Tait v. Pigott

Citations

• 32 Wash. 344
• 73 P. 364
• 1903 Wash. LEXIS 426

Syllabus

<p>CORPORATIONS - CAPITAL STOCK - REDUCTION - PURCHASE PROM STOCKHOLDER.</p> <p>A complaint by tbe receiver of a corporation alleging that the defendant, a stockholder, sold his stock to the corporation and received $834.50 therefor out of its assets, that the corporation thereby attempted to reduce its capital stock contrary to the law, and that the corporation is now insolvent, and has no assets to pay its creditors, states a cause of action against the stockholder, under Bal. Code, § 4265, providing that it is unlawful to pay any part of the capital stock to the stockholders.</p> <p>SAME.</p> <p>It is immaterial that the corporation was solvent at the time of the purchase, if it has since become insolvent.</p> <p>SAME.</p> <p>The capital stock of a corporation is a trust fund for the payment of its debts, upon the faith of which the law presumes credit to have been given.</p>