169 P. 670 | Cal. | 1917
This appeal was, in the first instance, heard in the district court of appeal for the first district, where the following opinion, prepared by Mr. Justice Richards, was filed:
"This is an appeal from a judgment in plaintiff's favor in an action brought against the defendant, as the secretary of a corporation, to recover the statutory penalty for refusing to transfer shares of stock of said corporation to the plaintiff upon his production of an assignment of the certificate of said stock and his demand for such transfer.
"The facts of the case are practically undisputed and are as follows: On February 15, 1915, one Andrew Ramage was the owner of two hundred shares of the capital stock of the Growers' Co-operative Agency, a corporation. On that date an action was commenced against him in the justices' court *748 of the city and county of San Francisco upon a debt, and an attachment was thereupon issued out of said court, which was straightway levied upon the said shares of stock of the defendant in said corporation. On March 15, 1915, said Andrew Ramage sold, indorsed, and delivered to Stanley Ramage, the plaintiff herein, 199 shares of said stock, and delivered the certificate evidencing the same to him. The plaintiff immediately presented said certificate to the defendant herein, as the secretary of said corporation, and requested the issuance of a new certificate therefor to him. The defendant then informed the plaintiff and also Andrew Ramage, his assignor, of the fact of said attachment, and stated to the plaintiff that he would sign and issue said stock as soon as said attachment had been released. On August 5, 1915, the plaintiff renewed his demand on the defendant for the issuance to him of said stock. The action against Andrew Ramage was still pending, and said attachment had not been discharged or released, and the defendant then stated that he was not at liberty to issue a new certificate for the attached stock but that he would do so as soon as said attachment had been released. This action was thereupon instituted to recover from the defendant as liquidated damages the statutory penalty provided by section 324 of the Civil Code.
"The sole question presented for decision in this case is as to whether the officers of the corporation can refuse to transfer certificates of shares of stock in their corporation to a purchaser and holder thereof demanding such transfer, when a writ of attachment has been levied on the shares or interest of the original holder of such stock, the lien of which attachment has not been released but is still subsisting at the time of such demand.
"We are unable to distinguish this case in principle from the case of Craig v. Hesperia Land Water Co.,
"The appellant also seeks to derive some comfort from the language used by this court in deciding the case ofSpangenberg v. Nesbitt,
"We find no error, therefore, in the ruling of the trial court holding the defendant liable to the penalties of the statute under the circumstances of the present case.
"Judgment affirmed."
Thereafter, an order was made transferring the cause to this court for hearing and determination. The application for such transfer was supported by friends of the court, who *750 attacked the judgment under review upon grounds differing somewhat from those advanced by the appellant himself. Our further examination of the case has satisfied us that neither petition shows any good ground for reversing or modifying the judgment appealed from. The opinion of the district court of appeal is adopted as embodying a satisfactory statement of the facts, and of the reasons for the conclusion reached. A few words may, however, be added, in view of the differing lines of attack made upon this conclusion.
The appellant himself takes the position that the plaintiff was not entitled to have a certificate issued to him so long as the attachment remained in force. This contention cannot be maintained unless it find justification in the statutes relative to attachment. There is no such justification. An attachment is a mere lien upon the shares of stock. Such lien, like any other, is upon the shares themselves, rather than upon the certificate of stock. The identity of the shares is not altered by the issuance of a new certificate, and the lien, if valid in its creation, will persist, notwithstanding the surrender of the certificate and the issuance of a new one to some person other than the defendant in the attachment suit. To this extent the decision in Craig v. Hesperia Land W. Co.,
There is, accordingly, no statutory provision authorizing the corporate officers to deny the stockholder or his assignee the rights incident to the holding and ownership of the shares attached. If, as is contended, this conclusion makes it possible for the owner of shares which have been attached to deceive others by inducing them to purchase shares in ignorance of the levy, the remedy lies with the legislature. The courts would not be justified in attributing to an attachment an effect greater than that which the statute gives, or in depriving stockholders in corporations, or their transferees, of any of their legal rights.
All of this is virtually conceded by learned counsel who appear here as amici curiae. They contend, however, that while the plaintiff, as purchaser of the shares and indorsee of the certificate, is entitled to have the shares transferred to his name on the corporate books, and to have a new certificate issued, the transfer should be made and the certificate issued subject to a notation that the shares have been attached. The claim is based upon Spreckels v. Nevada Bank,
The judgment is affirmed.
Shaw, J., Melvin, J., Lawlor, J., Henshaw, J., and Angellotti, C. J., concurred.