The opinion
On Rehearing.
BROWN, Justice.
The substance of what we hold in the foregoing opinion is that business corporations were unknown to the common law, and are of statutory origin. Therefore there is no reason to indulge the presumption that the common law prevails in the States of Illinois and Delaware; the law of-those states not being presented by appropriate pleadings and proof, the courts must apply our law, the law of the forum in disposing of the case. The authorities cited in the foregoing' opinion sustain that proposition.
We also stated that: “The question of innocent holders in due course, without notice, is not presented on this record for the reason that the intervening complainants do ‘ not allege that they acquired their rights for value and
without notice
We have held consistently since the decision i,n Moore et ais. v. Clay, 7 Ala. 742 , that one pleading that he is an innocent purchaser for value without notice must allege that he purchased for value and without notice, though he meets the burden by showing purchase and payment, and his adversary, if he would prevail, must show notice. This proposition is fully sustained by the authorities cited in the original opinion.
But appellants insist that White et al. v. Central Nat. Bank, 201 Ala. 298 , 78 So. 74 , lays down a different rule. We do not think so. The court there was not dealing with the sufficiency of the complaint in that case, but with the sufficiency of the defendants’ pleas, and merely referred to the statute, now § 9078, which is part of the uniform negotiable instrument' law, which provides:
“A holder in due course is a holder who has taken the instrument under the following conditions:
“(1) That the instrument is complete and regular upon its face.
“(2) That he became the holder of it before it was overdue, and without notice that it had been previously dishonored, if such was the fact.
“(3) That he took it in good faith and for value.
“(4) That at the time it was negotiated to him he had no notice of any infirmity in the instrument or defect in the title of the person negotiating it.”
This statute which is merely declaratory of the common law, does not deal with procedural law as previously established.
However, in the light of this statute, a mere averment in pleading that the party is “a holder in due course,” would be but a conclusion of the pleader. The statute specifies the- elements that constitute
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one a holder in due course, and the rule of this statute is not in conflict with the rules of good pleading as previously established.
But this aside, as stated in the original opinion, the case was submitted to the court on the limited issue “as to the validity vel non of the mortgage or deed of trust against the properties of the Alabama Public Utilities Company dated February 1, 1928, and the bonds secured thereby.” If the deed of trust and bonds, applying the lex fori, are void, they were void ab initio, and in the hands of a holder in due course. Hanover National Bank v. Johnson, 90 Ala. 549, 552 , 8 So. 42 ; Alabama Nat. Bank v. Parker & Co., 146 Ala. 513, 516 , 40 So. 987 ; Id., 153 Ala. 597 , 45 So. 161 .
Appellants suggest that we did not comment on the fact that Martin and Company eventually transferred the properties in Alabama to the Southern Utilities Company. We stated this as a fact, but that was the consideration to the corporation for the purchase of its capital stock and became the property of the corporation. This property could not afterwards be used by Martin as a consideration for the issuance of the $200,000 in bonds. The corporation was a legal entity and when it became clothed with a tangible body in the form of valuable property it could not be owned by one individual, and carried around in his vest pocket. The law and public policy required it to have stockholders, a board of directors and officers, through whom it must function.
Opinion extended. Application for rehearing overruled.
ANDERSON, C. J., and THOMAS and KNIGHT, JJ., concur.