in the college, they will incur the labor and expense of obtaining the subscription to that amount, to be certified by Mr. Hunt or Mr. Johnson; that they will collect the same, and invest the amount collected permanently, and in some safe and secure manner; that they will collect, receive and pay over the annual interest forever thereafter to the teachers of the college, free from all charge upon this fund; and they engage to take upon themselves the care and expense of taking charge of the fund, and preserving it in all its integrity, upon a continued permanent investment, and of applying the income according to the designs of its public spirited, enlightened and liberal donors, free from all abatement; so that their charity may go down to all time, testifying to their liberality, and enabling this public institution to confer upon the community that is interested in its prosperity, the blessings of education and science. All this, they say, we will undertake on our part. The defendant says, very well; if you will promise for yourselves and your successors to perform this very charitable service if the subscribers will promise to pay you this amount, I am content, and will promise, as one of those subscribers, to pay you $8oo towards that fund, which promise is to be binding upon me, if responsible subscriptions are obtained to that amount in the opinion of Mr. Hunt or Mr. Johnson. It seems to me that this is a fair and rational paraphrase of the real agreement between these parties. And if so, is there not a mutuality in it? A promise on the part of the defendant to pay, provided the trustees will promise on their part to perform? I think the promise on the part of the trustees is valid, and obliges them to perform their agreement, and that therefore it furnishes a good consideration for the promise of the defendant. There is a contract made between the donors and the trustees, for the donation, security and disposition of the fund. The promise on the part of the trustees they have assumed and ratified by accepting the subscriptions and collecting the fund, and they have subjected themselves to a perpetual obligation to fulfill that promise in good faith. This obligation may be enforced at all times; and the manner of executing the trust on their part may always be the subject of judicial inquiry, and the court will require that the trusts and the promises are all fulfilled.

In the case of the Trustees of Dartmouth College v. Woodward (4 Wheat. 518), Ch. J. Marshall, speaking of the contributions to the fund of that institution, says: "These gifts were made, not indeed to make a profit to the donors, or their posterity, but for something in their opinion of inestimable value, for something which they deem a full equivalent for the money with which it was purchased. The consideration for which they stipulated is the perpetual application of the fund to its object, in the mode prescribed by themselves.' It is not important that the the consideration of a promise should be plainly expressed in the writing; it is enough if it appears from the nature of the instrument and the recitals contained in it. If it is manifest that there was in the minds of the parties some obligation assumed, or some service to be rendered by the promisee, as the equiva

lent asked for the promise by the promisor, the promise is not void for want of a consideration. The law upon this subject is well stated, and the authorities collected in Saund. Pl. & Ev. 147. I can not doubt but that the promise of the defendant was made upon a good consideration. *

*

For reversal 21, for affirmance 5.

See 23 Am. & Eng. Ency. 791 et seq.; Beach, § 584; Boone, § 108; Clark, §§ 93-7; Cook, §§ 71-5; Elliott, § 349; Langdell's Summary of Contracts, $S 183-7; Morawetz, §§ 43-59; Taylor, §§ 62-64, 509-12; I Thompson, §§ 1200-13; VII Thompson, §§ 8606–25.

Note. If subscriptions are acted upon and money is expended on the faith of them, the donor or subscriber is estopped from claiming there is no consideration. 1816, Kidwelly v. Raby, 2 Price (Eng. Exch.) 93; 1828, Amherst Academy v. Cowls, 6 Pick. (Mass.) 427; 1852, Kennebec, etc., R. R. Co. v. Palmer, 34 Maine 366; 1857, Wesleyan Seminary v. Fisher, 4 Mich. 514; 1877, Roche v. Roanoke Classical Sem., 56 Ind. 198; 1877, M. E. Church v. Kendall, 121 Mass. 528; 1878, Simpson Centenary College v. Bryan, 50 Iowa 293; 1881, Twin Creek, etc., Co. v. Lancaster, 79 Ky. 552; 1885, Osborn v. Crosby, 63 N. H. 583; 1886, Roberts v. Cobb, 103 N. Y. 600; 1897, School District v. Sheidley, 138 Mo. 673; 1898, Beatty v. Western College of Toledo, 177 Ill. 280, 42 L. R. A. 797; 1899, Lasar v. Johnson, 125 Cal. 549, 49 C. L. J. 409, 58 Pac. 161. Also, see, cases infra, pp. 482, 491-492. But, see, Bryants Pond, etc., Co. v. Felt, 87 Maine 234, infra, p. 474; Hudson Real Estate Co. v. Tower, 161 Mass. 10, infra, p. 478; Baptist Church v. Cornell, 117 N. Y. 601.

Sec. 100. The general form of such contract: As a rule, the form is immaterial, unless the statute or charter requires a particular form. It may be either a statutory or a common law contract.

NULTON v. CLAYTON.

1880. IN THE SUPREME COURT OF IOWA. 54 Iowa Reports, 425428, 37 Am. Rep. 213.

Action to recover upon an alleged subscription to the stock of a banking corporation. The question arises upon demurrer to the petition, the defendant claiming that the petition does not show that the defendant became a subscriber to the stock in such sense that he became obligated to take and pay for it. The corporation is the Farmers' and Merchants' Bank of Bloomfield. The plaintiff is the assignee of the corporation. The petition avers that the capital stock was divided into shares of $100 each, and that the defendant subscribed for ten shares. As constituting the subscription, the plaintiff sets out as an exhibit to his petition a certain written statement, and the articles of incorporation, both purporting to be subscribed by the defendant. The statement is in these words:

"We, the undersigned, having associated ourselves together for the purpose of organizing a banking association, and transacting the business of banking under chapter 52, of the revision of 1860, do declare and state as follows:

"First. The name and title of the association shall be The Farmers' and Merchants' Bank of Bloomfield, Iowa.

"Second. The authorized capital of said Farmers' and Merchants' Bank of Bloomfield, Iowa, shall be $150,000, which shall be divided into shares of $100 each.

"Third. The name and residence of the stockholders of this association, with the number of shares held by each, are as follows: "J. W. Clayton,

10 shares."

The essential part of the articles of incorporation is in these words: "Eighth. Fifty per cent. of all the stock subscribed for this association before it commences business shall be paid in at the time of commencing business, and the balance so subscribed shall be paid at such times and in such installments as the board of directors may prescribe."

The petition avers that the directors have called for full payment of all the stock subscribed.

To the petition so showing the defendant demurred. The court sustained the demurrer. Judgment having been rendered for the defendant, the plaintiff appeals.

ADAMS, Ch. J. The action is brought to recover one-half of the amount of the alleged subscription, the other half having already been paid. The defendant insists that it is not shown that he contracted to pay any sum whatever. The defendant did not become a stockholder by subscribing the articles of incorporation. If he became such he did so by subscribing what we have denominated the statement. The more important portion of it is the third division. That is a declaration purporting to be made by the associated persons showing each his respective interest in the corporation. Is it a subscription to stock? If so, the defendant is liable to pay for the number of shares set opposite his name, without a promise to do so in so many words. This has been held repeatedly.

In Spears v. Crawford, 14 Wend. 20,1 the writing subscribed was in these words:

"We, the subscribers, do hereby severally agree to take the shares by us subscribed in the Harlem Canal Company.' A certain number of shares was set opposite the name of each subscriber. The question presented was whether the mere agreement to take shares rendered the defendant liable to pay for them. The court held that it did.

In Hartford & New Haven R. Co. v. Kennedy, 12 Conn. 500, the word subscriber" was used in what was claimed to be the subscription to stock. It was held that the subscriber was liable to pay for the stock, without a promise to do so in so many words. The court said: "It is true a promise to pay in precise terms does not appear to have been made. The defendant has not affixed his signature to an instrument which contains the words, 'I promise to pay,' but he has done an equivalent act. He has contracted with the plaintiff to become a member of the corporation, and to be interested in its stock." In Rensselaer & W. Plank Road Co. v.Barton, 16 N. Y. 460, the 128 Am. Dec. 513.

court said: "Whatever may be the form or language of a subscription to the stock of an incorporated company, any person who in any manner becomes a subscriber for, or engages to take any portion of, the stock of such company, thereby assumes to pay according to the conditions of the charter." See, also, Small v. Herkimer Manufacturing and Hydraulic Co., 2 Comst. 335; Dayton v. Borst, 31 N. Y. 437; Hartford & New Haven R. Co. v. Croswell, 5 Hill 384; Waukon & Mississippi R. Co. v. Dwyer, 49 Iowa 121.

Probably the defendant would not deny that where there is a valid subscription to stock, or written agreement to take stock, there arises upon such subscription or agreement an obligation to pay for it. But the defendant insists that the writing in this case, whatever it may be called, falls short of being a subscription to stock, or agreement to take stock.

It declared that "the number of shares held by each are as follows:" Then follow names and amounts. The averment of the petition in substance is that the defendant by his contract subscribed for ten shares. By this we understand that the writing was signed by the defendant. The association purports to be incorporated under the general incorporation law. What purpose such a written declaration by the associated persons could have if they were not thereby to become subscribers, each for the amount set opposite his name, we are unable to conceive. It is suggested that the written declaration was, perhaps, designed as a written admission of a previous subscription, but we see no reason for a formal written admission of what must have been already in writing if there was a subscription to be admitted. It appears to us far more probable that the declaration was designed as a subscription. Now it matters not how informal the writing may be, if the intent of the parties can be collected from it. What the intent was in this case we have no reasonable doubt. The parties intended to adopt articles of incorporation, and become subscribers to the stock thereunder. If they did they became obligated to pay in accordance with the eighth article to which they made themselves parties.

Suppose a creditor of the association had brought an action upon his claim against the defendant, alleging that he is a partner. We think that the defendant might, and would, have set up the incorporation and sought shelter beneath it. There is no doubt that he in good faith attempted to become a member and limit his liability by the exemption provided. If he could have escaped liability as a partner by setting up the incorporation and his membership, he can not escape the limited liability incident to such membership.

We think that the demurrer was improperly sustained.
Reversed.

Note. For subscriptions to commissioners see Walker v. Devereaux, supra, p. 385.

For subscriptions to incorporators, see Nickum v. Burkhardt, supra, p. 391. See, also, 1819, Chester Glass Co. v. Dewey, 16 Mass. 94; 1841, Cheltenham, etc., R. Co. v. Daniel, 2 Q. B. 281; 1848, Lohman v. N. Y., etc., R. Co., 2 Sandf. (N. Y.) 39; 1856, Fisher v. Evansville, etc., R. Co., 7 Ind. 407; 1856,

Poughkeepsie & S. P. P. R. v. Griffin, 21 Barb. (N. Y.) 454; 1858, Mobile & O. R. Co. v. Yandall, 5 Sneed (Tenn.) 294; 1860, Clark v. Farrington, etc., 11 Wis. 306; 1864, Ashtabula & N. L. R. Co. v. Smith, 15 O. S. 328; 1869, Iowa & M. R. Co. v. Perkins, 28 Iowa 281; 1873, Peninsula R. Co. v. Duncan, 28 Mich. 130, infra, p. 482; 1878, Woodruff v. McDonald, 33 Ark. 97; 1882, Wheeler v. Millar, 90 N. Y. 353; 1893, Barron v. Burrill, 86 Maine 72, 29 Atl. 938; 1896, Ventura, etc., R. Co. v. Collins, 116 Cal. 260, 46 Pac. Rep. 287. See, also, 23 Am. & Eng. Ency., p. 786, et seq.; Beach, §§ 61-5; Boone, § 108; Cook, §§ 52-3; Elliott, § 348; Morawetz, § 43, et seq.; Taylor, §§ 509-12; I Thompson, §§ 1136-95; II Thompson, §§ 1305, 1788.

Writing is not necessary-statute of frauds does not apply. 1853, Chaffin v. Cummings, 37 Maine 76; 1858, Cookney's Case, 3 DeG. & J. 170; 1886, Colfax Hotel Co. v. Lyon, 69 Iowa 683; 1887, Wemple v. R. R. Co., 120 III. 196; 1887, Bullock v. Falmouth, etc., Co., 85 Ky. 184; 1893, Webb v. R. R. Co., 77 Md. 92, infra, p. 528: 1894, York v. Park Building Assn., 39 Neb. 834; 1895, Shellenberger v. Patterson, 168 Pa. St. 30; 1895, Tabler v. Anglo-American Assn., 32 S. W. (Ky.) 602. See, Cook, §§ 52-3; Elliott, § 348; I Thompson, $$ 1146-7. Contra, a subscription requires writing, for subscribe literally means an underwriting. 1827, Thames T. Co. v. Sheldon, 6 B. &. C. 341; 1858, Pittsburgh, etc., R. Co. v. Gazzam, 32 Pa. St. 340; 1877, Galveston Hotel Co. v. Bolton, 46 Tex. 633; 1878, Freeland v. N. J. Stone Co., 29 N. J. Eq. 188; 1887, Fanning v. Ins. Co., 37 O. S. 339, 41 Am. Rep. 517.

Subscription may be assigned-Taylor (5th ed.) §§ 01, 102; 1902, Manchester v. Williams, N. H.- 52 Atl. 461, 16 Am. & E. C. C. (N. S.) 884.

ARTICLE II. FORMS OF ASSOCIATION CONTRACTS; STATUTORY SUB

THE SEDALIA, WARSAW & SOUTHERN RY., APPELLANT, V. WILKERSON, ADMINISTRATOR.1

1884. IN THE SUPREME COURT OF MISSOURI. 83 Missouri Reports 235-244.

MARTIN, C. This is an action to enforce an alleged subscription to the capital stock of plaintiff. The demand was first presented in the probate court for allowance against the estate of the subscriber, and was taken thence by appeal to the circuit court. The principal facts in the case are set forth in the following agreed statement:

It is hereby stipulated and agreed by and between the parties hereto, that upon the trial of this case the following facts shall stand admitted, viz.:

1. That the plaintiff is a railroad corporation, created and existing under the general railroad incorporation laws of the state, under the corporate name of the Sedalia, Warsaw and Southern Railway Company.

2. That its articles of association .were filed in the office of the secretary of state, September 16, 1879, the same having been pre1 Arguments omitted.

1