Converse v. Hamilton

Citations

• 224 U.S. 243
• 32 S. Ct. 415
• 56 L. Ed. 749
• 1912 U.S. LEXIS 2300

Syllabus

<p>This court looks to the constitution and statutes of a State and the decisions of its courts to determine the nature, extent, and method of enforcing the liability of stockholders of a corporation of that State. .</p> <p>The provisions of the Minnesota constitution imposing double liability on stockholders of corporations other than those carrying on manufacturing or mechanical business is self-executing, and under it each stockholder becomes liable for the debts of the corporation in amount measured by the par value of his stock.</p> <p>The liability of stockholders under the Minnesota constitution is not to the corporation but to the creditors collectively; is not penal but contractual; not joint, but several; and the means of its enforcement are subject to legislative regulation.</p> <p>Under § 272 of the Laws of Minnesota, the receiver of a corporation, the stockholders whereof are subject to double liability, is invested with authority to sue for and collect the amount of the assessment established in the sequestration suit provided by the statute.</p> <p>A receiver to collect the double liability of stockholders of a Minnesota corporation is more than a mere chancery receiver; he is a quasiassignee, invested with the rights of creditors, and he may enforce the same in any.court of competent jurisdiction.</p> <p>As the statute of Minnesota providing for determining whether stockholders of a corporation of that State are subject to statutory double liability does not preclude a stockholder from showing that he is not a stockholder or from setting up any defense personal to himself, it is not unconstitutional as denying due process of law, but is a reasonable regulation, and the jurisdiction of the court is sustained by the relation of the stockholder to the corporation and his contractual obligation in respect to its debts.</p> <p>While an ordinary chancery receiver cannot exercise his powers in jurisdictions other than that of the court appointing him, excep