Bank v. Wilson, 58 Cal. 604; Spreckels v. Nevada Bank, 113 Cal. 276, 54 Am. St. Rep. 350, 45 Pac. 329. Disapproved: Barstow v. Savage M. Co., 64 Cal. 392, 49 Am. Rep. 707, 1 Pac. 349.)

The possession of an unindorsed certificate of stock is insufficient to establish transmission of title to holder from person in whose name the stock stands or from his representative or heirs. (Nicholls v. Reid, 109 Cal. 630, 42 Pac. 298.)

But bona fide purchaser of stolen certificates of stock which stands on books of corporation in name of one person, but is owned by another, acquires no title as against true owner, notwithstanding such certificates were regularly indorsed by the person in whose name they stood, if they were stolen without the fault or negligence of the owner. (Barstow v. Savage Mining Co., 64 Cal. 388, 49 Am. Rep 705, 1 Pac. 349.)

For a bona fide purchaser of certificate of one who has no title and no authority to sell, cannot rely for his protection upon the negligence of the owner, unless he shows that he was misled by such negligence. (Barstow v. Min. Co., 64 Cal. 388, 49 Am. Rep. 705, 1 Pac. 349.)

And stock transferable on books of corporation by indorsement and surrender of the certificate, indorsed by holder and then lost, is not the property of a bona fide purchaser for value. (Sherwood v. Meadow Valley Co., 50 Cal. 412.)

Rights of Pledgee of Stock.-Pledgee of stock, when contract is silent on the subject, has no right to have the stock transferred to his name before maturity of the debt; and an injunction will issue at the suit of the pledgor to prevent such transfer. (Spreckels v. Nevada Bank, 113 Cal. 272, 54 Am. St. Rep. 348, 45 Pac. 329. To same effect: McFall v. Buckeye Assn., 122 Cal. 470, 68 Am. St. Rep. 47, 55 Pac. 253.)

Such a transfer of stock on books of corporation is not essential to the creation of a valid pledge of stock, but pledgee has the right to cause a proper entry of the transaction to be entered upon the books of the corporation for his protection, though he is not authorized to devest the pledgor of the right incident to his ownership of the pledge, by a surrender and cancellation of the pledged certificate, and the issuance of a new one in his name. (Spreckels v. Nevada Bank, 113 Cal. 272, 54 Am. St. Rep. 348, 45 Pac. 349.)

If stock of a corporation is pledged, the general property is in the pledgor. Stock in incorporated companies cannot be pledged without a written transfer of title. (Brewster v. Hartley, 37 Cal. 15, 99 Am. Dec. 237. To same effect: Cross v. Eureka etc. Co., 73 Cal. 306, 2 Am. St. Rep. 811, 14 Pac. 885. Note citations: 49 Am. Dec. 731; 51 Am. Dec. 313.)

And delivery of certificate of stock in pledge without transfer on books is invalid as against attaching creditor of assignor without notice. (Strout v. Natoma etc. Co., 9 Cal. 78. To same effect:

Naglee v. Pacific etc. Co., 20 Cal. 533. Note citation: 63 Am. Dec. 121.)

One who purchases, at execution sale, shares of stock standing on the corporate books in the name of the judgment debtor, is entitled to have certificates of such shares reissued to himself as such purchaser, if at the time of the purchase he acts in good faith, and without notice of the assignment or pledge of the stock. To notice his rights, an assignee or pledgee must cause a reissue to himself or must serve notice on the corporation that he holds the certificate as such assignee or pledgee. (West Coast etc. Co. v. Wulff, 133 Cal.

315, 85 Am. St. Rep. 171, 65 Pac. 622.)

But a transfer of stock, though not on books of the company, is good as against a purchaser at sheriff's sale with knowledge of the hypothecation of such stock, and such purcha er takes subject to the claim of the pledgee. (Weston v. Bear River Co., 6 Cal. 425. To same effect: Naglee v. Wharf Company, 20 Cal. 533; People v. Elmore, 35 Cal. 655; Parrott v. Byers, 40 Cal. 625; Winter v. Belmont Mining Co., 53 Cal. 430; Farmers' etc. Bank v. Wilson, 58 Cal. 604; Spreckels v. Nevada Bank, 113 Cal. 276, 54 Am. St. Rep. 350, 45 Pac. 329.)

A pledgee of stock to whom the certificates were assigned as security, has the right to maintain a suit in equity against the corporation and the purchasers at a void sale, and where the facts alleged warrant it, may, under the prayer for general relief, have the sale vacated, and his rights in the stock and to any dividends due thereon enforced. (Herbert Kraft Banking Co. v. Bank of Orland, 133 Cal. 64, 65 Pac. 143.)

Where shares are of same value, and certificate of stock pledged has been conveyed to bona fide purchaser for value, by pledgee, court may compel pledgee to convey stock owned by him in lieu of the certificate received by the pledgor. (Krouse v. Woodward, 110 Cal. 638, 42 Pac. 1084.)

Pledgee of mining stock, on redemption of pledge, is not obliged to return to the pledgor the identical certificates pledged, but may return certificates corresponding to those received. Failure to return identical stock does not render pledgee liable to action for conversion, provided he returns, upon redemption, similar certificate, and has been at all times ready to do so. (Thompson v. Toland, 48 C'al. 99.)

The rule as to the return of personal property wrongfully converted does not apply to shares of stock, because they are mere evidence of interest in business of corporation, and if all the shares are of equal value there can be no reason for preferring one share to another. Pledgee of stock is liable only in nominal damages for conversion when ready and willing to transfer to owner equivalent numbers of shares in the same company. (Atkins v. Gamble, 42 Cal. 86, 10 Am. Rep. 282. To same effect: Thompson v. Toland, 48

Cal. 116; Hayward v. Rodgers, 62 Cal. 372; Krouse v. Woodward, 110 Cal. 643, 42 Pac. 1084; Craig v. Hesperia etc. Co., 113 Cal. 12, 54 Am. St. Rep. 318, 45 Pac. 10.)

The right of a pledgor to redeem the pledge and insist upon return of shares of stock pledged is not affected by the fact that he borrowed from the pledgee the money with which he purchased the stock. (Krouse v. Woodward, 110 Cal. 638, 42 Pac. 1084.)

An action will not lie in favor of a pledgor for the conversion of the stock of a corporation pledged to secure his note, by reason of a sale thereof by the pledgee, after due notice to the pledgor, when the only pretense of previous payment of the note is that the corporation declared a dividend sufficient to pay it, if such dividend was never in fact paid to, or collected by, the pledgor. (McAuley v. Moody, 128 Cal. 202, 60 Pac. 778.)

And when a corporation claimed an offset against a dividend for alleged indebtedness of a pledgor of stock to the corporation, offered to pay the residue, the pledgee is not bound to await the result of litigation, but may demand payment of the matured note, and may proceed to sell the stock for nonpayment, upon due notice to the pledgor of the time and place of sale. (McAuley v. Moody, 128 Cal. 202, 60 Pac. 778.)

A dividend declared upon pledged stock is the property of the pledgor, the same as the stock, but the pledgee has the right to collect it if he can, and apply it upon the secured note; yet his failure to collect it does not cast upon him the duty of crediting it upon the note. (McAuley v. Moody, 128 Cal. 202, 60 Pac. 778.)

Transfer Subject to Assessment Lien.-Notwithstanding transfer of certificate of stock subsequent to a delinquent assessment therein, the shares remain subject to the assessment lien, and the new owner takes subject thereto; nor is the identity of the stock affected by the transfer. The corporation can enforce its delinquent assessment upon the shares liable therefor, no matter how many transfers have been made subsequent to the assessment. (Craig v. Water Co., 113 Cal. 7, 54 Am. St. Rep. 316, 45 Pac. 10.)

The fact that the purchaser did not know of a delinquent assessment at the time of demanding the transfer of stock subject thereto does not affect the validity of the assessment, nor the liability of the stock therefor. Craig v. Water Co., 113 Cal. 7, 54 Am. St. Rep. 316, 45 Pac. 10.)

While a corporation has a lien upon the shares of stock for the payment of delinquent assessments thereon, it has no lien upon the certificate of stock, which is the mere evidence of ownership of the stock, and has no right to prevent a transfer of such certificate on account of a delinquent assessment upon the shares. Water Co., 113 Cal. 7, 54 Am. St. Rep. 316, 45 Pac. 10.) And a corporation is liable for a conversion of stock which it refuses to transfer on the books of a corporation to a purchaser there

(Craig v.

of. The existence of an unpaid delinquent assessment upon the stock is no defense to an action for such conversion, though proof of them is admissible as affecting the value of the stock. (Craig v. Water Co., 113 Cal. 7, 54 Am. St. Rep. 316, 45 Pac. 10.)

Practice.-A complaint averring merely demand and refusal, without alleging a conversion of the stock, is not sufficient as a complaint for its conversion. (Ashton v. Heydenfeldt, 124 Cal. 14, 56 Pac. 624.)

An action of claim and delivery will not lie to recover shares of stock in a corporation, where the proceeding is not aimed at the certificate representing the shares, and it is not mentioned or described in the complaint. "Stock" in a corporation is an incorporeal, intangible thing, not capable of identification or seizure under the suit, in such an action. (Ashton v. Heydenfeldt, 124 Cal. 14, 56 Pac. 624.)

Where a corporation has no power to forfeit stock, and hence it was improperly sold, the stockholder may maintain an action for its recovery, but not for a specific interest in the corporate property. (Smith v. Maine etc. Co., 18 Cal. 111.)

In action to compel individual to perform agreement made by him for transfer of shares of stock in corporation, and to account for dividends, and to restrain negotiation of stock, corporation is not a necessary party, (Sayward v. Houghton, 82 Cal. 628, 23 Pac. 120.)

It is not essential to the validity of an execution sale of shares of corporation that the sheriff should have manual possession of the certificate at the time of the sale, nor that he should deliver the certificate to the purchaser; and, if, at the time of the sale, the certificate is in the hands of a pledgee without notice to a purchaser in good faith, the pledgee may be compelled to surrender the certificate for reissue to the purchaser. (West Coast etc. Co. v. Wulff, 133 Cal. 315, 85 Am. St. Rep. 171, 65 Pac. 622.)

A transfer of stock by virtue of a decree of distribution is suspended by an appeal from the decree, and upon reversal of decree, the executor is entitled to the stock, and may maintain an action against the corporation to recover dividends thereon. An assignee, pending the appeal from the decree, derives no rights thereunder, and the title of the executor upon reversal of the decree, revives, and is equivalent to a strict legal title. (Ashton v. Zeila Mining Co., 134 Cal. 408, 66 Pac. 494.)

Title to shares of stock in corporation which have been attached, and transferred by defendant in attachment suit after judgment rendered in his favor in justice's court, and pending appeal therefrom, will pass to purchaser from him, as against excution purchaser of stock sold upon a judgment afterward rendered against defendant in superior court. (Loveland v. Alvord etc., 76 Cal. 562, 18 Pac. 682.)

TRANSFER OF SHARES HELD BY MARRIED WOMEN, ETC.-
DIVIDENDS PAYABLE TO MARRIED WOMEN.

Sec. 325, C. C. Shares of stock in corporations held or owned by a married woman may be transferred by her, her agent, or attorney, without the signature of her husband, in the same manner as if such married woman were a feme sole. All dividends payable upon any shares of stock of a corporation held by a married woman may be paid to such married woman, her agent or attorney, in the same manner as if she were unmarried, and it is not necessary for her husband to join in a receipt therefor; and any proxy or power given by a married woman, touching any shares of stock of any corporation owned by her, is valid and binding without the signature of her husband, the same as if she were unmarried. En. March 21, 1872.

For transfer generally, see sec. 323, C. C., and note, post.

Legislative History.

The basis of the section is section 12 of the corporation act of 1850, page 347.

Annotation.

Held, prior to this section, a sale of stock which is the separate property of the wife, without a privy examination, is void. (Selover v. American etc. Co., 7 Cal. 266.)

AFFIDAVIT OR BOND MAY BE REQUIRED BEFORE TRANS-
FER.

Sec. 326, C. C. When the shares of stock in a corporation are owned by parties residing out of the state, the president, secretary, or directors of the corporation, before entering any transfer of the shares on its books, or issuing a certificate therefor to the transferee, may require from the attorney or agent of the nonresident owner, or from the person claiming under the transfer, an affidavit or other evidence that the nonresident owner was alive at the date of the transfer, and if such affidavit or other satisfactory evidence be not furnished, may require from the attorney, agent, or claimant, a bond of indemnity, with two sureties, satisfactory to the officers of the