Opinion by
Mr. Justice Mitchell,The claim that the defendant is estopped by the form of the certificate which sets out that the shares are “transferable personally or by attorney on the books of the company ” without any reference to a lien for the stockholder’s indebtedness cannot be sustained. The language of the certificate is not a representation of any inherent quality of the shares or rights of the holder, but is merely information as to the mode of transfer. From the nature of the business, transfers must be under some regulation and where, as in this case the regulations are imposed by the statute which is the fountain of the corporate power, all parties are bound to take notice of them. The Pennsylvania cases cited are not in point. Willis v. R. R. Co., 6 W. N. C. 461, and Kisterbock’s Appeal, 127 Pa. 601, decided that as the issue of certificates was an act within the lawful powers of the corporation, and depended on facts not accessible to outside parties, the latter were entitled to rely upon them as evidence of title to shares, and as against a purchaser for value the company would be estopped. There was no question of the mode or conditions of transfer. Wood’s Appeal, 92 Pa. 379 and Jeanes’s Appeal, 116 Pa. 573, were cases of private owners who had clothed their agents with apparent authority to transfer and were held to be estopped thereby. On the other hand an authoritative case on this question is Hammond v. Hastings, 134 U. S. 401, where the exact point was ruled in accordance with the views we have expressed.
II. Nor can the claim be sustained that the defendant has lost its right to lien as against the appellant, by reason of negligence in allowing the debt to be created. There is no obligation on a creditor to take care of other creditors of the mutual debtor further than by the avoidance of fraud. An employer may trust his employee to the extent of negligence without impairing his rights against the employee, or giving the employee’s creditor any ground of complaint, before notice of such creditor’s rights. And even after notice it does not follow that he *626must sacrifice his own rights. In the present case it is doubtful if the learned master did not go too far in favor of the appellant in holding that knowledge by the president and directors of the treasurer’s misconduct raised any duty to outside parties to discharge him, or in any way impair the right of lien even for a subsequent increase of his debt. Such is not the rule even in favor of sureties: Rw. Co. v. Shaffer, 59 Pa. 350. The directors being suddenly confronted with knowledge' that their treasurer.had by outside speculation with the company’s money, become a defaulter, had to decide whether it was for the interest of the company to allow him time and opportunity to withdraw gradually from the illegal ventures and reduce his debt or to stop him peremptorily at all risks. In reaching a decision they were not necessarily bound to take notice of danger to his other creditors, or to prefer such interests to their own. Those are matters which must depend on the particular circumstances of each case. It is not however necessary to go into this inquiry since it is conceded that the debt of Lippincott to the appellee incurred before knowledge of his misconduct or of appellant’s claim, very far exceeds the value of the shares in controversy.
III. The main question is the extent of the lien given by the act of 1874, P. L. 78, and this depends upon the meaning of the word “ indebted ” in the seventh section. The section provides for certificates to be issued to the holders of stock according to the number of shares held, which certificates “ shall be transferable at the pleasure of the holder, in person or by attorney . . . . subject however to all the payments due or to become due thereon; and the assignee .... shall be a member of said corporation and have .... all the immunities, privileges and franchises, and be subject to all the liabilities, conditions and penalties incident thereto, in the same manner the original subscriber or holder would have been, but no certificate shall be transferred so long as the holder thereof is indebted to said company unless the board of directors shall consent thereto,” P. L. 78. The last clause is the operative one from which the lien in this case arises. On its face and by the natural meaning of the words it includes all kinds of indebtedness. Standing alone there could be no question about it. But appellant contends that it should be read with and controlled by -the previous expression “subject to all payments due or to become due *627thereon,” and its meaning therefore is restricted to indebtedness growing out of the original subscription and subsequent calls or assessments thereon.
The argument is ingenious but not convincing. It is opposed not only as already said to the natural meaning of the words used, but also to the words which would most naturally have been used if the intent had been as claimed. The prior part of the section makes the certificates transferable at the pleasure of the holder, and the transferee takes them subject to all payments and liabilities incident to the original subscription. If the indebtedness which would prevent a transfer without the consént of the directors had been intended to be only that arising from the same source, the easiest and most obvious mode of expression would have been to add to the first clause “ and subject further as to all payments due thereon, to the consent of directors,” or to have substituted for the last clause, “ but no certificate shall be transferred so long as any payments remain due thereon,” unless the directors consent, etc. Either of these forms would have expressed clearly and definitely the restriction of the kind of debt which would prevent transfer, and one of them, or some other similar phrase would have been the natural expression chosen for such idea.. But instead of using any such expression the legislature indicated its intent by the broad word “ indebted.” The fact is as was pointed out by the learned master, that the two clauses as they stand in the act do not refer at all to the same thing. The first, “subject to all payments due or to become due thereon ” refers to the obligations to be assumed by the new taker, while the other “ so long as the holder is indebted” refers to the existing obligations of the former owner. A stockholder may become indebted to his company in many other ways than for calls upon his subscription, and the company may be content with his ability to pay, and its hold upon his shares as security. But this security would be lost if he could step out at any time by the transfer of his shares with only a liability for calls upon the original subscription. The legislature clearly had these considerations in view when it drew the distinction between the new obligations' of the transferee and the old ones of the transferor, and described the latter by the broad word “ indebted.”
But there is another section in the act which makes this con*628elusion irresistible. If the indebtedness which gives a lien is only such as arises from “ payments due” on the stock, then a stockholder not so indebted can, as the language of the first part says, transfer at his pleasure, and the consent of the directors need only be obtained when he is so indebted. But by section 12, “No shares shall be transferable until all previous calls thereon shall have been fully paid in.” That is, if the present holder is not indebted on calls the consent of the directors to a transfer is not necessary, and if he is so indebted the directors have no power to consent, so that in either alternative the prohibition against transfer without consent of the directors becomes ineffective, and the clause without meaning. A construction which leads to such results cannot be entertained.
Where the legislative intent is clear from the words used it is idle to discuss the agreement or variance of such intent from previous legislative policy. But as the subject has been somewhat elaborated in the argument, it may be well briefly to call attention to the trend of legislation in this state towards the gradual assimilation of rights and duties between members of partnerships and of corporations. The statutory authorization of special, and later of limited partnerships has approximated the status of the members to that of mere stockholders in that they may invest a definite amount of capital and avoid the unlimited common law liabilities. On the other hand when a partner sells out, either voluntarily or involuntarily, he passes to his vendee only a right to an account, and he cannot at any time unless by consent withdraw from the firm and leave the others to pay its debts, and in this respect the legislature has passed many acts, including the one under present consideration, tending to put a stockholder desirous of withdrawing, in an analogous position by requiring him first to pay up his indebtedness to the corporation. A number of such acts are cited in the argument of the appellee, and need not be enlarged upon here, further than to say that they have uniformly received from this court a construction in furtherance of their intent, and in harmony with the view we have expressed of the act of 1874. See Rodgers v. Huntingdon Bank, 12 S. & R. 77; Grant v. Mechanics’ Bank, 15 S. & R. 140; Sewall v. Lancaster Bank, 17 S. & R. 284; Mechanics’ Bank v. Earp, 4 R. 384 ; R. R. Co. v. Clarke, 29 Pa. 146; West Branch Bank v. Armstrong, *62940 Pa. 278 ; Klopp v. Lebanon Bank, 46 Pa. 88; Mt. Holly Paper Co.’s Appeal, 99 Pa. 513; Reading Trust Co. v. Reading Iron Works, 137 Pa. 282.
Decree affirmed at the costs of appellant.