Great Western Min. & Mfg. Co. v. Harris' Estate

Citations

• 111 F. 38
• 1901 U.S. App. LEXIS 4947

Syllabus

<p>1. Corporations—Liability of Officers—Effect of State Statutes.</p> <p>State statutes imposing liabilities upon officers and directors of corporations do not exclude their common-law liability for misfeasance and negligence in the performance of their duties as such officers or directors.</p> <p>3. Limitation—Law Governing—Actions against Officers of Corporation</p> <p>An action to charge the defendant, as an officer and director of a corporation, for acts of misfeasance in the management of tlie affairs of the corporation, being for the enforcement of a common-law liability, is governed as to limitation by the law of the forum, and not by that of the domicile of the corporation.</p> <p>3. Corporations—Increase of Stock.</p> <p>The issuance by a corporation of additional stock, within its powers, and its distribution pro rata among its then stockholders, although without receiving payment therefor, is an act which is not in itself injurious to the corporation or its creditors, and of which the latter cannot complain.</p> <p>4. Same—Rights of Creditors—Wrongful Diversion of Assets.</p> <p>A corporation issued 500 shares of additional stock, which it distributed pro rata among its stockholders as a stock dividend. It afterwards desired to sell an issue of bonds, and offered the game at CO per cent, of their par value, but was unable to sell them. 'It received an offer, however, of 85 per cent, for the bonds, provided it would also issue to the purchasers one-half the same’ amount of its capital stock, which would amount to 1,500 shares. It accepted such offer, making an agreement with its stockholders that they should furnish the stock pro rata, and receive 25 cents out of every 85 received for the bonds and stock, and at tlio same time it issued to such stockholders 1,000 shares additional stock, reciting as the consideration thereior the making of permanent betterments on its property from its net profits. This arrangement was not stated to the purchasers, and th