3. Do the directors of a corporation have the power to make assessments?

4. Can a corporation forfeit the shares of a member for non-payment of assessments?

5. Can the shareholders be assessed for the benefit of creditors after insolvency of the corporation?

6. When will an order to assess shareholders be not granted?

7. Can solvent stockholders be assessed to make up deficiency by insolvency of other stockholders?

8. Can a Receiver, Assignee or Trustee sue at Law to recover assessments from shareholders ?

9. Can a corporation make by-laws declaring a forfeiture of shares for non-payment of assessments and calls?

10. What notice must a corporation give a shareholder, before his shares can be sold to pay assessments?

11. Can a corporation sue for balance due after forfeiture and sale?

12. Does a forfeiture of shares release a shareholder's liability to creditors?

13. Can a corporation forfeit shares that have been paid in full?

14. If a stockholder's shares are forfeited, and are sold for more than his indebtedness to the corporation, is he entitled to the residue?

15. If the shareholders of a National Bank assess themselves to restore impaired capital, will this discharge them from their individual liability?

16. If the Comptroller of the Currency orders an assessment upon the stockholders to wind up an insolvent National Bank, can they appeal?

17. If a stockholder of an insolvent National Bank is also one of its creditors, can he cancel or diminish an assessment by offsetting his individual claim?

18. If a National Bank becomes insolvent, will a transfer of his stock relieve a shareholder of his liability?

19. If I become a shareholder in a National Bank, will I become liable for assessments for the debts of the bank while I hold such stock?

20. Who is liable for assessments on National Bank stock held in the names of minor children?

21. Do assessments upon the shareholders of an insolvent National Bank, made by the Comptroller of the Currency, bear interest?

22. If a National Bank becomes insolvent, who decides whether there is a deficiency of assets, and when it is necessary to enforce the individual liability of shareholders?

23. Is the estate of a deceased owner of National Bank stock liable to an assessment levied against his executors, if the bank fails after his death?

24. Is a trustee holding shares in a National Bank personally liable for the debts of the bank?

25. Who is liable as shareholder in a National Bank?

26. Is a married woman who owns stock in a National Bank liable to assessments?

27. Does a discharge in bankruptcy release a shareholder of a National Bank from his statutory individual liability to creditors of the bank?

Assessments and Calls.

Answers.

1. No corporation has the power to make an additional assessment upon the shares of its capital, after they have been paid for in full, unless this authority is given by statute.

2. An assessment, to be valid, must be made upon all the shareholders alike, who belong to the same class.

3. The directors of a corporation have the power to make assessments on unpaid stock, such call or assessment, must be made by a formal action of the board, and evidenced by the minutes of their proceedings. For assessments on full paid stock, see question No. I.

4. No corporation has the power to enact a by-law to forfeit the shares of a member for non-payment of assessments, unless the power is given by the Charter.

5. If their subscriptions are not fully paid, the stockholders can be assessed. If the stock is single liability, and fully paid, they cannot be assessed. the stock is double liability as in a National Bank, the stockholders can be assessed equal to the amount of stock held.

6. An order to assess shareholders in liquidation, will not be granted until all the assets have been exhausted.

7. It is held by good authority, that the solvent members are liable to be assessed for the purpose of making up the deficiency produced by the failure of those who are insolvent. Of course they cannot be assessed beyond their full statutory liability.

8. Yes.

9. It cannot, unless the power is expressly conferred by some statute, or by the articlcs of incorporation. 10. Notice for sale of shares for non-payment of assessments is generally perscribed by statute or by-law, which must be followed. If no provision is thus made, the notice must be reasonable, according to the circumstances.

11. Yes, a shareholder remains liable to the corporation for the deficiency.

12. When all the stock of a member is forfeited for non-payment of dues, he cannot be held liable as a stockholder for corporate debts.

13. No.

14. Yes, the balance must be paid to the shareholder.

15. It will not.

16. No, his decision is final.

17. No, he must take chances with the other creditors.

18. No, such a transfer is fraudulent.

19. You will become liable for assessments to the extent of your statutory liability for all debts of the bank existing while you hold such stock.

20. One buying stock in a national bank in the names of his minor children, himself becomes liable to assessment, as a shareholder, for minors are incapable of assenting to become stockholders, so as to bind themselves to the liabilities thereof.

21. Yes, they bear interest from the date of the order.

22. It is for the Controller of the currency to determine. His decision is final and conclusive.

23. The estate will be liable, not the executor personally.

24. He would be personally liable, unless his trusteeship appears on the books of the bank.

25. The person in whose name shares of the stock of a national bank stand on the bank books is subject to the individual liability of shareholder, although his holding of the stock was originally as collateral security for a loan, and the loan has been repaid and the stock certificate surrendered with an executed power of attorney for transfer.

26. Yes.

27. Yes, if at the time of his discharge, the claims of such creditors were provable, not merely contingent.

Assignments for Creditors.
Questions.

1. Can the directors of a corporation make an assignment for the benefit of creditors without the authorization of the stockholders?

2. Does an assignment dissolve a corporation? 3. Will a judgment after an assignment for creditors hold?

4. Can an assignee bring suit against the directors of a corporation for unlawfully declaring dividends? 5. Can a shareholder assign his shares for the benefit of his creditors.

Assignments for Creditors.

Answers.

1. Directors can make an assignment of all the assets of the corporation for a ratable distribution among its creditors, without the assent of the stockholders, unless the charter or statute enacts or implies the contrary.

2. Assignment by a corporation of all its property for the benefit of its creditors, does not extinguish it as a corporation.

3. No.

4. Yes, it is the duty of the assignee to bring suit against the directors, if they have declared dividends out of the capital stock in violation of the law. If the assignee fails to do this, he will be personally liable to an amount which might have been realized by such suits.

5. A shareholder may assign his shares for the benefit of his creditors, but he will still be liable to the creditors of the corporation for the statutory liability.

Assignees.

Questions.

1. By whom are assignees and trustees appointed, and what are their general duties?

2. Has an assignee the right to vote at corporate elections?

3. How is a corporation to know that an assignee really is such?

4. Can a corporation be compelled to transfer shares to an assignee?

5. If a note is signed "John Jones Assignee would he be personally liable?

Assignees.

Answers.

1. An assignee is a person to whom an assignment is made by an insolvent debtor, to administer his affairs for the benefit of his creditors.

A trustee is a person whom the Court has appointed or whom the creditors have elected to hold or manage property for the benefit of another.

When any person, partnership, association, or corporation, shall make an assignment of any property, money, rights, or credits in trust for the benefit of creditors, it shall be the duty of said assignee, within ten days after the delivery of the assignment, and before disposing of any property so assigned, to appear before the Court, and give a bond for the faithful performance of his duties according to law.

The statutes are not so definite in their provisions in the matter of designating who may or may not be assignees or trustees for the benefit of creditors, as they are as to guardians, administrators, or executors. But they do provide that the Court must remove an assignee who does not give proper bond within ten days, and appoint a trustee in his place.

As soon as the assignee shall have given bond, the Court in some States must appoint suitable, disinter