Visalia & Tulare Railroad v. Hyde

Citations

• 110 Cal. 632
• 43 P. 10
• 1895 Cal. LEXIS 1111

Syllabus

<p>Corporations—Assessment for Unpaid Shares — Liability of Transferee of Stock.—One who purchases unpaid stock in a corporation, and causes a transfer thereof to himself to be entered upon the books of the corporation, is substituted for the original subscriber of the stock as a stockholder of the corporation, and thereafter holds the stock on the same conditions and subject to the same obligations as the original stockholder prior to the transfer; and he is liable for an assessment upon the unpaid shares, of which liability he cannot divest himself by an assignment of the shares subsequent to the levy of the assessment.</p> <p>Id.—Liability for Assessment Determined by Books.—For the purpose of ascertaining those who are liable to the corporation for the amount of an assessment, the corporation may look only to the list of stockholders as their names are registered upon its books.</p> <p>Id.—Defense to Assessment—Time of’ Incurring of Liability—Sufficiency of Property of Corporation—Discretion of Directors.—It is no defense to an action to recover the amount of an assessment that it is required to meet outstanding obligations which were contracted before the defendant became a stockholder, nor is it any defense that the corporation has sufficient property with which to meet its obligations; but the liability of the stockholder for the unpaid portion of a subscription rests upon the contract of subscription, and the propriety or necessity of requiring him to pay it, for the purpose of meeting the corporate liabilities, rather than to resort to property in the hands of the corpora- . tion to meet such liabilities, is in the discretion of the board of direct-</p>