the personal representatives. If the executor or administrator distribute all the assets without making provision for the claims of creditors of the company, he renders himself personally liable to satisfy the same. A proceeding by motion brought by a corporate creditor in accordance with the Missouri statute,' to enforce a shareholder's liability upon the unpaid balance due on his stock, does not abate on the death of the shareholder. And the corporate creditors may sue the representative of a deceased stockholder without presenting a claim for allowance as on an ordinary claim. The estate of a deceased joint-owner of stock is not liable thereon. Where under a general act of incorporation a person can become a subscriber to the capital stock of a company formed in accordance there with only by signing the articles of incorporation or by subscribing to the capital stock after the incorporation, a preliminary subscription of a contract to take shares by a person who did not sign the articles of incorporation, is revoked by his death, and his estate can not be made liable by corporate creditors." § 136. (h) Trustees, executors and administrators.While of course the trustee has his remedy against the cestui que trust, it is he, and not the beneficiary, that is primarily 1 Cochran v. Weichers, (1889) 53 Hun, 636; Chase v. Lord, 77 N. Y. 1; s. c. 6 Abb. N. Cas. 258; Richmond v. Irons, 121 U. S. 27; Irons v. Manufacturers' Nat. Bank, 21 Fed. Rep. 197; Manville v. Edgar, 8 Mo. App. 324. Cf. Diversey v. Smith, 103 Ill. 379. 2 Taylor v. Taylor, (1870) L. R. 10 Eq. 477, and cases cited in § 136. 3 Mo. Rev. Stat., § 736. Marks v. Hardy, (1886) 86 Mo. 232. But see Cummings v. Wright, (1883) 11 Mo. App. 348. Cf. Donnelly v. Hodgson, 13 Mo. App. 15. Thompson v. Reno Savings Bank, (1885) 19 Nev. 171; s. c. 3 Am. St. Rep. 882. 6 In re Maria Anna &c. Co., (1875) 44 L. J. Ch. 423. But see New England Commercial Bank v. Newport Steam Factory, 6 R. I. 154; s. c. 75 Am. Dec. 688, from which it would seem that the estate may be proceeded against in equity by the corporate creditor. 7 Sedalia, W. & S. Ry. Co. v. Wilkerson, 83 Mo. 235, where the court said: "It has been held by the courts of New York, in construing a statute in most respects like our own, that a party failing to sign the articles of association could not be subjected to the liability of a stockholder, although he had signed a preliminary subscription paper. Troy & Boston R. Co. v. Tibbitts, 18 Barb. 297; Poughkeepsie & S. R. Plank R. Co. v. Griffin, 24 N. Y. 150." See also Wallace v. Townsend, 43 Ohio St. 537. 8 In re National Financial Co., liable to corporate creditors upon stock standing in his name upon the company's register,' although the registration may (1868) L. R. 3 Ch. 791; Hughes-Hallett v. Indian Mammoth &c. Co., (1882) 22 Ch. Div. 561; Shaw v. Fisher, 5 De G. M. & G. 596; Hoare's Case, (1862) 2 John. & H. 229; Evans v. Wood, L. R. 5 Eq. 9; Hawkins v. Maltby, L. R. 4 Ch. 200; Morris v. Cannan, 4 De G. F. & J. 581; Wynne v. Price, 3 De G. & Sm. 310; Kellogg v. Stockwell, 75 Ill. 68; Cheale v. Kenward, 3 De G. & J. 27; James v. May, (1873) L. R. 6 H. L. 328; Hemming v. Maddock, (1872) L. R. 7 Ch. App. 395; Cruse v. Paine, (1868) L. R. Eq. 641; Butler v. Cumpston, (1868) L. R. 7 Eq. 16; Mitchell's Case, (1870) L R. 9 Eq. 363; Ex parte Oriental Commercial Bank, (1868) L. R. 3 Ch. 791. 1 William's Case, (1875) 1 Ch. Div. 576; Hoare's Case, (1862) 2 John. & H. 229; In re British & Foreign Cork Co., (1865) L. R. 1 Eq. 231; Adderley v. Storm, (1844) 6 Hill, 624; Mann v. Currie, (1848) 2 Barb. 294; Worrall v. Judson, (1849) 5 Barb. 210; Rosevelt v. Brown, (1854) 11 N. Y. 148; In re Empire City Bank, (1858) 18 N. Y. 199, 225; Crease v. Babcock, (1846) 10 Metc. 525, 545, where the court said: "If a person was a holder of stock at the time of dissolution of the charter (sic), although he held the shares as collateral security, or as trustees for other persons, he was not on that account exempted from individual liability;" Fenwick's Case, (1849) 1 De G. & Sm. 557; In re National Financial Co., (1868) L. R. 3 Ch. 791; James v. May, (1873) L. R. 6 H. L. 328; In the Matter of the Companies Act, (1863) 4 De G. J. & S. 53; Chinnock's Case, (1860) John. (Eng. Ch.) 714; Pugh & Sharman's Case, (1872) L. R. 13 Eq. 566. In Grew v. Breed, (1846) 10 Metc. 569, 576, the court divided the shareholders into four classes and said: "The first are absolute owners of stock, at the time of the repeal of the charter of the bank. About the liability of these there is no doubt or question. The second class consists of those who were absolute owners of part of the stock held by them, and special holders of the residue; that is, they held part of the stock as collateral security only, or in trust for others, who furnished the money to pay for it, but the shares stood in their own names on the books of the bank. These holders are chargeable in the same manner as if they were absolute owners of all the stock standing in their names. The third class are holders of stock as trustees for others, and the trust appears on the books of the bank, either by its being there stated the owners hold in trust for some person named, or by the owner's being described as administrator. These also are chargeable like the two former classes. The fourth class consists of those who hold stock as administrators of deceased stockholders. They are chargeable as for other debts of their intestates in their representative capacity." Fanning v. Insurance Co., (1881) 37 Ohio St. 339; In re Norwegian Charcoal Iron Co., (1870) L. R. 9 Eq. 363; King's Case, (1871) L. R. 6 Ch. 196; Newry &c. R. Co. v. Moss, (1851) 14 Beav. 64; Shipman's Case, (1865) L. R. 5 Eq. 219; Buchan's Case, (1879) L. R. 4 App. Cas. 549; Chapman & Barker's Case, (1866) L. R. 3 Eq. 361; Ex parte Bugg, 2 Drew. & Sm. 452; In re Joint-Stock Discount Co., (1867) L. R. 3 Ch. 119. Cf. Hemming v. Maddick, (1870) L. R. 9 Eq. 175; Holyoke Bank show that he holds merely as trustee. While the liability of an executor or administrator is limited to the extent of the trust estate, and only becomes personal through his paying away its assets without making provision for payments on the v. Burnham, (1853) 11 Cush. 183. But see Cutting v. Damerel, (1882) 88 N. Y. 410, 415, and Shipman's Case, L. R. 5 Eq. 219. 1 Hemming v. Maddick, (1870) L. R. 9 Eq. 175; Ex parte Oriental Commercial Bank, (1868) L. R. 3 Ch. 791; Holt's Case, (1851) 1 Sim. (N. S.) 389; In re International Contract Co., Ind's Case, (1872) L. R. 7 Ch. 485; Lumsden v. Buchanan, 4 Macq. 950; Muir v. City of Glasgow Bank, 4 App. Cas. 337. See also the Glasgow Bank Cases, 4 App. Cas. 547. 2 Ex parte Hall, (1849) 1 Mac. & G. 309; Hamer's Devisee's Case, (1852) 2 De G. M. & G. 366; Robinson's Executors' Case, (1856) 6 De G. M. & G. 572; Ness v. Armstrong, (1849) 3 De G. & Sm. 38, n. ; Buchan's Case, (1879) L. R. 4 App. Cas. 549; Hoare's Case, (1862) 2 John. & H. 229; Bulmer's Case, 33 Beav. 433; In re North of England Joint-Stock Banking Co., Gouthwaite's Case, (1850) 3 De G. & Sm. 258, where it was held that, as the executrix had participated in the profits by receiving a dividend, it was unreasonable to attribute to her and the directors the intention that she was not to be liable to contribute to the losses in some manner; but quære, whether she should be a contributory personally or as executrix; Taylor v. Taylor, (1870) L. R. 10 Eq. 477; Alexander's Case, (1871) 15 Sol. J. 788; Hamer's Case, (1850) 2 De G. & Sm. 279, where a shareholder in a jointstock company bequeathed his personal estate to his wife for life and after her death to his daughter absolutely (subject to certain pay ments), and appointed his wife and daughter executrixes, and devised to them real estate, The widow received dividends on the shares and died; and afterward, on the company being wound up, the daughter and her husband were placed on the list of contributories in right of the daughter as executrix of her father. The Vice-Chancellor held that a call was properly made upon the daughter and her husband payable out of the testator's personal assets, whether the conduct of the executrixes in suffering their testator's assets to remain in the company was a breach of trust or not; and secondly, on its appearing that the personal assets had been fully administered, the daughter and her husband could not be put on the list in respect of her being a devisee; In re North of England Banking Co., Thomas' Case, (1849) 1 De G. & Sm. 579; Baird's Case, (1870) L. R. 5 Ch. 725; Stewart's Trustee v. Evans, (1871) 9 Scotch Ct. of Ses. Cas. (3d Series) 810; Evans v. Coventry, (1856) 25 L. J. Ch. 489; Blakeley's Case, (1850) 13 Beav. 133; Ex parte Gouthwaite, (1851) 3 Mac. & G. 187; Ex parte Doyle, (1850) 2 Hall & Twells. (Eng. Ch.) 221; Grew v. Breed, (1846) 10 Metc. 569, 576, cited and quoted supra; New England Commercial Bank v. Stockholders of the Newport Steam Factory, (1859) 6 R. L 154; Crandall v. Lincoln, (1884) 52 Conn. 73; Bailey v. Hollister, (1862) 26 N. Y. 112; Chase v. Lord, (1879) 77 N. Y. 1; Witters v. Sawles, (1885) 25 Fed. Rep. 168. Cf. Schouler on Executors, § 380; New York Laws of 1850, ch. 140, § 11; New York Laws of 1848, ch. 40, $ 13. But see stock,' or through accepting a transfer into his own name;2 the rule is otherwise in the case of ordinary trustees, whose liability is personal and not restricted to the funds of the trust estate, unless so limited by statute, as in New York' and under the federal act relating to trustees of stock in the national banks. A trustee may, however, avoid personal liability by stipulating against it at the time of accepting the trust. The rule as to the personal liability of trustees applies as well to those holding stock for the benefit of the company as to other ordinary trustees. Child v. Coffin, 17 Mass. 64; Gray v. Coffin, 9 Cush. 200; Ripley v. Sampson, 10 Pick. 371; Andrews v. Callendar, 13 Pick. 484; Dane v. Dane Manuf. Co., 14 Gray, 489. 1 Taylor v. Taylor, (1870) L. R. 10 Eq. 477; Jeffreys v. Jeffreys, (1871) 24 L. T. Rep. (N. S.) 177. Cf. Stewart's Trustees v. Evans, (1871) 9 Scotch Ct. Ses. Cas. (3d Series) 810; Witters v. Sawles, (1885) 25 Fed. Rep. 168. 2 Alexander's Case, (1871) 15 Sol. J. 788. An executor accepting new shares can not have recourse upon the estate if held liable upon them. Fearnside & Dean's Case, (1866) L. R. 1 Ch. 231; Spence's Case, (1853) 17 Beav. 203; Jackson v. Turquand, (1866) L. R. 4 H. L. 305; Mallorie's Case, (1867) L. R. 2 Ch. 181. Cf. Russell's Executor's Case, (1871) 15 Sol. J. 790. If the executor does not have the shares transferred into his own name, he is entitled to a reasonable time to find a purchaser who will take a transfer of them. Buchan's Case, (1879) L. R. 4 App. Cas. 549, 588. See also In re Cheshire Banking Co., (1886) 54 L. T. Rep. 558. 3 Chapman's Case, (1866) L. R. 3 Eq. 361; In re British & Foreign Cork Co., Leifchild's Case, (1865) L. R. 1 Eq. 231; Hoare's Case, (1862) 2 John. & H. 229; Muir v. City of Glasgow Bank, (1879) L. R. 4 App. Two or more trustees of the Cas. 387; Grew v. Breed, (1846) 10 Metc. 569, 576, cited and quoted supra. Cf. Sayles v. Bates, (1886) 15 R. I. 342. 4 N. Y. Laws of 1850, ch. 140, § 11; N. Y. Laws of 1848, ch. 40, § 13. 5 U. S. Rev. Stat., §§ 5151, 5152; Davis v. Essex Baptist Soc., (1877) 44 Conn. 582; Irons v. Manufacturers' National Bank, (1884) 6 Biss. 301. 6 Saunders' Case, (1864) 2 De G. J. & S. 101; Gray's Case, (1876) 1 Ch. Div. 664; In re City Terminus Hotel Co., (1872) L. R. 14 Eq. 10. Cf. Chapman & Barker's Case, (1866) L. R. 3 Eq. 361. 7 Preston v. Grand Collier Dock Co. 11 Sim. 327; In re Ennis &c. Ry. Co., 3 L. R. Ir. 187; Cree v. Somervail, 4 App. Cas. 648; In re International Contract Co., Ind's Case, (1872) L. R. 7 Ch. 485; Hoare's Case, (1862) 2 Johns. & H. 229; Ex parte Henderson, 19 Beav. 107; Eyre's Case, 31 Beav. 177; Munt's Case, 22 Beav. 55; Richmond's Case, 3 De G. & Sm. 96; In re Vale of Neath and South Wales Brewery Co., 3 De G. & Sm. 244. Cf. Sanger v. Upton, (1875) 91 U. S. 56, 60; Wilson v. Proprietors of Central Bridge, (1870) 9 R. I. 590; In re Empire City Bank, (1858) 18 N. Y. 199, 226; Allibone v. Hager, 46 Pa. St. 48; Crandall v. Lincoln, (1884) 52 Conn. 73; In re St. Marylebone Banking Co., (1849) 5 De G. & same stock are jointly liable thereon.1 But when the regis tration is in the name of one of the trustees "and others," the entry is not prima facie evidence against the others, their names not appearing therein.? § 137. (i) Agents.- An agent whose name appears on the company's books as the holder of his principal's shares may be rendered liable thereby to corporate creditors.3 Thus where a bank purchased shares of stock as a broker for a customer and took the transfer into its own name, it was held to assume the liability of a stockholder, and, as between itself and the corporation and those claiming through the corporation, to be estopped from denying the liabilities incident to that relation.' The creditors, however, may elect to hold either the principal or the agent liable. If they recover from the agent, he has, of course, as in other cases of liability in a representative capacity, his remedy over against his principal for the loss sustained." § 138. (j) Infants. A person who has become a shareholder during his minority but who repudiates the shares either before attaining majority or within a reasonable time thereafter, can not be subjected to liability thereon.' The (1847) 10 Q. B. 935; Hart's Case, (1868) L. R. Eq. 512; In re Norwegian Charcoal Iron Co., (1870) L. R. 9 Eq. 363; Ebbett's Case, (1870) L. R. 5 Ch. 302; Baker's Case, (1871) L. R. 7 Ch. 115; Wilson's Case, (1869) L. R. 8 Eq. 240; Dublin &c. Ry. Co. v. Black, (1852) 8 Ex. 181. Cf. Birkenhead &c. Ry. 3 Crandell v. Lincoln, (1884) 52 Co. v. Pilcher, (1850) 5 Exch. 24; Conn. 73. "Liability of Infants on Subscrip 4 McKim v. Glenn, (1887) 66 Md. tion of Shares," 4 Ir. Jur. 89. In 479. 5 Burr v. Wilcox, (1860) 22 N. Y. 551; Stover v. Flack, (1864) 30 N. Y. 64. Cf. Grangers' Market Co. v. Vinson, 6 Oregon, 172. • Orr v. Bigelow, (1856) 14 N. Y. 556; affirming s. c. (1854) 20 Barb. 21. Cork &c. Ry. Co. v. Cazenove, Newry & E. Ry. Co. v. Coombe, (1849) 3 Ex. 565, 578, the court said: "He became a shareholder by contract during infancy and during infancy he disaffirmed the contract; therefore, in my opinion, he ceased to be a shareholder liable to be sued for calls." |