PRIVATE CORPORATIONS VOLUME VII CHAPTER 56 (Continued) STOCK AND STOCKHOLDERS I. GENERAL CONSIDERATIONS [See Vol. 5] II. CERTIFICATES OF STOCK [See Vol. 5] III. SHARES OF STOCK AS PROPERTY [See Vol. 5] IV. LIABILITY OF SHARES OF STOCK TO EXECUTION, ATTACHMENT AND GARNISHMENT [See Vol. 5] V. CONVERSION OF SHARES OF STOCK [See Vol. 5] VI. AMOUNT OF CAPITAL STOCK AND INCREASE AND REDUCTION THEREOF [See Vol. 5] VII. ISSUE OF STOCK [See Vol. 5] VIII. ISSUE AND CANCELLATION OF CERTIFICATES OF STOCK [See Vol. 5] IX. UNAUTHORIZED AND FICTITIOUS STOCK AND CERTIFICATE [See Vol. 5] X. RIGHTS AND REMEDIES IN CASE OF LOSS OF CERTIFICATE OF STOCK [Sed Vol. 5] XI. PAYMENT FOR STOCK [See Vol. 5] XII. WATERED OR FICTITIOUS PAID UP STOCK [See Vol. 5] XIII. LIEN OF CORPORATION ON SHARES [See Vol. 5] XIV. PREFERRED STOCK [See Vol. 6] XV. CONVERTIBLE STOCK [See Vol. 6] XVI. DIVIDENDS [See Vol. 6] XVII. DIVIDENDS ON PREFERRED STOCK [See Vol. 6] XVIII. THE RIGHT TO TRANSFER SHARES [See Vol. 6] XIX. EFFECT OF TRANSFER [See Vol. 6] XX. NEGOTIABILITY OF STOCK CERTIFICATES AND TITLE OF BONA FIDE TRANS FEREES [See Vol. 6] XXI. MODES OF TRANSFERRING SHARES; REGISTRATION [See Vol. 6] XXII. EFFECT OF UNREGISTERED TRANSFERS [See Vol. 6] XXIII. REFUSAL TO RECOGNIZE AND REGISTER TRANSFERS [See Vol. 6] XXIV. FORGED AND UNAUTHORIZED TRANSFERS, AND TRANSFERS IN BREACH OF TRUST [See Vol. 6] XXV. CONTRACTS FOR THE SALE OF SHARES [See Vol. 6] XXVI. PLEDGES, MORTGAGES AND LEASES OF STOCK [See Vol. 6] XXVII. GIFTS OF STOCK [See Vol. 6] XXVIII. MEMBERSHIP IN CORPORATIONS [See Vol. 6] XXIX. CONTROL OF CORPORATION BY STOCKHOLDERS OR MEMBERS; POWER OF THE MAJORITY [See Vol. 6] XXX. DEALINGS BETWEEN CORPORATION AND ITS STOCKHOLDERS AND DEALINGS OF STOCKHOLDERS WITH CORPORATE PROPERTY [See Vol. 6] XXXI. ACTIONS BY STOCKHOLDERS TO ENFORCE INDIVIDUAL RIGHTS, OR REDRESS OR PREVENT INDIVIDUAL INJURIES [See Vol. 6] VII Priv. Corp.-1 XXXII. REMEDIES OF STOCKHOLDERS FOR INJURIES TO CORPORATION; RIGHTS OF ACTION AND PROCEDURE [See Vol. 6] XXXIII. LIABILITY OF STOCKHOLDERS TO CREDITORS ON ACCOUNT OF UNPAID SUB SCRIPTIONS [See Vol. 6] XXXIV. PERSONAL LIABILITY OF STOCKHOLDERS FOR DEBTS OF THE CORPORATION [Continued from Vol. 6] § 4210. Who may enforce liability-In general. § 4211. § 4212. § 4213. § 4214. § 1215. Creditors who are also stockholders in the corporation. Creditors who are also officers of the corporation. -Effect of assignment of claims. Receivers, trustees in bankruptcy, assignees for creditors, etc. Effect of receivership, bankruptcy or insolvency proceedings on right of creditors. § 4216. Mode of enforcing liability-General principles. § 4225. — Liability of shareholders in national banks-Involuntary liquidation. § 4231. Necessity for exhausting assets of the corporation and remedies against § 4232. § 4233. § 4234. it-General principles. Excuses for failure to exhaust remedies against corporation. Sufficiency and validity of judgment, execution and return. Requirement of action against the corporation within a limited time. § 4235. -Requirement of demand upon corporation. § 4236. Conclusiveness of judgment against corporation as against stockholders. 4237. Conclusiveness of order or decree assessing stockholders. § 4238. Application of the statute of limitations-General principles. $ 4239. § 4240. Acerual of right of action and running of the statute. § 4241. — Liability of estates of deceased stockholders. § 4242. — Liability of stockholders in national banks. § 4243. - Extension or reduction of time by the legislature. § 4244. Conflict of laws. § 4245. Laches. § 4246. Set-off of debts due to stockholders. § 4247. Priority as between creditors; distribution. § 4248. Enforcing liability in other states-General principles. § 4249. – Where a special remedy is prescribed by the statute. § 4250. — Method of enforcing liability in other states. § 4252. § 4253. Conclusiveness of judgment or assessment. Right of receivers, etc., to sue in foreign state. § 4254. Discharge of stockholders; waiver, release and payment-Scope. § 4255. § 4256. Waiver, release or discharge by creditors generally. -Release of individual stockholders. § 4257. Extension of time of payment, etc. § 4258. - Effect of taking guaranty from stockholders. § 4259. — Payment by or release of corporation. § 4260. Release by corporation. §4261. Payments by stockholders. § 4262. - Recovery of judgment against stockholder. § 4263. - Recovery of judgment against corporation. § 4264. — Insolvency or bankruptcy proceedings with respect to the corporation. § 4265. - Insolvency or bankruptcy proceedings with respect to stockholder. § 4266. Contribution among stockholders. § 4267. Subrogation. § 4268. Recovery of voluntary payments. XXXV. ASSESSMENTS ON FULL PAID STOCK § 4269. Scope of subdivision. § 4270. Right to levy assessments generally. § 4271. Power conferred by agreement or consent. § 4272. Power conferred by charter or statute. § 4273. Purpose and amount of assessment; conditions precedent. § 4274. Persons liable; rights and liabilities of pledgees, agents and trustees. § 4275. Mode of levying assessments; equality. § 4276. Enforcement of assessments; forfeiture. § 4277. Estoppel of stockholders; acquiescence. § 4278. Remedies in case of unauthorized or irregular assessments or forfeitures. § 4279. Contracts that stock shall be nonassessable. XXXVI. INDIVIDUAL LIABILITY AND RIGHTS ON FAILURE TO INCORPORATE § 4280. Scope of subdivision. § 4281. Liability to third persons generally. § 4282. Statutory liability. § 4283. Members as partners inter se. § 4284. Rights of associates as individuals. XXXIV. PERSONAL LIABILITY OF STOCKHOLDERS FOR DEBTS OF THE CORPORATION (Continued) § 4210. Who may enforce liability-In general. In the absence of provision to the contrary, the individual liability for corporate debts imposed upon the stockholders of a corporation by a charter, statutory or constitutional provision is solely for the benefit of, and directly to, creditors, and can only be enforced by them or by some. one representing them.87 The liability is not imposed for the benefit 87 California. Williams v. Carver, 171 Cal. 658, 154 Pac. 472. Colorado. Miller v. Smith, 26 R. I. 146, 66 L. R. A. 473, 106 Am. St. Rep. 699, 58 Atl. 634. Georgia. This is true of the liabil of the corporation, and is not in any sense a part of its assets, like unpaid subscriptions for stock, and, unless so provided by statute, it cannot be enforced by the corporation itself, by assessment or otherwise, even for the purpose of raising a fund for the payment of debts,88 ity imposed by statute upon persons who organize a corporation and transact business in its name before the minimum capital stock has been subscribed for. Rigbers v. Hathcock, 138 Ga. 120, 74 S. E. 834. Illinois. Golden v. Cervenka, 278 Ill. 409, 116 N. E. 273. Indiana. Hammond v. Cline, 170 Ind. 452, 84 N. E. 827. Land, Kansas. Anglo-American Mortgage & Agency Co. v. Lombard, 132 Fed. 721, certiorari denied 196 U. S. 638, 49 L. Ed. 630 (mem. dec.). Kentucky. Farmers' Bank of Wickliffe's Assignee v. Scott, 144 Ky. 575, 139 S. W. 801; Alsop v. Conway, 188 Fed. 568, certiorari denied 223 U. S. 720, 56 L. Ed. 629 (mem. dec.). Maine. Flynn v. American Banking & Trust Co., 104 Me. 141, 19 L. R. A. (N. S.) 428, 129 Am. St. Rep. 378, 69 Atl. 771. Maryland. Strauss v. Denny, 95 Md. 690, 53 Atl. 571; Cahill v. Original Big Gun Beneficial & Pleasure Ass'n, 94 Md. 353, 89 Am. St. Rep. 434, 50 Atl. 1044; Colton v. Mayer, 90 Md. 711, 47 L. R. A. 617, 78 Am. St. Rep. 456, 45 Atl. 874. Minnesota. Northwestern Trust Co. v. Bradbury, 117 Minn. 83, Ann. Cas. 1913 D 69, 134 N. W. 513; Childs v. Cleaves, 95 Me. 498, 50 Atl. 714. Montana. Barth v. Pock, 51 Mont. 418, 155 Pac. 282. A judgment creditor may enforce the liability of stockholders accruing through a failure to pay for subscribed stock, and it is not necessary to appoint a receiver for that purpose. Forsell v. Pittsburg & Montana Copper Co., 42 Mont. 412, 113 Pac. 479. Nebraska. Hamilton Nat. Bank v. American Loan & Trust Co., 72 Neb. 81, 100 N. W. 202; Id. 66 Neb. 67, 92 N. W. 189. New York. Van Tuyl v. Schwab, 165 App. Div. 412, 150 N. Y. Supp. 786; Van Tuyl v. Schwab, 85 Misc. 172, 148 N. Y. Supp. 292; Assets Realization Co. v. Howard, 70 Misc. 651, 127 N. Y. Supp. 798, judgment aff'd 152 App. Div. 900, 136 N. Y. Supp. 1130, 211 N. Y. 430, 105 N. E. 680; In re Jassoy Co., 178 Fed. 515. Ohio. Poston v. Hull, 75 Ohio St. 502, 80 N. E. 11; Irvine v. Elliott, 203 Fed. 82. Oklahoma. This is true of the liability to the extent of the amount unpaid upon the stock imposed by the Oklahoma statute. Smith v. Kastor, 195 Ill. App. 458. 88 United States. Mechanics' Sav. Bank v. Fidelity Insurance, Trust & Safe Deposit Co., 87 Fed. 113; Church v. Ayer, 80 Fed. 543. California. Williams v. Carver, 171 Cal. 658, 154 Pac. 472. Colorado. Zang v. Wyant, 25 Colo. 551, 71 Am. St. Rep. 145, 56 Pac. 565; Miller v. Smith, 26 R. I. 146, 66 L. R. A. 473, 106 Am. St. Rep. 699, 58 Atl. 634. Georgia. Lane v. Morris, 8 Ga. 468. Illinois. Golden v. Cervenka, 278 Ill. 409, 116 N. E. 273; Wincock v. Turpin, 96 Ill. 135. Indiana. Hammond v. Cline, 170 Ind. 452, 84 N. E. 827; Runner v. Dwiggins, 147 Ind. 238, 36 L. R. A. 645, 46 N. E. 580. Kansas. Anglo-American Land, Mortgage & Agency Co. v. Lombard, 132 Fed. 721, certiorari denied 196 U. S. 638, 49 L. Ed. 630 (mem. dec.). Kentucky. Farmers' Bank of Wick. The liability imposed by the Arkansas statute upon stockholders of banks for public funds deposited therein which the bank fails to pay over on demand to the person entitled to receive them, may be enforced by the official custodian of the funds so deposited.89 They are primarily liable, while his liability is secondary,90 and if he is liffe's Assignee v. Scott, 144 Ky. 575, 139 S. W. 801; Robertson v. Conway, 188 Fed. 579; Alsop v. Conway, 188 Fed. 568, certiorari denied 223 U. S. 720, 56 L. Ed. 629 (mem. dec.). Maine. Flynn v. American Banking & Trust Co., 104 Me. 141, 19 L. R. A. (N. S.) 428, 129 Am. St. Rep. 378, 69 Atl. 771; Pulsifer v. Greene, 96 Me. 438, 52 Atl. 921. Maryland. Colton v. Mayer, 90 Md. 711, 47 L. R. A. 617, 78 Am. St. Rep. 456, 45 Atl. 874; Republic Iron & Steel Co. v. Carlton, 189 Fed. 126. Massachusetts. First Nat. Bank of Barre v. Hingham Mfg. Co., 127 Mass. 563. Minnesota. Northwestern Trust Co. v. Bradbury, 117 Minn. 83, Ann. Cas. 1913 D 69, 134 N. W. 513; International Trust Co. v. American Loan & Trust Co., 62 Minn. 501, 65 N. W. 78, 632; Selig v. Hamilton, 234 U. S. 652, 58 L. Ed. 1518; Converse v. Hamilton, 224 U. S. 243, 56 L. Ed. 749, Ann. Cas. 1913 D 1292, rev'g judgment 136 Wis. 589, 118 N. W. 190; Childs v. Cleaves, 95 Me. 498, 50 Atl. 714. Missouri. Liberty Female College Ass'n v. Watkins, 70 Mo. 13. Montana. Barth v. Pock, 51 Mont. 418, 155 Pac. 282. Nebraska. Hamilton Nat. Bank v. American Loan & Trust Co., 72 Neb. 81, 100 N. W. 202, 66 Neb. 67, 92 N. W. 189. New York. Breck v. Brewster, 153 App. Div. 800, 138 N. Y. Supp. 821; Van Tuyl v. Schwab, 85 Misc. 172, 148 N. Y. Supp. 292; Assets Realization Co. v. Howard, 70 Misc. 651, 127 N. Y. Supp. 798, judgment aff'd 152 App. Div. 900, 136 N. Y. Supp. 1130, 211 N. Y. 430, 105 N. E. 680; Leighton v. Leighton Lea Ass'n, 62 Misc. 73, 114 N. Y. Supp. 918; In re Jassoy Co., 178 Fed. 515. The action to en force the individual liability of stockholders of a bank or trust company is properly brought in the name of the superintendent of banks rather than in the name of the corporation. Richards v. Schwab, 101 Misc. 128, 167 N. Y. Supp. 535. Ohio. Umsted v. Buskirk, 17 Ohio St. 113; Wright v. McCormack, 17 Ohio St. 86; Irvine v. Elliott, 203 Fed. 82. Oklahoma. This is true of the liatility to the extent of the amount unpaid upon the stock. Smith v. Kastor, 195 Ill. App. 458. Rhode Island. Atwood v. Rhode Island Agr. Bank, 1 R. I. 376. South Carolina. Parker v. Carolina Sav. Bank, 53 S. C. 583, 69 Am. St. Rep. 888, 31 S. E. 673. Utah. McLaughlin v. Kimball, 20 Utah 254, 77 Am. St. Rep. 908, 58 Pac. 685. West Virginia. Clark v. Bank of Union, 72 W. Va. 491, 78 S. E. 785. 89 Steed v. Henry, 120 Ark. 583, 180 S. W. 508; Warren v. Nix, 97 Ark. 374, 135 S. W. 896. The county treasurer is a proper party to an action to enforce the liability of stockholders of a bank which fails to pay a deposit of school funds made by school officials, but a failure to join him is not ground for reversal of a judgment against the stockholders, since the recovery is for his benefit. Black v. Special School Dist. No. 2, 116 Ark. 472, 173 S. W. 846, 1104. 90 The bank and its stockholders are primarily liable for the funds SO deposited, and the statute merely continues the liability of the officer |