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ton etc. R. R. Co. 13 Ill. 516; New York Laws 1881, ch. 468, § 12; Gaff v. Flesher, 33 Ohio St. 107.

4 Leggett v. Bank of Sing Sing, 24 N. Y. 283: German Security Bank v. Jefferson, 10 Bush, 326; Bradford Banking Co. v. Briggs, 31 Ch. Div. 149, reversing S. C. 23 Ch. Div. 119.

5 Spurlock v. Pacific R. R. Co. 61 Mo. 319. See, also, Knight v. Old National Bank, 3 Clifford, 423; In re Bachman, 12 Nat. Bank. Reg. 223; Pendergast v. Bank of Stockton, 2 Sawyer, 108; Bank of Holly Springs v. Pinson, 58 Miss. 421; 38 Am. Rep. 330; McDowell v. Bank, 1 Har. (Del.) 27; Mechanics' Bank v. Merchants' Lank, 45 Mo. 513; 100 Am. Dec. 388; St. Louis etc. Ins. Co. v. Goodfellow, 9 Mo. 149; People v. Crockett, 9 Cal. 112; Child v. Hudson's Bay Co. 2 P. Wms. 207; Cook on Stock & Stockh. § 522, and many banking and insurances cases there cited.

6 Vausands v. Middlesex County Bank, 26 Conn. 144.

7 Morgan v. Bank of North America, 8 Serg. & R. 73, 88; S. C. 11 Am. Deo. 575.

8 Union Bank v. Laird, 2 Wheat. 390; Bank of Utica v. Smalley, 2 Cowen, 770; 14 Am. Dec. 526; St. Louis etc. Ins. Co. v. Goodfellow, 9 Mo. 149; Bohmer v. City Bank, 77 Va. 445; Bishop v. Globe Co. 135 Mass. 132; Grant v. Mechanics' Bank, 15 Serg. & R. 140; Downer v. Zanesville Bank, Wright (Ohio), 477.

9 McCready v. Rumsey, 6 Duer, 594.

§ 390. The same subject, continued-Of by. laws creating a lien.-A lien upon stock for the debts due the corporation from the shareholder, may be created by the charter or statute directly, by express language to that effect, or it may be done indirectly, by conferring upon the company power to adopt by-laws for the regulation of its affairs and the transfer of its stock. But it has been held that charter or statutory authority to pass by-laws regulating the conduct of the corporate affairs," nothing being said about the transfer of stock, does not confer the power to make a by-law subjecting the transfer of shares to the lien of the company. In Massachusetts it has been doubted,3 and even entirely denied, that the company can, by means of a by-law, in any way limit the free transfer of stock.* In New Hampshire such restrictions are forbidden by statute.5 And it remains doubtful whether the corporation may create

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a lien by by-law, in the absence of express or implied authority in its charter or in some statute of the State. A lien created by a by-law, in order to be effective, must be brought to the knowledge of the transferree." The authorities are not agreed as to whether a notice upon the face of the certificate, that the stock thereby represented is subject to all debts due the company from the owner thereof, will suffice to bind a purchaser in the absence of a charter or statutory lien. A lien created by bylaw is inoperative as against the judgment creditors of the stockholder; it will be superior, however, to the title of the stockholder's assignee in bankruptcy. The rights of a transferree cannot be affected by a by-law passed after the transfer was made.11

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1 Brent v. Bank of Washington, 10 Peters, 596, 611; Pendergast v. Bank of Stockton, 2 Sawyer, 108; Cunningham v. Alabama etc. Trust Co. 4 Ala. 652; Spurlock v. Pacific R. R. Co. 61 Mo. 319; Byron v. Carter, 22 La. An. 98; Taylor on Corporations, § 601. Cf. Tuttle v. Walton, 1 Ga. 43.

2 Delaware etc. R. R. Co. v. Oxford Iron Co. 38 N. J. Eq. 340, and the reporter's notes thereto.

3 Plymouth Bank v. Bank of Norfolk, 10 Pick. 454; Nesmith v. Washington Bank, 6 Pick. 324.

4 Sargent v. Franklin Ins. Co. 8 Pick. 90; 19 Am. Dec. 306.

5 N. H. Laws of 1849, ch. 860, § 2.

6 See Angell & Ames on Corporations (10th ed.) §§ 355, 356; 1 Potter's Corporations, §§ 267-269; Field on Corporations, §§ 136-138; Green's Brice's Ultra Vires, 2nd ed. 15, note; Morse on Banking (2nd ed.), 505; Overton on Liens, §§ 82-86.

7 Driscoll v. West Bradley etc. Co. 59 N. Y. 96, 109; In re Long Island R. R. Co. 19 Wend. 37; 32 Am. Dec. 429; Bank of Holly Springs v. Pinson, 58 Miss. 431; 33 Am. Rep. 330; Planters' etc. Ins. Co. v. Selma Savings Bank, 63 Ala. 585; Petot v. Johnson, 33 La. An. 1286; Byron v. Carter, 22 La. An. 98; Steamship Dock Co. v. Heron, 52 Pa. St. 280; Anglo-Californian Bank v. Grangers' Bank, 63 Cal. 359; Morawetz on Corporations (2nd ed.) § 203. Cf. Neale v. Janney, 2 Cranch, 188; Evansville National Bank v. Metropolitan National Bank, 2 Biss. 527; Lee v. Citizens' National Bank, 2 Cin. Super. Ct. 298.

8 In New York it is held insufficient: Conklin v. Second National Bank, 45 N. Y. 655. Contra, in Connecticut: Vausands v. Middlesex County Bank, 26 Conn. 144.

9 Byron v. Carter, 22 La. An. 98.

10 In re Bigelow, 1 Nat. Bank. Reg. 632, also 667; Morgan v. Bank of North America, 8 Serg. & R. 73; S. C. 11 Am. Dec. 575.

11 People v. Crockett, 9 Cal. 112.

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§ 391. Extent of the corporate lien-The general rule. --Unless expressly restricted to a certain class of debts, a statutory lien covers all debts owing from the shareholder to the corporation;1 debts of every name and nature, due and to become due— whether contracted before or after the stockholder became a member of the corporation—whether the liability be personal to the shareholder or only as surety, and extends to debts due from a partnership of which the shareholder is a member, and to debts barred by the statute of limitations. The lien attaches for unpaid calls on the original subscription,3 and not only to the shares but also to the dividends thereon, although the statute or charter only specifies "shares and stock."5 The statutory lien is binding as to the creditors and assignees in insolvency of the shareholder, and also as to persons who purchase shares from prior holders or take them as collateral security. Thus, in a late case in Ohio, where a shareholder, who was indebted to the corporation, pledged his shares to secure a debt to a third party, and delivered them with an absolute power to sell and to demand a transfer on the books of the corporation, it was held that in the absence of any exercise of this authority on the part of the pledgee, the corporation might attach the interest of the shareholder, enforce a sale, and retain the surplus left after the discharge of the pledgee's claim, such attachment taking priority over a later attachment by another creditor by service on the pledgee of garnishee process. Under the Companies Act of 1862, when a company was by its articles of association entitled to a lien upon the shares of a shareholder for all debts owing

by him to the company, it was held that the company's lien attached even to shares held by a trustee, and had priority as against the cestui que trust.s

1 Taylor on Corporatious (2nd ed. 1889), § 604.

2 Cook on Stock & Stockh. § 527, and cases there cited. Many of the questions relating to the lien of the corporation upon the shares of its members have never arisen with respect to railway companies, and from the nature of these enterprises are not likely to arise. For a full discussion of the subject, vide Cook on Stock & Stockh. etc. §§ 521, 533.

3 Spurlock v. Pacific R. R. Co. C1 Mo. 319; Pittsburgh etc. R. R, Co. V. Clarke, 23 Pa. St. 146; Shaw v. Rowley, 5 Eng. R'y & Canal Cas. 47. Cf. Newry etc. R'y Co. v. Edmunds, 2 Ex. 118; Ambergate etc. R'y Co. v. Mitchell, 4 Ex. 540; Great North. etc. R'y. Co. v. Biddulph, 7 Mees. & W. 213.

4 Stebbins v. Phoenix Fire Ins. Co. 3 Paige, 350; Bates v. New York Ins. Co. 3 Johns. Cas. 238; Grank v. Mechanics' Bank, 13 Serg. & R. 140; Sargent v. Franklin Ins. Co. 8 Pick. 90; 13 Am. Dec. 306.

5 Hague v. Dandeson, 2 Ex. 147, and cases cited supra; Cook on Stock & Stockh. § 526. Cf. Hagar v. Union National Bank, 63 Me. 599. 6 Taylor on Corporations (2nd ed. 1889), § 603.

7 Norton v. Norton, 43 Ohio St. 509.

8 Browne & Theobald's Railway Law, 75, citing New London etc. Bank v. Brocklebank, 21 Ch. Div. 302.

§ 392. Extent of the corporate lien-The general rule, continued. The lien, when established, attaches to all of the stockholders' shares, although the debt may be for calls due and unpaid upon only a part of them.' This also is the statutory rule in England under the Companies' Clauses Act of 1845, which declares that no shareholder shall be entitled to transfer any share after any call shall have been made in respect thereof, until he shall have paid such call, nor until he shall have paid all calls for the time being due on every share held by him;* the meaning of which is held to be, that the company may refuse to execute a transfer of shares while a call remains unpaid, and not merely that the transferrer remains liable to pay the call.3 In America, also, it is held that the company may

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refuse to permit registration until the lien has been satisfied; even in the case of a bona-fide purchaser "at execution sale; and that it cannot be compelled to register so many of the shares as are in excess of the amount of the debt.

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1 Stebbins v. Phoenix Fire Ins. Co. 3 Paige, 350; Cook on Stock & Stockh. § 526. Contra, only to those shares upon which the call is made: Shenandoah Valley R. R. Co. v. Griffith, 76 Va. 913; Hubbersty v. Manchester etc. R'y Co. Law R. 2 Q. B. 471.

2 8 Vict. ch. 16, § 16.

3 Regina v. Wing, 17 Q. B. 645; S. C. nom. Hall v. Norfolk etc. Co. 21 Law J. Q. B. 94; 8. C. 16 Jur. 149. Under this statute a call is deemed to be made when the resolution ordering it is passed, and not when notice of it is given: Regina v. Londonderry etc. R'y Co. 13 Q. B. 995; Ex parte Tooke, 18 Law J. Q. B. 313. See further, upon the construction of statutes prohibiting transfers while calls remain unpaid, In re British Provident etc. Society, 32 Law J. Ch. 633.

4 Brint v. Bank of Washington, 10 Pet. 596; McCready v. Rumsey, 6 Duer, 574.

5 Newbury v. Detroit etc. R. R. Co. 17 Mich. 141.

6 Pierson v. Bank of Washington, 3 Cranch, 363; Sewall v. Lancaster Bank, 17 Serg. & R. 285.

§ 393. Extent of the corporate lien-modifications of the general rule.—The strict general rule as laid down by the authorities cited in the preceding section, is modified by other decisions, and, in some particulars, entirely denied. Thus it is held, that no lien exists upon the shares of an unregistered transferree for debts due from him to the company; that the lien does not extend to debts contracted after the company has received notification of the transfer; that a shareholder is entitled to transfer shares on which all calls have been paid, although he may be the holder of other shares upon which a call has been made; that the company has no priority of lien over an equitable incumbrancer, who advanced money on a deposit of the certificates, with notice to the company, before the debt to the company became due; that the lien does not

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