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CERTIFICATES OF STOCK AND THEIR TRANSFER

EMBASSY FARMS, INC. VS COURT OF APPEALS
188 SCRA 492 (Aug. 13, 1990)
FACTS:
MOA Eduardo Evangelista (EBE) is obligated to transfer
to Alexander Asuncion (AGA) 19 parcels of agricultural
land registered in his name, together with the stocks,
equipment, and facilities of a piggery farms owned by
petitioner Embassy Farms, a registered corporation, 90%
of which is owned by EBE.
EBE also obligated himself to cede, transfer, and convey
in any manner absolute and irrevocable any and all of
his shares of stocks in Embassy Farms to AGA or his
nominees until the total shares of stock so transferred
shall constitute 90% of the paid-in equity of said
corporation within a reasonable time from signing the
document.
AGA obligated himself to pay upon signing of the
agreement to pay EBE P8.6M; also, he obligated
himself to organize and register a new corporation with
an authorized capital stock of P10M which upon
registration will take over all the rights and liabilities of
AGA.
Pursuant to the MOA, EBE:
- Turned over to AGA the effective control and
management of the piggery at Embassy Farms;
- He served as president and Chief Executive of
Embassy Farms;
- He endorsed in blank all his shares of stock.
However, despite the indorsement, EBE retained the
possession of said shares and opted to deliver to AGA
only upon full compliance of the latter his obligations
under the MOA.
Notwithstanding the non-delivery of the shares of stocks,
AGA transferred a total of 8,602 shares to several
persons thru a Deed of Transfer of Shares of Stocks.
For failure to comply with his obligations, EBE intimated
the institution of appropriate legal action.
AGA preempted EBE by filing an action for rescission of
the MOA with damages.
ISSUE: Who has a better right over the shares and control of
the corporate affairs?
HELD:
It can be gleaned from the facts that there was no
delivery of the indorsed shares of stock, AGA cannot
therefore effectively transfer to other person or his
nominees the undelivered shares of stocks.
For an effective transfer of shares of stock, the mode and
manner of transfer as prescribed by law must be
followed. As provided under Section 63 of BP 68
otherwise known as the Corporation Code, shares of
stock may be transferred by the delivery to the
transferee of the certificate properly indorsed. Title may
be vested in the transferee by the delivery of the duly
indorsed certificate of stock. However, no transfer shall
be valid, except between the parties until the transfer is
properly recorded in the books of the corporation.
In the case at bar, the indorsed certificate of stock was
not actually delivered to AGA so that EBE is still
controlling stockholder of Embassy Farms despite the
execution of the MOA and the turnover of control and
management of the Embassy Farms to AGA.

RAZON VS ITERMEDIATE APPELLATE COURT
207 SCRA 234 (March 16, 1992)
FACTS:
E. Razon Inc. was organized by petitioner Razon for the
purpose of participating the bidding for the arrastre
services in Manila.
According to petitioner, some of the incorporators
withdrew from the said corporation.
Petitioner then distributed the stocks placed previously
in the names of the withdrawing nominal incorporators
to some friends, among them was the late Juan Chuidian
to whom he gave 1,500 shares of stock.
The said shares was registered in the name of Chuidian
only as a nominal stockholder and the agreement that
the said shares were owned and held by petitioner but
Chiudian was given the option to buy the same.
IN view of this agreement, Chuidian delivered to the
petitioner the stock certificate covering the stock
certificate covering the 1,500 shares of stock.
Since then, petitioner had in his possession the cert of
stock until the time, he delivered it for deposit with the
Phil. Bank of Commerce under the parties joint custody
pursuant to their agreement as embodied in the trial
courts order.
Petitioner maintains that his oral testimony as regards to
the nature of his agreement with the late Chiudian is
sufficient on the said shares, is sufficient to prove his
ownership over the said stocks.
ISSUE: Whether petitioner Razon is the rightful owner of the
shares.
HELD:
For an effective transfer of shares of stock, the mode and
manner of transfer as prescribed by law must be
followed. As provided under Section 63 of BP 68
otherwise known as the Corporation Code, shares of
stock may be transferred by the delivery to the
transferee of the certificate properly indorsed. Title may
be vested in the transferee by the delivery of the duly
indorsed certificate of stock. However, no transfer shall
be valid, except between the parties until the transfer is
properly recorded in the books of the corporation.
In the instant case, there is no dispute that the
questioned 1,500 shares of tock of E. Razon Inc. are in
the name of the late Juan Chuidian in the book of the
corporation.
Moreover, the records show that he was a stockholder of
the corporation. From the point of view of the
corporation, Chuidian was the owner of the 1,500 shares
of stock.
In such a case, the petitioner who claims ownership over
the questioned shares of stock must show that the same
were transferred to him by proving that all the
requirements for the effective transfer of shares of stock
in accordance with the corporations by laws, if any, were
followed or in accordance with the provisions of the law.
Petitioner failed in both instances. Petitioner did not
present any by-laws which could show that the 1,500
shares were effectively transferred to him.
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Since the certificate of stock covering the questioned
1,500 shares of stock registered in the name of late
Chuidian was never indorsed to petitioner, the inevitable
conclusion is that the questioned shares of stock belong
to Chuidian.
The indorsement of the certificate of stock is a
mandatory requirement of law for an effective transfer
of a certificate of stock.

RURAL BANK OF SALINAS VS COURT OF APPEALS
210 SCRA 510 (26 June 1992)
FACTS:
Clemente Guerero, president of Rural Bank of Salinas,
Inc., executed a special power of attorney in favor of his
wife, Melania Guerero, giving the latter full power and
authority to sell or otherwise of and/or mortgage 473
shares of stock of the bank.
Pursuant to said SPA, Melania executed Deed of
Assignment in favor of respondents, and 2 others.
2 days before the death of Clemente,
Subsequently, Melania presented to the bank the 2
parcels of deed of assignment for registration with a
request for the transfer in the Banks stock and transfer
book of the 473 shares of stock so assigned, the
cancellation of stock certificates, and the issuance of the
new stock certificates in the name of the new owners
thereof.
However, the bank denied the request.
Respondent Melania filed with the SEC an action for
mandamus against petitioner Rural Bank of Salinas, its
president and corporate secretary.
A motion for intervention was filed by Maripol Guerrero,
legally adopted daughter of Clemente and Melania,
wherein he claimed that a petition for the admin of the
estate had been filed with the RTC and the deeds of
assignment was fictitious and antedated.
SEC affirmed the decision of the hearing officer granting
the writ of mandamus. The same was affirmed by the CA;
hence this appeal.
ISSUE: W/N respondent erred in sustaining SEC when it
compelled by mandamus petitioner bank to register in its
stock and transfer book the transfer of 473 shares of stock to
private respondents.
HELD:
NO, SEC correctly ruled in favor of CA.
Section 63 of the Corporation Code provides that shares
of stock so issued are personal property and may be
transferred by delivery of the certificates so indorsed by
the owner or his attorney-in-fact or other person legally
authorized to make the transfer. No transfer, however,
shall be valid, except as between the parties, until the
transfer is recorded in the books of the corporation.
Said section contemplates no restriction as to whom the
stocks may be transferred. It does not suggest that any
discrimination any be created by the corporation in favor
of, or against a certain purchaser. The owner of shares,
as owner of personal property, is at liberty, under said
section to dispose them in favor of whomever he
pleases, without limitation in this respect, than the
general provisions of law.
The only limitation imposed by law is when the
corporation holds any unpaid claim against the shares
intended to be transferred, which is absent here.
A corporation, either by its board, its by-laws, or the act
of its officers, cannot create restrictions in stock
transfers, because restrictions in the traffic of stock must
have their source in legislative enactment, as the
corporation itself cannot create such impediment. By-
laws are intended merely for the protection of the
corporation, and prescribe regulation, not restriction.
The right of a transferee/assignee to have stocks
transferred to his name an inherent right flowing from
his ownership of the stocks.
The corporations obligation to register is ministerial. In
transferring stock, the secretary of a corporation acts in
purely ministerial capacity, and does not try to decide
the question of ownership. The duty of the corporation
to transfer is a ministerial one and if it refuses to make
such transaction without good cause, it may be
compelled to do so by mandamus.
For the petitioner to refuse registration of the
transferred shares in its stock and transfer book, which
duty is ministerial on its part, is to render nugatory and
ineffectual the spirit and intent of Section 63 of the
Corporation Code. Thus, respondent CA did not err in
upholding the decision of SEC

TAY VS. COURT OF APPEALS
GR No. 126891 (5 August 1998)
FACTS:
Sy Guiok secured a loan from petitioner in the amount of
P40,000. To secure payment, respondent Guiok executed
a Contract of Pledge in favor of the petitioner whereby
he pledged his 300 shares of stock in the Go Fay & Co.
Inc. On the same date, Alfonso Sy Lim secured a loan
from petitioner in the amount of P40,000 and executed a
contract of Pledge covering his 300 shares of stock with
Go Fay & Co., Inc. to secure payment of his loan.
Guiok and Sy Lim endorsed their respective shares of
stock in blank and delivered the same to the petitioner.
However, Guiok and Sy Lim failed to pay their respective
loans and the accrued interest thereon.
Petitioner filed a Petition for Mandamus against
respondent corporation, praying that an order directing
the corp secretary to register the stock transfers and
issue new certificates in favor of Lim Tay.
ISSUE: W/N petitioner is entitled to the relief of mandamus
as against the respondent Go Fay & Co., Inc.
HELD:
No, he is not entitled to the relief of mandamus.
Petitioners reliance on the doctrine set forth in Abejo v
De la Cruz and Rural Bank Salinas vs CA is misplaced.
Like Abejo spouses, respondents Rural Bank of Salinas
were already prima facie shareholders when the deeds of
assignment were questioned. If the said deeds were to
be annulled later on, respondents would still be
considered shareholders of the corporation from the
time of the assignment until the annulment of such
contracts.
In order that a writ of mandamus may issue, it is
essential that the person petitioning for the same has a
clear legal right to the thing demanded and that it is the
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imperative duty of the respondent to perform the act
required. It neither confers powers nor imposes duties
and is never issued in doubtful cases. It is simply a
command to exercise a power already possessed and to
perform a duty already imposed.
In the present case, petitioner has failed to establish a
clear legal right. Quite the contrary and as already
shown, he does not have any ownership rights at all. At
the time petitioner instituted his suit at the SEC, his
ownership claim had no prima facie leg to stand on. At
best, his contention was disputable and uncertain.
Mandamus will not issue to establish a legal right, but
only to enforce one that is already clearly established.
PLEDGE there is no showing that petitioner made any
attempt to foreclose or sell the shares through public or
private auction, as stipulated in the contracts of pledge
and as required by Article 2112 of the Civil Code. Unless
the thing pledge is expropriated, the debtor continues to
be the owner thereof.

RURAL BANK OF LIPA CITY, INC. VS COURT OF APPEALS
366 SCRA 188 (28 September 2001)
FACTS:
Respondent Reynaldo Villanueva, Sr. stockholder of Rural
Bank of Lipa City, executed a Deed of Assignment
wherein he assigned his shares, as well as those of 8
stockholders under his control with a total of 10,457
shares, in favor of the Bank represented by its BoD.
Villanuevas executed an agreement acknowledging its
indebtedness to the bank P4M which will be paid out of
the proceeds of the sale of real property.
The spouses assured the Bank that their debt will be
paid otherwise the bank would be entitled to liquidate
their shareholdings, including those under their control.
When the spouses failed to settle their obligation, the
Board sent them a letter demanding 1) the surrender of
all stockholders issued to them; and 2) the delivery of
sufficient collateral to secure the balance of their debt
amounting to P3.4 M.
The Villanuevas ignored the Banks demands, whereupon
their shares has been converted into treasury shares.
The stockholders of the Bank met to elect the new
directors and set of officers, but the spouses were not
notified.
In a letter, the Villanuevas questioned the legality of the
conversion of their shares and the validity of the
proceedings therein. In reply, the officers of the bank
informed the spouses that they were no longer entitled
to notice of the said meeting since they had relinquished
their rights as stockholders in favor of the Bank.
Consequently, the Villanuevas filed with the SEC a
petition for annulment of the Stockholder
SEC granted the issuance of a writ of preliminary
injunction upon finding that since the Villanuevas have
not disposed of their shares, voluntary or involuntarily,
they were entitled to notice of the annual stockholders
meeting.
SEC issued TRO preventing petitioners from holding
the stockholders meeting and electing the new
directors.
CA dismissed the petition for review; hence, this instant
petition for review.
ISSUE: W/N the transfer of title to such shares is ineffective
until and unless the duly indorsed certificate of stock is
delivered to them, notwithstanding the execution of the deed
of assignment.
HELD:
While it may be true that there was an assignment of
private respondents shares to the petitioners, said
assignment was not sufficient to effect the transfer of
shares since there was no endorsement of the
certificates by the owners, their attorneys-in-fact or any
other person legally authorized to make the transfer.
Moreover, petitioners admit the assignment was not
coupled with delivery of the stock duly endorsed by the
owner is the operative act of transfer of shares from the
lawful owner to the transferee. Thus, title may be vested
by the transferee only by the delivery of the duly
indorsed certificate of stock.
Requirements for a valid transfer of stocks:
1. There must be delivery of the stock certificate;
2. The certificate must be endorsed by the owner or his
attorney-in-fact or other persons legally authorized to
make the transfer; and
3. To be valid against 3
rd
parties, the transfer must be
recorded in the books of the corporation.
There being no showing that any of the requisites
mandated by law was complied with, the SEC hearing
officer did not abuse his discretion in granting the
issuance of the preliminary injunction.
CAs decision is affirmed.

TAN VS SEC
206 SCRA 740 (2 March 1993)
FACTS:
Due to the withdrawal of incorporators, and in order to
complete the membership of the 5 directors, petitioner
sold 50 shares to his brother Angel Tan.
As a result of the sale, certificate no. 2 was cancelled and
the corresponding cert Nos 6 & 8 was issued, signed by
the newly elected member of the Board, Angel Tan, VP,
upon instruction of Alfonso Tan, then president of the
corp.
[cancelled] cert 2 petitioner Alfonso Tan [400 shares]
[new]Cert 6 Angel Tan (50 shares)
[new]Cert 8 petitioner Alfonso Tan (350 shares)
Petitioner did not endorsed the certificates, instead he
kept the cancelled certificate (No. 2) and returned only
Cert. No. 8
When petitioner was dislodged as President, he
withdrew from the position on the condition that he be
paid 33.3% in lieu of the stock value of his shares.
After the withdrawal of the stocks, the BoD held a
meeting effecting the cancellation of Stock Certificate
Nos. 2 & 8.
After 5 years and 9 months after the transfer of 50 shares
to his brother, petitioner filed a case before the SEC
questioning the first time, the cancellation of the
aforesaid Stock certificates Nos 2 and 8.
The SEC Hearing Officer ruled that the cancellation of
stock certificate no. 2 and the subsequent issuance of
Stock No. 8 is declared null and void.
The Commission en Banc overturned the decision of the
Hearing Officer.
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ISSUE: W/N the cancellation and transfer of the petitioners
shares and Stock No. 2 was valid.
HELD:
YES, the cancellation ad transfer was valid.
In the case Tuason v La Provisora Filipina, the Court held
that: but delivery is not essential where it appears that
the person sought to be held as stockholder are officers
of the corporation, and have already custody of the stock
book.
Under the present case, the fact of the matter is. The
new holder Angel Tan, has already exercised his rights
and prerogatives as stockholder and was even elected as
member of the BoD in the corp with the full knowledge
and acquiescence of petitioner. Due to the transfer, Tan
was clothed with rights and responsibility in the board of
the crop when he was elected as member thereof.
Petitioners argument that the cancellation of Stock
Certificates Nos. 2 and 8 was null and void for lack of
delivery of the cancelled mother certificate No. 2
whose endorsement was deliberately withheld by
petitioner, is to prescribe certain restrictions on the
transfer of stock in violation of the Corporation Law
itself.

NAVA VS PEERS MARKETING
74 SCRA 65 (25 November 1976)
FACTS:
Teofilo Po as an incorporator subscribed to 80 shares of
Peers Mktg Corp. at P100/share P80,000. Po paid
P2,000. No certificate of stock was issued to him, or for
that matter, to any incorporator, subscriber or
stockholder.
Po sold to Ricardo Nava for P2,000 20 of his 80 shares. In
the deed of sale, Po represented that he was the
absolute and registered owner of 20 shares of Peers
Marketing Corporation.
Nava requested the officers of the corporation to register
the sale in the books of the corp, but the same was
denied since Po has no paid full the amount of his
subscription. Nava was informed that Po was delinquent
in the payment of the balance due on his subscription
and that the corporation had a claim on his entire
subscription.
Nava filed his mandamus action in the CFI to compel the
corporation and the executive VP and secretary to
register the said 20 shares in Navas name in the corps
transfer book.
Respondent countered that no shares of stock against
the corp which the corp holds an unpaid claim are
transferrable in the books of the corp.
ISSUE: W/N the officers of Peers Mktg Corp can be compelled
by mandamus to enter in its stock and transfer book the sale
made by Po to Nava of the 20 shares forming part of Pos
subscription of 80 shares, with a total Par value of P8,000 and
for which Po had only paid P2,000, it being admitted that the
corporation has an unpaid claim of P6,000 as the balance due
on Pos subscription and that the 20 shares are not covered
by any stock certificate.
HELD:
The transfer made by Po to Nave is not the alienation,
sale, or transfer of stock that is supposed to be recorded
in the stock and transfer book as contemplated in section
52 of the corporation law.
As a rule, the shares which may be alienated are those
which are covered by certificates of stock, as shown in
the following provisions of the corporation law:
1. Section 35 shares of stock may be transferred
by delivery to the transferee of the certificate
properly indorsed.
2. Section 36 voting trust agreement
The usual practice is for stockholder to sign the form on
the back of the stock certificate. The certificate may
thereafter be transferred from one person to another. If
the holder of the certificate desires to assume the legal
rights of a shareholder to enable him to vote at
corporate elections and to receive dividends, he fills up
the blanks in the form by inserting his own name as
transferee. Then he delivers the certificate to the
secretary of the corporation so that the transfer may be
entered in the corporations books. The certificate is then
surrendered and a new one issued to the transferee.
That procedure cannot be followed in the instant case
because, as already noted, the 20 shares in question are
not covered by any cert of stock in Pos name. Moreover,
the corp has a claim on the said shares for the unpaid
balance of Pos subscription.
Under the facts for this case, there is no clear legal duty
on the part of the officers of the corp to register the 20
shares in Navas name. Hence there is no cause of action
for mandamus.

WON VS WACK WACK GOLF & COUNTRY CLUB
104 Phil. 466 (30 August 1959)
FACTS:
Defendant corporation issued to Iwao Teruyama
membership certificate which was assigned to MT Reyes
on April 22, 1944.
Subsequently, MT Reyes transferred and assigned said
certificates to the plaintiff.
Plaintiff filed an action with the CFI against the defendant
alleging that shortly after the rehabilitation of the
defendant, after the war, the defendant refused to
register in its book the assignment in favor of plaintiff
and to issue the latter a new certificate; and praying that
the plaintiff be declared the owner of one share
certificate.
Defendant countered that the plaintiffs right of action
had accrued, to April 6, 1955, when the complaint was
filed, 11 years have elapsed, and that therefore the
complaint was filed beyond the 5-year period fixed by
Art. 1149 of the Civil Code.
CFI dismissed the complaint. The MR was denied; hence,
this appeal.
ISSUE: W/N the plaintiff was bound, under the said condition
and by-laws of the defendant or any statutory rule for that
matter, to present and register the certificate assigned to him
in 1944 within any definite or fixed period.
HELD:
From the moment the certificate was assigned to the
plaintiff, the latters right to have the assignment
registered commenced to exist, but it would not follow
that that said right should be exercised immediately or
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within a definite period. The existence of right is one
thing, and the duration of said right is another.
It is stated that the appealed order of dismissal that the
plaintiff sought to register the assignment on April 13,
1955; whereas the plaintiffs brief, it is alleged that it was
only in Febraury 1955 when the defendant refused to
recognize the plaintiff.
If, as already observed, there is no fixed period for
registering an assignment, how can the complaint be
considered as already barred by the Statute of
Limitations when it was filed on April 26, 1955, or barely
a few days and 2 months (according to the plaintiff) after
demand for registration and its denial by the defendant.
Plaintiffs right was violated only sometime in 1955, and
it could not accordingly have asserted any cause of action
against the defendant before that.

DE LOS SANTOS AND ASTRAQUILLO VS
REPUBLIC & MCGRATH
95 Phil 577 (28 February 1955)
FACTS:
Several stock certificates covering 1,600,000 shares of
the Lepanto Consolidated Mining Co., Inc. issued in favor
of Vicente Madrigal, who is registered owner in the
books of the corporation whose indorsement in blank
appears in the back of the certificate.
shares are claimed by de los Santos and the other half
by Astraquillo bought from Juan Campos and Carl Hess.
During the pendency of the case, Astroquillo allegedly
conveyed and assigned his interest in and to de los
Santos.
Defendants contention: prior to the outbreak of the war,
Vicente Madrigal, the registered owner of the subjects
shares, allegedly delivered the corresponding stock
certificates , with his indorsement in blank thereon, to
the Mitsuis, which kept the said certificates until the
liberation of the latter by the American forces in 1945;
that the Mituis never sold, or otherwise disposed of the
said shares of stock; and that the stock certificate
aforementioned must have been looted during the
emergency resulting from said liberation.
Plaintiff instituted the present action to establish title to
the aforementioned shares of stock.
CFI favored plaintiffs.
ISSUE: W/N the plaintiffs are entitled to the subject shares.
HELD:
NO, the plaintiffs are not entitled to the said shares.
Pursuant to Section 35 of the Corporation Law, a share of
stock may be transferred by endorsement of the
corresponding stock certificate, coupled with delivery.
However, the transfer shall not be valid, except as
between the parties until it is entered and noted upon
the books of the corporation.
No such entry in the name of the plaintiffs has been
made, it follows that the transfer allegedly effected by
Juan Campos and Carl Hess in their favor is not valid or,
in the words of the SC absolutely void and, hence, as
good as non-existent insofar as Madrigal and the Mitsuis
are concerned.
Although a stock certificate is sometimes regarded as
non-negotiable , in the sense that it may be transferred
by endorsement, coupled with delivery, it is well settled
that the instrument is non-negotiable, because the
holder thereof takes it without prejudice to such rights or
defenses as the registered owner or creditor may have
under the law.
Certificates of stock are not negotiable instruments.
Consequently, a transferee under a forged assignment
acquires no title which can be asserted against the true
owner, unless his own negligence has been such as to
create an estoppels against him. If the owner of the
certificate has endorsed it in blank, and it is stolen from
him, no title is acquired by an innocent purchaser for
value.
In the case at bar, neither Madrigal no the Mitsuis had
alienated the shares of stock in question. It is not even
claimed that either had, through negligence, given
occasion for an improper or irregular disposition of the
corresponding stock certificates.

ISSUANCE OF STOCK CERTIFICATES

FUA CUN VS SUMMERS AND CHINA BANKING CORP.
44 Phil 705 (27 March 1923)
FACTS:
On August 26, 1920 Chua Soco subscribed for 500 shares
of stock of defendant China Banking Corp. at a par value
of P100 per share, paying the sum of P25,000, of the
subscription price, in cash, for which a receipt was
issued.
Soco then executed a promissory note in favor of
petitioner Fua Cun for the sum of P25,000 with chattel
mortgage on the subscribed shares. The shares was also
endorsed and delivered to the mortgagee.
In the meantime, Soco appears to have become indebted
to the bank P37k for dishonored acceptances of
commercial paper and in an action brought against him
to recover this amount, Socos interest in the 500
subscribed shares for was attached and the receipt
seized by the sheriff. The attachment was levied after the
defendant bank had received notice of the fact that the
receipt had been endorsed over to the sheriff.
Fua Cun brought the present action maintaining that by
virtue of the payment of the of the subscription price
of 500 shares, Soco in effect became the owner of 250
shares ; and he prayed that by virtue of the chattel , be
declared to have priority over the claim of the bank.
Trial court declared Soco, through the payment of
P250K, acquired right to 250 shares fully paid-up, upon
which shares the plaintiff holds a lien superior to that of
the defendant Bank and ordering that the receipt be
returned to said plaintiff. Hence, this appeal.
ISSUE: W/N Fua Cun has a superior right over the subscribed
shares to that of the banking corporation even if the same
was only paid in half.
HELD:
YES. The claim of the bank was for the non-payment of
drafts accepted by Soco and had no direct connection
with the shares of stock in question. At common law, a
corporation has no lien upon the shares of stockholders
for any indebtedness to the corporation.
There can be no doubt that an equity in shares of stock
may be assigned and that the assignment is valid as
between the parties and as to persons to whom notice is
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brought home, such an assignment exists here, though it
was made for the purpose of securing a debt.
The endorsement was accompanied by the delivery of
the receipt to the plaintiff and further strengthened by
the execution of the chattel mortgage, at least, operated
as a conditional equitable assignment.
As against the rights of the plaintiff, the defendant bank
had, as we have seen, no lien unless by virtue of the
attachment. But the attachment was levied after the
bank had received notice of the assignment of SOcos
interest to the plaintiff and was therefore subject to the
rights of the latter. It follows that as against these rights
the bank holds no lien whatsoever.
As already stated, the court erred in holding that the
plaintiff as the owner of the 250 shares of stock; the
plaintiffs right in an equity in 500 shares and upon
payment of the unpaid portion of the subscription price
he becomes entitled to the issuance of the certificate for
said 500 shares in his favor.
SC judgment is modified accordingly, and in all other
respects it is affirmed.