27 Ind. App. 1 | Ind. Ct. App. | 1901
— This was an action by the appellee to enjoin the appellant corporation and other appellants who are its officers and directors from disconnecting appellee’s service-pipe from the mains of appellant corporation. The complaint is long, and includes a copy of the articles of association and the constitution and by-laws of appellant company. It is averred in the complaint that certain by-laws were adopted by the company, the second section of which was as follows: “Any member of the company, on full payment of $25, will be entitled to a paid up certificate, duly issued by the secretary of said corporation, with official seal attached thereto. Said certificate when so issued shall entitle the owner thereof to the free use of natural gas for illuminating, fuel, and all other domestic purposes. No member of this company being the owner of a single share of stock will be permitted to use in any one residence to exceed four stoves or grates, and in the event any stockholder should use stoves or grates to exceed the number as herein stipulated said stockholder will be required, by order of the board of directors, to pay to the secretary of said corporation for each additional stove or grate seventy-five cents per month during the period so used, and the money so accumulated shall be held as a sinking fund, to be used to defray the incidental expenses of the corporation.” It is further averred that appellant company drilled wells, laid mains in the streets and alleys of the town of Eedkey, and began furnishing gas to its stockholders as provided in its by-laws, and so continued to do and was so doing at the time this action was commenced. That appellee after the adoption of said by-laws became a stockholder, and paid to said company the sum of $25, and received a certificate of stock in said company; that he caused his residence to be plumbed for the use of gas for fuel and light, and appellant company connected his pipe
Appellant company separately assigns as error the action of the court in overruling its demurrer to the complaint and sustaining the demurrer of appellee to its second paragraph of answer. The other appellants jointly assign the same errors. We regard the complaint as sufficient. It seems to be settled law that injunction is the proper remedy where the proposed unauthorized action of the corporation or its directors will prejudice the rights of a stockholder. Stewart v. Transportation Co., 17 Minn. 372; Bergman v. Building Association, 29 Minn. 275.
The stockholders would no doubt have the right to change the by-laws and authorize a uniform charge to be made for the gas used by them, and thus raise the money necessary to provide for the expenses of the company, and the debt contracted for gas used could, undoubtedly, be enforced by a discontinuance of the service until the delinquency was settled. But the rule of non-liability at common law beyond the par value of the stock is established beyond question and is the chief inducement for the formation of corporations to conduct business. Gainey v. Gilson, 149 Ind. 58.
“Attempts have been made in various ways to authorize the assessment of stockholders for amounts after the par value of the stock has been paid in. Such efforts have generally failed. It can not be done by a majority vote of the stockholders, nor of the directors, nor by a by-law.” 1 Cook on Stockholders, §242. See, also, Flint v. Pierce, 54 Mass. 539. Gainey v. Gilson, supra. But the liability for additional assessments above the par value of the stock may be and is frequently created by statute.