Cornick v. Richards. declared purpose that it shall be levied on and sold as other personal property is sold. The next clause requires the company in case of such sale to make "the proper entries in its stock or transfer book, and imposes the duty on the company of showing the transfer or sale to the purchaser by entering the stock as transferred to him by the sale, so that he shall stand on the books of the company as its owner, and be entitled to the privilege of a stockholder in said company, for we take it as to these privileges the company may only recognize the title as shown on its stock book, so far as its own dealing with the stockholder is concerned. It is proper to add here that this right, that is the right conferred on a stockholder, to the privileges of a corporator, and to vote in stockholders' meeting for direction of the affairs of the company, the election of officers and the like, is usually overlooked in the definition of the right conferred by reason of ownership of stock, yet these rights are valuable as an incident to such ownership, and cannot properly be overlooked as a1 element of such ownership. It may, under the charter, be the sole means by which the shareholder's voice can be made potential in the management of his capital put into the corporation, and by which the other rights usually enumerated, to-wit., the receipt of dividends during the life, and sharing the capital at the dissolution of the corporation, can be made good for the proper management of the business, and is the means of securing these against improper management, the certain or usual means Cornick v. Richards. by which they are they are rendered valueless, or their value impaired. But to return to the section. The next clause saves the liability of the debtor to the holder as to liabilities previously accrued by reason of the ownership of said stock, and says he shall not be relieved from them by such sale, and adds, neither will a voluntary sale, thus recognizing a forced sale by the officer by process of law providing for transfer in such case on the stock book, and also a voluntary sale, but no provision is found requiring the entry to show such sale on this book. It is insisted, however, that the succeeding section, 1491, contains a regulation of this question that is to be taken, as we understand the argument, to be equivalent to the requirements of our registration law as to sales or transfer of property therein required to be registered. In other words, until the requirements are complied with, as to all the world except probably between the immediate parties, certainly as to creditors and purchasers without notice, the sale is void. The section is as follows: The stock books of the company shall be be so kept as to show intelligibly the original stockholders, their respective interests, the amount which has been paid on on their shares, and all transfer thereof; and such books, or a correct copy thereof, so far as the items mentioned in this section are concerned, shall be subject to the inspection of any person applying. On looking at the previous sections immediately before this, from 1488, it will be seen they are a series Cornick v. Richards. of regulations fixing duties upon the officers and imposing liabilities for failures to perform such duties. For instance, fraud in failing to comply substantially with the articles of incorporation, deceiving the public as to liabilities, the division of funds, the keeping false books, make them liable to liable to the penalties imposed. Then follows the section cited requiring the stock books to be kept as specified. It is clear from these provisions they can only be fairly construed as intended to govern the conduct of the company and its officers in their management of the business under their control, and apply solely as regulations upon corporate action, but have no reference whatever to the rights or conduct of individuals who may own shares of the stock. The section does not even accurately refer to such parties or such a subject as their right to transfer their property. The officers must so keep their stock book as to show original stockholders the amount paid on their shares, and all transfers thereof, but how the transfer or sale thus shown is to be made between the party selling and the party buying or receiving an assignment, is not attempted to be fixed, on the contrary in view of universal commercial usage, the known habits of business men in dealing with such stocks, the inference is very strong from the language, if not conclusive, that this was left as was established by general law, and the company only required to make their stock book show, or evidence by its entries, a transaction previously made, complete and executed. It could not be fairly said that the showing a fact to have occurred, to-wit., a transfer of stock Cornick v. Richards. means that it is the transfer itself, that is, that the fact could not exist without this particular duty performed showed it to have been done. The sale or transfer would necessarily precede this entry of the fact on the stock book. It would seem to follow that in order to render the sale or assignment of stock void in connection with these requirements, the Legislature would of necessity be required to have so expressed its will, a requirement so materially affecting the rights of holders of property ought at least to be directed to such holders, and in terms impose the duties upon them before they should be held affected by it. An owner of shares or a purchaser from him might read this section fixing the duties of the officers of a corporation, and never suspect that any thing was required of them by the language used in order to complete a purchase or sale of such stock. If such had been the purpose of the Legislature it was easy, and the natural mode of carrying out that intention, simply to have added, "and all transfers not so shown shall be held void as to creditors or innocent purchasers." Such language would have hardly been germane to the main purpose of the section, but would have been effective. Something is claimed in favor of the view assumed as being in accord with the spirit of our registration laws. That transfers of property recorded on official books kept for the purpose by a public officer is the policy of these laws, we know, but that a requirement that such record shall be kept in the books of a private corporation is in accordance with this we cannot very Cornick v. Richards. well see. Be this as it may, the two laws are very different, the registration laws expressly making all instruments not recorded or noted as required void as to creditors or purchasers without notice. It would be a very strained construction to say the requirement of the section under consideration is equivalent to this language in our registration laws. It would be much more reasonable, we think, to say that with our system of registration, so long established, if sales or transfers of this kind of property were to be recorded at all, as notice to the world of title, they would have been required to be regularly registered, and thus the record be where all other records of the kind are found, in an official book, kept in a public office, made by a public officer under the sanction and safeguard of his official responsibility. This argument receives considerable aid, to say the least of it, from section 1463 of art. 2 of the same chapter, regulating manufacturing, quarrying and mining corporations, which provides that "no transfer of stock is valid (that is in these companies) for any purpose except to render the person to whom it is made liable for the debts of the company as herein provided, until it has been entered on this stock book, showing to and from whom the transfer was made." This section of the Code, as well as sec. 1491, are taken from the acts of 1849-50, and embodied in the Code by the compilers, and so passed by the Legislature. It can scarcely be conceived they would have made a specific provision in the same chapter in such plain language as to certain corporations, and left the mat |