48 S.C. 120 | S.C. | 1897
Lead Opinion
The opinion of the Court was delivered by
Both parties, plaintiff and defendant, are corporations, and the object of plaintiff’s action is that the defendant may be adjudged to deliver to the plaintiff the 200 shares of the capital stock in such plaintiff corporation, which has been pledged to snch defendant, corporation illegally. The history of the whole matter, as .briefly stated, is as follows: On the 3d day of January, 1893, the plaintiff, contemplating the completion of its railroad from
According to the first clause in said agreement, the plaintiff, on the 3d day of January, 1893, did issue to the said National Rand Improvement and Manufacturing Company $50,000 of its capital stock, by delivering 500 shares thereof
On the 15th of May, 1893, the National Land Improvement and Manufacturing Company carried 200 shares of the capital stock of the plaintiff corporation, represented by scrip Nos. 13 and 17, each for 100 shares of the same, to the defendant, the Bank of Charleston, National Banking Association, and offered them as collateral to secure its note for $8,000. The offer was accepted, the note discounted, the 200 shares assigned as security. On the same day the note was discounted, one John C. Mallonee, as its general manager, checked out every dollar that was realized by the loan in payment of the paper of the said National Land Improvement and Manufacturing Company due to said bank, except about $2,500, which was applied to two obligations to said bank, in which the National &c. Company had no concern whatever. Soon afterwards, this National &c. Company made an assignment of its whole property for the benefit of its creditors, being wholly insolvent. But before its failure, Wm. H. Mauldin, as president.of the plaintiff, made demand upon John C. Mallonee, as general manager for said National &c. Company, for a surrender of the 500 shares of the capital stock of said plaintiff corporation, as provided for in clause 6 of agreement. While Mallonee did not refuse to do so, he certainly did not so- surrender. The plaintiff corporation, hearing of the offer and intention of the defendant bank to sell the 200 shares of its stock
It is the judgment of this Court, that the judgment of the Circuit Court be reversed, and that the cause be remanded to the Circuit Court, with directions to formulate a decree therein affording the plaintiff the relief prayed for in the complaint.
Concurrence Opinion
The plaintiff and the National Land Improvement and Manufacturing Company, of Charleston, S. C., entered into an agreement in January, 1893, whereby the plaintiff agreed to transfer $50,000 of its stock to said National Land Improvement and Manufacturing Company, and to deliver to it for sale certain first mortgage bonds on plaintiff’s road. The said National Land Improvement and
On the 15th of May, 1893, the defendant discounted, for the National Land Improvement and Manufacturing Company, a note made by said National Land Improvement and Manufacturing Company, dated 13th May, 1893, payable thirty days after date to J. H. Steinmeyer or order, for the sum of $8,000, with interest - after maturity at the rate of eight per cent, per annum. The note was executed by J. H. Steinmeyer, as president, and by J. N. Mallonee, as secretary and treasurer of the National Land Improvement and Manufacturing Company, and was endorsed by J. H. Steinmeyer. The note was secured by two scripts, Nos. 13 and 17, for 100'shares each of the stock of said railroad company, which were delivered to the defendant when the note was discounted. The certificates of stock are sealed with the company’s seal, signed by Wm. H. Mauldin, president and treasurer, and each certifies that the National Land Improvement and Manufacturing Company is entitled to 100 shares in the capital stock of the Hampton and Branchville Railroad and Lumber Company. The certificates are both endorsed by the company. The proceeds of
The Circuit Judge held that the defendant was an “innocent bona fide holder for value without notice,” of the said stock, and ordered that the plaintiff do transfer upon its books to the said defendant the said 200 shares of stock,, arid that the complaint be dismissed.
The plaintiff appeals upon several exceptions, which,, however, will not be considered separately, as they raise practically but the single question, whether the defendant was an “innocent bona fide holder for value without notice.”
Certificates of stock are not negotiable. Maybin v. Kirby, 4 Rich. Eq., 105; Hammond v. Hastings, 134 U. S., 401; 10 S. C. R., 727; Union Bank v. Laird, 2 Wheat., 390.
Although they are not negotiable, a bo7ia fide vendee for valuable consideration without notice will be protected. State Bank v. Cox & Co., 11 Rich. Eq., 344; Fraser & Dill v. Charleston, 11 S. C., 486. We do not question the principles announced in these cases, but they are not applicable to this case.
The act chartering the plaintiff (20 Statutes, 1169,) is a public act, and, therefore, all persons are chargeable with notice of its provisions. 23 Am. & Eng. Enc., 696; Hammond v. Hastings, 134 U. S., 401. Section 8 of said act provides: “That the stock of said company may be transferred in such manner and form as may be directed by the
For these reasons, I concur in the opinion of Mr. Justice Pope.
Dissenting Opinion
dissenting. I dissent, but will not delay the filing of this opinion by taking the time necessary to write out my views.