Springfield Wagon Co. v. Bank of Batesville

Riddick, J., (after stating the facts.) We are of the opinion that the ruling of the circuit court was correct. It is not disputed that H. H. Hinkle was at the time of the issuance of the execution against him, and is yet, indebted to the Bank of Batesville for a sum of money greater than the value of such stock. The bank had a lien upon the stock for its debt, and, if this lien was superior to that of the execution creditor, a transfer of the stock would have availed nothing, for it would have been subject to a lien for a greater sum than the value of the stock. The statute provides that the stock of a corporation shall be transferred only on the books thereof, and that the corporation “shall at all times have a lien upon all the stock or property of its members invested therein for all debts due from them to such corporation.” Sand. & H. Dig., § 1342. The wagon company was bound to take notice of this statute. Besides, in this case, it was expressly notified of the bank’s claim and lien before it purchased the stock, and its purchase was subject to that lien. This stock had been previously pledged to S. R. Hinkle to secure a loan of money to H. H. Hinkle, but there was no transfer of the stock upon the books of the bank, and there is some controversy as to whether the bank had notice of such pledge before Hinkle became indebted to it. But we regard that as a matter of no importance here; for this is not a controversy between S. R. Hinkle, the pledgee, and the bank, and it is unnecessary to consider whether the lien of the bank was superior in law to that of S. R. Hinkle, or subject to it; for it appears that the liens of both of these parties were prior in point of time and superior to that of the wagon company. The contention that section 1356, Sand. & H. Dig., gives priority to the execution lien of the wagon company cannot be sustained. That section simply declares that the provisions of' the statute for the enforcement of the bank’s lien shall not affect “any lien or right acquired by any other party by virtue of any attachment or levy of execution upon the stock of any stockholder in any such corporation.” Certainly, the legislature did not by this language intend .that the statutory lien of the corporation for the debt of its stockholder should be displaced whenever another creditor levied an execution or an attachment upon the stock. A lien of that kind, subject to be displaced by the act of the creditors, would be of little value. That section, as we understand it, only declares that the enforcement of the bank’s lien by the statutory method shall not affect other liens upon the stock, and leaves the question of the priority of such liens to be determined by proper pleadings to which the holders of such liens are parties, and under rules of law already in force. Oliphint v. Bank of Commerce, 60 Ark. 198. We see nothing in the facts of this case to justify a finding that the bank had waived its lien as against the appellant wagon company, and we think the court rightly refused to order a transfer of the stock on the books of the bank. Judgment affirmed.