Schaeffer v. Missouri Home Insurance

CURRIER, Judge, delivered the opinion of the court. The plaintiff recovered judgment against the Missouri Home Insurance Company, upon which an execution ivas duly issued against the effects of that company. It was returned nulla bona, whereupon the plaintiff, in pursuance of the statute (Wagn. Stat. 291, § 13), moved for an execution against John Finn, the defendant herein. The motion recited the fact of the judgment and of the return of the execution as above stated, and then alleged that Finn held ten shares of the capital stock of said insurance company, of the par value of $1,000. On the hearing' oil the motion before the court, but one point was contested, namely: whether Finn was a stockholder as alleged. The plaintiff gave evidence tending to show that he ivas, and the court so found the fact to be. But the defendant complains of the action of the court in refusing certain declarations of law, one 'of which was to the effect that the plaintiff was not entitled to recover. This declaration is based upon the assumption that the corporate existence of the insurance company was not sufficiently shown. For the purposes of the motion, we think the judgment against, the company was •prima fació evidence of its corporate existence, at the time that judgment was rendered. So much is implied in the judgment, and this is merely a proceeding for an- execution [250] thereon against Finn as a stockholder. If he would resist his liabilities as such on the ground of irregularities in the organization of the company, or on the ground of defects and deficiencies thergin, he should point out such irregularities, defects, or deficiencies, and make some proof of them. lie did neither. There was no written answer to the plaintiff’s motion, nor was there any proof submitted at the trial on the part of the defendant, except on the single point of his subscription for stock and his subsequent acts in relation thereto. This disposes of the main matters urged in this court. The other instructions refused either lacked a basis of evidence on which to found them, or announced incorrect propositions of law. The court found, as a matter of fact, that the defendant subscribed for ten shares of the stock. That constituted him a “stockholder” within the meaning of the statute, although he failed to meet the subsequent calls thereon. The company might have sued him on his contract of subscription, and enforced the payment of the assessments, as he might have paid the assessments and insisted upon his right to the stock. The subscription constituted a contract between him and the company, and secured certain rights which the parties respectively might enforce (Ang. & Ames on Corp., § 517), and it made no difference that certificates of stock were not in fact issued. (Id., § 565.) A subscription for stock fraudulently and collusively made is not necessarily void. Notwithstanding the fraud or collusion, the laAv will hold the parties bound by their subscriptions, and com-pellable to comply with all the terms and responsibilities imposed upon them thereby. (Id., § 146.) These responsibilities can not be evaded by a mere notice to the officers of the corporation that the subscriber does not choose to take stock in accordance with the subscription contract. The judgment will be affirmed. The other judges concur.