Kinter v. Connolly

Citations

• 233 Pa. 5
• 81 A. 905
• 1911 Pa. LEXIS 454

Syllabus

<p>Corporations — Bonding company — Ten per cent deposit — Insufficient capital — Defective incorporation — Liability of officers and directors— Equity — Jurisdiction—Receivers—Bankruptcy acts.</p> <p>1. The receiver of a bonding company has no standing to maintain a bill in equity-to enforce on behalf of creditors of the company a personal liability against the officers and directors of the company because of false representations made by them and because they permitted the company to begin business without having ten per cent of its stock paid in cash at the time the certificate was sworn to, and without having $125,000 of the capital paid in when it started in business, as required by law in case of title insurance companies.</p> <p>2. While the national bankrupt law and the insolvency act of Pennsylvania declare that, under certain conditions, any preference given by an insolvent corporation shall enure to the benefit of all its creditors generally, it imposes no personal liability upon the directors or officers of the company concerned in the preferential disposition of the corporation’s assets, to answer to it for such action as a breach of trust.</p>