Bates v. Great Western Telegraph Co.

Citations

• 134 Ill. 536
• 25 N.E. 521

Syllabus

<p>1. Corporations—subscription for stock—after issue to others. Stock in a private corporation, after its issue to outside parties, as owners thereof, is not the subject matter of subscription. A subscription must be for such stock as the company still owns and has not parted with.</p> <p>2. Same—stockholders—contract diminishing liability—creditors. As against creditors of a corporation, no contract made by the company can be allowed to stand which attempts to change a subscription into a purchase of paid up stock, or to diminish the amount to be paid by the stockholder.</p> <p>3. The issue of certificates of stock to subscribers on payment of forty per cent of their subscriptions does not make them the holders of full paid stock in such sense as that they can not be called upon for the remaining sixty per cent, at the suit of creditors of the corporation.</p> <p>4. Setting aside decree—for fraud. Where the only allegation of fraud for the setting aside of a decree is the suppression of certain contracts relating to the subject matter of the suit, which could not have changed the result if they had been produced and the attention of the court called to them, the bill seeking to set aside the decree upon that ground can not be maintained.</p> <p>5. Parties—on bill to dissolve an insolvent corporation—and to appoint a receiver. The stockholders are not necessary parties to a bill by creditors to dissolve an insolvent corporation, and have a receiver appointed to wind up its affairs. The court acquires jurisdiction to appoint a receiver of corporate assets upon service of process on the corporation.</p>