Conway v. John

• Decision Date: 14 February 1890
• Citation: 23 P. 170,14 Colo. 30
• Parties: CONWAY v. JOHN et al.
• Court: Colorado Supreme Court

23 P. 170

14 Colo. 30

CONWAY v. JOHN et al.

Supreme Court of Colorado

February 14, 1890

Appeal from district court, El Paso county.

Syllabus by the Court

1. Under the laws of this state, title to stock in a corporation, as against creditors, can only pass by transfer on the books of the company.

2. The proper foundation being laid, the character and contents of the missing files in a cause tried before a justice of the peace may be established by oral evidence.

3. Under the act of 1879, in relation to attachments before justices of the peace, requiring notices in certain instances to be posted in three of the most public places within the precinct, evidence showing that one of such notices was posted on the front door of the court-house, one on the side of the stairs leading to the justice's office, and one on a certain corral fence, and that 'these places were then regarded, and would now be, three about as public places as could be found in the precinct,' shows a sufficient compliance with the statute, as against a collateral attack upon the proceedings.

4. Ordinarily, inadequacy of price paid is not alone sufficient cause for setting aside a judicial sale, particularly of personal property of fluctuating value.

5. The right of redemption from a judicial sale of personal property does not exist in this state.

Wells, McNeal & Taylor, for appellant.

J M. John, for appellees.

HAYT J., ( after stating the facts as above.)

The attack upon the judgment of the district court sustaining the title of appellee John to the stock in controversy is based upon four grounds: (1) That the stock was not, at the time of the attachment proceedings, subject to attachment as the property of Irland, because of the previous assignment to appellant. (2) That the stock could not be attached upon a writ issued by a justice of the peace. (3) Irregularities in the proceedings in court, and attending the sale, sufficient as it is claimed, to avoid the judgment and vitiate the sale. (4) Inadequacy of the price paid.

It is admitted by the pleadings that the certificate of stock in controversy provided upon the face thereof that it was 'transferable only upon the books of the company, in person or by attorney, on the surrender of this certificate.' This was inserted by virtue of the following by-law of the company: 'Transfers of stock shall be made on the books of the company either in person or by attorney, and the possession of the script shall not be regarded as evidence of ownership, unless it shall so appear on the books of the company.' Express statutory authority for the making of such by-law is given the corporation in section 241, Gen. St. 1883, in this language: 'The shares of stock shall not be less than ten nor more than one hundred dollars each, and shall be deemed personal property, transferable as such in the manner provided by the by-laws.' In addition to this, we find a subsequent section, requiring, inter alia, that a book shall be kept by the secretary or clerk of such corporation showing the names of all stockholders, with their places of residence, the number of shares of stock held by each, etc and providing, further, that 'no transfer of stock shall be valid for any purpose whatever, except to render the person to whom it shall be transferred liable for the debts of the company, * * * unless it shall have been entered therein, as required by this section, within sixty days from the date of such transfer.' Section 269, Id.

Here we have a clear provision of statute taking from the owner of stock the right to transfer it in accordance with the known rules of the common law, and substituting therefor another and different mode. This change was doubtless made for the purpose of furnishing record evidence of the title, and, in view of the plain and explicit language employed, the statute cannot be disregarded. Under its provisions, we are clearly of the opinion that, notwithstanding the attempted transfer from Irland to appellant, the stock remained subject to attachment at the suit of the former's creditors. Fiske v. Carr, 20 Me. 301; Bank v. Cutler, 49 Me. 315; Bank v. Gridley, 91 Ill. 457; Association v. Cory, 129 Mass. 435; Northrop v. Turnpike Co., 3 Conn. 544; Weston v. Mining Co., 5 Cal. 186; Naglee v. Wharf Co., 20 Cal. 530; Murphy's Case, 51 Wis. 519, 8 N.W. 419.

We are aware that in some jurisdictions somewhat similar provisions have been held to relate solely to the government of the corporation in the transaction of its corporate business, to advise it of the names of those entitled to vote, receive dividends as stockholders, etc., and that creditors should not be allowed to take advantage of any failure to comply with such requirements. Such decisions have usually, however, been based upon statutes essentially dissimilar from those here under consideration, and frequently upon the construction to be given a bylaw of the company, in the absence of express statutory restriction. But the decided weight of authority, as well as the better reason, we think, unite in support of the conclusion that when, as in this state, the statute of the state, as applicable to corporations, requires that shares shall be transferred in a particular mode, there must be at least a substantial compliance with the requirement in order to protect the property against future assignments or levies. Bank v. Gridley, supra.

At the time of these proceedings it was provided by statute that...