stockholder, by being present and acting as director at a meeting when the directors nullified such payments in land, but gave the subscribers a right to surrender their certificates issued thereon, and take new certificates for the amount of money paid by them, does not render him liable if he offer to surrender his certificate and take one for his money payments only.15

5. Where the general statutes of the state, or the special act of the company, render the stockholder personally liable for the debts of the corporation, they remain holden, notwithstanding the transfer of their stock after the debt accrued, until all the requirements of the act for their release have been strictly complied with. And if the act allows creditors to take certain proceeding, by way of notice to stockholders, to prevent their release from liability, by the transfer of their stock, and such proceeding has been taken, the liability will continue.16

6. The corporation cannot shield its property from attachment or levy of execution upon the ground of the state or any other mortgagee having a prior lien upon it.17 The mortgagee must assert his own claim, and it cannot be urged by the mortgagor on his behalf unless by his express procurement.18 The judg ment against the corporation may be evidence against a shareholder, who is made responsible in default of the company, to show, primâ facie, such default by judgment, execution, and return of nulla bona.19

SECTION IV.

Assignments by Railways, in contemplation of Insolvency.

§ 245. General assignment of property by business corporations, for the benefit of creditors, giving preferences among them, but providing for the payment of all their debts before any re16 Force v. Tanning & Leather Company, 22 Ga. R. 86. See also Robinson v. Beall, 26 Ga. R. 17.

17 Patterson v. Wyomissing Manufacturing Co., 40 Penn. St. 117.

Boyd v. Chesapeake & Ohio Canal Co., 17 Md. R. 195.

19 Hudson v. Carman, 41 Me. R. 84. But such judgment would not be evidence against a shareholder whose liability was concurrent with that of the company.

turn to the company, have been held valid.1 But such an assignment by a railway company was held void under the insolvent laws of New York.2

1 Warner v. Mower, 11 Vt. R. 385; Whitwell v. Warner, 20 Vt. R. 444, 445 ; Angell on Corp. § 191 and notes; 3 Wend. 13; 3 Barb. Ch. 119; 16 Barb. 280; 21 id. 221.

2 Bowen v. Lease, 5 Hill, 221. But where no preferences are made, it is valid; but the franchise of the corporation does not pass. Hurlburt v. Carter, 21 Barb. 221. See also Fellows v. Commercial & Railway Bank of Vicksburg, 6 Rob. (Louis.) 246; De Ruyter v. St. Peter's Church, 3 Comst. 238. But see Loring v. United States Vulcanized Gutta Percha Co., 36 Barb. 529. This subject is very extensively discussed in the case of Curtis v. Leavitt, 15 N. Y. Court of App. 9, in regard to the North American Trust & Banking Co. Most of the points ruled are more or less affected by statutory provisions. But some may be of general interest.

It was held that a pledge of most of the assets of the company, when it was in fact insolvent, and known by the officers making the pledge to be deeply embarrassed, if done by them in good faith, and with the honest expectation of continuing the business of the company and paying its debts, is valid, it not being done to prefer any of its creditors, in contravention of the provisions of the statute, but to enable the company to borrow money.

Where the statute prohibits the officers of moneyed corporations from conveying any of its effects, except in pursuance of a resolution of the board of directors, this does not hinder the corporation itself from directing or ratifying a conveyance, in any mode it may deem proper.

The duties of receivers of insolvent corporations under the New York statute, in winding up the concerns of such corporations are discussed here at length. It is held that the receivers represent and are subject to the disabilities of the corporation.

But a receiver cannot be appointed to take charge of the effects of a corporation unless upon a bill to which the company is a party or consenting by formal appearance in court. Gravenstene's Appeal, 49 Penn. St. 310. See Sands v. Boutwell, 26 N. Y. Ct. of App., 233; Dayton v. Borst, 4 Bosworth, 115, where the conclusiveness of an adjudication of the insolvency of a corporation, made without notice to any officer of the corporation, is discussed, and under the circumstances of the case maintained. See Nichols v. Perry Patent Arm Company, 3 Stockton Ch. 126.

In Louisiana, a corporation, created under the act for the organization of corporations for works of public improvement and utility, cannot avail itself of the provisions of the act relative to the involuntary surrender of property. Jeffries v. Belleville Iron Works Co., 15 La. Ann. 19. See Bank Commissioners v. Rhode Island Central Bank, 5 Rhode Island R. 12. The subject The subject is discussed at length in Murray v. Vanderbilt, 39 Barb. 140, in which some of the points.

decided may be worthy of mention. It is here held that no power can be exercised by the Supreme Court of New York over a foreign corporation, in pro

ceedings instituted by a stockholder to wind up its affairs; but for the purpose of preserving the property of such corporation, for the benefit of creditors or stockholders, a court of equity has ample power to take charge of it, and appoint a receiver. An appearance of the corporation by officers of the court will be valid and give jurisdiction, whether the service of process upon its officers be good or not, provided the corporation is still in existence. Murray v. Vanderbilt, supra.

Where the president and secretary of a corporation executed an assignment of its property, and attached the seal of the company thereto, without any specific authority to do so, this was held not a proper execution of the instrument. And that the want of authority on the part of the officers could not be cured by any proof of execution before the commissioner. Id.

In Pennsylvania it is provided by statute (Act of Assembly, January 21, 1843) that no public internal improvement company shall make an assignment, &c. of its real or personal property, while debts or liabilities to contractors, workmen, or laborers remain unpaid, without first obtaining their written assent. As to the assignment contemplated by this Act, see McBroom & Wood's Appeal, 49 Penn. St. 92.

*CHAPTER XXXVI.

BOARD OF TRADE. RAILWAY COMMISSIONERS.

SECTION I.

Supervision of Railway Legislation.

$246. It is well known that from the first existence of railways, operated by steam, in England, the Board of Trade, which is a department of the executive government, have (except from 1846 to 1851, when their jurisdiction over railways was transferred to the Railway Commissioners, a distinct board created for that purpose) exercised a very extensive and very important control over the railway management in that country. This at one time extended to the supervision of all applications to parliament for legislation upon that subject, and resulted in the almost entire control of the railway legislation. As stated before, this jurisdiction was conferred upon a distinct board, denominated Railway Commissioners, from 1846 to 1851.1 But in 1853 the report of the select committee of the House of Commons, upon the subject of railways, recommended that the supervision of railway legislation be referred in future to a permanent standing committee in the House of Commons, who, with the aid always attainable from the executive government, would prove a more satisfactory tribunal for the supervision of this subject than the Board of Trade. This proposition was adopted, and seems to have met with acceptance. The Board of Trade still present, at the beginning of each session of parliament, a comprehensive report upon the general nature of the railway schemes for the year, and detailed reports upon the provisions contained in the several bills, which are required to be * furnished the board in advance of the meeting of parliament. A somewhat similar duty is, in many of the American states, performed by Railway 1 9 & 10 Vict. c. 105; 14 & 15 Vict. c. 105.

* 610, 611

Commissioners. And such a board, if properly constituted, can scarcely fail to be of very essential service to the legislatures of the several states, whose sessions are short, and whose members are often inexperienced both in the detail of general legislation requisite for the proper management of railways and especially with the devices sometimes resorted to for the purpose of gaining unequal and unjust special legislation in behalf of interested individuals or corporations. But the benefit.of such a board must depend chiefly upon its intelligence and independence. Without these it might become an instrument of wrong and injustice, more effective, perhaps, than an ordinary legislative committee.

SECTION II.

Supervision of Railways by Board of Trade and Railway Commissioners.

1. Proceedings in England, in opening rail-5. English courts regulate railways for public

ways.

2. Establish rules for connection.

3. Connection of branch railways.

4. Courts of equity will not interfere with decisions of Railway Commissioners.

accommodation.

6 and n. 8. Desirableness and efficiency of railway commissioners in this country considered.

§ 247. 1. In England, no railway or any portion of it can be opened for the public conveyance of passengers, until upon proper notice from the company it has been inspected and approved by the Board of Trade.1 And if the officer inspecting the proposed railway shall report that it is not in proper condition to be used with perfect safety to the 'public, the Board of Trade may, from time to time, postpone the opening, not exceeding one month at one time, until it shall appear that such opening may take place without danger to the public.2 And railways are subjected to severe penalties for opening their roads. 1 5 & 6 Vict. c. 55; Hodges, 547, 554.

2 And it is said, that although the board may have sanctioned the opening of one line of railway, they have authority to prohibit the use of an additional line [track?]. Attorney-General v. Oxford & Wolverhampton Railway, Weekly Reporter, p. 330, 1853-4. And the Board of Trade may originate prosecutions for violations of their orders. Hodges, 554.