Case Plow Works v. Montgomery

This an action against a stockholder to recover his proportionate share of a corporate debt under section 322 of the Civil Code.

It is alleged in the complaint that on a certain day the corporation made, executed, and delivered to plaintiff its certain promissory note, which is then set out at length. *381 In no other way is corporate indebtedness averred. The complaint sufficiently shows the amount of subscribed capital stock, and the amount of stock owned by defendant at the time the note was executed, and the only question involved on this appeal is whether this is a sufficient allegation that the indebtedness was incurred while the defend ant was a stockholder.

The question was suggested in Tilden v. Gashwiler, which was not reported, but was referred to in Hunt v. Ward, 99 Cal. 612 , 37 Am. Rep. 87 , where Mr. Justice McFarland expressed some doubt upon the subject. It is again discussed in Winona Wagon Co. v. Bull, 108 Cal. 1 , in which case the question was decided. It was there held that the complaint must show that the indebtedness was incurred while the defendant was a stockholder, and that the mere allegation that on a certain day, while the defendant was a…