15 U.S.C. § 156 — Dissolution of corporation; trustees

submitted 104 years ago by ch. 346 to r/title-15-COMMERCE-AND-TRADE · 177 words · no verdicts yet

in plain englishAI-generated · not legal advice

When a China Trade Act corporation dissolves or loses its charter, its directors become trustees for its creditors and stockholders. A court can replace the directors with different trustees instead. Trustees wind up the company's business and divide what is left among stockholders, and can sue or be sued in the corporation's name.

If a China Trade Act corporation voluntarily dissolves, or its certificate of incorporation is revoked, its directors automatically become trustees. They act on behalf of the corporation's creditors and stockholders. There is an exception: a court can appoint different people as trustees instead of the directors. This can happen if an interested party applies to the United States Court for China, or if any court already handling a related case decides to do it on its own, at that court's discretion. The trustees have the power — and the duty — to do whatever is necessary to wind up the corporation's affairs. Once every debt and obligation has been settled, the trustees divide the remaining property among the stockholders, based on each stockholder's share of ownership. For legal purposes, the trustees can sue and be sued using the corporation's name. They are personally responsible — jointly and individually — to the stockholders and creditors, but only up to the value of the property that came into their hands as trustees.

the actual law source: uscode.house.gov ↗public domain

In case of the voluntary dissolution of a China Trade Act corporation or revocation of its certificate of incorporation, the directors of the corporation shall be trustees for the creditors and stockholders of the corporation; except that upon application to the United States Court for China by any interested party, or upon the motion of any court of competent jurisdiction in any proceeding pending before it, the court may in its discretion appoint as the trustees such persons, other than the directors, as it may determine. The trustees are invested with the powers, and shall do all acts, necessary to wind up the affairs of the corporation and divide among the stockholders according to their respective interests the property of the corporation remaining after all obligations against it have been settled. For the purposes of this section the trustees may sue and be sued in the name of the corporation and shall be jointly and severally liable to the stockholders and creditors of the corporation to the extent of the property coming into their hands as trustees.

Source credit: (Sept. 19, 1922, ch. 346, § 16, 42 Stat. 854.)

history & why it existsrecord from the source credit

1922Enacted · Act of Sept. 19, 1922, ch. 346 · 42 Stat. 854

A history note hasn’t been published yet. The record shows enactment by ch. 346 on 1922-09-19.

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