Clark v. German Security Bank

61 Miss. 611

Opinion

Campbell, C. J.,

delivered the opinion of the -court.

The right of the appellee to the shares of stock, which are the subject of this controversy, is paramount to the claim of the attaching creditor. The provision of the charter of the company that “ all stock shall be transferable only on the books of the company,” has reference only to the mode by which one may be substituted for another as a stockholder with respect to the company. It does not affect a transfer of shares as between the assignor and assignee or an attaching creditor. The transfer of the certificates entitled the holder under the transfer to have the required transfer made on the books of the company, and the attaching creditor acquired nothing as against the appellee, who, notwithstanding the attachment, is entitled to have the transfer made on the books of the company. The decided preponderance of authority is in support of this view and it is sustained by reason. The contrary view is based on the erroneous assumption that the. charter provision above quoted is a registry law for the protection of creditors and purchasers, when in truth it has not a single feature of resemblance to such law. It has no relation to purchasers or creditors, but pertains only to the relation between shareholders and the company. Dos Passos on Stock Brokers, etc., 625, and cases cited ; Colebrooke on Collateral Securities, § 293 et seq.; Morawetz Private Corporations, § 325 et seq. ; 14 American Decisions 530, note and cases cited ; Cornick v. Richards, 3 Lea (66 Tenn.) 1.

Decree affirmed.