Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/732

 § 717.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. XIII. " Iii order to contrast the nature of the liability of share- holders with that of partners, companies must be divided into those which are incorporated and those which are not, and each class must be again subdivided, for, owing to the diversity of the statutes relating to companies, little is common to them all. The general principles which require to be borne in mind, are, first, that unincorporated companies are not at common law distinguishable from partnerships; and, secondly, that incor- porated companies are distinguishable from them, and that the shareholders in such companies are not liable for the corporate debts and engagements save so far as they are rendered so by act of Parliament. If shares in an incorporated company are registered in the names of two persons and one of them dies, the survivor is the only person liable to be made a contributory in respect of them." ' § 717. This doctrine that shareholders in corporations are not liable for the corporate debts, save so far as they holders not are ren ^ ere ^ s0 D y the statute imposing the indi- le/t, but vidual liability, does not accord with the view made liable. ~ taken in Corning v. McCullougn/ where it was said that by these statutes shareholders are not made but left liable for the corporate indebtedness. The difference is important. If the shareholder is left liable, in every case of doubt there is a presumption in favor of his liability; while if he is made liable, his liability is to be deduced from a fair construction of the statute. The view of Baron Lindley seems the correct one, and accords with the prevailing doctrine in America. "Individual liability is repugnant to the law of corpora- tions, and qualifies in this case an exemption which would otherwise exist. Stockholders in such cases are liable accord- ing to the plain meaning of the terms employed by the legis- lature, and not otherwise." 3 Moreover, it would seem that if shareholders are left liable, made " individually responsible for an amount equal to the amount of stock held by them respectively " were said to be partners in Thomp- son v. Meisser, 108 111. 359; and Schalucky v. Field, 124 111. 617. 1 1 Lindley on Partnership, 375, citing Hill's Case, L. R. 20 Eq. 595. 712 1 N. Y. 47. 8 Carroll v. Green, 92 U. S. 509, 512, opinion of the court per Swayne, J. See, also, Terry v. Little, 101 U. S. 21G: Chase v. Lord, 77 N. Y. 1; Libby v. Tobey, 82 Me. 397.