5 Cal. 186 | Cal. | 1855
Bryan, J., concurred.
Heydenfeldt, J., dissented.
The twelfth section of the Act concerning Corporations, passed 22d April, 1850, provides, that " Whenever the capital stock of any cor
In the present case, it is contended that an assignment, by mere deivery, of the certificates of stock is sufficient to defeat the rights of an attaching creditor. The position assumed by the respondents’ counsel is, that the sections of the Act above referred to were intended for the protection and government of the incorporation, and cannot be extended to transfers between third parties. That the person to whom the certificates have been delivered has an equitable interest in the stock, which cannot be divested by any subsequent proceedings. In support of this position, a number of authorities have been cited, some of which I propose briefly to review.
In the case of the United States v. Cutts, 1 Sumner, 138, the language of the Act was, that the stock shall be transferrable only on the books of the treasurer, &c.” In commenting on this statute, the Court said, “ It seems, that the true interpretation of the statute is, that, so far as the United States and the proprietors are concerned, no transfer is to be considered as complete and perfect, so as to pass the legal
The reasons thus given by Judge Story, as well as the difference between the phraseology of the Act of 1790, and the Act now under consideration, fully justify the opinion of the Court; but there is, I think, little or no analogy between the cases.
In the case of the Bank of Utica v. Smalley, 2 Cowen, 777, it was held that a transfer of bank stock was good as between vendor and vendee, though the Act of incorporation provided that no such transfer should be valid or effectual until registered in a book to be kept by the bank for that purpose, and that the debts due from the vendor to the bank should be first paid. In this case, the Court said, “ This provision was intended exclusively for the benefit and protection of the bank. Their lien upon the stock for any debts due them cannot be affected by any transfer of the stock; and the only notice of a transfer which they are bound to regard, is a registry of it on their books.”
The case of Quiner v. Marblehead Social Insurance Company, 10 Massachusetts Reports, 480, as well as that of Sargent v. Essex Railroad Company, 9 Pickering's Reports, 204, support substantially the same doctrine.
I have examined several other authorities cited by the respondents’ counsel, which maintain the general doctrine of equitable assignments of this kind of property or dioses in action. But I have found no case,
This alone would be sufficient for practical purposes, and it is not assuming too much to say, that after having delegated to corporations the power of regulating such transfers for their own protection, in going further, and employing words of exclusion, the Legislature intended to protect the public from the frauds which might be perpetrated by a sale or hypothecation of the certificates passing the legal or equitable title, while the books of the company induced credit to the vendor, by holding him out to the world as the owner of such stock.
The conclusion to which I have thus arrived, renders it unnecessary to examine any of the other points presented.
Judgment reversed, with costs.