Bullard v. Garvin

• Decision Date: 06 May 1965
• Docket Number: CA-CIV,No. 1,1
• Citation: Bullard v. Garvin, 401 P.2d 417, 1 Ariz.App. 249 (Ariz. App. 1965)
• Parties: , Blue Sky L. Rep. P 70,678 Doyle BULLARD and Ed Cook, Appellants, v. Daniel GARVIN and Lorraine Garvin, husband and wife, W. F. Cochran and Veronica Cochran, husband and wife, Appellees. * 20.
• Court: Arizona Court of Appeals

Page 417

401 P.2d 417

1 Ariz.App. 249, Blue Sky L. Rep. P 70,678

Doyle BULLARD and Ed Cook, Appellants, v.Daniel GARVIN and Lorraine Garvin, husband and wife, W. F. Cochran and Veronica Cochran, husband and wife, Appellees. ^*

No. 1 CA-CIV 20.

Court of Appeals of Arizona.

May 6, 1965.

Rehearing Denied June 17, 1965.

Review Denied July 15, 1965.

Ronald McKelvey, Yuma, for appellantDoyle Bullard.

Cameron & Varga, by James Duke Cameron, Yuma, for appellant Cook.

O'Connor, Anderson, Westover, Killings-worth & Beshears, Phoenix, John H. West-over, Phoenix, of counsel, for appellees.

MOLLOY, Judge.

This is an appeal from a judgment rendered in favor of the plaintiffs by the court after a trial without a jury on a complaint alleging that the defendants, Bullard and Cook, sold to the plaintiffs stock in a Mexican corporation which was not registered with the Arizona Corporation Commission as required by Ch. 12, Tit. 44, A.R.S., and at a time when the defendants were neither registered dealers nor registered salesmen of securities as required by this chapter.

Though various defenses were presented at the time of trial, on appeal there is only one contention made and this revolves around whether or not the plaintiffs are foreclosed from any relief by reason of the fact that they did not formally tender back the stock in question to the defendants until the commencement of the actual trial of the case.

In their complaint, the plaintiffs had alleged that the stock had been deposited with the clerk of the court.However, apparently their attorney overlooked doing this and, when a motion to dismiss was made at the commencement of the trial, the plaintiffs' attorney, in resisting the motion, deposited the subject stock with the clerk of the court.

The trial court denied the motion and permitted the plaintiffs to put on proof of their case.This testimony disclosed that prior to the bringing of the action the plaintiffs had offered to sell back to the defendants the stock which had been purchased, had demanded their money back thereon and the defendants had refused.However, there had been no formal presentment of the stock to the defendants in connection with these converations.

The statute under which the subject action is brought is A.R.S. § 44-2001 which reads as follows:

'A sale or contract for sale of any securities to any purchaser in violation of any provision of §§ 44-1841,44-1842 or article 13 of this chapter, is voidable at the election of the purchaser, who may bring an action in a court of competent jurisdiction to recover the consideration paid for the securities, with interest thereon, taxable court costs and reasonable attorneys' fees, less the amount of any income received by dividend or othersie from ownership of the securities, upon tender of the securities purchased or the contract made, or for damages if he no longer owns the securities.'

The defendants have seized upon the word 'tender,' contending that it is a definite legal term with a definite and precise legal meaning.The argument is made that the subject statutes are 'penal' in nature, that they should therefore be strictly construed, and that the legislative purpose in requiring 'tender' is to relieve the courts from serving as a stakeholder in a gambling transaction.It is argued that were the plaintiffs in such an action not required to make tender of the stock that they purchased prior to filing an action, they would dispose of the stock during the pendency of the action should the stock go up in value, and thus the statute would have been used as a threat rather than as a remedy.

This court has not been able to accept these arguments.While there are penal provisions in the subject statute, it seems clear that the particular statute under which this action is brought is one providing for a civil remedy,...