McCoy v. World's Columbian Exposition

• Decision Date: 21 June 1900
• Citation: 57 N.E. 1043,186 Ill. 356
• Parties: McCOY v. WORLD'S COLUMBIAN EXPOSITION.
• Court: Illinois Supreme Court

186 Ill. 356

57 N.E. 1043

McCOY

v.WORLD'S COLUMBIAN EXPOSITION.¹

Supreme Court of Illinois.

June 21, 1900.

Appeal from appellate court, First district.

Action by the World's Columbian Exposition against William McCoy. From a judgment in favor of plaintiff, affirmed by the appellate court (87 Ill. App. 605) defendant appeals. Affirmed.

Joseph Wright, for appellant.

Matz, Fisher & Boyden, for appellee.

CARTWRIGHT, J.

Appellant subscribed for 1,000 shares of the capital stock of appellee. The shares were $10 each, and at the time of subscription 2 per cent., or $200, was paid to meet preliminary expenses. Afterwards three calls, of 18, 20, and 20 per cent., respectively, of the capital stock were made, which appellant refused to pay. Appellee brought this suit to recover the amount of said calls, and at the trial the court directed a verdict for $7,500; being the amount of the calls, with 5 per cent. interest from the time when they became due. A verdict was returned accordingly, and judgment was entered thereon. The branch appellate court for the First district affirmed the judgment.

To the declaration, defendant filed 12 pleas. The first was the general issue; the second, nul tiel corporation; and the remaining 10 were substantially alike, and averred, in different forms, that the capital stock of the plaintiff had never been fully subscribed. When the case was called for trial no replications to these pleas had been filed, and defendant objected to a trial, and filed his motion for judgment in his favor on each of the 12 pleas. Counsel for plaintiff stated that they would immediately file general replications to each of the pleas, and the court denied the motion for judgment, and called a jury. The jurors were sworn to answer questions and examined by the parties, but, before they were sworn, replicationswere presented, and leave was given to file them nunc pro tunc as of the time the case was called for trial. The defendant excepted to each ruling of the court, and the jury was sworn to try the issue. It would have been error to try the case without issues of fact being formed on the pleas, and it may be admitted that the court had no power to order the replications filed nunc pro tunc, when none had ever been filed, and there had been no attempt to file them. The case, however, was not tried without being at issue, and when the jury were sworn to try the issues they were fully made up. The defendant suffered no harm, being fully advised as to the issue to be joined when the jurors were examined as to their qualifications. The first two pleas only required the similiter, and the replications were general, alleging that the entire capital stock had been subscribed prior to the calls. When they were filed the jury had not been sworn, and there was opportunity for any further examination, or, if there was good reason, defendant might have asked for time thereafter to prepare for trial; but he did nothing of the kind, and, it is apparent, had no reason to do so. The court was right in denying the motion for judgment and trying the case.

No complaint is made of anything that occurred on the trial up to the time the court directed a verdict, and that direction is attacked solely on the ground that the evidence showed that the capital stock had not been fully subscribed at the time the calls were made. Plaintiff was incorporated under the general act concerning corporations, in force July 1, 1872. The capital stock was fixed at $5,000,000, and commissioners were licensed to open books for subscription to such stock. The commissioners took defendant's subscription, with others, for the purpose of effecting the incorporation. In such case the contract of subscription is binding and enforceable only after the full capital stock has been subscribed. Until the whole amount has been subscribed, the corporationcannot be organized or have a legal existence, and the directors cannot make any call or assessment on the shares. The subscribers cannot be required to pay such assessments until the corporation is authorized by law to begin the prosecution of its business. Allman v. Railroad Co., 88 Ill. 521;Temple v. Lemon, 112 Ill. 51; 1 Redf R. R. 175; Cook, Stocks & S. § 176; Mor. Priv. Corp. § 137. In such a case, after the capital stock has been fully subscribed the commissioners are authorized to convene a meeting of the subscribers, upon due notice addressed to each, for the purpose of electing directors or managers, and for the transaction of other business. In this case the stock was fully subscribed in good faith, and it was not claimed that there was any nominal or fictitious subscription, or any release of any subscriber from the obligation of his contract. The notice was given to the subscribers, and a meeting held on April 4, 1890, when directors were elected for the term of one year. In pursuance of the statute, on April 8, 1890, the commissioners made a report to the secretary of state of their proceedings, signed and sworn to by them, including therein a copy of the notice to the subscribers of the meeting to organize, a copy of the subscription list, and the names of the directors, with their term of office. The secretary of state thereupon issued a certificate of the complete organization of the corporation, making a part thereof a copy of all the papers filed in his office, including the subscription list; and this was recorded in the office of the recorder of deeds of Cook county, where the principal office of the corporation was located. The records of the corporation are sufficient and competent evidence that the full capital stock has been subscribed. Cook, Stocks & S. § 180. The final certificate of complete incorporation issued by the secretary of state April 9, 1890, and the proceedings...