US SUPREME COURT DECISIONS

1. By a statute of Missouri, stockholders of a corporation at its dissolution are liable for its debts, but it is provided that no person holding stock as executor, administrator, guardian, or trustee, and no person holding stock as collateral security, shall be personally subject to such liability, but the persona pledging such stock shall be considered as holding the same, and liable, and the estates and funds in the hands of executors &c., shall be liable. Held 1. That persona to whom a corporation pledges its stock as collateral security are within the exemption of the statute. 2. That certificates of the stock absolute on their face, issued in trust or as collateral security to a creditor, may be shown to be so held by evidence in pals. 3. That the person holding such stock in trust or as collateral security, is not by his voting thereon, estopped from showing that it belongs to the company and that he holds it as collateral security.

2. The Supreme Court of Missouri, after the circuit court had decided this case, made a contrary decision against the same stockholders at the suit of another plaintiff, holding that the clause of exemption in the statute does not extend to persons receiving from the corporation itself stock as collateral security. Held that this Court is not bound to follow the decision.

3. The courts of the United States, in the administration of state laws in cases between citizens of different states, have an independent jurisdiction coordinate with that of the state courts, and are bound to exercise their own judgment as to the meaning and effect of those laws.

4. Where, however, by the course of the decisions of the state courts, certain rules are established which become rules of property and action in the state and have all the effect of law -- especially with regard to the law of real estate and the construction of state constitutions and statutes -- the courts of the United States always regard such rules as authoritative declarations of what the law is. But where the law has not been thus settled, it is their right and duty to exercise their own judgment, as they also always do in reference to the doctrines of commercial law and general jurisprudence, and when contracts and transactions have been entered into and rights have accrued thereon under a particular state of the decisions of the state tribunals, or when there has been no decision, the courts of the United States assert the right to adopt their own interpretation of the law applicable to the case although a different interpretation may be given by the state courts after such rights have accrued. chanrobles.com-redchanrobles.com-red

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5. But even in such cases, for the sake of harmony and to avoid confusion, the courts of the United States will lean toward an agreement of views with the state courts if the question seems to them balanced with doubt.

6. Acting on these principles of comity, the courts of the United States, without sacrificing their own dignity as independent tribunals, endeavor to avoid, and in most cases do avoid, any unseemly conflict with the well considered decisions of the state courts.

7. As, however, the very object of giving to the national courts jurisdiction to administer the laws of the states in controversies between citizens of different states was to institute independent tribunals which it might be supposed would be unaffected by local prejudices and sectional views, it is their duty to exercise an independent judgment in cases not foreclosed by previous adjudication.

8. A judgment entered by consent for a specific amount, subject to any credits which the defendant may produce vouchers for, is good as between the parties themselves and their privies.

The case is stated in the opinion of the Court.