446
THE GREEN BAG
and this decision was affirmed by the U. S. Supreme Court in an opinion by Mr. Justice Moody. The case was a new one in the U. S. Supreme Court, so far as these or like facts were concerned. The plaintiff relied principally on Denver &c. Co. R. R. Co. v. Roller, 100 Fed. Rep. 738, and Tuchband v. Chicago &c. Co. R. R. 115 N. Y. 437. The defendant relied on Maxwell v. Atchison &c. Co. R. R. 34 Fed. Rep. 286; Fairbanks Ac, v. Cincinnati 4c, 54 Fed. Rep. 420; Union Asso ciated Press v. Times-Star Co. 84 Fed. Rep. 409; and Earle v. Chesapeake &c. R. R., 127 Fed. Rep. 235, all of which cases were referred to in Mr. Jus tice Moody's opinion. The decision was confined to the facts in this case, and the court refused to lay down any general rule as to what would be " doing business," apparently preferring to consider sep arately each case that might come before it. The facts in this case, however, would seem to cover what is done by most of the trunk lines which maintain branch offices in the large cities of many states in which they have no tracks and operate no trains. E. A. Waters. CORPORATIONS. (Liability of Purchaser of Franchises and Property.) Mo. Sup. — A cor poration which purchases the franchises and property of another corporation at an agreed price per share is, in Hagemann v. Southern Electric R. Co., 100 S. W. Rep. 1081, held not to be liable to the creditors of the corporation whose franchises and property have been purchased for debts which were not liens on the property at the time of the transfer. This decision, however, is based on the ground that a fair consideration was paid by the purchaser. CORPORATIONS. (Stockholders — Subscription Rights.) N. Y. Ct. of App. — The right of a stockholder of a corporation to a proportionate share of new stock issued, is upheld in Stokes v. Cont nental Trust Co., 78 N. E. Rep. 1090. The court notes that the rights of a stockholder in this matter are not regulated by statute and that the question has never been directly passed upon by the court, and only to a limited extent has it been considered by New York Courts. The New York cases in which the question has been referred to, either directly or indirectly, are Miller t;. Illinois Central R. R., Co., 24 Barber, 312; Matter of Wheeler, 2 Abbot's Practice (new series), 361, and Currie v. White, 45 N. Y. 822. The fair implication from the opinions in the last two cases is that if a stockholder has preserved his rights, he will be entitled to his proportionate share of new stock issued. In other jurisdictions, the decisions support the rights of a stockholder as contended for in the case, with the exception of Ohio Insurance Co. v. Nunnemacher, 15 Ind.
294, which turned on the language of the corpo ration's charter. The leading authority is Gray v. Portland Bank, decided in 1807 and reported in 3 Mass. 364, 3 Am. Dec. 156. In that case the court held that stockholders who held old stock had a right to subscribe for and take new stock in proportion to their respective shares. This decision the court says has stood unquestioned for nearly one hundred years and has been followed generally by courts of the highest standing. It is the foundation of the rule on the subject that prevails almost without exception throughout the entire country. Other authorities relied on are Way v. American Grease Co., 60 N. J. Eq. 263, 269, 47 Atl. 44; Eidman v. Bowman, 58 Ill. 44, 447, 11 Am. Rep. 90; Dousman v. Wisconsin, etc., Co., 40 Wis. 418, 421; Jones v. Morrison, 31 Minn. 140, 152, 16 N. W. 854; Real Estate Trust Co. v. Bird, 90 Md. 229, 245, 44 Atl. 1048; Jones v. Concord & Montreal R. R. Co., 67 N. H. 119, 38 Atl. 120; Bank of Montgomery v. Reese, 26 Pa. 143, 146; Reese v. Bank of Montgomery, 31 Pa. 78, 72 Am. Dec. 726, and Morris v. Stevens, 178 Pa. 563, 578, 3-6 Atl. 151. DISCOVERY. (Parties.) U. S. C. C. A. — Where an action is brought against a railroad company alone for an alleged violation of the interstate commerce act, the corporation's offi cers and agents are not, according to Cassatt v. Mitchell Coal & Coke Co., 130 Federal, 32, "parties" within the federal statute (Rev. St. § 724, U. S. Comp. St. 1901, p. 583), authoriz ing federal courts, on notice, to require the parties to produce books or writings in their pos session or power which contain evidence perti nent to the issues. In support of the decision, the court cites Rose v. King, 5 Serg. & R. 241, wherein the Supreme Court of Pennsylvania, dealing with an order made under the Pennsyl vania statute, evidently modeled on the federal statute cited, declared that there was no power under that statute requiring a third person, not a party to the record of the case, to produce books or papers at the trial of the action, and also Ridgely v. Richard, 130 Fed. 387, wherein the Circuit Court followed the same rule in construing section 724 of the federal statutes. The court in this case further holds that the statute does not authorize an order requiring a party to produce books and papers before trial. If such relief is desired, it must be obtained by a bill of discovery INSURANCE. (Entire or Severable Contracts.) Cal. Sup. Ct. — Where the defense of forfeiture is interposed in an action on an insurance contract, the question quite frequently arises as to whether or not the contract is entire or severable. There is considerable conflict between the courts as to
