Allen v. Arnold

Assuming that the provisions of Pub. Stat. R.I. cap. 155, "Of Manufacturing Corporations," to which, by its charter, the Warwick and Coventry Water Company is made subject, are applicable to that company which has no manufactory established either within or without this State, we do not think that the complainant is entitled to maintain his bill against the stockholders of that company, either to enforce their statutory liability or for contribution on the ground that they have not paid in full their subscriptions to the capital stock, until he has first exhausted his remedy against the company by obtaining a judgment at law against it and having the execution on that judgment returned unsatisfied, the reason being that the primary liability is that of the corporation, that of the stockholders being merely secondary. 1 Cook on Stock and Stockholders and Corporation Law, 3d ed. §§ 199, 200, 219, and notes.

Demurrer sustained.