195 Pa. 349 | Pa. | 1900
Opinion by
This is a bill in equity brought by Robert W. Finletter, receiver of the Acetylene Light, Heat and Power Company, against the company and its stockholders for an accounting and to compel the payment of unpaid subscriptions to its capital stock. The company was incorporated under the laws of this
The bill avers that at the time of the transfer of said license
The bill alleges that claims against the company have been presented to the receiver amounting to about $60,000 and that the assets of the company remaining in his hands are about $9,000. The relief prayed for is, inter alia, that the debts of the company and the amount due each creditor be ascertained; that the 8,000 shares of stock issued .to Vincent and transferred by him to Napheys be decreed not full paid stock; that it was issued in fraud of the company, and that the same is liable to be assessed to its full par value in the hands of its present holders to pay the debts of the company; that the 10,000 shares of stock retained by Vincent be decreed to have been issued in fraud of the company and of its stockholders, and that the same is liable up to the full par value of the stock in the hands of its present holders for such amounts in excess of what they paid therefor as may be necessary to pay the debts of the company.
The appellees demurred and set forth, inter alia, as reasons therefor, that the bill admits that they were not original subscribers to the stock or promoters of the company but were purchasers of the stock in the market; that the stock _was issued as full paid to Vincent in consideration of jsroperty transferred to the company by him, and that the appellees acquired their title to the stock through Vincent; and that the bill fails to aver that they purchased the stock with notice of the fraud alleged in the bill, or were not purchasers thereof for value.
The learned court below sustained the demurrer “ because the bill fails to aver that said defendants purchased their stock with notice of the fraud alleged in the bill and that they were not purchasers thereof for value.”
Pleadings in equity like those at law, should show a good cause of action. Every material fact on which the plaintiff relies for relief must be distinctly and clearly averred, and that, too, with reasonable fullness and certainty: Smith v. Wood, 42 N. J. Eq. 563. He should set forth definitely and precisely in his bill the whole case upon which he seeks relief: Motley v. Rogers, 22 Ark. 227. If he does not disclose in his bill a cause of action against the defendant, the latter cannot be called upon to reply or to defend. The bill in this case shows that the defendants are owners of, but not the original subscribers to, certain full paid shares of stock. There is no allegation that they are not holders for value or holders with notice of the fraud alleged in the bill. It is conceded that they purchased their stock in the open market. As shown by the pleadings, therefore, the defendants are not responsible to the plaintiff for any unpaid subscriptions on the stock now held by them, and hence can safely rest upon their demurrer.
The appellant cites no case of this court, and we know of none that sustains his contention. His counsel state that the reason why the burden is on the purchaser of stock to show the bona fides of the transaction is that “ the matter is wholly within his knowledge while it would generally be difficult, and often impossible, for the injured party to trace knowledge of the fraud to the purchaser.” But we do not regard this as a sufficient reason for relieving the plaintiff from alleging in his bill that the defendants had notice of the fraud and were not holders of the stock for value. The presumption as to the ownership of other personal property, where the contrary does not appear, is that it has been acquired honestly and in good faith. It may be, and frequently is, difficult to establish fraudulent possession or ownership of property. But that is no valid reason for a presumption that property is held mala fides, and for casting the burden on the owner of showing a bona
If a creditor of an insolvent corporation has grounds to believe that the holder of its stock is not a bona fide owner for value, he should aver it in his bill. If he does not so believe and cannot allege it, the owner should not be required to show that his acquisition of the stock was, as it is presumed to have been, in good faith and for value. He should not be compelled to defend his title until it has been attacked by proper averments in the bill.
We are unable to see that the cases relating to negotiable paper and to confidential relations, cited by the appellant’s counsel, have any application to the issue raised by the pleadings in the ease under review. Even in case of a suit by an indorsee against a maker of a negotiable note, the plaintiff may rest on the presumption that he obtained it for a valuable consideration, in the usual course of business and before it was due, until there is proof that the note was fraudulently issued.
We are of opinion that for the reasons assigned in the decree, the learned judge of the court below committed no error in sustaining the demurrer.
The assignment of error is overruled and the decree is affirmed.