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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 cor. poration 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 col. lect 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. (Craig v. 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.

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 incor. poreal, intangible thing, not capable of identification or seizure under the suit, in such an action. (Ashton v. Heydenfeldt, 124 Cal. 14, 56 Pae. 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, (Bayward v. Houghton, 82 Cal. 628, 23 Pac. 120.)

It is not essential to the validity of an execution sale of shares of a 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 corporation; or, if not so satisfactory, then one approved by a judge of the superior court of the county in which the principal office of the corporation is situated, conditioned to protect the corporation against any liability to the legal representatives of the owner of the shares, in case of his or her death before the transfer; and if such affidavit or other evidence or bond be not furnished when required, as herein provided, neither the corporation, nor any officer thereof, shall be liable for refusing to enter the transfer on the books of the corporation. En. March 21, 1872. Amd. 1873-74, 205; 1883, 4.

Legislative History.

This section is based on section 12 of the corporation act of 1850, as amerided April 8, 1862, Statutes 1862, page 111.

The text is the same as the section as amended in 1873-74, except that it has “judge of the superior court” where the former seetion had “district judge or county judge.”

The original section as enacted in 1872 was as follows: “In all transfers of shares of stock in corporations, on behalf of owners residing out of the state, the president, secretary, or directors of such corporation, before entering such transfer on the books of the corporation or issuing the certificate therefor to the transferee, must require from such attorney, or from the person claimring under such transfer, a bond of indemnity with two sureties, satisfactory to the officers of the corporation, or if not so satisfactory, then approved by the district judge of the district in which the principal office of the corporation is situated, conditioned to protect such corporation against any liability to the legal representatives of the owner of such stock, in case of his or her death before such transfer; and in case of refusal to furnish such bonds upon request, such transfer is utterly void as against the corporation,

Section Cited.

Brown v. S. F. Gas Light Co., 58 Cal. 428.

Annotation.

Where the executor under a will probated in New York was given power to sell stock of a California corporation constituting part of the estate, upon indorsement and delivery of such stock the corporation is required to enter the transfer on its books without issue of letters of administration in California and without the bond provided for in this section. (Brown v. Gas Light Co., 58 Cal. 428.)

ACT TO RELIEVE DIRECTORS VOID. Sec. 327, C. C. Any contract or contracts, verbal or written, hereafter made, whereby it is sought directly or indirectly to relieve any director or trustee of any corporation or joint stock association from any liability imposed by section three of article twelve of the Constitution of California, are hereby declared to be and shall be null and void. En. Stats. 1880, 9.

See sec. 3, art. XII, Const., ante.

Section Cited.

Silva v. Campbell, 84 Cal. 422, 24 Pac. 316.

ARTICLE II.

ASSESSMENTS OF STOCK.

§ 331. Directors may levy assessments. § 332. Limitation-How levied. § 333. Levy of assessment-old assessment remaining unpaid. § 334. What order shall contain, § 335. Notice of assessment-Form. $ 336. Publication and service of notice. § 337. Delinquent notice-Form. § 338. Contents of notice. § 339. How published. § 340. Jurisdiction acquired, how. § 341. Sale to be by public auction. $ 342. Highest bidder to be the purchaser. § 343. In default of bidders, corporation may purchase. § 344. Disposition of stock purchased by corporation. § 345. Extension of time of delinquent sale. § 346. Assessments shall not be invalidated. § 347. Action for recovery of stock, and limitation thereof. § 348. Affidavits of publication, Affidavits of sale-To be filed. $ 349. Waiver of sale-Action to recover assessment.

DIRECTORS MAY LEVY ASSESSMENTS.

Sec. 331, C. C. The directors of any corporation formed or existing under the laws of this state, after one-fourth of its capital stock has been subscribed, may, for the purpose of pay

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