by John Marshall Harlan

“ Justice Strong, said that while a shareholder of the stock of a corporation has generally a right to transfer his shares, and thereby disconnect himself from the corporation, and from responsibility on account of it, there were limits to that right; that it is not every transfer that releases a stockholder from his responsibility as such; and that 'a transfer for the mere purpose of avoiding his liability to the company or its creditors is fraudulent and void, and he remains still liable.' And in Pauly v. ”

“ Stuart became the owner of 100 shares of the stock of the Capital National Bank in 1884, and of 50 additional shares in 1886. Substantially from the time of becoming a shareholder, he was one of the directors of the bank, and a member of its finance committee, and acted in both capacities until about December 16, 1892. On the last-named day, Gruetter & Joers, dealers in furniture at Lincoln, sold to Stuart certain real property in that city, for $67,500, upon which there was at the time a mortgage for $30,000, bearing interest at the rate of 6 per cent. per annum. ”

“ I told him I thought it was rather an exorbitant price for the property; that I did not consider the building worth any such money,-to which he responded that they were going to make a very good lease. They would take it for ten years,-a ten years' lease on the premises, at a rental of $6,000 a year. ”

“ A. Well, yes. I guess it was after he made the trade; either he told me about it or I took occasion to remark, 'I see you made that trade, Professor.' As I told you before, I don't like Mosher and Outcault's ways of doing business, and I shall prefer to manage my own affairs hereafter.' Q. Did he, in any conversation you had with him, say anything about the amount of the capital stock of the bank that was tied up n real estate? A. Yes, some 130 or 140 thousand dollars ”