State ex rel. Canal Bank v. North American Land & Timber Co.

Citations

• 112 La. 441
• 36 So. 488
• 1904 La. LEXIS 414

Syllabus

<p>PLEDGE — BIGHTS OF PLEDGEE — TBANSEEB OP . STOCK — MANDAMUS.</p> <p>1. Where an act of pledge, whereby, in the event of the failure of the pledgor to pay at maturity the debt to secure which the pledge is given, or in the event of his failure to fuinish additional security when required, the pledgee is authorized to sell the- pledged property, consisting of stock in a corporation, and to become the owner thereof by purchase, is made the basis of a continuing credit, which is used for the purposes of successive debts, varying in amounts, the pledgee, who admits that he is not the owner, and neither alleges nor proves an existing or past-due debt or other consideration, which, under his contract, would entitle him' to become the owner of the pledged stock, cannot malte himself the owner thereof in a manner and under conditions not contemplated by such contract, and has no standing for the purpose's of a suit to compel its transfer to him on the books of the corporation and the issuance of new certificates.</p> <p>2. Where a litigant, alleging that he is the pledgee of stock in a corporation, brings suit in that capacity, to compel the corporation to transfer such stock and issue new certificates to him, and the corporation sets up the defense that the pledgor, as one of its members, is without right to transfer his stock in disregard of its charter and of its rights thereunder, and it is found that the pledgee has no standing in his own right to demand the judgment prayed for, a possible inference, arising from testimony given by him that the pledgor may be willing or anxious that it should be done, affords no sufficient reason for the rendition of, such judgment, or for an inquiry into the merits of the controversy between the pledgor and the corporation.</p> <p>(Syllabus by the Court.)</p>