Dodo v. Stocker
| Decision Date | 01 October 1923 |
| Docket Number | 10536. |
| Parties | DODO v. STOCKER. |
| Court | Colorado Supreme Court |
Department 2.
Error to District Court, City and County of Denver; S.W. Johnson Judge.
Action by Allison Stocker against Mike Dodo. Judgment for plaintiff and defendant brings error.
Affirmed.
C. W. Darrow, of Glenwood Springs, for plaintiff in error.
Everett Owens, of Denver, and William J. Miles, of Los Angeles, Cal for defendant in error.
Dodo made his promissory note to the Mountain States Mixed Feed & Feedyards Company, payable in six months. The note was indorsed to Stocker for value before maturity; he brought suit and recovered judgment. The defendant brings error.
The note was given for preferred stock in the said company, with which was thrown in some common stock. Certain defenses were set up to which there was a general denial. Trial was to the court and there was a general finding for the plaintiff.
The propositions relied on in defense are: (1) That the evidence shows that the plaintiff acquired the note after maturity; (2) that when the note was made there was an oral agreement that the stock which was the consideration for the note might be returned at any time, and that the note would then be surrendered; (3) that no transfer of the note from the company to the plaintiff is shown; (4) that the company was so organized that certain stockholders had the control of it, which plaintiff knew; (5) that of the $250,000 of common stock $50,000 was given as bonus with the preferred stock to the purchasers thereof, including defendant, and $200,000 was issued full paid to certain directors for 'option, plans, and formulae' which were of no value; (6) that the note was procured by false representations which plaintiff knew.
As to the first point we find no evidence, and the general finding of the court for the plaintiff determines, for the purposes of this court, that the transfer was before maturity.
As to the second proposition, it is evident that the oral agreement contradicts the terms of the note.
As to the third, the evidence shows that one Collins, as president, and one Hoffman, as secretary and treasurer, indorsed the note in the name of the company by them, and it is claimed no authority is shown in them to do so, and that at a meeting of the directors, which ratified their action, no quorum was present. It appears, however, in evidence that Collins and Hoffman had the actual management and charge of the company, and that the note was transferred in part payment for the erection of a building in pursuance of the legitimate purposes of the corporation. This is enought to justify a finding of sufficient authority.
The fourth proposition requires no answer.
Upon the fifth it is claimed that the $200,000 was issued to certain directors for 'options, plans, and formulae of no value'; that this was fraudulent as to all other purchasers of stock, including the defendant; that it was Stocker's duty as vice president and director to know of this issue and of the consideration, and therefore he is charged with notice of it, and is not a holder in due course. The general finding for plaintiff destroys this argument, because the effect of it is to say that the options, plans, and formulae were of value. We may say in addition that there is no proof or evidence of what such options, plans, and formulae were, nor of their value nor what has become of them, therefore nothing fraudulent has been shown on this point with notice of which the plaintiff can be charged.
In support of proposition No. 6 is testimony by the defendant himself that the agents for the company, who sold him the stock and obtained the note therefor, made certain representations to him concerning the stock, which were false; there is no direct evidence that Stocker knew anything about this or had any notice of it, but it is claimed that, since he was a vice president and director, he is individually charged with knowledge of it because the directors as a board, or, to put it in another way, the company itself, is charged with knowledge of such representations. This is the real question in the case: Is the purchaser of a current note, from an industrial corporation payee, individually charged with knowledge of false representations made by agents of the corporation in procuring the note, merely because he is a director in the corporation?
The Negotiable Instruments Act (C. L. § 3873) says:
'To constitute notice of an infirmity * * * the person to whom it is negotiated must have had actual knowledge of the infirmity * * * or knowledge of such facts that his action in taking the instrument amounted to bad faith.'
There is no evidence here nor any claim that Stocker had actual knowledge of the false representations of the agents, and no evidence of bad faith or...
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Bailey v. Meister Brau, Inc.
...Cir. 1975).* "A legal fiction is the assumption, for purposes of justice, of a fact that does not or may not exist." Dodo v. Stocker, 74 Colo. 95, 219 P. 222 (1923). ...
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People v. Ayala, 87SA187
...may be drawn only from facts established, and presumption may not rest on presumption or inference on inference. Dodo v. Stocker, 74 Colo. 95, 219 Pac. 222 [1923]; Mountain Motor Fuel Co. v. Rivers, 65 Colo. 561, 170 Pac. 1164 [1918]; Elliott v. People, 115 Colo. 382, 174 P. (2d) 500 [1946]......
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Pac. Nat. Agr. Credit Corp.. v. Hagerman.
...citing it but to draw a distinction, are Washburn v. Inter-Mountain Mining Co., 56 Or. 578, 109 P. 382, Ann.Cas. 1912C, 357; Dodo v. Stocker, 74 Colo. 95, 219 P. 222; Commercial Sav. Bank v. Kietges, 206 Iowa, 90, 219 N.W. 44; Pitman v. Walker, 187 Cal. 667, 203 P. 739; Minnesota Loan & Tru......
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...later decisions hold that there is such an implied power, or at least a presumption of authority to endorse such paper. See Dodo v. Stocker, 74 Colo. 95, 219 P. 222; Jones v. Stoddard, 8 Idaho 210, 67 P. 650; Wagnor Trading Co. v. Battery Park National Bank, 228 N.Y. 37, 126 N.E. 347, 349, ......