Dunnington v. Syfers

• Decision Date: 26 November 1901
• Citation: 62 N.E. 29,157 Ind. 458
• Parties: DUNNINGTON v. SYFERS et al.
• Court: Indiana Supreme Court

157 Ind. 458

62 N.E. 29

DUNNINGTON

v.SYFERS et al.

Supreme Court of Indiana.

Nov. 26, 1901.

Appeal from circuit court, Hendricks county; John V. Hadley, Judge.

Action by M. Helen Dunnington against Rufus K. Syfers and others. From a judgment in favor of defendants, plaintiff appeals. Affirmed.

Ira M. Sharp, for appellant. Daniel Wait Howe, for appellees.

JORDAN, C. J.

Appellant originally commenced this action in the Marion circuit court against appellees, Rufus K. Syfers, Frank A. McBride, and George C. Webster, to recover the sum of $25,000. The venue of the cause was changed to the Hendricks circuit court. The following may be said to be an epitome of the facts alleged in the complaint: Appellees herein, together with one Andrew Dunnington, on March 10, 1891, agreed among themselves that they would each contribute $1,500 for the purpose of purchasing from Leslie E. Keeley, of Dwight, in the state of Illinois, the right to use, in the states of Indiana and Kentucky, a certain secret process for the treatment of persons addicted to the excessive use of intoxicating liquors and morphine. That after the purchase of said right by the aforesaid parties, they, in the month of March, 1891, began the use of said treatment at the town of Plainfield, Hendricks county, Ind., the institute established at Plainfield for that purpose being operated by them under the name and style of the “Keeley Institute.” Appellant, together with her husband, Andrew Dunnington, executed a promissory note for $1,500, payable to said institute for a one-fourth interest, which her husband was to have and hold in the concern. Thereafter, in August, 1891, said institute was incorporated by appellant and appellees, who became the owners and holders of the entire stock of said corporation; appellant owning 30 shares of the capital stock at the par value of $50 per share. Upon the organization of said corporation all of the assets belonging to the Keeley Institute,including the right to practice said treatment under the process in question, were turned over to and merged in said corporation. Prior to February 10, 1892, as averred, appellant had no knowledge of the business affairs of said concern, and the same were managed exclusively by appellees, who concealed from her and her husband, Andrew Dunnington, by whom she was represented, the books and business relating to said institute. That appellees, knowing that appellant was ignorant of the value of her stock, and knowing that its value was far in excess of its par value, entered into and formed a conspiracy for the purpose of obtaining her stock for a sum greatly under its value, and for that purpose they represented to her through her husband that said institute or corporation was losing money, and that the stock thereof had become greatly depreciated in value, and was worthless, and, unless she sold the stock held by her within a certain time, they (appellees) would surrender up the right to practice said treatment, and would dissolve the corporation, and thereafter would organize a new one, in which she would have no stock or interest. It is further averred that appellant, by reason of these representations and statements, believed that she was about to lose her stock or interest which she had and held in said corporation or institute, and, being ignorant of the value of her said stock, sold her interest in said corporation to one Rose for the sum of $5,000, which interest in fact was of the value of $25,000. It is also alleged that appellees thereafter represented to said Rose that he had been swindled in the purchase of appellant's interest; that she had no such interest in the concern as he had purchased and advised him to “sell out”; that thereafter Rose sold the interest which he had purchased from appellant to one Mahorney, who thereafter transferred the same to appellees; that the latter, on becoming the sole owners of the stock of the corporation, sold and transferred their right to practice said treatment in the state of Indiana for $50,000, retaining, however, their right to practice the same in the state of Kentucky. The complaint charges that all the acts, representations, and statements of appellees were false and fraudulent, and made with the purpose and intent to defraud and cheat appellant, and that by reason thereof she has been damaged in the sum of $25,000, for which judgment is demanded. A demurrer to the complaint having been overruled, appellees answered by denying generally all the allegations of the complaint, and by setting up...