Costello v. Brewing Co.

1 Citing case

  1. Blue Mt. Forest Ass'n v. Borrowe

    71 N.H. 69 (N.H. 1901)   Cited 12 times

    " Dow v. Railroad, 67 N.H. 1, 4, 5. Upon the ground of the contractual obligations resting upon stockholders as between themselves, unincumbered with questions relating to the rights of third parties, it was held in Costello v. Brewing Co., 69 N.H. 405, that a by-law of a corporation providing that the indebtedness of a stockholder to the corporation may be considered a lien on the shares standing in his name, to be enforced by a cancellation of such shares to the extent of the indebtedness, is binding upon a stockholder who is chargeable with knowledge of its existence. With reference to the by-laws the court say: "By them, the stockholders in effect agreed among themselves that the corporation should have a lien upon the shares of a stockholder for his indebtedness to the corporation, and his right to sell and transfer the shares should be subject to this lien; and that the corporation, by a two-thirds vote of its directors at a regular meeting, might apply the shares at the rate of $500 each to the payment of the debt, after it had been due for three months and payment had been demanded and refused.