Farnsworth v. Robbins
| Decision Date | 31 January 1887 |
| Citation | 31 N.W. 349,36 Minn. 369 |
| Parties | William Farnsworth, Receiver, v. Andrew B. Robbins |
| Court | Minnesota Supreme Court |
Appeal by defendant from an order of the district court for Ramsey county, refusing a new trial after a trial by Brill, J., a jury being waived.
Order affirmed.
E. A Campbell, for appellant.
Young & Lightner and Kitchel, Cohen & Shaw, for respondent.
The facts of this case as found by the trial court may be thus stated: The Northwestern Grain-dealers Association was organized as a corporation in 1881, with an authorized capital stock of $ 30,000. Subsequently this defendant subscribed for 100 shares of stock, of the par value of $ 5,000, for which he paid to the association $ 1,500 in cash, and gave his note for the remaining $ 3,500 which note was not, however, accepted as actual payment. It has never been paid. The certificates for this stock, to the amount of $ 3,500, were left in the possession of the secretary and treasurer, the remainder of the stock certificates being delivered to the defendant.
Among the by-laws of the corporation was the following The by-laws further provided that the regular meetings of the stockholders should be held on the first Tuesday of September of each year, and that special meetings might be called upon notice of not less than five days to each stockholder.
A regular meeting of the stockholders was held September 4, 1883, special notice of which was given not more than 10 days prior to the meeting. Several stockholders were not present at that meeting. At that meeting the defendant announced that he surrendered his stock, and withdrew from the association. Objection was interposed by some of the stockholders present, and no action was taken upon the subject by the body of stockholders. No prior notice of such action on the part of the defendant had been given. A month later the defendant formally surrendered to the secretary and treasurer his stock certificates, and that officer delivered up to the defendant his note, and repaid to him, out of the assets of the association, the amount which had been paid for stock, $ 1,500. Other officers of the corporation, being subsequently advised of the facts, acquiesced in what had been done. At that time the corporation was solvent, but its capital stock had been impaired by losses to the extent of $ 5,000 or more, and it was then in debt to the amount of more than $ 70,000, of which indebtedness over $ 40,000 is still unpaid, and the corporation is now insolvent.
This plaintiff, having been appointed receiver of the corporation, seeks by this action to recover $ 3,500, with interest, the amount unpaid on the stock subscription. A recovery having been allowed, the defendant has appealed from an order refusing a new trial.
The point that the defendant's subscription was not binding upon him, for the reason that, as is claimed, the whole authorized capital stock was never subscribed for, is not tenable. Without referring to other considerations, it is sufficient to say that the defendant admits in his answer that he purchased the stock, but alleges that he fully paid for it; and, further, that, in accordance with the by-law above recited, he subsequently surrendered it to the corporation, receiving his note in return. Neither the answer nor the...
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