(See "Non-Assessable.") Corporations in which shareholders can be lawfully held individually responsible, not one for the other, but equally and ratably, for all obligations of the corporation, to an amount equal to the face value of such shares; this in addition to the amount already invested therein. The shareholders of a corporation of this nature, with a capital stock of $100,000, can be held liable, as above, for an additional $100,000. All our national banks, except two,1 and certain other banking institutions chartered under many of the States are examples.
1 Section 5151 of the Revised Statutes of the United States in relation to personal liability of shareholders reads, in part, as follows: ..." except that shareholders of any banking association now existing under State laws having not less than five millions of dollars of capital actually paid in and a surplus of twenty per centum on hand, both to be determined by the Comptroller of the Currency, shall be liable only to the amount invested in their shares; and such surplus of twenty per centum shall be kept undiminished, and be in addition to the surplus provided for in this Title."
By this it would seem that the shareholders of the American Exchange National Bank and the National Bank of Commerce, both of New York City, are entitled to this exemption from " double liability " as when these banks were converted into national from State institutions, they met this part of the requirement of the act. Nevertheless, the Congressional Globe of April 26, 1864, in giving the discussion in Congress upon this act, shows that Senator Sherman said that it would u exempt the Bank of Commerce and no other bank.".
A stockholder in an insolvent institution of this kind might not be called upon for the full amount of his liability, it all depending upon the magnitude of the losses of the institution. Very frequently no additional sum is called for at all, but part of the original investment may be returned the stockholder in the shape of cash. In the former case he pays an " assessment;" in the latter case, he receives a " dividend in liquidation."
A recent United States Supreme Court decision is of interest as touching this subject. It establishes the fact that statutes of limitation by which a debtor would be cleared under State laws, in a certain number of years, do not affect the liability of stockholders of national banks, which are chartered under federal laws.
Double-Name Paper. Same as " Two-name Paper."