Flinn v. Bagley
District Court, E.D. Michigan
In Equity. This was a hill in equity by the assignee of the Detroit Novelty Works to compel the payment of the balance due upon certain unpaid subscriptions to the capital stock of the company. The material facts were that the company was organized in 1859, with a capital stock of $50,000, divided into 2,000 shares of $25 each.
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In Equity. This was a hill in equity by the assignee of the Detroit Novelty Works to compel the payment of the balance due upon certain unpaid subscriptions to the capital stock of the company. The material facts were that the company was organized in 1859, with a capital stock of $50,000, divided into 2,000 shares of $25 each. In 1871 it was proposed to increase the stock of the company to $100,000, and tho following agreement was entered into by the defendants in this suit, or by those from whom the defendants hold their stock: “ The undersigned subscribe hereby the amount set opposite our…
1Opinion of the Court
Brown, D. J.
That the capital stock of a corporation is a trust fund for the payment of its debts, and that the law implies a promise by the subscribers of stock to pay its par value, which in this instance was $25 per share, when called for, and that no subsequent release of their original contract or subscription by the corporation will avail against the claims of creditors, are propositions too clearly established to admit of question. But whether a court cannot only compel a subscriber to live up to a bargain he has made, but can make another bargain for him, and compel him to live up to…
2Cases cited5 opinions
- Upton v. TribilcockSupreme Court of the United States · 1875
- Hatch v. DanaSupreme Court of the United States · 1880
- Hawley v. UptonSupreme Court of the United States · 1880
- Sturges v. StetsonU.S. Circuit Court for the District of Southern Ohio · 1858
- Pittsburgh & Connellsville Railroad v. StewartSupreme Court of Pennsylvania · 1861
3Cited by2 opinions
- Noonan v. Chester Park Athletic Club Co.Court of Appeals for the Sixth Circuit · 1900
- McAllister v. American Hospital Ass'nOregon Supreme Court · 1912