Winona Wagon Co. v. Bull

Citations

• 108 Cal. 1
• 40 P. 1077
• 1895 Cal. LEXIS 809

Syllabus

<p>Corporations—Liability of Stockholders—Pleading.—A complaint in an action to enforce the liability of a stockholder of a corporation for his proportion of the indebtedness evidenced by promissory notes does not state a cause of action where it does not allege when the debt or liability of the corporation was created or incurred for which the notes were given, and does not show but that they may have been given in renewal of other notes, or upon settlement of accounts for goods sold and delivered or services rendered prior to their respective dates.</p> <p>Id.—Nature and Extent of Stockholder’s Liability.—The liability of a stockholder is an original liability created by statute, and is dependent upon the fact that he is a stockholder at the time the debt is created, and the extent of his liability is measured by the proportion between the stock then held by him and the total number of shares issued.</p> <p>Id.—Representation of Stockholder by Corporation.—The corporation has no power to extend the liabilities of its stockholders, nor to represent them as to their individual obligation to pay a debt or liability at the time when it was first incurred, and it cannot hind them by a note subsequently executed in consideration of a prior liability of the corporation, for which alone the stockholders were responsible.</p>