[Chap. XVII. liable, in their individual capacity, to the amount of stock held by each of them, for all work or labor done to carry on the operations of each of said corporations." 235 In any action or bill in equity to enforce such liability, any one or more of the stockholders claimed to be liable may be joined; and if judgment be given in favor of the claims it shall be given against any stockholder found liable. Execution shall first be levied on any property of the corporation that may be found; the deficiency, or so much as a stockholder is liable to pay, shall be collected of the property of a stockholder. On paying the whole or part of a judgment a stockholder may have that part he has paid assigned to him, with power to enforce it against the corporation, and if it cannot be so collected, then ratably against the other solvent stockholders originally liable. No stockholder shall be personally liable for payment of the debt of the corporation unless suit for collection is brought against such stockholder within six months after it becomes due." 236

"If part of the capital stock of a company is withdrawn and refunded to the stockholders before the payment of all the debts of the company, contracted previously to the recording of a copy of the vote for that purpose in the office of the recorder of deeds, as prescribed in the preceding section, all the stockholders of the company shall be jointly and severally liable to the payment of such debts." 237

"The stockholders of any and all corporations under this act shall be personally liable for all sums of money due to laborers, clerks and operatives for services rendered within six months before damand made upon the corporation, and its neglect or refusal to make payment." 238

"The shareholders of any [bank] shall be individually responsible, equally and ratably, but not one for another, for all

235 Pa. 1874, P. L. 80, § 14.

236 Ibid. § 15.

237 Pa. 1874, P. L. 101, § 29, cl. 4.

238 Pa. 1874, P. L. 102, § 39, cl. 11.

contracts, debts and engagements of such corporation to the amount of their stock therein in addition to the par value of such shares." 239 "All stockholders in banks, banking companies, saving funds institutions, trust companies, and all other incorporated companies doing the business of banks or loaning and discounting moneys as such in this Commonwealth, shall be personally liable for all debts and deposits in their individual capacity, to double the amount of the capital stock held and owned by each." 240

"If the directors of any company declare any dividend when the company is insolvent, or the payment of which would render it insolvent, they shall be jointly and severally liable for all the debts of the company then existing, and for all thereafter contracted, so long as they respectively continue in office: provided, that the amount for which they shall be liable shall not exceed the amount of such dividend, and if any of the directors are absent at the time of making the dividend or object thereto, at said time, and file their objections in writing with the clerk of the company, they shall be exempted from such liability." 241 A director compelled under this clause to pay a debt of the corporation is not entitled to subrogation or indemnity from the company.242

$419. Rhode Island.

In the case of ordinary corporations there is no provision. for liability of either stockholders or directors beyond that imposed by the common law; that is, for unpaid subscriptions, or for actual fraud. Elaborate statutory provisions, however, have been made for liability of stockholders and directors in manufacturing corporations.

"The members of every incorporated manufacturing company shall be jointly and severally liable for all debts and

239 Pa. 1876, P. L. 161, § 5.

240 Pa. 1874, P. L. 135, § 1.

241 Pa. 1874, P. L. 102, § 39, cl. 5. 242 Kisterbock's Appeal, 51 Pa. 483.

contracts made and entered into by such company, except as hereinafter provided, until the whole amount of the capital stock fixed and limited by the charter of said company, or by vote of the company in pursuance of the charter or of law, shall have been paid in and a certificate thereof shall have been made and recorded in a book kept for that purpose, in the office of the town clerk of the town wherein the manufactory is established, and no longer, except as hereinafter provided.243 The president and directors, with the treasurer and clerk of such company, within ten days after the payment of the last installment of the capital stock fixed and limited by the charter or by vote of the company, in pursuance of the charter or of law, shall make a certificate stating the amount of the capital so fixed and paid in, which certificate shall be signed and sworn to by the president, treasurer and clerk and by a majority of the directors, and they shall, within said ten days, lodge the same to be recorded in the book kept as aforesaid in the office of the town clerk of the town wherein the manufactory shall be established. In case of increase of the capital stock of said companies, like proceedings shall be had as to the amount added and paid in.24 If any of said officers shall refuse or neglect to perform the duties required of them as aforesaid, they shall be jointly and severally liable for all debts of the company contracted after the expiration of said ten days and before such certificate shall be recorded as aforesaid." 245

244

"If any part of the capital stock of such company shall be withdrawn and refunded to the stockholders before payment of all the debts of the company contracted previously to the recording of the copy of the vote reducing the capital stock, as in the preceding section required, all the stockholders of the company shall be jointly and severally liable for the payment of said last mentioned debts. If the di

243 R. I. Gen. L. ch. 180, § 1.

244 Ibid. § 2.

245 Ibid. § 3.

rectors of any such company shall declare and pay any dividend when the company is insolvent, or any dividend the payment of which would render it insolvent, they shall be jointly and severally liable for all the debts of the company then existing and for all that shall be thereafter contracted so long as they shall respectively continue in office: Provided, that the amount for which they shall all be so liable shall not exceed the amount of such dividend, and that if any of the directors shall be absent at the time of making the dividend or shall object thereto and shall file their objection in writing with the clerk of the company, they shall be exempted from such liability. No note or obligation given by any stockholder, whether secured by pledge or otherwise, shall be considered as payment of any part of the capital stock, and no loan of money shall be made by any such company to any stockholder therein; and if any such loan shall be made to a stockholder, the officers who shall make it, or who shall assent thereto, shall be jointly and severally liable to the extent of such loan and interest for all the debts of the company contracted before the repayment of the sum so loaned." 246

"The liability of members of an incorporated manufacturing company provided by section one of this chapter, and of the members of such corporations under other statutory provisions, for the debts of such company hereafter contracted or for obligations hereafter incurred, shall be and hereby is limited to the shares of such members in such corporation paid up to the par value thereof." 247

"The whole amount of the debts which any such corporation shall at any time owe shall not exceed the amount of its capital stock actually paid in; and in case of any excess, the directors under whose administration it shall happen shall be jointly and severally liable, to the extent of such excess, for all the debts of the company then existing, and for all that shall be contracted as long as they shall respectively con

246 Ibid. §§ 5-7. 247 Ibid. § 13.

tinue in office, and until the debts shall be reduced to the amount of the capital stock of such company paid in. Any director who shall be absent at the time of contracting any debt contrary to the foregoing provisions, or who shall object thereto, may exempt himself from said liability by forthwith. giving notice of the fact to the stockholders at a meeting which he may call for that purpose." 248

"If any certificate made or any public notice given by the officers of any manufacturing company, in pursuance of the provisions of this chapter, shall be false in any material representation, all the officers who shall have signed the same, knowing it to be false, shall be jointly and severally liable for all the debts of the company contracted while they were stockholders or officers thereof." 249

"Whenever any of the officers of any manufacturing company shall be liable, by the provisions of this chapter, to pay the debts of such company or any part thereof, any person to whom they may be so liable may have an action of the case against any one or more of the said officers, and the declaration in such action shall state the claim against the company and the ground on which the plaintiff expects to charge the defendant personally, and such action may be brought, notwithstanding the pendency of an action against the company for the recovery of the same claim or demand, and both of the actions may be prosecuted until the plaintiff shall obtain the payment of his debt and the costs of both actions." 250

"All proceedings to enforce the liability of a stockholder for the debts of a corporation shall be either by suit in equity, conducted according to the practice and course of equity, or by an action of debt upon the judgment obtained against such corporation, and in any such suit or action such stockholder may contest the validity of the claim upon which the judg

248 Ibid. §§ 15, 16.

249 Ibid. § 20. 250 Ibid. § 21.