syracuse Plank Road Co. v. Rust & Rust

Hubbard, Justice.

The demurrer may be stated in two points. 1. That the complaint does not show that the plaintiffs were duly *392incorporated. And 2d. There is no allegation of considerations for the subscription to stock in the plaintiffs’ road.

The complaint alleges generally the incorporation of the plaintiffs pursuant to the provisions of the act passed May, 7, 1847, This is sufficient for any purpose; but even that, I think, was unnecessary in this action. The defendants by subscribing for stock have admitted the legal existence of the plaintiffs as a corporation, and can not question their capacity to appear upon the record. This principle was distinctly decided in the case of the Dutchess Cotton Manufactory vs. Davis (14 John. 238; see opinion, p. 245). That case was in relation to a stock subscription and hence strikingly analagous to this.

Upon the second point óf demurrer, I have had more doubt; but I have come to the conclusion that the complaint is sufficient for the following reasons; 1. That it contains allegations of every fact essential to be proved to support the action. It alleges the corporate existence of the plaintiffs, the defendants’ subscription to twenty shares of capital stock, the payment of the five per cent, and the call of the directors for the payment of the balance. The proof of these facts would show a case for a recovery, prima facie. 2. It is unnecessary to allege specifically that the defendants, by virtue of their subscription, became entitled to twenty shares of the capital stock of the company. The legal implication from the facts alleged is that the defendants were entitled to those shares. The company was organized, as appears from the complaint, for the purpose of constructing a plank road and reaping the pecuniary advantages to toll. By the.provisions of the act the subscribers became a body corporate for the purpose of constructing and owning a plank road. How can the subscriber be an owner, except through and to the extent of his subscription]

The shares subscribed are deemed personal property and may be sold as such and reached by judgment creditors. To allege, therefore, that the defendants subscribed to so many shares of stock, is in legal effect an allegation that it was done upon the consideration of the ownership of those shares. It can not be seriously urged that the defendants intended to make a gratuitous *393subscription. The contrary, I think, is clearly inferrible from the complaint. The case of the Trustees of Hamilton College vs. Stewart (1 Cow. 581), can have no application. The contract in that case was clearly without consideration. The corporation undertook to do no act'as a condition for the subscription, neither was there any possible pecuniary benefit to result to the defendant.

The plaintiffs are entitled to judgment on the demurrer, but the defendants are at liberty, on payment of costs of demurrer, in twenty days after service of notice of this order, to answer the complaint.