denied.42 The allowance of the writ is within the discretion of the court upon the facts presented in each particular case." 43 This common-law principle seems to apply to the right given to the stockholder to inspect books. The power of the court to compel a corporation to exhibit its books to a stockholder is discretionary, and should not be exercised where the stockholder wishes to inspect the books for the purpose of annoying the corporation or for any purpose except the protection of his own interest.44 The statute was thus construed in a recent New Jersey case 45 in which it was held that the statute does not extend the right of the stockholder to examine corporate books, beyond that accorded to him by common law; that the original purpose of the act, which was to prevent fraudulent elections, must be construed into the act; and that a stockholder who acquired shares for the purpose of making an examination of the books of the company for a purpose not germane to his status as a stockholder does not thereby become entitled to make such examination.46

42 Citing In re Steinway, 159 N. Y. 250, 53 N. E. 1103, 45 L. R. A. 461; Phoenix Iron Co. v. Com., 113 Pa. 563, 6 Atl. 75.

43 State v. Hoboken, P. & P. Co., 67 N. J. L. 119, 50 Atl. 906.

44 People v. Produce E. T. Co., 53 App. Div. 93, 65 N. Y. S. 926.

45 O'Hara v. National Biscuit Co., (N. J.) 54 Atl. 241.

48 See Dill on Corporations, §§ 33, 44. Mr. Dill says: "The following provision has been inserted in several certificates of incorporation for the purpose of limiting such examination.

""The corporation shall keep at its registered office in this State the transfer books, in which the transfers of stock shall be registered, and the stockbooks, which shall contain the names and addresses of the stockholders and the number of shares held by them respectively, which shall at all times during the usual hours for business be open to the inspection of a stockholder in person with respect to his interest as such stockholder, or for a purpose germane to his status as such, upon application in writing to the registered agent of the corporation in charge of such office and having the custody of said books; but the registered agent may refuse permission to any stockholder to examine the same, (except as to the entries affecting the shares owned by such stockholder) unless and until satisfied that such examination and the information to be acquired thereby are for a legitimate purpose and not for a purpose hostile to the interests of the corporation or its individual stockholders, and the determination of the registered agent shall be final,

§ 338. Inspection of stock-books by creditors.

or

In order to enforce the stockholder's liability, it is necessary for the creditor to learn the names of the stockholders. This he could probably do without express aid from statute, by a bill for discovery or by interrogatories: but in several States a creditor is allowed to inspect the stock-books for the purpose of investigating the stockholders and their liability.47 In a few States the provision is more liberal; as that the book shall be open to the inspection of the creditor and his attorney,48 or of any person doing business with the corporation, 49 of any person interested.50 In other States something more is required, as that the person obtaining the inspection should be a judgment creditor; 51 a judgment creditor who has an execution against the corporation; 52 an officer holding execution against the corporation; 53 a person presenting a sworn affidavit that he is a creditor.54 In Wisconsin it is provided that "every creditor of a corporation shall be informed at any time of the amount of capital stock of such corporation subscribed, the amount paid in, who the stockholders are, the number of shares of stock owned by each, and the amount unpaid by each stockholder upon the shares owned by him, and if any shares of stock which were not fully paid for have been transferred within six months of the time of inquiry,

conclusive and binding upon all stockholders and all persons claiming under such stockholders.'"

47 Cal. Civ. Code, § 378; Col. Stat. § 508, amended 1893, p. 90, § 1; Ga. Code, 1891 (when shareholders are individually liable); Hawaii Civ. L. § 2021; Ida. Rev. Stat. § 2151; Ind. Rev. Stat. § 3433; Md. Gen. L. Art. 23, § 72; Mont. Civ. Code, § 541; N. Mex. Comp. L. § 451; N. Dak. Civ. Code, § 2907; Okla. Stat. § 979; S. Dak. Code, § 444; Wash. Corp. Supp. § 18. 48 N. H. Pub. Stat. ch. 148, § 12.

49 Me. Rev. Stat. ch. 47, § 20; Ore. Misc. L. § 3228.

50 Ky. Stat. § 546.

51 N. Y. 1901, ch. 354.

62 Kan. Stat. ch. 66, § 52.

53 Fla. Rev. Stat. § 2153.

54 Nev. 1903, ch. 121, § 72. In Connecticut, a creditor of such stockholder as he seeks information about. Conn. 1903, ch. 194, § 39.

the name of the person who transferred the same and the amount due thereon at the date of such transfer." 55

§ 339. Examinations and special reports of corporate affairs.

In a few States it is expressly provided that "The Legislature, or either branch thereof, may examine into the affairs and condition of any corporation in this State at all times; and for that purpose, any committee appointed by the Legislature, or either branch thereof, may administer all necessary oaths to the directors, officers, and stockholders of such corporation, and may examine them on oath in relation to the affairs and condition thereof; and may examine the safes, books, papers, and documents belonging to such corporation, or pertaining to its affairs and condition, and compel the production of all keys, books, papers, and documents by summary process, to be issued on application to any court of record or any judge thereof, under such rules and regulations as the court may prescribe.' In California the Attorney General, when required by the Governor, may make a similar examination.57 In a few States it is provided that a special report of the affairs of the corporation shall be furnished (not oftener than once in six months) at the request of fifteen per cent. of the stockholders, 58 or one-third of the stockholders.59

1956

In New Jersey and North Carolina "the court of chancery or the supreme court, or any justice thereof, may, upon proper cause shown, summarily order any or all of the books of said corporation to be forthwith brought within this state, and kept therein at such place and for such time as may be designated in such order, and the charter of any corporation failing to comply with such order may be declared forfeited by the

55 Wis. Rev. Stat. § 1757.

56 Cal. Civ. Code, § 383; N. Dak. Civ. Code, § 2942; Okla. Stat. § 1012; S. Dak. Code, § 478; and a more general provision to the same effect, W. Va. Code, ch. 53, § 60.

87 Cal. Civ. Code, § 382.

58 Colo. Stat. § 507; Wyo. Rev. Stat. § 3057.

59 Kan. Stat. ch. 66, § 31; Minn. Gen. Stat. § 2800.

court making such order, and it shall thereupon cease to be a corporation, and all its directors and officers shall be liable to be punished for contempt of court for disobedience of such order." 60

60 N. J. Corp. Supp. § 44; N. Car. 1901, ch. 2, § 49.

This chapter is intended to contain only a rather fragmentary statement of such statutory provisions as to stocks and bonds as it would interest incorporators and investors to know. Questions of mere practice and detail have been omitted. For instance, the elaborate provisions for making calls for the payment of subscribed capital, and for sale of shares for non-payment of calls, have been altogether omitted. The statutes imposing liability on stockholders and directors will be found in the next chapter.

§342. Payment for stock.

It is provided in many States that "no corporation shall