Page:Harvard Law Review Volume 10.djvu/255

229 STOCKHOLDERS IN FOREIGN CORPORATIONS. 229 poration who were stockholders, and what were the equities be- tween them." Such was the interpretation of the statute by the New Hamp- shire court in the case of Hadley v, Russell.^ That interpretation should be followed in this State. "When the statute creates a right and prescribes a remedy, that particular remedy and that only can be pursued." These two decisions of Erickson v. Nesmith were approved in New Hampshire when the same plaintiff brought a bill there to enforce the same liability, joining all the creditors and stockholders. The principles upon which these decisions were based seem to be the following : — 1. The stockholder's liability is created solely by statute. 2. The particular remedy prescribed by that statute must be pursued. 3. The courts of Massachusetts will not permit such foreign statutes to work injustice to our own citizens. 4. Such statutes can operate here only by comity. These principles have been adhered to in succeeding cases, and are submitted as a statement of the law of Massachusetts to-day. The foundation of the stockholder's liability to the creditor is of course contractual. This was nowhere stated by the Massachu- setts court in the decisions of Erickson v. Nesmith, but was un- doubtedly assumed. It was, however, distinctly stated in the case of Hutchins v. N. E. Coal Mining Co. ,2 a case decided in the same year as the second of those cases. There the court say : — " The right of creditors to recover a judgment against a corporation for the amount of their debts, and to take out execution on which, in certain contingencies, the private property of stockholders might be taken, was one of the attributes or properties of its legal existence, by virtue of its charter, of which it did not and could not divest itself by entering into contracts in other States. On the contrary, such contracts must be pre- sumed to have been made with reference to this very liability. Certainly the corporation and its stockholders are estopped from denying it." This was a case where a creditor, living without the State, brought suit to enforce in our courts the liability of resident stockholders in a Massachusetts corporation. This he was per- mitted to do. This case dealt with the rights of a foreign creditor of a Massachusetts corporation. 1 40 N. H. 109. 2 4 Allen, 580, 583.