only himself but his heirs and personal representatives, and assigns in bankruptcy or insolvency.'

This principle applies notwithstanding a provision in the charter or by-laws that no transfer shall be complete or effectual without registration. Such a provision has no more effect upon the rights of the parties than the provision in statutes requiring registration of transfers of real estate. The title passes as between the parties, though the deed is unrecorded.3

A registry is important in order to furnish the transferee the best evidence of his title and to enable him to enjoy the full benefits of his purchase. He is not entitled to vote or receive dividends until he has given notice to the corporation and had his name substituted

v. Pequonnock B'k (U. S. C. Ct.), 15 Rep. 137; Balt. City P. Ry. Co. v. Sewall, 35 Md. 238; Fitchburg Sav. B'k v. Torrey, 134 Mass. 239; U. S. v. Vaughan, 3Cinn. (Pa.) 394; Duke v. Cahawba Nav. Co., 10 Ala. 82; Chouteau Spg. Co. v. Harris, 20 Mo. 382; America v. McNeil, 10 Bush, 54; Carroll v. Mullanphy Sav. B'k, 8 Mo. App. 249; Gilbert v. Manchester Iron Mfg. Co., 11 Wend. 627; Far- · mers' & M. Bank v. Wasson, 48 Ia. 336; Broadway B'k v. McElrath, 13 N. J. Eq. 24; Smith v. Crescent City, etc., Co., 30 La. Ann. 1378; Cushman v. Thayer Mfg. Co., 76 N. Y. 365; People's Bank v. Gridley, 9 Ill. 457; White v. Salisbury, 33 Mo. 150; Crawford v. Provincial Ins. Co., 8 Upper Can. 9 P. 263.

1 Dickinson v. Cent. Nat. B'k, 129 Mass. 279; Ex parte Dobson, 2 Mont. D. & D. 685; Morris v. Cannon, 8 Jur. N. S. 653; Sibley v. Quinsigamond Nat. B'k, 133 Mass. 515; no informalities or irregularities in the transfer can be set up by the transferrer or his privates to defeat the title of his transferee. Sheffield A. & M. Ry. Co. v. Woodcock, 7 M. & W. 574; Home Stock Ins. Co. v. Sherwood, 72 Mo. 461; Holyoke Bank v. Goodman Paper Mfg. Co., 9 Cush. 576; Cheltenham & G. W. N. Ry. Co. v. Daniels, 2 Q. B. 281; Maguire's Case 3 De G. & S. 31; Chew v. B'k of Balt., 14 Md. 299.

2 Johnson v. Laflin, 103 U. S. 800; s. c. 5 Dill. 65.

3 Noyes v. Spaulding, 27 Vt. 420, the court saying: "The object of having the transfer recorded on the books of the corporation is notice, and that is the only object. For that reason the transfer, though unrecorded, is good against the party and all those who have notice in fact of the transfer." See also Bank of Utica v. Smalley, 2 Cowen, 770; U. S. v. Cutts, 1 Sumn. 133; First Nat. B'k, v. Gifford, 47 Ia. 575; Johnson v. Underhill, 52 N. Y. 203; Baldwin v. Canfield, 26 Minn. 43.

4 Nicollet Nat. B'k v. City B'k, 38 Minn. 85, 35 N. W. 577; Herdegen v. Cotzhausen, 70 Wis. 589; 36 N. 385; Thurber v. Crump (Ky.), 6 S. W. 145;. Poole v. W. P. B., etc., Assn., 30 F. 513; Gould v. Head, 41 F. 240. 5 Supra, §§ 465, 476.

for that of the original owner as a member. And until that is done, the original owner remains liable to the corporation to pay all assessments whether made before or after such sale and assignment.1

But a failure to do this does not alter the relations between the immediate parties to the transfer. The rights and duties between them are not added to or diminished by failure to have the transfer made. While the corporation is not bound by it, and may continue to exact dues from and pay dividends to the vendor, the latter may, by bill in equity, compel the vendor to do all things necessary to a complete substitution and transfer. And if the vendor has incurred liability to the corporation and its creditors since the sale, he may have the vendee compelled to indemnify him to that extent.2

1 Bell's App., 115 Pa. 288; 8 A. 177; Hamilton v. Glenn (Va.), 9 S. E. 129; and this liability is not altered by the fact that the assignor held the stock as trustee for another whose name does not appear on the books of the corporation. Borland v. Haven, 37 F. 394. See Treadway v. Johnson, 33 Mo. App.

122.

Where an executor, without consideration, transfers bank stock in trust for his own benefit, and to enable the transferee to become a director of the bank, the title, for the purpose of assessment, remains with the executor. Witters v. Sowles, 32 F. 130. The Ala. Stat. makes both assignor and assigneo liable for assessments due at the time of transfer. Morris v. Glenn, 87 Ala. 628; 7 So. 90.

2 Kellogg v. Stockwell, 75 Ill. 68; Witters v. Sowles, 32 F. 762; Herdegen v. Cotzhausen, 70 Wis. 589; 36 N. W. 385; Wynne v. Price, 3 De G. & Sm. 310; Cheale v. Kenward, 3 De. G. & J. 27; Crescent City, etc., Co. v. Deblieux, 40 La. Ann. 155; 3 So. 726. See also Callanan v. Windsor, 78 Ia. 193; 42 N. W. 652. Where after assignment and delivery of stock as collateral the pledgee neglected for seven years to have the proper transfer made on the company's books, and in the meantime the shares were sold under execution against the vendor, the transfer made by the sheriff making the sale to the purchaser was held to extinguish the titles of both pledgor and pledgee. Noble v. Turner, 69 Md. 519. The vendor is not bound by an agreement between the corporation and the vendor to the effect that the latter will give existing stockholders preference in the sale of the stock. Especially is this true where the vendee is not shown to have had notice of such agreement. Gould v. Head, 41 F. 240. The liability to indemnify previous holders for calls paid by them is confined to the holders of the shares at the time of the call being made by the company. Brinkley v. Hambelton, 67 Md. 169; 8 A. 904.

After & contract for the sale of certain shares in the stock of a corporation

This right of indemnity may be enforced either at law by reason of the implied contract, or in equity where the relation of trustee and cestui que trust exists between the parties.2

but before the time appointed for receiving payment and making delivery, a dividend was declared as to which there was no express stipulation in the contract. It was held that though the purchaser, if he has accepted the stock and paid for it, would have been entitled to the dividend, as between the immediate parties to the transfer, yet he had no right to decline acceptance and payment because the seller claimed the dividend as his own, and refused to give an order for its payment to him (the purchaser). The latter, having failed without just cause to comply with his contract, lost his hold both upon the stock and the dividend. Phinizy v. Murray, 83 Ga. 747; 6 L. R. An. 426. See also Sargent v. Franklin Ins. Co., 8 Pick. 90; Ross v. S. W. R. Co., 53 Ga. 515; Cent. R. & B'kg Co. v. Papot, 59 Ga. 342; Bright v. Lord, 51 Ind. 272; Black v. Hemersham, L. R. 4 Exch. Div. 34; Harris v. Stevens, 7 N. H. 454. It is the right and duty of the purchaser in such case to accept the tender of the stock and proxies and then sue the seller, if necessary, to recover the dividend. Miller v. Mariner's Ch., 7 Me. 51; Hamilton v. McPherson, 28 N. Y. 72; Conant v. Seneca, etc., B'k, 1 Ohio St. 298. A purchaser of shares takes them subject to a lawful agreement previously entered into among the stockholders by which new obligations are imposed upon them, and can only demand a certificate in accordance with such agreement. Campbell v. Zylomite Co., 55 N. Y. Sup.

Ct. 562; 3 N. Y. St. 822.

An owner of stock on which a dividend had been declared but not paid authorized an agent to sell the stock, expressly reserving the right to the dividends. The agent agreed with the purchaser that the dividend should go with the stock. Held, that the purchaser had no right to presume that the agent, because the possessor of the stock, was authorized to sell the dividend, which formed no part and did not pass as an incident to it, and as to that dealt with the agent at his peril, and that the owner of the stock was not bound by his representations,and that the retention of the proceeds of the sale without knowledge of the unauthorized representations did not amount to a ratification of them. Wheeler v. Northwestern Sleigh Co., 39 Fed. Rep. 347. See also Owings v. Hull, 9 Pet. 629; Berrueke v. Ins. Co., 105 U. S. 360; Bloomfield v. B'k, 121 M. S. 135; Rolling Mill v. Ry. Co., 5 Fed. Rep. 852; McClelland v. Whiteley, 15 Fed. Rep. 322; Dickinson v. Conway, 12 Allen, 491; Bell v. Cunningham, 3 Pet. 69, 81; Hastings v. Proprietors, 18 Me. 436; Bryant v. Moore, 26 Me. 87; Thatcher v. Pray, 113 Mass. 291; Nav. Co. v. Dandridge, 8 Gill. & J. 248; Smith v. Tracy, 36 N. Y. 79; Baldwin v. Burrough, 47 N. Y. 199; Smith v. Kidd, 68 N. Y. 130; Reynolds v. Ferree, 86 Ill. 576; Roberts v. Rumley, 58 Ia. 301; Bohart v. Oberne 36 Kan. 284; Ins. Co. v. Iron Co., 21 Wis. 458, 464.

1 Walker v. Bartlett, 18 C. B. 845, overruling Humble v. Langston, 7 M. & W. 517; Chapman v. Shepherd, L. R. 2 C. P. 228; Grissell v. Bristowe, L. R. 3 C. P. 112; Bowring v. Shepherd, L. R. 6 Q. B. 309; Kellock v. Enthoven, L. R.

9 Q. B. 241, affirming L. R. 8 Q. B. 458; Davis v. Haycock, L. R. 4 Exch. 373; Brigham v. Mead, 10 Allen, 245.

2 Johnson v. Underhill, 52 N. Y. 203, 211; Wynne v. Price, 3 De G. & Sm.

The vendee is entitled to any dividends which may be declared pending a completion of the transfer, and if dividends are paid in the meantime to the vendor, he may have an accounting in equity or sue at law for money had and received to his use. The statute of frauds is no defence to an action by the vendor on a verbal agreement made at the time of the sale of shares that the purchaser shall assume the liabilities and receive the dividends past and future.2

499. Measure of damages between vendor and vendee of stock. In the absence of evidence of actual sales, the market value is presumptively the par value; and the burden of proof is on the defendant that the market value is less than the par value. But other evidence than actual sales is admissible where no sales can be shown, such, for instance, as the dividend earning power and special value. In the absence of better evidence the market value of all the property of the corporation may be shown with a view to arriving at

310; Kellogg v. Stockwell, 75 Ill. 68; Cheale v. Kenward, 3 De G. & J. 27; Hawkins v. Maltby, L. R. 4 Ch. 200; Morris v. Cannan, 4 De G. F. & J. 581; Evans v. Wood, L. R. 5 Eq. 9; Shaw v. Fisher, 5 De G. M. & G. 596; 2 De. G. & Sm. 11; Cruse v. Paine, L. R. 6 Eq. 641; 4 Ch. 441; James v. May, L. R. 6 H. L. 328; Butler v. Cumpston, L. R. 7 Eq. 16.

1 See Gilbert v. Manchester Iron, etc., Co., 11. Wend. 627; Fitchburg Sav. B'k v. Torrey, 134 Mass. 239; Sargent v. Franklin Ins. Co., 8 Pick. 90; Quiner v. Marblehead, etc., Ins. Co., 10 Mass. 476; Planters', etc., Mut. Ins. Co. v. Selma Sav. B'k, 63 Ala. 585; U. S. v. Cutts, 1 Sumner, 133; Ex parte Dobson 2 Mont. D. & D. 685; Stebbins v. Phœnix Fire Ins. Co., 3 Paige, 350; Brigham v. Mead, 10 Allen, 245; Nesmith v. Wash. B'k, 6 Pick. 324; Sabin v. B'k of Woodstock, 21 Vt. 353; Baltimore, etc., Ry. Co. v. Sewall, 35 Md. 252; Conant v. Reed, 1 Ohio St. 298; Duke v. Cahawba Nav. Co., 10 Ala. 82; St. Louis, etc., Ins. Co. v. Goodfellow, 9 Mo. 149; Tuttle v. Walton, 1 Ga. 43; McCready v. Rumsey, 6 Duer. 574. See Johnson v. Laflin, 5 Dill. 79, and cases cited.

2 Bailey v. Shroyer (Pa.), 1 A. 717. The reason assigned for so holding was that the promise was not "to pay the debt of another, but to discharge an oblition assumed by virtue of his purchase of the stock.

App. of Harris (Pa.), 12 A. 743.

4 Freon v. Carriage Co., 42 O. St. 30, 38. See also Shaw v. Fisher, 2 De G. & Sm. 11; s. c. 5 De G. M. & G. 596.

the proportionate value of the shares in controversy.1 The published market rates in the newspapers may be read in evidence.2

§ 500. Remedies for breach of contracts for future delivery. The vendee may, where the time of performance and terms of sale are fully set forth, sue the vendor in equity for specific performance where the shares have no ascertainable market value, and the latter is still in a position to perform the contract; in other cases, his remedy is at law in an action for damages. When the sale is conditional, upon failure to perform the condition, the vendor may proceed against the vendee as a trustee of the stock and compel a re-transfer, making the corporation a party defendant. The market value may be fixed by evidence of the price at which the stock is sold in the market at a given time. In case no sales can be shown to have taken place at or about the time in question, evidence of sales at other approximate periods is admissible. Of course the price agreed upon may be recovered when the action is by vendor against vendee for refusal to accept and pay for stock."

5

The remedy by action for specific performance in these as in other cases depends principally upon the absence of an adequate remedy at law, generally because of the impossibility of fixing a measure of damages. This often happens in the case of contracts to

1 Hitchcock v. McElreath, 72 Cal. 565; 14 P. 305. See also McGuffey v. Humes, 1 Pickle (Tenn.), 26; 1 S. W. 506.

2 Brinkley v. Hambleton, 8 Atl. Rep. 904; Lessassier v. Kennedy, 36 La. Ann. 539.

3 Poole v. Middleton, 29 Beav. 646; Beckitt v. Billsbrough, 8 Hare, 188; Turner v. May, 32 L. T. N. S. 56.

4 Alford v. Wilson, 20 F. 96. See also Jones v. Kent, 80 N. Y. 585.

5 Johnson v. Kirby, 65 Cal. 482; 4 P. 458.

6 Douglas v. Merceles, 25 N. J. Eq. 144; Stewart v. Cauty, 8 Mees, & W. 160; Seymour v. Ives, 46 Conn. 109; Sturges v. Keith, 57 Ill. 451; Texas, etc., Ry. v. Gentry, 69 Tex. 625; 8 S. W. 98.

7 Mabley v. Morgan (Pa.), 6 A. 694.