incorporation are filed, a copy certified by the Secretary of State of the certified copy of such articles on file in his office is admissible in evidence to prove the organization of the corporation.-Boston Tunnel Co. V. McKenzie, 67 Cal. 485, 8 Pac. 22; Fresno etc. Irr. Co. v. Warner, 72 Cal. 379. [j] Corporate seal may be shown to have been affixed to deed without proper authority.-Vaca Valley etc. R. R. v. Mansfield, 84 Cal. 566, 24 Pac. 145. [k] A promoter of the corporation, being an active party to the litigation, his statements and admissions pertaining to the subject matter of the action wherever and whenever made, are competent evidence against him.-Burbank v. Dennis, 101 Cal. 90, 35 Pac. 444. [1] Records of a corporation showing authority from the board of directors given to its president and secretary to execute a note, and that the one who signed the note as secretary and attached to it the corporate seal, authenticated the record of the meeting of the directors conferring the authority, and the records of the other meetings for a considerable time prior and subsequent to the execution of the note, are sufficient to sustain a finding that he was secretary of the corporation when the note was executed, and was duly authorized as such to execute it.-Barrell v. Lake View Land Co., 122 Cal. 129, 54 Pac. 594. [m] It is presumed that the board of directors of a corporation consists of at least five, since the code requires at least that number. -Barrell v. Lake View Land Co., 122 Cal. 129, 54 Pac. 594. [n] Where in a suit on a note of a corporation defendant claimed that it was not properly executed, because one of the directors was not notified and was not present at the meeting at which it was authorized, but the resolution of the board of directors showing the nature of the transaction in which the note was given, authorizing the same, was in evidence, and recited the absence of the director, in the absence of evidence to the contrary it would be presumed that proper notice was given.-Mills v. Boyle Min. Co., 132 Cal. 95, 64 Pac. 122. [o] In a suit on the note of a corporation, defendant claimed the same not to have been properly executed, in that at the meeting at which it was authorized one of the directors was not present, and was not notified thereof. It appeared from the record of the meeting that the director was absent, and one of the directors testified that on the day of the meeting the payee had agreed to loan a sum to the defendant, and that the meeting took place thereafter. Another witness testified that no opportunity was given the payee to notify any director, but it appeared that the absent director had a desk in the room adjoining where the meeting was held, and the parties had been engaged in negotiating the matter for four or five days. Held, that the evidence was not sufficient to overcome the presumption that the absent director was Cal. Digest, Vol. 2-77 notified; there being no testimony on the part of the president or the absent director.Mills v. Boyle Min. Co., 132 Cal. 95, 64 Pac. 122. [p] The fact that the superintendent who purchased the cattle from plaintiff gave his individual note to the plaintiff for the balance of the purchase price is merely a circumstance in favor of the corporation defendant, but is not conclusive of the issue whether the corporation defendant made the purchase.-Lake Shore Cattle Co. v. Modoc Land etc. Co., 130 Cal. 669, 63 Pac. 72. [q] Where the contract sued on describes plaintiff as a corporation, no further proof of its incorporation is necessary.-Tustin Fruit Assn. v. Earl Fruit Co., 53 Pac. 693. FOR AUTHORITIES FROM OTHER STATES: 12 Cent. Dig., cols. 2121-2127, §§ 20852093. § 432. Judgment. [a] Where an action was commenced in a justice's court against the "Independent Company" and the return showed that service was made on R., a member of the Independent Company, and judgment was entered by default against the "Independent Tunnel Company," held, that the court acquired no jurisdiction over the Independent Tunnel Company, although the summons was addressed in that name; and the judgment was void.-King v. Randlett, 33 Cal. 318. [b] If a corporation is sued by a wrong name, but answers by its true name, and judgment is rendered against it by its true name, the judgment is not void, and the supreme court, on appeal, in affirming the judgment, will direct the court below to substitute the true name in the complaint.Mahon v. San Rafael Turnpike Road Co., 49 Cal. 269. [c] A judgment against a corporation establishes its liability conclusively until reversed in a direct proceeding, and concludes the stockholders in an action against them in the nature of a creditor's bill to compel them to pay in the unpaid portion of their subscriptions to the capital stock toward the satisfaction of the judgment obtained, and it is not necessary that the complaint in such action should allege the indebtedness upon which the judgment was recovered.-Tatum v. Rosenthal, 95 Cal. 129, 29 Am. St. Rep. 97, 30 Pac. 136. [d] The fact that a certain corporation is named as defendant in a complaint, while judgment is rendered against another not named, does not render the judgment irregular, where the latter appeared and filed an answer which, if true, showed the identity of the two.-Haynes v. Backman, 31 Pac. 746. FOR AUTHORITIES FROM OTHER STATES: 30 L. R. A. 240, note. See, also, 12 Cent. Dig., cols. 2129-2135, §§ 2099 2113. § 433. Property Subject to Execution. [a] Stock sold for assessment and purchased by corporation is held subject to control by stockholders, and cannot be sold under execution against corporation.-Robinson v. Spaulding Gold & Silver Min. Co., 72 Cal. 34, 13 Pac. 65. FOR AUTHORITIES FROM OTHER STATES: 30 L. R. A. 103, note. See, also, 12 Cent. Dig., cols. 2136-2146, §§ 2114-2130. § 434. Redemption from Execution Sale. [a] Where the property of a corporation has been sold under execution, and no steps are taken by the corporate authorities to redeem the property within the period limited by law, a stockholder may interpose, and redeem the property for the corporation, and hold it liable for the money advanced for that purpose. By so doing, he becomes the equitable assignee of the certificate of sale, and is subrogated to all the rights of the original purchaser at the sheriff's sale.Wright v. Oroville Gold etc. Min. Co., 40 Cal. 20. § 435. Appeal and Error. [a] Upon the motion to vacate a judg ment by default against a corporation, upon the ground that there was no service of the summons upon the corporation, and that the one to whom the summons was delivered was not the president or other officer of the corporation, the question whether he was such is a question of fact for the court below, and a finding that he was a president of the corporation at the time of the service will be sustained when the evidence upon the issue is substantially conflicting and not so one-sided as to show an abuse of discretion in making the finding.-J. L. Mott Iron Works v. West Coast Plumbing Supply Co., 113 Cal. 341, 45 Pac. 683. [b] Where Code of Civil Procedure, section 462, gives plaintiff in an action on a note the right to controvert by evidence any new matter set up in the answer, except as to the genuineness and due execution of the note, it is harmless error to allow plaintiff to file an affidavit denying the genuineness and due execution of a corporate note set up in the answer, after the time allowed by statute, where the note on its face does not purport to have been made by the corporation, as an admission of its due execution would not be an admission that it was the company's note.-Myers V. Sierra Valley Stock etc. Assn., 122 Cal. 669, 55 Pac. 689. [c] Where defendant's corporate character was alleged and not denied, it was error to find that defendant was not a corporation, in view of Code of Civil Procedure, section 462, declaring that uncontroverted material allegations in the complaint must be taken as true, and section 590, declaring that issues of fact arise only on allegations in the complaint controverted by the answer.-Moyni han v. Drobaz, 124 Cal. 212, 71 Am. St. Rep. 46, 56 Pac. 1026. FOR AUTHORITIES FROM OTHER STATES: 10 Cyc. 736; 12 Cent. Dig., cols. 21472150, §§ 2131-2137. VIII. INSOLVENCY AND RECEIVERS. APPLICATION OF GENERAL INSOLVENCY LAWS, $436. PETITION IN INSOLVENCY-PLACE OF FILING, 437. JURISDICTION OF SUPERIOR COURT-WHEN PREFERENCES TO CREDITORS, § 439. TRANSFER TO ANOTHER CORPORATION HAVING SAME OFFICERS OR STOCKHOLDERS, § 441. REMEDIES OF CREDITORS, § 442. ASSIGNMENT FOR BENEFIT OF CREDITORS, § 443. RIGHT OF ASSIGNEE TO ENFORCE SUB- APPOINTMENT OR RECEIVER, § 445. ENFORCEMENT OF UNPAID SUBSCRIPTION, 447. RANK AND PRIORITY OF CLAIMS, § 448. Foreign corporations. See post, § 493. § 436. Application of General Insolvency Laws. [a] A petition for a writ of prohibition to the superior court to restrain a proceeding in insolvency against a corporation which does not set forth the class of corporations to which the insolvency corporation belongs, or the nature of the business in which it is engaged, is defective in not showing that such a corporation is within the scope of the bankruptcy act.-R. H. Herron Co. v. Superior Court, 136 Cal. 297, 89 Am. St. Rep. 124, 68 Pac. 814. FOR AUTHORITIES FROM OTHER STATES: § 437. Petition in Insolvency-Place of [a] Statutes of 1880, chapter 87, section 8, requires that a petition in insolvency shall be filed in the superior court of the county, or city and county, in which the debtor resides or has his place of business." Held, that a corporation whose residence was in the county of S., but whose mill was located in the county of H., where all his operations were carried on, where it contracted its liabilities, and where its creditors lived, had its place of business in the county of H. for the purposes of the above statute.Creditors v. Consumers' Lumber Co., 98 Cal. 318, 33 Pac. 196. § 438. Jurisdiction of Superior CourtWhen Acquired. [a] The superior court acquires jurisdiction over the estate of an insolvent corporation, § 440. Preferences to Officers. [a] A mortgage given by a corporation in lieu of an invalid one previously given by the stockholders, which has been canceled for a corporate indebtedness, is not fraudulent as to creditors.-Head v. Horn, 18 Cal. 211. [b] Where the president of a corporation resigned as president and director in order to take a conveyance of all of the corporation's property in consideration of a pre-existing debt, the conveyance should be treated as though made to an officer of the corporation, and therefore void as against the corporation's creditors.-Nixon V. Goodwin (Cal. App.) 85 Pac. 169. [c] A deed of all the property of a mining company to its president and director the day after he had resigned, in consideration of a pre-existing debt, held void as to the corporation's creditors.-Nixon v. Goodwin (Cal. App.) 85 Pac. 169. FOR AUTHORITIES FROM OTHER STATES: Preferences by insolvent corporations: 45 Am. St. Rep. 826, note. See, also, 10 Cyc. 803-807, 1255, 1256; 12 Cent. Dig., cols. 2186-2196, §§ 2170-2175. § 441. Transfer to Another Corporation Having Same Officers or Stockholders. [a] The property of a railroad corporation is vested in its trustees, to be preserved by them as a fund to secure the creditors of the corporation. Where the persons interested in one railroad corporation formed a new one, which chose for its icers the officers of the old corporation, and the persons owing the stock of the old corporation received in exchange therefor stock of the new, and the trustees then caused the property of the old corporation be conveyed to the new, held, that the conveyance was a fraud upon the ereditors of the old corporation.-San Francisco etc. R. Co. v. Bee, 48 Cal. 398. § 442. Remedies of Creditors. [a] Where a creditor of a corporation has suffered damages by reason of the fraudulent other misappropriation by creditors of moneys belonging to the corporation, whereby the corporation has been rendered insolvent, the remedy is by an action in the nature of a creditor's bill against the corporation and the other creditors or wrongdoers, wherein the rights of all the parties in interest may be adjudicated.-Reid v. Goldstein, 53 Cal. 296. [b] A creditor's remedy for damages from fraudulent misappropriation by other creditors of the corporation's moneys, rendering it insolvent, is by suit in the nature of a creditor's bill against both it and them.— Reed v. Goldstein, 53 Cal. 296. [c] The subscribed stock of a corporation is a trust fund in favor of its creditors which a court of equity will enforce in their favor when the corporation ceases to be a going concern and it will not allow the trust so arising to be defeated by simulated payment, or by any device short of an actual payment in good faith.-Vermont Marble Co v. Declez Granite Co., 135 Cal. 579, 87 Am. St. Rep. 143, 67 Pac. 1057. § 445. Appointment of Receiver. [a] Part of the property of a corporation was sold in good faith to petitioners, who were among its stockholders, pending proceedings for the appointment of a receiver. Held, that the fact that the petitioners, in their character of stockholders, contested the appointment of the receiver for the corporation's property cannot be construed as a voluntary submission to the jurisdiction of the court in their character of purchasers, SO as to estop them from questioning the validity of the appointment otherwise than by appeal.-Havemeyer v. Superior Court, 84 Cal. 327, 18 Am. St. Rep. 192, 24 Pac. 121, 10 L. R. A. 627. [b] A court is without jurisdiction to appoint a receiver to take possession of the property of a corporation upon a complaint filed by a member or stockholder which does not show that the corporation has been dissolved, or seek its dissolution, and which neither shows its insolvency nor alleges fraud · or mismanagement on the part of its officers, but alleges only that its liabilities exceed its assets, and that it has ceased to conduct the business for which it was incorporated.— Murray v. Superior Court of Los Angeles County, 129 Cal. 628, 62 Pac. 191. [a] Where vice-president, who, in absence of president, conducts business affairs of corporation, employed an attorney for the corporation, with whom a settlement was had for services rendered, and payment made, without objection on the part of the corporation or any officer thereof, the subsequent assignee in insolvency of the corporation cannot recover the money so paid.-Streeten v. Robinson, 102 Cal. 542, 36 Pac. 946. [b] A corporation having no power to adopt a by-law inconsistent with the laws of the state (Civil Code, section 301), and corporate directors having express anthority to levy and collect an assessment for such percentage of the full amount unpaid on capital stock as may be necessary to satisfy the claims of creditors (Civil Code, section 331, and section 332, subdivision 1), a corporate bylaw providing that "no further calls for payments on capital stock shall be made except by a two-thirds vote of all the stock issued and outstanding" does not prevent an assessment by the directors in liquidation.Union Sav. Bank v. Leiter, 145 Cal. 696, 79 Pac. 441. FOR AUTHORITIES FROM OTHER STATES: 12 Cent. Dig., cols. 2269-2274, §§ 22612264. § 447. Enforcement of Unpaid Subscriptions. [a] An action by the assignee of an insolvent corporation organized under the laws of this state to recover from the stockholders the balance due from them severally upou their subscriptions to its capital stock is an action upon contract, and an attachment will lie against nonresident stockholders who are sued as defendants therein; and it is immaterial that the complaint does not show the amount due upon each subscription and that the prayer of the complaint is for an accounting, where the affidavit for attachment shows the amount due.-Kohler V. Agassiz, 99 Cal. 9, 33 Pac. 741. [b] A finding in an action by creditors against stockholders of an insolvent corporation to recover unpaid subscriptions, that its indebtedness exceeded such unpaid subscriptions, was sufficient, without specifying the amounts due such creditors, and was not inconsistent with a finding that the court could not definitely determine the amount due one of such creditors until securities held by it had been realized.-Welch v. Sargent, 127 Cal. 72, 59 Pac. 319. FOR AUTHORITIES FROM OTHER STATES: Power of courts to compel payment of subscriptions and levy and payment of assessments at the instance of creditors: 100 Am. Dec. 552, note. See, also, 10 Cyc. 485; 12 Cent. Dig., cols. 2274-2289, §§ 2265-2279. § 448. Rank and Priority of Claims. [a] Where an insolvent stockholder of an insolvent corporation is indebted on his subscription for stock to an amount in excess of a sum due him on a note of the corporation, an attachment lien procured by him in an action on his note against the corporation will be postponed in equity to a subsequent attachment lien of other creditors of the corporation. Kimball V. Richardson-Kimball Co., 111 Cal. 386, 43 Pac. 1111. [b] A creditor of an insolvent bank, who recovers a portion of his debt from stockholders on their personal liability, is not thereby prevented from sharing with other creditors on the basis of his entire debt in the assets of the corporation, to the extent of the balance due.-Sacramento Bank v. Pacific Bank, 124 Cal. 147, 71 Am. St. Rep. 36-n, 56 Pac. 787. [c] Where a stockholder of an insolvent corporation paid a portion of the corporate indebtedness on which he was liable as surety, he was entitled to share the assets of the corporation ratably with other creditors to the extent of the payment so made.-Welch v. Sargent, 127 Cal. 72, 59 Pac. 319. [d] The indorsers of a note of the corporation, to the extent of any payments made by them, stand in the relation of ordinary creditors of the corporation, and may share ratably in the assets of the corporation.— Welch v. Sargent, 127 Cal. 72, 59 Pac. 319. FOR AUTHORITIES FROM OTHER STATES: 10 Cyc. 1263; 12 Cent. Dig., cols. 22962305, §§ 2283-2286. 449. Actions Against Insolvent Corporations and Receivers. [a] Question of liability of receiver of an insolvent street railway corporation properly belongs to the court appointing the receiver. Pacific Ry. Co. v. Wade, 91 Cal. 449, 25 Am. St. Rep. 201, 27 Pac. 768. [b] While it is, under certain circumstances, proper to direct the prosecution of an action at law against the receiver of a street railway corporation to determine the amount of compensation or damages against the corporation in favor of one having a claim against it, yet the better and more commonly recognized practice is to apply for relief by petition to the court in which the receiver is acting; and it is immaterial whether the damage was occasioned prior or subsequent to the appointment of the receiver.-Pacific Ry. Co. v. Wade, 91 Cal. 449, 25 Am. St. Rep. 201, 27 Pac. 768. [c] A creditor of an insolvent corporation held not entitled to relief against stockholders in a suit for distribution of the corporation's assets, where no such relief was demanded by a cross-complaint.-Bank of Visalia v. Dillonwood Lumber Co. (Cal. Sup.), 82 Pac. 374. Consolidation of corporations, effect of: 89 Am. St. Rep. 604, note. See, also, 10 Cyc. 1265; 12 Cent. Dig., cols. 2345, 2346, §§ 2330, 2331. § 452. Consent of Stockholders. [a] It is sufficient that the number of consenting stockholders of each constituent corporation shall be three-fourths of the outstanding stock, and it is not required that the consent shall be by the owners of threefourths of the entire nominal capital stock of the corporation.-Market Street Ry. Co. v. Hellman, 109 Cal. 571, 42 Pac. 225. [b] Where the trustees of stock consented to the consolidation of the corporation prior to the cancellation of certificates held by them in trust, it is immaterial that the stock so held in trust by them was subsequently canceled.-Market Street Ry. Co. v Hellman, 109 Cal. 571. FOR AUTHORITIES FROM OTHER STATES: 10 Cyc. 297-301; 12 Cent. Dig., cols. 23492351, §§ 2338-2340. § 453. Status of New Corporation. [a] The consolidated corporation becomes a new and distinct corporation which may be organized for the term of fifty years, irrespective of the term of existence of the constituent corporation, and it cannot be objected to the consolidation that it has the effect to extend the existence of the constituent corporations beyond the period of fifty years fixed for each of them.-Market Street Ry. Co. v. Hellman, 109 Cal. 571, 42 Pac. 225. § 454. Right to Stock in Consolidated Corporation. [a] Civil Code, section 309, prohibits the directors of a corporation from dividing, withdrawing, or paying to stockholders any part of the capital. Held, that where a mining corporation conveys its lands to another corporation in consideration of a part of the stock of the latter, such stock becomes capital of the former corporation, which neither the directors nor the stockholders can distribute among themselves.-Kohl v. Lilienthal, 81 Cal. 378, 22 Pac. 689, 6 L. R. A. 520, reversing (1889) 81 Cal. 378, 20 Pac. 401. FOR AUTHORITIES FROM OTHER STATES: 12 Cent. Dig., cols. 2351-2354, §§ 2341 2342. § 455. Rights and Liabilities of New Corporation. [a] An association of individuals, calling themselves the "Experimental Tunnel Company, ," located a mining claim and began work. Afterward the active members of this company, uniting with others, formed a corporation known as the "Table Mountain Tunnel Company, which was put in possession by these members. Held, that whatever |