the issuance of stock for services or property under this section, no stock shall be counted whose owner or holder is interested in such services or property, nor any stock that has merely been subscribed for, and payment for which is to be made in services.

36. Whenever the stock of any corporation is issued for services or property, in accordance with the preceding section, the books of the corporation shall be so kept as to show at all times fully what property was received and what services were rendered for the said stock; at what value, and the number of shares issued for the same. Whenever any stock is issued in payment for services or property, as aforesaid, a certificate, signed by the president or vice-president and secretary and sworn to by the treasurer, setting forth the amount of stock so issued and the property or services in payment for which said stock is issued, and particularly specifying the nature and character of such property or services, shall, within thirty days after the issue of said stock, be filed in the office of the clerk of the Circuit Court for the county in which the principal office of the corporation is located (or of the clerk of the Superior Court of Baltimore City, if such principal office is located in Baltimore City), and any officer or director of such corporation wilfully and knowingly authorizing or consenting to the failure to so file such a certificate within thirty days from the issue of said stock, or wilfully and knowingly making or consenting to any false statement contained in the entries required by this section to be made on the books of the corporation, or of said certificate, shall be deemed guilty of a misdemeanor, and upon conviction, shall be subject to the pains and penalties prescribed by Section 134 of Article 27 of the said Code of 1904. Provided, however, that the valuation placed by the stockholders upon such services or property at the meeting duly warned, as aforesaid, and the propriety of their action in accepting the same and issuing the agreed number of shares therefor, shall in the absence of actual fraud be conclusive against and binding upon any and all creditors of the corporation.

Art. 23, sec. 36-For what constitutes services and property, see Frost on Corporations, 3d Edition, Sections 102 and 103.

Transfer.

37. The stock of any corporation of this State shall be deemed personal estate and shall be transferable on its books in such manner as may be prescribed by the stock certificate or the by-laws, but no share shall be transferable until all previous calls thereon shall have been paid in.

Calls.

38. Unless otherwise payable by the subscription contract, the directors of any corporation having a capital stock, may call in and demand from the stockholders the amounts due on their subscriptions at such times and in such payments and instalments as the said directors shall deem proper; but at least thirty days' written or printed notice of the amount, time and place of payment of such calls shall be given to each stockholder; such notice shall be delivered to each stockholder by leaving the same with him, or at his residence or usual place of business, or by mailing it, postage prepaid, and addressed to him at his address as it appears upon the books of the corporation.

39. When any stockholder fails to pay any instalment or call upon his stock which may have been properly assessed thereon by the directors, at the time when such payment is due, the directors may collect the amount of such instalments or call or any balance thereof remaining unpaid, from the said stockholder by an action at law, or they shall sell at public sale such part of the shares of such delinquent stockholder as will pay all assessments then due from him with interest and all incidental expenses, and shall transfer the shares so sold to the purchaser, who shall be entitled to a certificate therefor. Notice of the time and place of such sale

Art. 23, sec. 37--When a shareholder executes an assignment on the back of the certificate of stock, and delivers the same to another party, the latter has an equitable title to stock wihout a transfer on the books of the company. Bloede Co. v. Bloede, 84 Md. 129. The power to regulate the transfer stock does not authorize a corporation to control the alienation of shares by describing to whom the owner may sell and upon what terms. Ibid. A by-law of a corporation proving that no stockholder owing to the corporation a matured debt, shall transfer his stock until such debt be paid, is valid and enforceable against all transferees of stock, except innocent purchasers for value. Grafflin & Co. v. Woodside, 87 Md. 146.

and of the sum due on each share shall be given by advertisement for three weeks successively; once in each week before the sale, in a newspaper of the county or city where the principal office of said corporation is located in this State, and such notice shall be mailed by the treasurer of the corporation to such delinquent stockholder at his last known postoffice address at least twenty days before such sale. If no bidder can be had to pay the amount due on the stock, and if the amount is not collected by an action at law, brought within the county or city where the principal office of said corporation is located within six months from the date of the bringing of such action at law, the said stock shall be forfeited to the corporation and the amount previously paid in by the delinquent on the stock shall be forfeited to the corporation.

Liability of Stockholders.

40. Except in the case of banking corporations, for which provision is made by Section 39 of Article 3 of the Constitution, and except as provided in the next succeeding section, and in the case of those classes of corporations for which special provision is hereinafter made in this Article, no stockholder in any corporation of this State shall be liable for the debts thereof; and in no case shall any person holding stock in any corporation of this State, which shall be entered on the books thereof in his name as executor, administrator, guardian, committee, trustee, receiver or pledgee, be individually subject to any liability as stockholder, but the person pledging the stock, and the estates and funds in the hands of such execu tor, administrator, guardian, committee, receiver or trustee, shall be subject to the liability, if any, imposed upon the holders of the shares.

Art. 23, sec. 39-This provision is contrary to the common law and must be strictly complied with. Frost on Corporations, 3d Edition, Section 31.

Art. 23, sec. 40--The stockholders of the following corporations are liable for the par value of their stock, in addition to the amount unpaid thereon, to wit: Safe deposit, trust, fidelity, loan and guaranty companies. (Sec. 104.) Where a person appears on the books of a corporation to be the absolute owner of shares, he will not be allowed to relieve himself from personal liability as a stockholder by showing that he held the stock in a representative capacity. Karr v. Urie, 86 Md. 72.

41. Every stockholder of any corporation of this State, in case of a reduction of its capital stock, as provided for in Section 27 of this Article, shall be liable to the corporation or its receiver for the payment of its liabilities existing at the time of such reduction, to the extent of the amount withdrawn and paid to such stockholder, and (except stockholders in banking corporations and those classes of corporations for which special provision is hereinafter made in this Article) every stockholder of any corporation in this State shall remain liable for the benefit of its creditors for the amount of the face value of his stock, or of his subscription in case the stock has not been issued, less the amount he shall already have paid thereon, until he shall have paid said amount in good faith; and in the event of the insolvency of the corporation, such liability shall be considered as an asset of the corporation and may be enforced by the receiver, trustee or other person winding up the affairs of said corporation, notwithstanding any release, agreement or arrangement short of actual payment which may have been made between said corporations and said stockholder.

41A. All the stockholders of any such corporation shall be severally and individually liable to the creditors of the corpora

Article 23, sec. 41-This section is in substitution of Section 72, Article 23. See Matthews v. Albert, 24 Md. 527. Norris v. Johnson, 34 Md. 485. Norris v. Wrenschall, 34 Md. 492. Basshor v. Forbes, 36 Md. 154. Fiery v. Emmert, 36 Md. 464. Hager v. Cleveland, 36 Md. 476. Booth v. Campbell, 37 Md. 522. Emmert v. Smith, 40 Md. 123. Garling v. Bechtel, 41 Md. 305. Weber v. Fickey, 47 Md. 196. Strauss v. Heiss, 48 Md. 292. Fickey v. Weber, 52 Md. 500. Musgrave v. Morrison, 54 Md. 162. Frank v. Morrison, 55 Md. 406. Crawford v. Rohrer, 59 Md. 604. Balto. City Passenger Ry. Co. v. Hambleton, 77 Md. 351. Glymont Co. v. Toler, 80 Md. 287. Gettysburg Bank v. Brown, 95 Md. 383, 386. Tompkins v. Sperry, 96 Md. 580. For limitations, see Williams v. Waters, 97 Md. 113. Williams, Receiver, v. Taylor, 99 Md. 306. holder enforcible under the Practice Act of Baltimore city. Boulton, 100 Md. 350.

Liability of stock-
Coulbourn Bros. v.

A corporation has no authority to release subscribers to its capital stock from paying the amount due on their subscriptions because that is a trust fund for the creditors of the corporation. Maryland Trust Co. v. Mechanics' Bank, 102 Md. 608.

NOTE-Sections 41A and 41B were enacted by Chapter 305 of the laws of 1908, approved and taking effect April 6, 1908, in the form of repeal and reenactment of Section 64 of Article 23 of the Code of Public General Laws of 1888, which now constitutes Section 72 of Article 23 of the Code of Public General Laws of 1904. The courts may hold that these sections are repealed by the revised general corporation law approved March 31, but which did not take effect until June 1, 1908.

tion of which they are stockholders to an amount equal to the amount of stock held by them respectively, for all debts and contracts made by the corporation, until the whole amount of the capital stock fixed and limited by the corporation shall have been paid in, and a certificate thereof made and filed as prescribed in the following section, which certificate may, however, be filed at any time after thirty days mentioned in said section, but no stockholder shall be individually liable to the creditors of such corporation except to the amount of his, her or their unpaid subscriptions to the capital stock; and the liability of such stockholder shall be an asset of the corporation for the benefit ratably of all the creditors of such corporation, if necessary, to pay the debts of such corporation, and shall be enforceable only by appropriate proceedings by such corporation or by a receiver, assignee or trustee of such corporation, acting under the orders of a court of competent jurisdiction; provided, however, that this section shall not affect the rights of any creditor under the existing laws of this State against the stockholders who were liable to such creditors at the date of the passage of this Act; and provided further, that nothing in this section shall be considered as a construction by the Legislature of the law hereby amended, and the capital stock so fixed and limited shall be paid in, onefourth thereof in one year, one-fourth in two years, one-fourth in three years and one-fourth, or the balance, in four years from and after the incorporation of said company, or such corporation may be dissolved; provided, however, that it shall be lawful for the trustees, directors or managers of any such corporation to collect and enforce the payment of all subscriptions to the capital stock as other debts are collected, after notice being given, as required by Section 70 of this Article; and if suit shall be brought by the trustees, directors or managers of any such corporation against all delinquent stockholders for the full amount of unpaid subscriptions within four years from the incorporation of said company, such corporation shall not be dissolved; and provided furthermore, that the provisions of this section shall not apply to any homestead or building association.