69 Md. 519 | Md. | 1888
delivered the opinion of the Court.
The question for decision in this case arises upon demurrer to the appellant's bill, which the Circuit Court of Baltimore City sustained, and accordingly dismissed the bill.
The facts averred in the hill and the amended hill are as follows: The appellant on the seventh of November, 1876, endorsed the note of one Jerome Bradley for two thousand dollars, in order that it might be discounted by the Jenkintown National Bank, which was an institution doing "business in Pennsylvania. At the time that discount was asked and secured, Jerome Bradley deposited with the bank certain shares of stock in “ The Cdorless Excavating Appai^tus Company of Baltimore City,'' which is a corporation, as collateral security for the ultimate payment of the note discounted. The maker of the note failed to pay the same, and appellant was compelled to pay it, which he did by partial payments from time to time; and on the first
Subsequently, about eighteen months after the discount of the note and the pledging of the certificates as collateral to the bank, the bill charges that the appellee Robert Turner, a citizen of Baltimore, sued out a writ of attachment from the Superior Court of Baltimore City against Jerome Bradley as a non-resident debtor, under which attachment these shares of stock in the “ Odorless Excavating Apparatus Company of Baltimore City” were levied upon, seized and attached, and judgment of condemnation was procured, so that on the twentieth day of February, 18*79, the shares of stock were sold for the sum of seven hundred and fifty dollars, and the sheriff transferred the same on the books of the company to Robert Turner, the purchaser, to whom new certificates were issued by the company. The appellant contends that he had the title to the stock and a valid lien thereon by virtue of the assignment and delivery of the stock to the bank and then to him, subject to which the appellee Turner bought: and therefore he prays for a cancellation of the certificates issued to Robert Turner, and that the “Odorless Excavating Apparatus Company” may be compelled to transfer the original shares of the stock assigned to the bank (and afterwards delivered up to the appellant,) on their books to the appellant, and that a trustee may be appointed to sell for his benefit.
By the assignment and delivery of the certificates to the hank it became, in equity, the owner of the stock. As between the parties to the transaction, the title effectually passed, for assignment on the hooks could he enforced; hut it was an equitable title only; and this Court so decided in.Balto. Retort and Fire Brick Co. vs. Mali, 65 Md., 96-97, and Swift vs. Smith, 65 Md., 435.
While inter partes (i. e. the assignor and assignee,) the provision for transfer on corporation hooks' is treated as unessential to equitable title, yet as against the corporations or third parties, it is essential, and the assignment is imperfect and executory unless perfected on the hooks of the corporation. It is essential to the corporation to know who are its members and entitled to the dividends which may he declared; and this provision is its protection. Even in Cowean vs. The Guild Farm Oil Company, 3 Daly, 218, upon which special reliance was placed hy appellant’s counsel, the Court expressly recognizes the provision for transfer on the hooks of the corporation as intended for the protection of the corporation, and enforceable for that purpose; hut as the delay, in that case to comply with it, had not led the corporation into doing any act prejudicial to itself, the transfer was required to he made. There the corporation had notice of the assignment and also of the attachment which was there sought to he made finally effectual hy transfer on the hooks. Here the hill avers attachment proceedings not only perfected hy judg
Decree affirmed.