SINGER v. GIVEN

SINGER v. GIVEN. (Supreme Court of Iowa, June, 1883. ) 1. Corporation—Subscription—Method of Payment. Where the defendant as a subscriber to the stock of a corporation has agreed to take a certain amount of its stock, it is not material, as between him and the creditors of the corporation, in what manner the subscription was payable, whether in real property, money, etc. 2. Ibid—Debt—Action Against Stockholder—Off-set. In an action against such a subscriber brought by a judgment creditor of the corporation, the defendant cannot set off, as against the plaintiff, the value of his services and of the use of his property; debts due him from the corporation. The plaintiff is a judgment creditor of a corporation (Des Moines Plow Company), and defendant is a stockholder thereof, and liable thereto for unpaid installments on his stock in an amount greater, as is alleged, than plaintiff’s judgment. The defendant’s contention is succinctly stated in the opinion. He appealed from the judgment below. [MAJORITY — Day, C. J.,] Day, C. J., in delivering the opinion of the Court, said : The defendant was one of the original incorporators of the Des Moines Plow Company, and was elected a member of its first hoard of directors. The evidence shows that the defendant subscribed for 150 shares of the capital stock at $50 each. The defendant insists that the evidence, without any conflict, shows that the subscription of the defendant was “to be paid in the buildings of Given and Courson.” The plaintiff, upon the contrary, claims that the jury were warranted in finding from the testimony that the subscription of the defendant was unconditional, and that they did so find. We do not deem it necessary to determine this point of controversy between the parties. The evidence shows, without any conflict, and as the defendant concedes, that he subscribed for 150 shares, or $7,500 of stock. The defendant by this subscription became liable to pay towards the capital stock of the company, either in money or property, $7,500, and he assumed towards the creditors of the corporation an obligation which can bé discharged in no other way than by payment of that sum. (See Code, Sec. 1082.) The company could not, by any action or arrangement upon its part, release the defendant from this liability. (See Burnham v. Ins. Co., 36 Iowa, 632; Osgood v. King, 42 lb., 478.) The case of Gelpcke v. Blake, 19 lb., 263, relied upon by appellant, does not hold that the company can make arrangements with stockholders to the prejudice of creditors. Now it appears clearly, and without conflict, that the defendant has never paid the conditional subscription which he alleges he made. ITe never conveyed to the company the property in which he alleges his subscription was to be paid. It is true, the company went into posession of the property and occupied it for a time, but without any conveyance, and the evidence shows that the company afterward surrendered the property to the receiver of the defendant and his partner, and cancelled the defendant’s subscription. If he had conveyed the property, as he alleges he agreed to do, the company would have been by that much the more able to pay its creditors. The defendant complains of the action of the Court in giving certain instructions, and in refusing to give instructions asked, and in certain rulings upon the evidence. But the objections of the defendant are mostly based upon the ground that defendant is not liable if his subscription was payable in the buildings and property referred to. In our opinion it is not material, as between the defendant and creditors of the corporation, in what manner the subscription was. payable. In this view of the case many of the objections urged by the defendant need not be noticed in detail. The appellant insists that the Court erred in refusing to allow the defendant to prove whether or not the Des Moines Plow Company had paid him for his services, and for the use of the property in which he claims the subscription was to have been paid. It is claimed that if he is liable on his subscription he has a right to set off the items above referred to. As between Jiimself and the company he might have the right to do so. But we do not think he can do so as against a creditor. No authority is cited by appellant in support of his position upon this point. Judgment affirmed.