Page:Federal Reporter, 1st Series, Volume 9.djvu/371

 856 FEDERAL REPORTER. �the Picayune corporation, in or aboub December, 1873, and had no connection with the transfer to Holbrook ; and though it is evident they were paid with more readiness by him after the action of Warmoth in making such trans- fer, or rather that resistance to their collection was withdrawn, they existed long before as the obligations of Holbrook, and have no bearing upon the case, and may therefore be dismissed f rom f urtlier consideration. �The first question to be considered is whether the conveyance of the Picayune establishment, executed under the authority of the board of direetors and ratified by a meeting of the stockholders, was valid, and could anddid, in law, convey title to Eernandez. It is not neeessary, in the view I have taken of this case as exhibited in the record, to do more upon this point thau to see that the meeting of the stockholders was lawfully convened aiid regularly constituted; for since this meeting ratified the sale and transfer, and since the members or shareholders are the real principals or constituents of the corporation, if what they did was within the scope of their oapacity, and was regularly done in time and manner, it would be conclusively the action of the corporate body. The Herald Company had. given a 12-month3' bond, in amount upw'ards of $20,000, for this very property, and then the same corporators, with the same proportionate interests, had added a new corporator, A. M. Hol- brook, and changed the name of the corporation, using the pur- chased property as a capital. As between the bondholder and the new corporation, to the extent of the purchased property, the bond was surely enforceable against that corporation. The collateral undertaking of Holbrook to pay the bond did not at all affeci these relations. The debt was the debt of the New Orleans Printing Com- pany. Indeed, the bill of complaint of the complainant concedes this. At paragraph 23 he says : �"For this petitioner avers and admits that in equity and good conscience, and notwithstanding the fraudaient and illegal combinations and transac- tions of said A. M. Holbrook, Joseph Hernandez, George ificholson, Peter St. Armand, and R. AV. Holbrook, nevertheless the said New Orleans Picayune Printing Company, and the holders and owners of the remaining 51 shares of stock thereof, owed to the said Joseph Hernandez, or his legal assigna, the amount in money which the said Joseph Hernandez paid for the discharge of the I2-months' bond aforesaid, upon which said Hernandez was surety afore- said, but tohich was primarlly the debt in equity and good conscience of the New Orleans Picayune Printing Company, as suocessor of the Herald Com- pany, which corporation was legally the principal on said bond." �The thing done, then, was for a corporation, at a meeting of stock- holders, to sanction and ratify the application of its property to the payment of its sole debt. ��� �