Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/751

 CHAP. XIII.] SHAREHOLDERS AND CREDITORS. [§ 735. shareholders are made liable for the " debts " of the corporation a shareholder may plead that the claim of the creditor is not a "debt" in the sense in which the term is used in the statute. Thus, a judgment against a corporation for personal injuries is not a "debt contracted" by it. 1 § 735. Shareholders may also plead that their individual liability has been waived in respect of the claim on which suit is brought against them, 2 or that the statutory provision on which rests their liability had been repealed either before they became share- holders, 3 or before the debt on which suit is brought withstat- was contracted ; 4 or that the statutory liability was created after the debt was contracted by the corporation, and Waiver or repeal of statutory liability. Substantial compliance statute is assignable. Oneida Bank v. Ontario Bank, 21 N. Y. 490. A suit in equity against all the other share- holders is the proper means of en- forcing contribution when a share- holder has paid wages of an employe. Clark v. Myers, 11 Hun, 608. So a travelling salesman was held not to be a laborer. Jones v. Avery, 50 Mich. 326. See Clark, Appeal of, 100 Mich. 448. See Sleeper v. Gor- dium, 67 Wis. 577, for a construction of a statute of this nature. The liability of shareholders to creditors, to the extent of their un- paid subscriptions, is not excluded by the existence of a statute render- ing shareholders individually liable to the amount of stock held by each of them, for all work or labor done, or materials furnished to carry on the operations of the corporation ; even though the claims of the judg- ment creditors suing to enforce the payment of the unpaid subscriptions arose from labor done and materials furnished. Bunn's Appeal, 105 Pa. St. 49. 4 Brockway v. Innes, 39 Mich. 47; nor a railroad contractor. Peck v. Miller, 39 Mich. 594. A corporation cannot be an " employe " of another corporation within the purview of a statute making shareholders liable for debts due employes. Dukes v. Love, 97 Ind. 341. As to who are "employes," see Palmer v. Van Sautvoord, 153 N. Y. 612. 1 Bohn v. Brown, 33 Mich. 257 ; Hacock v. Sherman, 14 Wend. 58 ; Doolittle v. Marsh, 11 Neb. 243. Compare Dryden v. Kellogg, 2 Mo. App. 87. Liability for " dues " covers damages arising from a tort of the corporation. Rider v. Fritchey, 49 O. St. 285. See § 773. 2 French v. Teschemaker, 24 Cal. 518; Basshor v. Forbes, 36 Md. 154. See Brown v. Eastern Slate Co., 134 Mass. 590. 3 Ochiltree v. Railroad Company, 21 Wall. 249. 4 But where bonds were issued by a corporation while personal liabil- ity attached to its shareholders, the holder of them, though he became such after the repeal of this per- sonal liability, has all the rights of his assignor, including the latter's right of action against the share- holders. Blakeman v. Benton, 9 Mo. App. 107. 731