128 P. 989 | Or. | 1913
delivered the opinion of the court.
“No domestic corporation, no foreign corporation, joint stock company or association which shall have failed to pay the last annual license fee or any other tax or fee which shall have become due and payable against it as provided in this act or any other law of this State shall be permitted to maintain any suit, action or proceeding in a court of justice in this State while such delinquency shall continue. * * While such delinquency shall continue the right of such delinquent corporation, company or association to transact business shall be deemed to be in abeyance and such corporation, joint stock company or association shall not be permitted to maintain any suit, action or proceeding in any court of justice
It is provided in Section 6709, L. O. L., that:
“A plea that any domestic corporation or any foreign corporation, joint stock company or association has not paid any tax or fee required by any law of this State and which is then due and payable may be interposed at any time before trial upon the merits of any action, suit or proceeding and if issue be joined upon such plea the same shall be first tried.”
It is easy to conceive a case where a foreign corporation which has fully complied with all the provisions of the statutes on that subject has commenced a suit in the courts of this State pending which another annual tax or license fee has become due. While the suit is waiting trial the plaintiff is amenable to the plea mentioned in Section 6709, which could be interposed at any time before the final submission of the case. The certificate of the Secretary of State would go in proof of the corporate delinquency, and this certificate may, in turn, itself be overcome by subsequent certificate of that officer that the license fee or tax previously unliquidated has been paid, with interest. This would certainly defeat the plea in abatement entered pendente lite, and allow the action to proceed to trial on its merits. The statute under consideration is penal in its nature. Indeed, under Section 6707, a corporation failing to comply with the terms of the statute is liable to a fine of $100 to be recovered with any license fee due by an action in the name of the State. Such statutes are to be construed strictly, and are not to be extended beyond their express terms. The statute does not say that the contracts of
It remains to determine whether or not the defendant stockholders were liable for the debts of the principal corporation defendant, the Portland Construction Company. As between the plaintiffs and the individual stockholders defendants, the liability of the latter depends upon two conditions: First, whether or not the individual defendants had fully paid for their stock as subscribed by them; and, second, if the stock was issued to them in whole or in part as a gratuity, whether or not the plaintiff at the time of or before entering into this contract sued upon knew of this condition.' In passing, we hold that the suit must be dismissed as to the defendant Carpenter because there is no testimony whatever that he ever subscribed for any of the stock of the defendant corporation.
“The stockholders of all corporations and joint stock companies shall be liable for the indebtedness of said corporation to the amount of their stock subscribed and unpaid and no more.”
The records of the corporation, defendant, show that the defendants Bowles, Keeney, Gill, and Martin subscribed to the following agreement:
“We, the undersigned, hereby subscribe and agree to pay for in advance as called upon by the board of directors of the Portland Construction Company, a corporation, the number of shares of stock of the corporation as are set opposite our names.”
Each of them subscribed for 50 shares, amounting to $5,000. As to the defendants Keeney, Gill, and Martin, it appears that at the first meeing of the board of directors of which they were members a resolution was adopted by that body to the effect that $5,000 be paid to each director qualifying as such after the organization in payment of the price of 50 shares of the capital stock of the corporation heretofore subscribed for by each of the said directors, and that the president and secretary be authorized and directed to issue 50 shares of said capital stock of the par value of $5,000 fully paid up and non-assessable in full of $5,000 to be paid for their services to each of the following named directors, naming, among others, the defendants Keeney, Gill, and Martin. At a subsequent meeting of the directors they resolved that the sum of $5,000 be paid J. R. Bowles as his salary for one year in advance for services to be rendered as president. In addition to the allegation of the answer that the defendants fully paid for all the shares of stock held by them, the pleading contained the statement that “plaintiff was advised that the defendants herein had received or were to receive stock subscribed for by them for their individual services to the Portland Construction Com
“It has been testified that' we were entirely familiar with the financial condition of the Portland Construction Company. That is not a fact. We knew it was not financed in the sense that the stock was all subscribed and fully paid up. We knew that pretty well, but as to the individual holdings they had or money we knew nothing about them. The way they talked about going along with the work led us to believe that they had enough to pay us for our services, and it was specifically specified in the contract that, if the thing was a failure, our certain, definite, limitéd amount would have to be paid; that is, for the actual cost of the work in the field. That was thoroughly understood.”
In addition to this, in all the mass of correspondence in evidence attending the efforts of plaintiff to get the payment of its claim, no hint is found on the part of the individual defendants that they would not be ultimately liable under the constitutional provision quoted above. On the other hand, the testimony discloses, as already indicated, that among them in some manner they raised and paid on plaintiff’s claim several amounts amounting to $4,050-. It is not likely that they would have done this unless they were liable for the debt of the corporation by reason of their delinquency -in the payment of their subscriptions to its capital stock. Indeed, they do not base their defense squarely upon plaintiff’s knowledge that the stock of the defendant Construction Company was inflated as they now would have us believe. On the contrary, they pleaded a i express agreement on
The amount due to the plaintiff on the decree will rtmain as' computed by the court below, but a decree will be here entered modifying the determination' of the circuit court so that each individual defendant, Bowles, Keeney, Gill, and Martin, will be required to pay one-fourth of the amount thus ascertained. The defendant Carpenter will recover from the plaintiff his costs and disbursements, but the plaintiff will recover from the other defendants its costs and disbursements.
Modified and Affirmed.