BANKS AND BANKING - LIABILITY OF STOCKHOLDERS FOR DEBTS IN INSOLVENCIES OCCURRING AFTER TRANSFER OF STOCK

Authors

Warren W. Kennerly, University of Michigan Law School

Abstract

The effect of the holding of the Sanders case is of special interest at the present time because of the large number of recent bank failures. This decision may possibly result in former stockholders of Illinois state banks and the heirs of former stockholders being subjected to an assessment on stock that was disposed of several decades ago. The holding is applicable only to state banks, since national banks are not subject to state regulation. It would not be surprising if this Illinois holding should be followed in Nebraska, since the latter state has already based some of its rulings as to the liability of stockholders on Illinois decisions. Probably, this will be the extent of the persuasive effect of the Sanders decision, because it seems extremely unlikely that the courts of Washington, Iowa, or West Virginia will abandon the strained constructions they have previously adopted for the purpose of avoiding the imposition of an oppressive liability on stockholders.

Recommended Citation

Warren W. Kennerly, BANKS AND BANKING - LIABILITY OF STOCKHOLDERS FOR DEBTS IN INSOLVENCIES OCCURRING AFTER TRANSFER OF STOCK, 30 Mich. L. Rev. 1270 (1932).
Available at: https://repository.law.umich.edu/mlr/vol30/iss8/7