Bankers' Mortg. Co. v. Lessley

• Decision Date: 04 May 1931
• Citation: 38 S.W.2d 485,225 Mo.App. 643
• Parties: BANKERS MORTGAGE COMPANY, APPELLANT, v. WILLIAM T. LESSLEY, RESPONDENT
• Court: Kansas Court of Appeals

38 S.W.2d 485

225 Mo.App. 643

BANKERS MORTGAGE COMPANY, APPELLANT, v. WILLIAM T. LESSLEY, RESPONDENT

Court of Appeals of Missouri, Kansas City

May 4, 1931

Appeal from Circuit Court of Howard County.--Hon. A. W. Walker Judge.

AFFIRMED.

Judgment affirmed.

Kirshner & Stroheker and Lionel Davis for appellant.

Sam C Major and J. H. Denny for respondent.

CAMPBELL C. Boyer, C., concurs. Trimble, P. J., absent.

OPINION

CAMPBELL, C.

Plaintiff, a domestic corporation, in December, 1919, entered into a written contract with Albert S. White, which, by its terms, appointed White plaintiff's "sole exclusive fiscal agent" and authorized him to sell the then remaining unissued and unsold portion of its $ 800,000 authorized capital stock, and an additional $ 200,000 over and above the present capitalization of the company. It is also recited in the contract that White was given the exclusive right to sell and dispose of said stock, to appoint subagents and assistants and authorized to accept in payment for capital stock sold, "cash, . . . negotiable notes . . . or other goods, valid and binding evidences of indebtedness." White appointed two salesmen named Okey and Carson who, in company with a Mr. Reynolds, a local banker and relative of the defendant, called upon defendant about April, 1920, and induced the defendant to execute a writing, which is referred to in the record as a subscription for stock, and to execute notes aggregating $ 13,000. Later, two of those notes, for $ 1750 each, were in the possession of Reynolds who claimed to be an innocent purchaser. The remaining notes, aggregating $ 9500, were sent to plaintiff, together with the so-called subscription contract. The sole consideration which the defendant received therefore was the agreement upon plaintiff's part to issue to him one hundred shares of its capital stock.

Plaintiff's vice president and treasurer, a witness in its behalf, said:

"Q. And when he (White) turned those notes over to you, you knew exactly what they were for--for stock in this company? A. Yes, sir."

A certificate of stock was signed and sealed by plaintiff in which it is recited that defendant is the owner of one hundred shares of the capital stock of plaintiff. That certificate was never actually delivered to defendant but was retained by plaintiff as collateral security for the notes. The notes were not paid, although plaintiff made frequent demand for payment, and, finally, in April, 1924, the defendant called at plaintiff's office and there entered into what is called a settlement agreement, by the terms of which it is provided that defendant assigned all of his right, title and interest in and to a subscription contract for one hundred shares of the capital stock of plaintiff and authorized plaintiff's secretary to issue a certificate for one hundred shares of stock in the name of plaintiff or its order. At this time the defendant executed to plaintiff three notes, two for $ 1000 each, and one for $ 2000.

The foregoing facts appear from the testimony on plaintiff's behalf, and in the view we take of the case, further statement is unnecessary.

The defendant refused to pay the notes last mentioned, and thereupon the plaintiff brought suit to recover the amount claimed to be due thereon. A trial resulted in a verdict and judgment in defendant's favor, and plaintiff has appealed.

The defense interposed by answer is that the original notes were given to plaintiff in payment for one hundred shares of its capital stock and are therefore illegal and void under the provisions of article 12, section 8, of the Constitution of Missouri, and section 9740, Revised Statutes 1919.

It is averred in the reply that plaintiff was at all times willing to deliver to defendant all stock subscribed for by him upon payment being made therefore; denies that the notes sued on were renewals of the notes previously given, and alleges that they were "given and accepted under an agreement for compromise and settlement of a claim of this plaintiff against defendant."

It is further averred that plaintiff, in good faith, demanded that defendant pay the original notes, and thereupon the parties entered into a new agreement for the compromise and settlement of the original notes, and that in pursuance of and in accordance with said compromise and settlement, the defendant surrendered to plaintiff his rights under the subscription contract, offset a payment of $ 100 made by him and gave to plaintiff the three notes sued upon as a part of the consideration for said settlement and compromise; that said new agreement was entered into and carried out by both plaintiff and defendant in good faith and...