Page:Harvard Law Review Volume 10.djvu/257

STOCKHOLDERS IN FOREIGN CORPORATIONS. 231 requiring local administration." The court declined to take juris- diction of the bilL The bill did not set out a statutory liability but claimed that equity jurisdiction existed under such circum- stances by the law of Connecticut. The Massachusetts court say, in effect, that this is such an unusual ground of equity jurisdiction, and depends so much upon the law governing the creation of cor- porations in Connecticut, that it is justified in declining to take jurisdiction. There was no judgment against the corporation prior to bringing the bill, and the law of Connecticut was not set out with adequate allegations. To enforce a bill founded on such grounds, which were no foundation for equity jurisdiction under the law of Massachusetts, would be an injustice to the citizens of Massachusetts who were made defendants. No statute of Con- necticut was actually invoked by the plaintiff, or considered by the court. Under the decisions discussed in the foregoing pages, the policy of the Massachusetts courts seemed to be established, denying the right of creditors of foreign corporations to enforce here a statutory liability against resident stockholders. It was so regarded by the Massachusetts Supreme Court, as appears from the following dic- tum in the case of Smith v, Mut. Life Ins. Co.^: "No proceed- ing at law or in equity will lie to enforce the individual liability for corporate debts imposed upon officers or stockholders by the laws of another State in which the corporation is established." But this was not the inevitable or logical conclusion from the cases decided. The principles laid down by the court in those cases seem perfectly sound. No case had been presented where the remedy prescribed by the statute creating the corporation was such as could be availed of in Massachusetts; it was too much to say, though, that no such case ever could be presented. This was later the conclusion of the court, as appears in a dictum in a sub- sequent case. Post & Co. v. Toledo R. R.,^ when they say : — "The difficulty which courts find in dealing with foreign corporations in matters relating to their internal affairs and management, the impossi- bility of compelling persons to perform their obligations, unless either the bodies or the property of such persons can be attached, the intimate re- lations existing between the States of the United States, and the well known fact that corporations are frequently organized by the citizens of one State under the laws of another and the principal offices of the cor. 1 14 Allen, 336, 342. 2 J44 Mass. 341, 344. 31