8 Houston etc. R'y Co. v. Van Alstyne, 56 Tex. 439, 448. 9 Baker v. Wasson, 53 Tex. 150. 10 Weston v. Bear River etc. Co. 6 Cal 425; 63 Am. Dec. 117; Wood's Railway Law, § 99. $403. The remedy of a transferree, the certificates outstanding. When the registered owner of shares of stock institutes proceedings to establish his title thereto, he should immediately attach the stock in the domicile of the corporation; or, if he sues in the domicile of the holder of the outstanding certificates, he should obtain an injunct on against him restraining their transfer. For otherwise the defendant may at any time before judg ment and execution transfer the certificates, and the transferree will be protected; the rule being that, while the transferree of the defendant will be affected with knowledge of a judgment and execution against his vendor, and any transfer made thereafter will be entirely void, he is not affected with knowledge of the pendency of the litigation.* In general, it may be said that the doctrine of lis pendens does not apply to sales of stock. In a case in North Carolina, it was held no defense to an action by the purchaser of shares under attachment and execution, for the purpose of compelling a transfer to him on the corporate books, and the execution of a proper certificate, that they had been duly assigned to a third party before the judginent was rendered under which the sale was made; it not appearing or being alleged that such assignment took place before the levy of the attachment. “ No rights, as against the purchaser at the attachment sale, will be acquired by the intended purchaser in a negotiation for the sale of corporate BEACH ON RAILWAYS-41 stock between non-residents, where, prior to the payment of the purchase price or the assignment and delivery of the certificates, an attachment has been levied on it in a suit in equity against the owner, although neither the latter nor the intended purchaser had any actual notice of the attachment bill at the time of the negotiation." 1 Quarl v. Abbott, 102 Ind. 233; 52 Am. Rep. 662. 2 Smith v. American Coal Co. 7 Lans. 317; Smith v. Crescent City etc. Co. 30 La. An. 1378. 3 Sprague v. Cocheco Manuf. Co. 10 Blatchf. 173; Smith v. American Coal Co. 7 Lans. 317; Smith v. Crescent City etc. Co. 30 La. An. 1378. 4 Holbrook v. New Jersey Zinc Co. 57 N. Y. 616; Leitch v. Wells, 48 N. Y. 586. 5 Bank of Virginia v. Craig, 6 Leigh, 399, 435; Taylor on Corporations, $795. Cf. Dovey's Appeal, 97 Pa. St. 153, where it was left an open question. 6 Morehead v. Western N. C. R. R. Co. 96 N. C. 362. 7 Young v. South Tredegar Iron Co,87 Tenn, 189; 4 Am. St. Rep. 752. § 104. CHAPTER XVII. STOCKHOLDERS' RIGHTS AND LIABILITIES. (A.) The principal rights and powers of the stockholders enumer ated. § 405. The power to make by-laws. § 406. Of the right to inspect the corporate books. § 407. § 408. Whether the right to inspect includes the right to make copies. § 403. How the right of inspection may be enforced-Mandamus. § 410. When mandamus will lie. § 411. The right to sue to remedy ultra vires acts. § 412. The right to maintain actions to remedy the frauds of directors, officers and agents. § 413. § 414. Of representative actions brought by a single stockholder. § 415. Whether the shareholders may institute and defend actions for and against the corporation. § 416. § 417. The same subject, continued-When that right arises. § 418. What interest in stock will entitle its holder to sue herein. Of the futility of attempts to avoid liability upon stock. § 423. The same subject, continued-Of agreements to issue stock at less than par. § 424. The registered holder liable. § 425. Corporate creditors must first exhaust their remedy against the company. § 426. The same subject, continued. 427. The judgment against the corporation conclusive as against the shareholders. § 430. A call unnecessary in case of corporate insolvency. § 431. Limitation upon the shareholders' liability. (A.) 404. The principal rights and powers of the stockholders enumerated.—The management and transaction of all business for which the company was created, and the general affairs of the corporation, devolve upon the directors, and clearly may be exercised by them; but there are other powers that are as clearly reserved to the shareholders.1 The powers of directors are such as are conferred by the charter of their corporation and the laws pertaining thereto, and such corporate powers as are not conferred by law upon the directors remain in the corporation to be exercised, or at least set in motion, by its component parts, the shareholders." To the shareholders is reserved the right to effect any great or radical change in the organization of the company, to accept or reject legislative amendments of the corporate charter, to change the termini of the railway, to increase or diminish the capital stock, to mortgage the corporate property,' and to determine the amount of money which shall be borrowed on mortgage, to lease the road or to alter the terms of an existing lease, to sell and transfer the charter and franchises,1o and to dissolve the corporation." The shareholders are vested with authority to make by-laws for the government of the corporation,12 to elect13 and to remove directors and officers for the general management of the corporate enterprise,1 to increase or diminish the number of directors, 15 and, in En 8 gland, to declare dividends.16 As incidental to their other rights and powers the shareholders may inspect the corporate books," may institute legal proceedings against directors and officers guilty of fraudulent and illegal or ultra vires acts;18 and under certain circumstances they may maintain actions in behalf of the corporation. 19 1 Eidman v. Bowman, 58 Ill. 444; 11 Am. Rep. 90. 2 Metropolitan Elevated R'y Co. v. Manhattan R'y Co. 11 Daly, 377; S. C. 15 Am. & Eng. R'y Cas. 1, per VAN BRUNT, J. 3 Eidman v. Bowman, 58 Ill. 444; 11 Am. Rep. 90. 4 Railway Co. v. Allerton, 18 Wall. 233, 235. Vide supra, §§ 40-49. But an enabling act merely extending the privileges of the company may be accepted by the directors: Eastern R. R. Co. v. Boston etc. R. R. Co. 111 Mass. 125; 15 Am. Rep. 13; Joy v. Jackson etc. Plank Road Co. 11 Mich. 155, 170. Cf. Illinois River R. R. Co. v. Zimmer, 20 Ill. 654. 5 In New York the assent of two-thirds of the stockholders is requi site: N. Y. Laws of 1871, ch. 560, § 2. 6 Railway Co. v. Allerton, 18 Wall. 233; Eidman v. Bowman, 58 Ill. 444; 11 Am. Rep. 90; 8 Vict. ch. 16, § 91. 7 Mass. Pub. Stat. ch. 106, § 23; Saltmarsh v. Spaulding, 147 Mass. 224; 4 R'y & Corp. Law J. 151. 8 8 Vict. ch. 16, § 91. 9 Stevens v. Davison, 18 Gratt. 819; 98 Am. Dec. 692; Penobscot etc. R. R. Co. v. Dunn, 39 Me. 587, 601; Bedford R. R. Co. v. Bowser, 48 Pa. St. 29, 37; Kersey Oil Co. v. Oil Creek etc. R. R. Co. 12 Phila. 374. 10 Eidman v. Bowman, 58 Ill. 444; 11 Am. Rep. 90. 11 Smith v. Smith, 3 Desaus. Ch. 547; Eidman v. Bowman, 58 Ill. 444; 11 Am. Rep. 90; Angell & Ames on Corporations, § 772. 12 Vide infra, § 405. 13 Vide infra, CHAPTER XIX; Eidman v. Bowman, 58 Ill. 444; 11 Am. Rep. 90; 8 Vict. ch. 16, § 19. 14 Vide infra, CHAPTER XIX; Isle of Wight R'y Co. v. Tahourdin, 25 Ch. Div. 320. 15 8 Vict. ch. 16, § 91. 17 Vide infra, § 406. § 405. The power to make by-laws.-The power to make by-laws for the government of the corporate affairs is vested in the shareholders in meeting assembled.' This power is frequently ex |