iff in the State of New York, it appeared that the sheriff had sold, among other property, one share in the Bank of Columbia, and three shares in the Hudson Library; Kent, C. J., said, "The bank and library shares were levied on by mistake, for these were mere choses in action, and not the subject of a levy and sale by a fieri facias any more than bonds and notes." In Connecticut, it seems that shares in a turnpike company are held to be real estate, and the decision to this effect would as properly apply to a canal company, it being founded upon the supposition, that the company had an incorporeal right or easement in the land upon which the road is constructed. But in Massachusetts, in the case of Howe v. Stark weather,' Parker, C. J., who gave the opinion of the court, expressly says, "Shares in a turnpike or other incorporated company, have more resemblance to choses in action, being merely evidence of property; the sale of them upon execution not being justifiable at common law." When the stockholder of a corporation is garnisheed as a debtor of the company, and answers that he has paid all the calls made by the company upon him, he cannot be made responsible upon the residue of his stock, upon which no calls have been made. So stock owned by an individual cannot be subjected to the payment of his debts by garnisheeing the corporation."

Shares in incorporated companies being not thus at common law liable to execution, they have been expressly made so in Massachusetts and in some other States, by statute. The

1 Denton v. Livingston, 9 Johns. (N. Y.) R. 96; and see Com. Dig. tit. Execution, c. 4. In Louisiana the creditors of a stockholder cannot sell his share in the property of a corporation. Williamson v. Smoot, 7 Martin (La.) R. 31.

* Swift's Digest, and 2 Conn. R. 567. But see Amment v. New Alexandria, &c. Turn. Co. 13 S. & Rawle (Penn.) R. 173, in which it was held, that a turnpike road could not be levied upon under a judgment against the company, because they had no tangible interest, nothing but a right receive tolls. And see ante, § 1 of this chapter.

3 Howe v. Starkweather, 17 Mass. R. 243.

to

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Bingham v. Rashing, 5 Alabama R. 403.

Planters and Merchants Bank of Mobile v. Leavens, 4 Alabama R. 753.

statute in these cases generally directs the mode of attachment by mesne process, the course to be pursued when they are attached, and when they are sold on execution. But under such provisions, where the charter, or a general act of the legislature, requires that no stockholder, who is indebted to a bank, shall make a transfer of his stock, until his debt is discharged, the judgment creditor cannot levy. Or, perhaps it might be more proper to say, that if the judgment creditor does levy, the lien of the bank will be preserved; and this lien will extend to notes drawn before and falling due after the levy. So much respect is in fact paid to this lien given by statute, that a bank is not bound to appropriate part of the debtor's shares to pay their demands, and transfer the balance to the judgment creditor, even though the stock is sufficient to pay it and leave a balance.' In the case just referred to it was observed by the court, "It is long settled, and not disputed, that a lien is a good bar to an action of trover; the bank had a lien and were justified in refusing to permit a transfer of the stock until the lien was discharged." Where an act of incorporation prescribes the particular manner in which the shares of members in the stock are to be attached, and sold on execution; such provision supersedes the general provision of a statute on the same subject.'

By the act of 1796, establishing the Third Massachusetts Turnpike Corporation, it was provided, that the shares therein. "may be attached, and may be sold on execution in the same manner as is or may by law be provided for the sale of personal property by execution; a copy of the execution and of the officer's return being left with the clerk of the corporation within ten days after the sale. It was afterwards decided, that the general act of 1804, directing the mode of attaching and selling

1 Sewall v. Lancaster Bank, 17 S. & Rawle (Penn.) R. 285. It had been before settled in Pennsylvania, that the word "indebted " extended to notes given to the bank which had not fallen due. Rogers v. Huntingdon Bank, 2 S. & Rawle (Penn.) R. 77; Grant v. Mechanics Bank, 15 Ibid. 140.

Titcomb v. Un. Marine and Fire Ins. Co. 8 Mass. R. 326.

by execution shares of debtors in incorporated companies, repealed the provision for the same objects contained in the act of incorporation.'

Howe v. Starkweather, 17 Mass. R. 240. The same general act respecting the sale, &c. of shares in corporations provides also for the sale, &c. of an equity of redemption. And it has been held, that an officer, who had sold an equity of redemption on execution, was bound to pay over the surplus money arising from the sale, to another officer having an execution against the same debtor. Denny v. Hamilton, 16 Mass. R. 402.

CHAPTER XVII.

OF THE PERSONAL LIABILITY OF THE MEMBERS OF JOINT STOCK INCORPORATED COMPANIES, For the debts of the CORPORATION.

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§ 1. We have already had occasion, in treating of the nature and meaning of civil corporations established for the purposes of trade and commercial adventure, to distinguish them from the common association of partnership, in respect to the personal liability of the members, for the company debts. No such personal liability, it was shown, attached to the individuals united under the sanction of the government, and invested by charter or other act of legislation, with the full powers and immunities of a corporate body; while it was, on the other hand, shown, that each and every individual of a common partnership association is personally responsible for every debt of the firm. There is the same distinction between incorporated and unincorporated joint stock companies. The latter, in fact, are but partnerships, though established upon a large scale, and though consisting of an indefinite, or of a very large, number of joint undertakers. Whatever name they may assume and use, in the transaction of their business, it is a partnership, and not a corporate designation; and every suit upon a contract with the company, must be brought in the names of the several persons composing the firm. The object of their institution is to prosecute some important undertaking for which the capital and exertions of a few individuals would be inadequate. Such are most of the English fire and life insurance companies. They have no charter, nor any corporate functions or immunities conferred upon them by the

See ante, p. 36 et seq.

2 Williams Bank of Michigan, 7 Wend. (N. Y.) R. 542.

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government. They differ, it is true, from ordinary partnerships in their formation; and a variety of acts are to be done, before the partnership is actually commenced, which is either under what is called "a deed of settlement," or under what is called a "provisional agreement." The first is a covenant between a few of the shareholders chosen as trustees for the purpose, and others, by which each of the latter covenants with the rest of the shareholders, for the due performance of a series of articles which are set forth, and this deed is the only instrument of regulation, and, as between the shareholders themselves, contains the law affecting them. Upon points, however, which are not comprehended in the deed, the general law of partnership prevails; and even, as to the provisions of the deed itself, effect would be given to, or taken away from, it, by courts of law and equity. But, as to the transactions between the company and the world, the deed of regulation is wholly inoperative, and the shareholders stand upon the same footing as ordinary partners, in respect to the rights and the remedies of the persons with whom they deal. It is

1 Gow on Part. 10.

Collyer on Part.

3 Wordsworth on Joint Stock Companies.

Ibid. Whether companies so formed are legal or not, depends upon the common law unless so far as they are subject to some special statute. The principal act which has been designed to prohibit them is the "Bubble Act," or as the Master of the Rolls, in Stent v. Bailis, 2 P. Wms. R. 219, termed it, the moonshine act. It was passed in the year 1719, in the sixth year of the reign of George I., and during the excitement occasioned by the noted South Sea Company; and it originated in an intention to restrain the extraordinary spirit of speculation which prevailed at that period, and which had its commencement in the preceding reign of Queen Anne. It having been the source of much litigation, from time to time, both in the courts of law and equity, it was at length repealed by the act of 6 Geo. IV. Notwithstanding its repeal, the common law in respect to all schemes of hazard, is expressly reserved by the repealing statute, and if it can be shown, (as it may, if the fact be so,) that such schemes are fraudulently designed, and are injurious to the public welfare, it is an offence indictable. See Duvergier v. Fellows, 5 Bing. R. 248; Blunden v. Winsor, 8 Sim. Ch. R.