173 P. 1059 | Mont. | 1918
delivered the opinion of the court.
Action to recover of the defendant $1,000, the par value of ten shares of its capital stock upon a subscription contract therefor. The complaint alleges: That on or about May 28, 1913, the defendant and other persons agreed to form a corporation to conduct a sheet metal business, and for that purpose signed the following agreement:
“We, the undersigned, in consideration of the mutual promises herein contained do hereby severally subscribe for the number of shares of the capital stock of the Enterprise Sheet Metal Works, a corporation proposed to be organized under the laws of the state,of Montana, with a capital stock of $30,000, of the par value of $100 per share, and promise to pay therefor in cash, except as hereinafter provided, upon the demand of the treasurer of said proposed corporation after the organization thereof.
“The undersigned, H. B. Stridiron and John Sadring have heretofore been engaged in business as a partnership under the firm name of Enterprise Sheet Metal Works, and as such partners are joint owners of considerable personal property consisting of stock on hand, tools and machinery, bills receivable, accounts receivable, and a certain patent for the manufacture and sale of a certain flume, the equity in which H. B. Stridiron and John Sadring value at the sum of $15,000.
“It is mutually agreed by and between the subscribers hereto that all said personal property shall bé turned over by said H. B. Stridiron and John Sadring to said proposed corporation,
That defendant subscribed for ten shares of the stock of the corporation to be formed; that thereafter “the plaintiff was duly incorporated under the laws of the state of Montana by the subscribers to said subscription contract, in pursuance with the terms thereof”; that it ever since has been and now is engaged in the sheet metal business; that as such corporation the plaintiff succeeded to and acquired all the rights of said subscribers and each of them to the amount for which they subscribed; that plaintiff-has issued its stock to its subscribers; that it “has issued and delivered to defendant ten shares * * * in accordance with his said subscription contract, and that the same has been accepted by him; that he has refused to pay for the same or any part thereof, though the treasurer of the plaintiff has repeatedly demanded payment. ’ ’ Judgment is demanded for $1,000, the subscription price, with interest thereon from April 25, 1915. The defendant interposed a general demurrer, which was overruled. Thereafter issues >vere joined by defendant’s answer and plaintiff’s reply thereto, a trial of which resulted in a judgment in favor of plaintiff. From this judgment and an order denying him a new trial, defendant has appealed.
The principal contention made by counsel is that the complaint does not state a cause of action. The argument is that subscriptions for the entire amount of the capital stock of plaintiff specified in the contract and in the articles of incorporation is a condition precedent which must have been fulfilled before the defendant became liable, and that, since the complaint contains no allegation of the amount that has been subscribed, nor any allegation that any of it other than that of the defendant has been subscribed for, it is fatally defective.
The rule is well established that, when a subscription is made
In Livesey v. Omaha Hotel Co., 5 Neb. 50, the reason is stated thus: “The rule seems to be well established that, when the charter or subscription contract specifically fixes the capital stock at a certain amount, divided into shares of a certain amount each, the whole amount of capital so fixed and required
In some states there are statutes which expressly provide that
Counsel for plaintiff insist that the allegation that “plaintiff was duly incorporated under the laws of the state of Montana
Counsel contend that tbe allegation of a delivery of his
To make the principle invoked available to plaintiff, therefore, it was incumbent upon it to allege facts showing knowledge by defendant that all the stock had not been subscribed, and that, having this knowledge, he nevertheless accepted that for which he had subscribed. The allegation in question falls short of this requirement; for it implies no knowledge as to how much of the stock had been subscribed. Indeed, it showed nothing further than that the defendant had agreed to take
In support of their contention in this behalf counsel cite the case of Inter-Mountain Pub. Co. v. Jack, 5 Mont. 568, 6 Pac. 20. That was an action to recover an assessment on shares of the capital stock of the plaintiff. The territorial court held that an allegation in the complaint that the defendant had accepted the shares and made payment of one assessment thereon was sufficient to show a waiver by him of his objection made by general demurrer that all the shares had not been taken. In our opinion, the court was in error, in that it did not appear from the complaint that the acceptance and payment were made by defendant with knowledge that all the shares had been taken. Even so, it is distinguishable from this ease in that it is alleged in the complaint here that the defendant has repeatedly refused payment.
Counsel admit that the general rule governing stock sub
The judgment and order are reversed, and the cause is remanded, with leave to plaintiff to amend the complaint if it desires to do so.
Reversed and remanded.