Katama Land Co. v. Jernegan
| Citation | 126 Mass. 155 |
| Parties | Katama Land Company v. Alexander Jernegan |
| Decision Date | 21 January 1879 |
| Court | United States State Supreme Judicial Court of Massachusetts |
Argued October 25, 1878
Dukes County. Contract upon an agreement signed by the defendant and others, to recover an assessment made by the plaintiff corporation on ten shares of stock standing in the name of the defendant. The parts of the agreement now material to be stated were as follows: "Whereas, by act of the Legislature of Massachusetts in the year 1872, Erastus P Carpenter, Joel H. Hills, Grafton N. Collins, and Nathaniel M. Jernegan, their associates and successors, are created a corporation, under the name of the Katama Land Company, for the purpose of purchasing, holding, improving, and disposing of land in the town of Edgartown, the capital stock of which corporation is fixed at fifty thousand dollars; now therefore, the undersigned hereby associate themselves together to form said corporation, and severally subscribe for and agree each with the other and with said corporation to take the number of shares in said corporation affixed to their respective names, and to pay therefor the sum of one hundred dollars per share, at such times as shall be determined, upon the organization of said corporation Provided, however, that the subscription shall not be binding until the whole amount of said capital stock shall have been subscribed." Opposite the defendant's name were written the words "ten shares."
Trial in the Superior Court, before Rockwell, J., who ruled that the plaintiff could not maintain the action upon the evidence introduced by it, and reported the case for the consideration of this court. The nature of the evidence appears in the opinion.
Judgment for the defendant.
J. Brown, for the plaintiff.
T. M. Stetson & F. B. Greene, for the defendant.
OPINION
It is the well settled law of this Commonwealth, that a subscription for shares in a corporation, authorized by law to lay assessments upon shares and to sell the shares for the nonpayment of such assessments, does not impose any personal liability upon the subscriber to pay assessments upon the shares, unless he has expressly promised to do so. Mechanics' Foundry & Machine Co. v. Hall, 121 Mass. 272, and cases cited. This action, therefore, can only be maintained upon the ground that the subscription paper signed by the defendant binds him to pay the assessment sued for.
The subscription paper provides that whereas the Katama Land Company has been incorporated, "the capital stock of which corporation is fixed at fifty thousand dollars; now therefore, the undersigned hereby associate themselves together to form said corporation, and severally subscribe for and agree each...
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