McDowell v. Lindsay

Citations

• 213 Pa. 591
• 63 A. 130
• 1906 Pa. LEXIS 540

Syllabus

<p>Conflict of laws — Foreign laws — Unconstitutionality—Public policy.</p> <p>The courts of Pennsylvania will not declare unconstitutional the statute of another state, in the absence of such construction by the courts of that state, where there is no question of public policy or general right involved.</p> <p>Corporations — Foreign corporations — Stock and stockholders — Subscription agreement — Contract for the p'urchase of stock — Statutes.</p> <p>There is a distinction between a subscription agreement and a contract for the purchase of stock. Subscribers, as generally understood, are those who, upon the formation of a corporation, agree mutually to take and pay for shares of the captial stock, and in the absence of any special provision, they agree with each other to pay therefor the par value of the stock.</p> <p>After the organization of a West Virginia corporation is completed, an individual may make an agreement to purchase stock from the corporation at any stipulated price, in such case the contract is binding on the corporation as well as the purchaser.</p> <p>There can be no recovery from the purchaser of stock in a West Virginia corporation who paid the corporation less than the par value of the stock, of the difference between the price paid and the par value, notwithstanding the failure to comply with the West Virginia act requiring the giving of notice of publication of the intention to present the resolution for the sale of the stock at less than par at the stockholder’s meeting, where the buyer of the stock was an innocent purchaser. Such a purchaser has the right to assume that all things necessary to be done were rightly done. The provision of the statute as to notice is merely directory, not mandatory.</p>