108 N.Y.S. 528 | N.Y. App. Div. | 1908
Lead Opinion
The defendants appeal from an interlocutory judgment overruling their demurrer to the complaint.
The action is'to recover two assessments levied on the stockholders of the Telephone, Telegraph and Cable Company of America, a ¡New Jersey corporation. The plaintiffs sue as receivers of the company, alleging their appointment both in ¡New Jersey and in this State. The company was incorporated in 1899 with an authorized capital stock of $30,000,000 divided into 600,000 shares of the par value of $50,each. Of this stock 499,970 shares were offered for subscription, and defendants subscribed for 1,000 shares. The terms of subscription require the payment of five per cent of the par value, of shares subscribed for, being $2.50 per share upon subscription, and a further five per cent on February 1, Í900. The subscribers also agreed to pay the balance of the par value of the stock subscribed for as and when called upon so to do by the board of directors. Certificates of stock were to be issued to the subscribers when the first two payments, aggregating $5 per share, had been paid, and thereafter the subscribers were to be liable to pay assessments, only upon such'shares as would stand on record in their names when the assessment or call was made. The defendants paid five per cent upon subscription and five per cent on or about February 1, 1900, and received wliat was termed a temporary certificate of stock, the permanent certificates not being then réady for delivery. The temporary certificate recited upon its face that the “ holder of this certificate accepts the same subject to liability for-the payment upon said shares of all installments not noted as paid upon the face or reverse of this certificate which shall be called by the board of directors prior to the transfer of this certificate upon the books.” On March 1, 1900, and again on June 12, 1900, the board of directors levied an assessment of $2.50 per share, both of which the defendants paid. On ¡November 27, 1900, the directors levied an assessment of ten per cent, or $5 per share, of which due notice was given to defendants, but which they have refused to pay, and to recover which this action is brought. In March, 1901, pursuant to
It follows that the judgment must be affirmed, with costs, with leave to defendants to. withdraw the demurrer and answer within twenty days upon payment of the costs in this court and in the court below.
Patterson, P. J., Clarke and Houghton, JJ., concurred; Ingraham, J., dissented.
Dissenting Opinion
I dissent. . I think the reduction of the capital stock by the corporation, whose rights the plaintiffs seek -to enforce* so changed the conditions that the defendants .were relieved from their-Obligation to pay the- remainder of their subscription for tlie-Capital stock of the company: What the- defendants agreed to do was to subscribe for a certain number of shares of stock in a corporation with $30,000,000 capital, and -their subscription was dependent upon that amount of stock being subscribed for.. With- that amount of capital the corporation could profitably transact business, when a corporation with only $9,000,000, of capital might be seriously hampered by a lack of sufficient working capital. ■ There are many reasons why a subscriber to the stock of a corporation might be willing to. become a stockholder in case the company had ample capital, when he would be unwilling to become such a stockholder if the amount of capital' to be subscribed would not be sufficient for the business' of the company. There was, therefore, a material change iii the conditions brought about by the corporation itself, without the consent of the defendants,' and this, I think, relieved them from liability upon their subscription. .
Judgment, affirmed, with costs, with leave to defendants to withdraw demurrer and answer on payment of costs.