Appeal
from Superior Court, Durham County; Long, Judge.
Action
by the Lancaster Trust Company against J. B. Mason. Judgment
of nonsuit, and plaintiff appeals. Reversed.
The
word "dividend" denotes a fund set apart by a
corporation, out of its profits, to be apportioned among the
shareholders.
A
corporation on December 16th declared a 4 per cent
semiannual dividend, a 6 per cent. extra dividend, and a 50
per cent. stock dividend, payable to the stockholders of
record on January 2d following. After the dividends were
declared, but before they were due, plaintiff, a stockholder
sold four shares to defendant, the parties agreeing that the
seller should receive the "January dividend," and
the amount of the regular semiannual dividend due in January
was added to a sight draft attached to the certificates of
stock, sent to a bank to be delivered upon payment therefor.
Neither party had heard of the extra cash dividend, nor of
the stock dividend declared. Held, that the "January
dividend" reserved included any dividend payable in
January.
BROWN
J.
The
plaintiff sues to recover certain dividends declared by the
Durham Cotton Manufacturing Company at the meeting of the
directors of said company on December 16, 1907, viz., a 6 per
cent. extra dividend, and a 50 per cent. stock dividend, said
dividends amounting to $120 and $1,000, respectively. On
December 16, 1907, the directors of the Durham Cotton
Manufacturing Company met at Watts' office in the city of
Durham, and declared a 4 per cent. semiannual, a 6 per cent
extra, and a 50 per cent. stock, dividend, payable to the
stockholders of record of said company on January 2, 1908. On
said date, December 16, 1907, the plaintiff as trustee of
Margaret G. Arnold, both of the city of Lancaster, state of
Pennsylvania, was the owner of four shares of the capital
stock of the said Durham Cotton Manufacturing Company of the
par value of $2,000. On said date, December 16, 1907, the
defendant J. B. Mason, a resident of the city of Durham
state of North Carolina, was a stockholder in said company.
On December 27, 1907, the plaintiff forwarded to the
Citizens' National Bank of Durham, N. C., four shares of
stock held by it in the Durham Cotton Manufacturing Company,
attached to a sight draft on J. B. Mason, the defendant,
pursuant to the following letters and telegrams, which said
letters and telegrams embrace the contract of sale of said
stock by the plaintiff to the defendant, viz.:
(a)
"Durham, N. C., Dec. 19, 1907. Lancaster Trust
Company, Lancaster, Pa.--Dear Sir: Some time ago I was
informed that you had a client who desired to dispose of
some stock of the Durham Cotton Manufacturing Company. I
was not in a position to handle any at that time, but if
you still hold this stock, I would handle it promptly at
$650 per share, and if you desire to accept this offer you
can forward certificate to J. Harper Erwin, Treasurer of
Durham Cotton Manufacturing Company, with instructions to
transfer same on payment of above price. This offer is for
not over ten shares. Please advise prompt acceptance of
this offer by wire at my expense, and oblige, Yours truly,
J. B. Mason."
(b)
"Lancaster, Pa., Dec. 23, 1907. Mr. J. B. Mason, Durham,
N. C.--Dear Sir: We are in receipt of your favor of the 19th
inst., stating that you would handle the four shares of the
Durham Cotton Manufacturing Company's stock at $665.00
per share. In reply beg to say that we have other parties who
are desirous of purchasing this stock. If you will put an
offer into our hands of $675.00 per share, allowing the
January dividend to us, we will consider making the sale. To
this note we await your prompt reply. Yours very truly, John
Hertzler, President."
(c)
Telegram from Mason to Lancaster Trust Company: "Durham,
N. C., Dec. 25, 1907. John Hertzler, President Lancaster
Trust Company, Lancaster, Pa.: Answering your letter 19th,
your offer accepted. Attach stock properly indorsed to demand
draft at price named, with January dividend added, and I will
honor same on presentation. Send draft to Citizens'
National Bank this city and same will be remitted at par.
Send stock to reach here Saturday. Party out of town after
this date. Answer. J. B. Mason."
(d)
"Durham, N. C., Dec. 25, 1907. John Hertzler, President
The Lancaster Trust Company, Lancaster, Pa.--Dear Sir: I
wired you today as follows, which I now beg to confirm:
'Answering your letter of the 19th, your offer accepted.
Attach stock properly indorsed to demand draft at price
named, with January dividend added, and I will honor same on
presentation. Send draft to Citizens' National Bank this
city and same will be remitted at par. Send stock to reach
here Saturday. Party out of town after this date.
Answer.' My client will leave Saturday, and he desires to
know whether he will get the stock in order that he could
arrange payment for same before leaving hence
I telegraphed instead of writing. The offer is for $675 per
share with January dividend. Yours very truly, J. B.
Mason."
(e)
"Lancaster, Pa., Dec. 27, 1907. J. B. Mason, Durham,
N.C. Offer accepted. Will forward four shares today to
Citizens' National Bank. John Hertzler, President."
(f)
"Lancaster, Pa., Dec. 27, 1907. Mr. J. B. Mason, Durham
N. C.--Dear Sir: We are in receipt of your telegram under
date of the 25th inst., as follows: 'Answering your
letter 19th, your offer accepted. Attach stock properly
indorsed to demand draft at price named, with January
dividend added, and I will honor same on presentation. Send
draft to Citizens' National Bank this city and same will
be remitted at par. Send stock to reach here Saturday. Party
out of town after that...
