offered by the plaintiff for the purpose of proving the value and identity of the goods in the box. The testimony was received. So far as the value of the goods is concerned, that was determined by stipulation, and the testimony thereby became immaterial. The identity of the goods was sufficiently estab lished by the other testimony in the case. Hence if the testimony was improperly admitted it could not have harmed the defendant, and its admission is no ground for a reversal. We find no material error disclosed in the record.

By the COURT. The judgment of the circuit court is affirmed.

CARRIERS-BURDEN OF PROOF. - Where a bill of lading exempts a carrier from liability for breakage, he must, in an action for damages, first bring himself within the exception: Witting v. St. Louis etc. R'y Co., 101 Mo. 631; 20 Am. St. Rep. 636, and note. The burden of proof is upon a carrier to show that he complied with the terms of the contract of carriage: Hull v. Chicago etc. Ry Co., 41 Minu. 510; 16 Am. St. Rep. 722, and note.

CARRIERS - EVIDENCE OF NEGLIGENCE. — Non-delivery of goods at point of destination is presumptive evidence of negligence: Wheeler v. Oceanic etc. Co., 125 N. Y. 155; 21 Am. St. Rep. 729, and note; Lennon v. Rawitzer, 57 Conn. 583.

CONNECTING CARRIERS. - A connecting carrier, by receiving freight from another carrier, under a contract between the consignor and the latter, becomes the agent of such carrier to complete his contract, and is entitled to the benefit of all valid limitations of the carrier's liability contained in the contract: St. Louis etc. R'y Co. v. Weakly, 50 Ark. 397; 7 Am. St. Rep. 104. Compare Adams Ex. Co. v. Harris, 120 Ind. 73; 16 Am. St. Rep. 315, and note.

GOGEBIO INVESTMENT COMPANY V. IRON CHIEF MINING COMPANY.

[78 WISCONSIN, 427.]

CORPORATIONS. — In an ACTION AGAINST THE STOCKHOLDers of an InsOLVENT CORPORATION to compel them to contribute to the payment of its debts, it is only necessary, in order to make out a prima facie case, to establish that they have not in good faith paid the par value for the stock of the corporation.

CORPORATIONS. — THE OBLIGATION OF A SUBSCRIBER TO THE CAPITAL STOCK of a corporation to pay a subscription cannot be surrendered or released by the directors. They are bound to call in that which is unpaid, and to carefully husband it when received.

CORPORATIONS. — Unpaid SubsCRIPTION to the capital stock of a corporation is an asset to which its creditors look for payment, and they have the right to insist upon its collection, the same as any other debt due the corporation.

AM. ST. REP., VOL. XXIIL-27

CORPORATIONS. THE ISSUANCE OF THE STOCK OF A CORPORATION FOR A WHOLLY INADEQUATE CONSIDERATION is as much a fraud upon its creditors as though the corporation had disposed of any other debt due it for a wholly inadequate consideration, and a fraudulent holder of stock is liable to the creditors for its par value, less what he has paid for it to the corporation.

CORPORATION. SUBSCRIBER FOR STOCK OF A CORPORATION, whether he is to pay for it in money or in property, impliedly agrees to pay its par value, and so far as the creditors of the corporation are concerned, its direotors cannot release him from that obligation.

CORPORATIONS.

Subscriber to tHE STOCK OF A CORPORATION, WHO PAID THEREFOR IN PROPERTY known to them to be worth much less than the par value of the stock received by him, is liable to the creditors of the corporation for the difference between the value of such property and the par value of the stock received therefor.

Turner and Timlin, for the appellant.

H. Nunnemacher, R. Nunnemacher, H. M. Benjamin, and Williams, Friend, and Bright, for the respondents.

TAYLOR, J. This is an appeal from an order sustaining a demurrer to the complaint of the plaintiff in the action. The complaint is intended to set up a cause of action under sections 3216, 3217, 3219, 3221, 3224, and 3226 of the Revised Statutes. The complaint sets forth the fact that the plaintiff is a judgment creditor of the defendant corporation; that execution upon its judgment has been duly issued, and returned unsatisfied. It also alleges that the corporation is insolvent, and unable to pay its debts. The complaint then alleges that Herman Nunnemacher, Robert Nunnemacher, and H. M. Benjamin are stockholders of said defendant company, and sets forth facts which show that they have not paid for their stock its full and fair value, as required by law, so as to relieve them from contributing further to the payment of the debts of said company.

It is not seriously contended by the learned counsel for the respondents that the complaint does not state facts sufficient to show that these defendants are stockholders of said corporation, and that, as between them and the creditors of said corporation, they would be liable to make further payment upon the stock held by them to satisfy the debts of said insolvent corporation; but it is claimed that because it is alleged in the complaint that these stockholders obtained their stock from the corporation as full-paid stock as the purchase price paid by said corporation for certain mining rights sold to said corporation by said stockholders, the plaintiff does not make

out a case against these stockholders, notwithstanding its allegations show that the property transferred to said corporation was not in fact worth one tenth part of the par value of said shares of stock so received by them in exchange therefor, and that such fact was well known to said stockholders at the time they received their shares of stock therefor, unless the plaintiff makes the further allegation that at the time it gave credit to said corporation it was ignorant of the fact as to how said defendants had obtained their shares of stock, and that, relying upon and believing that they had paid full value for their shares of stock, it gave credit to said corporation. The claim is, that the same rule of pleading is applicable to the case at bar as is applicable to an action to recover damages of a defendant for obtaining goods from the plaintiff by false and fraudulent representations made by the defendant for the purpose of obtaining such goods, and that in such case the plaintiff must allege that the representations were false, to the defendant's knowledge, and that the plaintiff relied upon them as true, and gave the credit or made the purchase relying upon the truth of such representations.

We do not think the cases are at all analogous. The case at bar is in the nature of a bill in equity to subject to the payment of debts the property of the defendant, which it has conveyed under such circumstances as the law declares to be fraudulent as against its creditors. In an action against the stockholders of a corporation to compel them to contribute to the payment of the debts of the insolvent corporation it is only necessary, in order to make out a prima facie case, to establish the fact that the stockholder has not in good faith paid the par value for his stock to the corporation.

The nature of the stockholder's liability to the creditors of the corporation, when such corporation is bankrupt, is well stated in the cases of Upton v. Tribilcock, 91 U. S. 47, and Sanger v. Upton, 91 U. S. 60. In the case first cited the court say: "The capital stock of a moneyed corporation is a fund for the payment of its debts. It is a trust fund, of which the directors are the trustees. It is a trust to be managed for the benefit of its share-holders during its life, and for the benefit of its creditors in the event of its dissolution. This duty is a sacred one, and cannot be disregarded. Its violation will not be undertaken by any just-minded man, and will not be permitted by the courts. The idea that the capital of a corporation is a foot-ball, to be thrown into the market for the

purpose of speculation, that its value may be elevated or depressed to advance the interests of its managers, is a modern and wicked invention. Equally unsound is the opinion that the obligation of a subscriber to pay his subscription may be released or surrendered to him by the trustees of the company. This has been often attempted, but never successfully. The capital paid in, or promised to be paid in, is a fund which the trustees cannot squander or give away. They are bound to call in what is unpaid, and carefully husband it when received." In the second case cited the court say: "The capital stock of an incorporated company is a fund set apart for the payment of its debts. It is a substitute for the personal liability which subsists in private copartnerships. When debts are incurred, a contract arises with the creditors that it shall not be withdrawn or applied otherwise than upon their demands, until such demands are satisfied. The creditors have a lien upon it in equity. If diverted they may follow it as far as it can be traced, and subject it to the payment of their claims, except as against holders who have taken it bona fide for a valuable consideration and without notice. It is publicly pledged to those who deal with the corporation for their security. Unpaid stock is as much a part of this pledge and as much a part of the assets of the company as the cash which has been paid in upon it. Creditors have the same right to look to it as to anything else, and the same right to insist upon its payment as upon the payment of any other debt of the company. As regards creditors, there is no distinction between such a demand and any other asset which may form a part of the property and effects of the corporation."

Under the rule stated in these opinions, that the capital stock of a corporation is an asset of the corporation, held in trust for the benefit of the corporation and of its creditors when bankrupt, it follows logically that when the corporation disposes of this stock for a wholly inadequate consideration, it is as much a fraud upon the creditors of the corporation as though the corporation had disposed of any of its other debts due to the corporation for a wholly inadequate consideration. It differs from the other tangible assets of the corporation, as between the creditors of the corporation and the stockholders, in this, that when the tangible assets of the corporation are fraudulently conveyed, the creditor can only take the property so conveyed in satisfaction of his debt, but cannot compel

the fraudulent vendee to pay the creditor's debt unless he has disposed of the property fraudulently received by him, and in that event he must account for what he has received for it, or for its fair value; but the fraudulent holder of stock, under the common law and under our statute, becomes liable to the creditors for the par value of the stock, less what he has paid for it to the corporation. The law makes the fraudulent holder of stock, so far as creditors are concerned, a debtor to the company for its par value, and as to creditors he cannot relieve himself of this obligation until the debts of the corporation are paid. Under sections 1753 and 1758 of the Revised Statutes, which are not, perhaps, materially different from the common law, the subscriber for stock of a corporation, whether he is to pay for it in money or in property, impliedly agrees to pay its par value therefor, and, so far as creditors of the corporation are concerned, the trustees of the corporation cannot release him from that obligation.

In the case at bar the facts stated in the complaint show that nearly all the capital stock of the corporation was issued and delivered to the stockholders named in the complaint for a nominal consideration, and the presumption of the law is, that such a transfer of the stock is a fraud upon the creditors of the corporation, and that as to such creditors the parties to whom the stock was issued must be held liable to a further payment upon their stock to the par value thereof, if it be necessary to make such further payment to satisfy the debts of the corporation. The allegations of the complaint, which are admitted to be true by the demurrer, show conclusively that the stockholder defendants have not, as between themselves and the creditors, paid in full for their stock, and are therefore liable to make further payments for the benefit of the plaintiff as a creditor of the corporation. This is all that is necessary under our statute or at common law to make a case against the stockholder of unpaid stock in favor of a creditor of the insolvent corporation.

That the defendants may be able to defeat this claim of the creditor of the corporation, by showing that at the time his debt was incurred he knew that the stock of the corporation had all been issued in payment for property of a value very much less than the par value thereof, is a question which does not arise on this demurrer. Such a defense is in the nature of an estoppel upon the plaintiff, and need not be negatived in the complaint. All the cases cited by the