Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/799

 CHAP. XV.] LEGAL RELATIONS AMONG SHAREHOLDERS. [§ 792. If the transfer of shares forms part of a contract that equity will specifically enforce, as, for instance, a contract for the sale of land, equity will specifically enforce the transfer in the course of enforcing the main contract. 1 On the other hand, if the contract to transfer shares is part of a contract which equity cannot or will not specifically enforce, the transfer of shares will not be enforced specifically. 2 § 791. The purchaser is not the only party to the contract who is entitled to its specific performance. When any liability is connected with the shares, either for cation of " unpaid subscriptions or on account of some statute trausferrer - creating individual liability on the part of shareholders, the vendor has the right to have the vendee specifically perform the contract, and register himself as owner of the shares, in order that the vendor may be freed from liability. 3 And at all events after a valid sale has been made, the vendee is bound to indemnify the vendor from all liability as to future calls, 4 as well as from liability created by statute. 5 § 792. If the transferrer is guilty of such misrepresenta- tions or concealments as would entitle the purchaser „ j- i i i ". Fraud. of personal property to have the sale set aside, the transferee will be discharged from his agreement to purchase, 6 or he may hold to his bargain and sue the transferrer for damages. 7 1 Leach v. Fobes, 11 Gray, 506; Bissell v. Farmers', etc., Bank, 5 McLean, 495. 2 Ross v. Union Pac. R'y Co., 1 Woolw. 26; Danforth v. Philadelphia and C. M. R'y Co., 30 N. J. Eq. 12; Fallon v. Railroad Co., 1 Dill. 121. 3 Paine v. Hutchinson, L. R. 3 Eq. 257; S. C, aff'd L. R. 3 Ch. 388; Shepherd v. Gillespie, L. R. 5 Eq. 293; Walker v. Bartlett, 2 Jur. N. S. 643; S. C, 18 C. B. 845. Shepherd v. Gillespie, supra; Walker v. Bartlett, supra ; Wynne v. Price, 3DeG. & Sm. 310; Cruse v. Paine, 37 L. J. Eq. 711; Evans v. Wood, ib. 159; Hodgkinson v. Kelly, ib. 837; Hawkins v. Maltby, L. R. 4 Ch. 200; Castellan o. Hobson, L. R. 10 Eq. 47. Contra and semble overruled by above cases. Humble v. Langston, 7 M. & W. 517. 5 Wheeler v. Faurot, 37 Ohio St. 26; Brown*. Hitchcock, 30 Ohio St. 667. These were instances of liabil- ity created by statute which was held to attach to shareholders who were such at the time when the debt was contracted by the corporation. See §§ 718 et seq. 6 See Fosdick v. Sturges, 1 Biss. 255. If, however, the transferee's name is registered as a shareholder, the rights of creditors or other share- holders might intervene. 7 Riggs v. Tayloe, 2 Cranch Cir. Ct. 687; McClure v. Central Trust 779
 * Hutzler v. Lord, 64 Md. 534;