National Carriage Manufacturing Co. v. Story & Isham Commercial Co.

Citations

• 111 Cal. 531
• 44 P. 157

Syllabus

<p>Corporations—Insolvency—Unpaid Subscription to Stock—Transfer of Stock to Avoid Liability to Creditors.—A stockholder in an insolvent corporation cannot avoid his liability for an unpaid subscription upon stock held by him, by assigning it without consideration to an insolvent person; and a judgment creditor of the corporation who has had execution issued against the corporation and returned nulla bona may attack the Iona fides of such assignment, and enforce the subscription against the original holder of the stock to the extent of his judgment.</p> <p>Id.—Judgment for Conversion of Stock by Corporation—Estoppel— Liability of Stockholders.—A judgment in favor of the assignee of such stock against the corporation for damages for conversion of the stock, on account of the refusal of the corporation to transfer the stock to the assignee upon its books, is not an estoppel, which can prevent a judgment creditor of the corporation from assailing the bona fides of the assignment; nor can the corporation after its insolvency, by converting . the stock, relieve the stockholder of liability thereupon to its creditors, whatever may be the motive which induced the act of conversion.</p>