United States Gypsum Co. v. Houston

Defendant Houston borrowed from the plaintiff $5,000, and as evidence thereof gave his promissory note. To secure payment, 'he pledged and delivered to plaintiff five certificates of the common nonpar capital stock of the defendant Commercial Securities Company, a Michigan corporation, aggregating 3,000 shares. Houston was indebted to the defendant company in a considerable amount as unpaid purchase price of the shares. The certificates were in usual and due form and each recited that the shares were “fully paid and nonassessable.” Nothing was stated on any of the certificates to indicate…