§ 569.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. IX. gate value of his stock substantially the same. It is of no spe- cial importance whether that value be divided into a few or many shares." ' § 569. The power of a corporation to purchase its own shares or increase or decrease its capital stock has already been discussed. 2 If the capital stock is increased by the proper authorities, the right to take the additional shares vests in the shareholders pro rata? This right may be waived ; but the directors cannot deprive a shareholder of it, 4 nor burden it with conditions unauthorized by the charter or enabling act, as for instance, the payment of so much per share for the privi- lege of subscribing. 5 Accordingly, when a corporation is issuing new stock generally and refuses to issue to a share- holder his due proportion, he can compel it to do so by a suit in equity ; at least so long as there remains stock undisposed of. 6 And when new stock is issued to share equally with the Risjlit to subscribe to addi- tional shares on an increase of the capi- tal stock. 1 Still the decision of this case seems really to have turned on the plaintiffs own laches. 2 § 133. 8 Real Estate Trust Co. v. Bird, 90 Md. 229. When a corporation in- creases its shares on the basis of its property already owned, and not with a view to sell them to raise more money, the increase belongs to the shareholders in proportion to their holdings. Knapp v. Publishers, etc., Co., 127 Mo. 53. 4 Humboldt Driving Park Ass'n v. Stevens, 34 Neb. 528; Eidman v. Bow- man, 58 111. 444; Hart v. St. Charles St. R. R. Co., 30 La. Ann. Pt. I. 758; Jones v. Morrison, 31 Minn. 140. In the last case the stock of a corpora- tion was all held by a few holders, the plaintiff owning about one-third of it. While he was absent in Europe, a vote was passed (as was competent) to increase the stock, which was worth much more than par, and to allow the old shareholders to sub- scribe in proportion to their shares. 576 This privilege was limited in time to a shorter period than was possible for the plaintiff to act in the matter, as the rest knew. It was held that he had a right to subscribe after such period had expired. See also Ark. V. Ag. Soc. v. Eichholtz, 45 Kan. 164. 5 Cunningham's Appeal, 108 Pa. St. 546. See De La Caesta v. Insur- ance Co., 136 Pa. St. 62; compare Reading Tr. Co. u. Reading I. Works, 137 Pa. St. 282; Electric Co. of Am. o. Edison Electric Co., 200 Pa. St. 516. Dousman U.Wisconsin, etc., M'g Co., 40 Wise. 418. It seems, also, that the shareholder could have maintained an action for damages against the corporation. lb. Cf. Way v. American Grease Co., 67 N. J. Eq. 263; Merideth v. Zinc & Iron Co., 55 N. J. Eq. 211. When a corporation has issued the full number of shares author- ized, no court can compel it to issue further shares unless some of the shares originally issued were void.
