Franks Oil Co. v. McCleary

The opinion of the court was delivered, January 3d 1870 by

Thompson, C. J. —

There is nothing in the Act of the 18th of July 1863, under which the plaintiff was created a corporation, *319nor in any by-law of the company, or the precedent association out of which it was created, brought to our notice, which makes it an incident of receiving a transfer of assessable stock, that the holder thereof becomes personally liable to pay the assessments which may be made by the company. The cases of The Canal Co. v. Sansom, 1 Binn. 70, and Palmer v. The Ridge Mining Co., 10 Casey 288, show that this is not the case; that no implication of a personal promise arises therefrom. In those cases, as well as that in hand, the company could only indemnify itself by a sale of the stock, and pursuit of the original contractor with the company for the stock. If a company wish for more than this security, it ought to provide for it in the act of incorporation, or, perhaps, in the certificate itself. The defendant in this case received a transfer of the shares in question from the original subscriber to the association, and transferred them before the company was incorporated. It is not necessary to consider whether this would have any effect in the case; certainly it would not aid the company, nor does it hurt the defendant. Treating the case as if the company were incorporated at the time of defendant’s transfer, and it can ask no more, our judgment is, that no action lies against the defendant personally for the unpaid assessments called. Nor is it to be inferred from his voluntary payment of one assessment. The company was not injured, or he estopped by that. The case of The Merrimac Mining Co. v. Levy, 4 P. F. Smith 227, is not in conflict with these views. We decided that case on a Michigan charter, and considered ourselves bound by the decisions of their Supreme Court, otherwise as we said, “ some stockholders will be bound to pay instalments called, and others, standing in the same position, will not;” dependent on the forum administering the law in or out of the state.

We consider it unnecessary to examine the authorities referred to, in this respect, on both sides ofithe able arguments in this case, for we have the rule, which must govern us in our own cases, cited above. Seeing no error in the rulings of the learned judge complained of, we must affirm the judgment.

Judgment affirmed.