125 F. 823 | U.S. Circuit Court for the District of Eastern Pennsylvania | 1903
This action was brought to recover an installment of an assessment upon 2,100 shares of the preferred stock of the American Alkali Company, under a certain subscription agreement, of which it is at this point enough to say that it was executed by the defendants, and that prima facie it imposed the liability sought to be enforced. Stated broadly, the defense was that the subscription in question was npt made by the defendants for their own account, but as brokers for others. The rulings of the court upon the trial excluded this defense, and I have not been convinced that those rulings were in any respect erroneous. Neither in the body of the
“Upon payment of the first installment of 20% the full-paid certificates of common stock and partially paid certificates of preferred stock, setting forth that 20% has been paid thereon, shall be delivered to the subscribers hereto and as subsequent installments are paid they shall be endorsed on the latter.
“Provided, however, that after the payment of the 20% provided for above, amounting to a total of $10 per share, the subscribers hereto-shall no longer be liable for any balance on their subscription excepting upon such shares as shall stand of record on the books of the company in their names at the time any subsequent assessments or calls are made, but the holders of such shares of record on the books of the company at that time, and they only shall be liable for the same.”
In my opinion, the construction which the learned counsel of the defendants seek to put upon the foregoing extract is an inadmissible one. It could not be adopted without holding that it was contemplated that subscribers to the stock of this corporation might evade the obligation generally and properly incident to such subscriptions by simply directing that the shares for which they subscribed should stand in the name of some financially irresponsible third person. Without pausing to consider whether any provision that, would really have this effect should not be disregarded as being in conflict with the policy of the law, I content myself with saying that the particular provision in question may reasonably be, and therefore should be, so interpreted as to limit its applicability to cases of bona fide changes of
Upon the whole case I have reached the conclusion that the verdict which was rendered by direction of the court should not be disturbed, and therefore the defendants’ rule for a new trial is discharged.