Cal. 589, 29 Am. St. Rep. 161, 27 Pac. 674, 30 Pac. 776; Kimball v. Richardson-Kimball Co., 111 Cal. 396, 43 Pac. 1111.)

An action on stockholders' liability may be tried in any county in which any defendant resides, and a defendant residing in a county other than that of the place of trial cannot get a change of place of trial, unless he shows that no defendant resides in the county where the action was brought. (Greenleaf v. Jacks, 133 Cal. 506, 65 Pac. 1039.)

The superior court has no jurisdiction of an action to enforce liability as to stockholders against whom a judgment in sum less than three hundred dollars is demanded, although aggregate indebtedness of corporation sued upon exceeds that sum. (Hyman v. Coleman, 82 Cal. 650, 16 Am. St. Rep. 178, 22 Pac. 62.)

In an action under the provisions of this section against a number of stockholders to recover several judgments for proportionate amounts of a debt of a corporation, the superior court has no jurisdiction as to these defendants against whom judgment is demanded for a sum less than three hundred dollars. If, however, more than three hundred dollars is demanded in the complaint, the court acquires jurisdiction, and may render judgment for a less amount than three hundred dollars, against the stockholder alleged to owe more than three hundred dollars. (Derby v. Stevens, 64 Cal. 288, 30 Pac. 820.)

3. Attachment.-An action against a stockholder to recover his proportion of the debt of a corporation is an action upon a contract, within the meaning of section 537 of the Code of Civil Procedure, relative to attachments. (Kennedy v. California Savings Bank, 97 Cal. 93, 33 Am. St. Rep. 163, 168, 31 Pac. 846.)

Pendency of an attachment suit against the corporation upon the same note upon which the stockholders are sued does not constitute a defense to the action against them. (Herman v. Hecht, 116 Cal. 553, 48 Pac. 611.)

4. Evidence.-Evidence must show that defendant was a stockholder to sustain action. (Abbott v. Jack, 136 Cal. 510, 69 Pac. 257.) In an action against the stockholders to recover the proportionate share of each one of the corporate debts, the proof must show that the defendant was a stockholder when such debt was contracted, and proof of a judgment against the corporation does not show when the debt was contracted. (Larrabee v. Baldwin, 35 Cal. 155. To same effect: Stilphen v. Ware, 45 Cal. 111; Hyman v. Coleman, 82 Cal. 653, 16 Am. St. Rep. 180, 23 Pac. 62. Note citation: 3 Am. St. Rep. 844, 860; 43 Am. Dec. 698.)

Plaintiff must prove the whole amount of outstanding stock, and a stock certificate book, stock ledger and stock journal of the corporation, with testimony of secretary that they contain the names of all stockholders, are sufficient to prove the whole amount of stock

outstanding, and the fact that the stock certificate book was not named as in the code, is immaterial. (Knowles v. Sandercock, 107 Cal. 629, 40 Pac. 1047.)

One in whose name stock is issued and stands upon the books of the corporation is liable to creditors as if he were the true owner, and in action for unpaid subscriptions evidence to show that he was not the owner is inadmissible. (Baines v. Babcock, 95 Cal. 581, 29 Am. St. Rep. 158, 27 Pac. 674, 30 Pac. 776.)

Pass-books of depositors are admissible in evidence against the corporation, as proof of its indebtedness, in action against stockholders of bank to enforce their individual and personal liability for balance due upon such books. (McGowan v. McDonald, 111 Cal. 57, 52 Am. St. Rep. 149, 43 Pac. 418. To same effect: San Pedro etc. Co. v. Reynolds, 121 Cal. 85, 53 Pac. 410.)

And in action against stockholders of insolvent bank to recover their respective shares of a deposit, where the amount of the deposit was proved independently of a statement of account signed by the managers of the bank, and where the bank-book was offered in evidence by both parties, such statement of account is admissible in evidence. (Dingley v. McDonald, 124 Cal. 90, 56 Pac. 590.)

Pendency of an attachment suit against the corporation upon the same note upon which the stockholders are sued does not constitute a defense to the action against them; and if it were a defense, in the absence of a pleading of it, no evidence thereof is admissible. (Herman v. Hecht, 116 Cal. 553, 48 Pac. 611.)

Stockholders of a corporation were not competent witnesses by reason of their liability and interest, under the act of 1853. (McAuley v. York Min. Co., 6 Cal. 80. To same effect: Mok. Hill. Co. v. Woodbury, 14 Cal. 266; Blen v. Bear River Co., 20 Cal. 615, 81 Am. Dec. 136; Contra Costa R. R. Co. v. Morse, 23 Cal. 329; Wolf v. St. Louis etc. Co., 15 Cal. 319.)

5. Assignments.-An assignment of a cause of action to recover the amount of a deposit in a bank, or the proportionate share thereof against the stockholders respectively, need not be in writing; and an assignment thereof may be made by an agent acting in the name of the principal upon verbal authority. (Dingley v. MeDonald, 124 Cal. 90, 56 Pac. 790.)

It is no defense to an action by the assignee of indorsing stockholders who paid a note of the corporation that they would profit by the recovery and were the real parties in interest, where no defense could have been made to the note if it had been sued upon by thenr; and the fact that they were stockholders is no defense to the action; nor is evidence thereof admissible. (Herman v. Hecht, 116 Cal. 553, 48 Pac. 611.)

Judgment in favor of assignee of stock, against corporation, for damages for conversion thereof on account of refusal of corporation

to transfer stock to assignee upon its books, is not an estoppel, which can prevent judgment creditor of corporation from assailing bona fides of fraudulent assignment; nor can corporation after insolvency relieve stockholder of liability thereon to its creditors. (National etc. Co. v. Story etc. Co., 111 Cal. 531, 44 Pac. 157.)

6. Judgment.-Neither by the Constitution nor by any statute are the several stockholders made jointly liable to each of the creditors of the corporation. This section authorizes two or more separate actions to be united in one, but the issues to be joined between the parties are separate, and may be very different, and a several judgment can be rendered as between the plaintiff and each of the defendants. In such an action a joint judgment for costs cannot be rendered. (Derby v. Stevens, 64 Cal. 288, 30 Pac. 820.).

The creditors appearing in a creditor's bill to enforce claims out of the assets of an insolvent corporation, whether as plaintiffs or as interveners, are entitled to have several judgments against each stockholder made a party to the action, to the extent of his indebtedness for unpaid subscription to the stock of the corporation. (Welch v. Sargent, 127 Cal. 72, 59 Pac. 319.)

Under this section there may possibly be as many diverse issues made and as many trials had resulting in several judgments as there are separate defendants, so that the disposition of the case as to one defendant can have no effect on the right and duty of the court to ascertain the proportion of the claim or debt for which each defendant is liable and to render a judgment "in conformity therewith." (Grimwood v. Barry, 118 Cal. 276, 50 Pac. 430.)

A judgment against a corporation does not extinguish, suspend or merge the liability of the stockholders. (Young v. Rosenbaum, 39 Cal. 646.)

And corporate stockholders are concluded by a judgment against a corporation from asserting that it was rendered on an ultra vires contract. (Baines v. Babcock, 95 Cal. 581, 29 Am. St. Rep. 158, 27 Pac. 674, 30 Pac. 776. To same effect: Illinois etc. Bank v. Railway Co., 117 Cal. 342, 49 Pac. 197. See Nickum v. Burckhardt, 30 Or. 465, 60 Am. St. Rep. 829, 47 Pac. 788, 48 Pac. 474.)

And, in an action to enforce a stockholder's liability, the corporation is not a necessary party. (Greenleaf v. Jacks, 133 Cal. 506, 65 Pac. 1039.)

For the liability of a stockholder is distinct from that of the corporation, and only a several judgment for his proportion of the corporate liability can be rendered against him. (The Griffin & S. Co. v. Fruit Cannery Co., 107 Cal. 318, 40 Pac. 495.)

A special statutory remedy, given by the laws of another state, for enforcing the statutory liability of stockholders of a corporation organized under its laws, limits the liability, and where such remedy is not afforded by the laws of the state, the liability of the stockholders of such corporation cannot be enforced in this state against

resident stockholders.

(Russell v. Pac. R. R., 113 Cal. 258, 45 Pac. 323. To same effect: Ferguson v. Sherman, 116 Cal. 173, 47 Pac.

1023.)

CERTIFICATES, HOW AND WHEN ISSUED.

Sec. 323, C. C. All corporations for profit must issue certificates for stock when fully paid up, signed by the president and secretary, and may provide in their by-laws, for issuing certificates prior to the full payment, under such restrictions and for such purposes as their by-laws may provide. En. March 21, 1872.

Legislative History.

Section 14 of the railroad act of 1861, page 614, contained a similar provision. Section 12 of the corporation act of 1850, page 347, also contemplates an issuance of stock certificates.

Section Cited.

Lankershim Ranch Land etc. Co. v. Herberger, 82 Cal. 603, 23 Pac. 134; Green v. Abietine Medical Co., 96 Cal. 329, 31 Pac. 100; San Joaquin L. & W. Co. v. Beecher, 101 Cal. 70, 35 Pac. 349; Vermont etc. Co. v. Declez etc. Co., 135 Cal. 583, 87 Am. St. Rep. 143, 67 Pac. 1057.

Annotation.

Value of Stock.-A finding of fact that a mine owned by a corporation is valueless does not necessarily show that the stock of the corporation is valueless. (Gifford v. Carville, 29 Cal. 589.)

Issuance of Certificate.-It is not essential to the ownership of stock in a corporation that a certificate for the stock should have been issued to the stockholder; nor need the corporation issue a certificate to a subscriber until the subscription price has been fully paid. (California Hotel Co. v. Callender, 94 Cal. 120, 28 Am. St. Rep. 99, 29 Pac. 859.)

Nor is it necessary to issue certificates of stock to subscribers to an agreement for the formation of a corporation in order to constitute them stockholders. (San Joaquin etc. Co. v. Beecher, 101 Cal. 70, 35 Pac. 349. To same effect: Cal. etc. Co. v. Callender, 94 Cal. 120, 28 Am. St. Rep. 104, 29 Pac. 859; Mitchell v. Beckman, 64 Cal. 117, 28 Pac. 110.)

Certificates of stock are mere evidences of property. The property in the stock may exist without the certificate. (Mitchell v. Beckmran, 64 Cal. 117, 28 Pac. 110. To same effect: Lankershim Ranch etc. Co. v. Herberger, 82 Cal. 603, 23 Pac. 134; Cal. etc. Co. v. Callender, 94 Cal. 127, 28 Am. St. Rep. 104, 29 Pac. 859; San Joaquin etc. Co.

v. Beecher, 101 Cal. 79, 35 Pac. 349. Note citations: 43 Am. Dec. 697; 81 Am. Dec. 394; 99 Am. Dec. 435; 3 Am. St. Rep. 830, 860.)

By unanimous consent, stockholders may ratify an unauthorized issuance of certificates of stock, though they cannot cure an issuance in violation of law. (Green v. Abietine Med. Co., 96 Cal. 322, 31 Pac. 100.)

And when a corporation, through the misrepresentations of its di rectors, induced a purchaser to take an illegal and improper issue of stock, it is estopped to claim their invalidity and such shares are good in the hands of a bona fide purchaser. (Smith v. Martin, 135 Cal. 247, 67 Pac. 779.)

Executors have a cause of action against a corporation for a wrongful issue of certificates of stock in violation of the rights of the executors, and also a cause of action against the corporation and transferees of stock owned by an estate to compel the transfer of the stock to their name as executors. (Ashton v. Heggerty, 130 Cal. 516, 62 Pac. 934.)

One who purchases at execution sale shares of stock standing on the corporate books in the name of the judgment debtor is entitled to have a certificate of such shares reissued to him as such purchaser, if at the time of the purchase he acts in good faith and without notice of the assignment or pledge of the stock. To protect his rights an assignee or pledgee must cause a reissue to himself or must serve notice on the corporation that he holds the certificate as such assignee or pledgee. (West Coast etc. Co. v. Wulff, 133 Cal. 315, 85 Am. St. Rep. 171, 65 Pac. 622.)

Paid-up Certificate.-When stockholders authorized and directed the sale of stock, and the certificates so stated, and no objection was made for three years, the stockholders are estopped to deny that full payment was made for the stock. (Green v. Abietine Med. Co., 96 Cal. 322, 31 Pac. 100.)

By unanimous concurrence of all the directors and stockholders of a corporation, its shares of stock may be issued as paid up, for less than their par value in money, or in exchange for labor or property. Stock issued in exchange for labor or property is upon lawful consideration, and is neither fictitious nor void as to the public. (Smith v. Martin, 135 Cal. 247, 67 Pac. 779.)

Under railroad act of 1861, railroad corporations cannot issue certificates of stock until they are paid for in full. (Brewster v. Hartley, 37 Cal. 15, 99 Am. Dec. 237.)

Sale of Stock.―The sale of stock below par as paid-up stock is not prohibited by this section. (Green v. Abietine Med. Co., 96 Cal. 322, 31 Pac. 100.)

Under this section a corporation may, by proper provision in the by-laws, issue certificates to subscribers to its stock prior to full payment for the same. And, where stock is to be paid for in installments,