Kennedy v. Norton

91 Wash. 244 | Wash. | 1916

Morris, C. J.

Appellant is a judgment creditor of the Green Bay Logging & Timber Company, an insolvent corporation. Execution having been issued and returned unsatisfied, this action was brought against Gardiner and Norton upon an alleged unpaid stock subscription. The only question to be determined is whether Gardiner and Norton have fully paid for their stock.

Gardiner was one of the original stockholders of the logging company, subscribing to one-third of its capital stock of the value of $4,000. Gardiner and two associates were the owners of timber and logging contracts of the value of $12,000. Preferring a corporation to a common ownership, they organized the Green Bay Logging & Timber Company with a capital stock of $12,000, and turned the timber and logging contracts over to the corporation in exchange for fully paid and nonassessable stock. There seems to be little doubt but that the property turned over to the corporation in exchange for the stock was of the value of $12,000. We find no evidence of any fraud in this transaction, and in the absence of fraud, such transfers are upheld. Inland Nursery & Floral Co. v. Rice, 57 Wash. 67, 106 Pac. 499; Gold Ridge Min. & Dev. Co. v. Rice, 77 Wash. 384, 137 Pac. 1001.

Subsequently Holmes, one of the original holders, transferred his one-third of the stock to Norton in exchange for notes and mortgages of a value in excess of $4,000, the face value of the stock.

These facts sustain the judgment, and it is affirmed.

Holcomb, Main, Bavsman, and Parker, JJ., concur.