principle stated is not to be questioned, but when we look into the cases for illustrations of it we find

that they are by no means in harmony. For instance, a provision in a general incorporation law, that stockholders shall be liable for corporate debts to the amount of stock held by them until the whole amount of capital stock shall have been paid in and the fact duly certified,' was considered by the Supreme Court of the United States to be, in effect, but a withholding of that portion of the franchise, which assures to the individual members, the usual exemption from corporate debts, until certain conditions have been complied with, and it was held to be a part of the corporator's contract." The Massachusetts courts, however, held this liability to be a "limited statute liability" not arising out of a contract, and they refused to enforce it.' The Tennessee court declared a similar provision of the Kentucky statute to be "highly penal,” and, therefore, not to be enforced without the limits of that State."

§ 400. Further Illustrations.-A provision of the Missouri statute, making persons who were stockholders at the time of the dissolution of the company liable for any debts which it may have left unpaid, and authorizing suit against them thereon without joining the company as co-defendant, and giving the defendant stockholder a right of action

1 Acts N. Y. Feb. 17, 1848, ch. 40, §§ 10, 11 and 24.

2 Flash v. Conn, 109 U. S. 371, citing Wiles v. Suydam, 64 N. Y. 173, and Corning v. McCullough, 1 N. Y. 47. See also Flash v. Conn, 16 Fla. 428.

3 Halsey v. McLean, 12 Allen, 438. Fed. Rep. 513.

Compare Knower v. Haines, 31

'Woods v. Wicks, 75 Tenn. (7 Lea) 40. In that case, it may be noted, the capital stock had all been paid in within the time specified but no certificate was filed as required.

over against his fellow-stockholders, at the time of the dissolution,' was held, by the Supreme Court of New York, to create a personal liability on the part of the stockholder, which may be enforcd by a common-law action in other States.' It was so held also of a provision' that each stockholder shall be liable for corporate debts over and above the stock held by him to a further sum at least equal in amount to such stock.'

§ 401. Illustrations of Penal Liability.—A statute of Rhode Island,' providing that, upon failure of the company to file an annual report of all assesments voted and paid, and of all existing debts, the stockholders should be jointly and severally liable for all the corporate debts, was held penal. So was a provision of the Ohio statutes, making the stockholders of a bank jointly and severally liable,

1 Wag. St. Mo. ch. 37, art. 1, § 22.

Savings Assn. v. O'Brien, 51 Hun, 45, 3 N. Y. Supp. 764, following Perry v. Turner, 55 Mo. 418; Association v. Kellogg, 52 Mo. 583; Association v. Kellogg, 63 Mo. 540; Donnelly v. Mulhall, 12 Mo. App. 139. 3 Const. Ohio, 1851, art. 13, § 3; Rev. St. Ohio, § 3258; Act Ill. April 11, 1869.

4 Aultman's Appeal, 99 Pa. St. 505; Nimick v. Mingo Iron Works, 25 W. Va. 194, citing Wright v. McCormick, 17 Ohio St. 86; Hawkins v Furnace Co., 40 Ohio St. 507; Brown v. Hitchcock, 36 Ohio St. 667; Hawthorne v. Calef, 2 Wall. 10. See also Queenan v. Palmer, 117 Ill. 619. A similar provision in the charter of an Illinois bank (1 Priv. L. Ill. 1869, pp. 194-196) was held, by a Missouri court, to be contractual. Hodgson v. Cheever, 8 Mo. App. 318. But see Rice v. Hosiery Co., 56 N. H. 114, where liability of stockholders for all debts due to laborers under an Ohio charter was held to be the "mere creature of the statute, having none of the elements of a contract, whether express or implied." 5 Rev. St. R. I. ch. 155, §§ 11 and 12.

Sayles v. Brown, 40 Fed. Rep. 8, s. c. 7 Ry. & Corp. L. J. 2. It was so held, too, of a statute imposing a liability for corporate debts upon trustees for failure to file a certain annual report. Wiles v. Suydam, 64

N. Y. 173.

in their individual capacities, for the amount of unauthorized paper circulated by such bank.'

§ 402. Penal Laws Strictly Construed.-The general rule is that penal laws are to be strictly construed. So it has been held that a demand against a corporations for damages for the laws of a steamboat while upon its docks, through the negligence of its agents, is not a "debt," within a statutory provision imposing upon stockholders an individual liability, if the corporation fail to give notice annually of all its "existing debts.

§ 403. Contractual Liability-Designated Remedy. Whether the liability of the shareholder, on his contract of subscription, can be enforced in a a foreign jurisdiction, depends in the first instance upon whether the charter of the company has prescribed any remedy. The rule is, that where a statute giving a right has provided a remedy by by which it is to be enforced, that remedy is exclusive and no other method can be resorted to;' and since courts have no power to adopt the procedure of a foreign jurisdiction they will not ordinarily enforce rights so created. Thus in the leading case

1 Lawler v. Burt, 7 Ohio St. 340, overruling Lawler v. Walker, 18 Ohio, 151.

2 Cable v. McCune, 26 Mo. 371.

3 Fourth Nat. Bank v. Francklyn, 120 U. S. 747; Pollard v. Bailey, 20 Wall. 520; Mills v. Scott, 99 U. S. 25; Terry v. Little, 101 U. S. 216; Erickson v. Nesmith, 4 Allen, 233; Knowlton v. Ackley, 8 Cush. 97; Erickson v. Nesmith, 15 Gray, 221; Ripley v. Sampson, 10 Pick. 371; Kelton v. Phillips, 3 Metc. 61; Stone v. Wiggins, 5 Metc. 316; Gray v. Coffin, 9 Cush. 192; Leland v. Marsh, 16 Mass. 389; Child v. Coffin, 17 Mass. 64; Andrews v. Callender, 13 Pick. 484; Smith v. Drew, 5 Mass. 513; Moies v. Sprague, 9 R. I. 541; Savings Ass'n v. O'Brien, 51 Hun. 45; 3 N. Y. Supp. 764; Knower v. Haines, 31 Fed. Rep. 513.

Nimick v. Mingo Iron Works Co., 25 W. Va. 184; Erickson v. Nesmith, 4 Allen, 233; Erickson v. Nesmith, 15 Gray, 221; Lowry v. Inman, 46 N. Y. 119; Fourth Nat. Bank v. Francklyn, 120 U. S. 747; Hadley v

of Lowry v. Inman,' the New York court declined, on that ground, to enforce a provision of the charter of a Georgia bank making the individual property of each stockholder liable for the bills of the bank, and authorizing the levy of any execution, issued against the bank and returned unsatisfied, on such property. In Fourth National Bank v. Francklyn,' the Supreme Court of the United States held that the liability under Rhode Island statute,' making stockholders in manufacturing companies liable for corporate debts, until the capital stock has been paid and in the fact certified, and further providing that proceedings to enforce such liability should be by suit in equity, or action of debt on the judgment against the corporation would not sustain an action at law against the stockholder in the United States Court in New York, no judgment having been obtained against the corporation, although it had been adjudged bankrupt.*

§ 404. Same-Remedy under Lex Fori. When the liability is contractual, and no remedy is designated by the law under which it arises, it will be enforced in the foreign jurisdiction by the most appropriate remedy afforded by the lex fori. The

Russell, 40 N. H. 109; Moies v. Sprague, 9 R. I. 541. But see Aultman's Appeal, 98 Pa. St. 505, where the liability under Rev. St. Ohio, § 3258, was enforced by bill in equity, though by another section a statutory proceeding in the nature of a bill in equity is prescribed. Id. § 3260. 146 N. Y. 119.

2120 U. S. 747.

3 Rev. St. R. I. 1851, ch. 128, §§ 1, 19 and 20. and Gen. Sts. R. I. 1872, ch. 142, §§ 1, 20 and 21.

4 See Flash v. Conn, 109 U. S. 371, where the court held that a very similar liability arising out of the New York statutes (Act N. Y. Feb. 17, 1848, §§ 10, 11 and 24), which specified no particular remedy, might very properly be enforced in another State by action at law.

5 First Nat. Bank v. Gustin, etc. M. Co., 42 Minn. 327, 44 N. W. Rep. 198, 7 Ry. & Corp. L. J. 175; Persch v. Simmons, 3 N. Y. Supp. 783

liability itself remains as created by the law of the corporate domicile, and must be enforced with the limitations prescribed by that law. The local remedy cannot enlarge or vary the liability. Thus if by the law of the charter, the stockholder is liable to pay for his stock, only on call by vote of five directors, he cannot be made liable, in the absence of such a call, under a local statute providing that upon the return of a nulla bona execution against a foreign corporation, the creditor may maintain action against a stockholder and recover any sum, to the amount due him, which the defendant would be liable to pay in any event in the State of the corporate domicile.'

§ 405. Same-Massachusetts Rule.-And in Massachusetts it has been held that the right arising under a foreign charter will not be enforced, ex comitate, if it varies substantially from the right which would have resulted from a subscription to capital stock in that State. Thus, it being there

Drinkwater v. Portland Marine Ry., 18 Me. 35; Bagley v. Tyler, 43 Mo. App. 195; Hodgson v. Cheever, 8 Mo. App. 318; Ex parte Van Riper, 20 Wend. 614; St. Louis Sav. Ass'n v. O'Brien, 51 Hun, 45. But in Rice v. Hosiery Co., 56 N. H. 114, the New Hampshire court declined to enforce in a proceeding in equity against stockholders in an Ohio corporation, a liability for debts due to laborers, on the ground that such liability was a mere creature of the statute, and had none of the elements of a contract; that courts will use a sound discretion as to the mode and extent of the comity with which they enforce the laws of another State, and as it was not shown what remedy was granted by the laws of Ohio, it might happen that they would afford a remedy which was denied in that jurisdiction, and which would not be allowed to persons seeking a similar right under the New Hampshire laws.

1 Seymour v. Sturges, 26 N. Y. 134; McDonough v. Phelps, 15 How. Pr. 372; Drinkwater v. Portland Marine Ry., 18 Me. 35; Farwell v. Wadworth, 35 Ill. App. 469; Molson Bank v. Boardman. 47 Hun, 135; Savings Ass'n v. O'Brien, 51 Hun, 45; Andrews v. Bacon, 38 Fed. Rep. 777; Viele v. Wells, 9 Abb. N. C. 277.

2 Seymour v. Sturges, 26 N. Y. 134.