Foley v. Nimocks
| Decision Date | 07 April 1916 |
| Docket Number | 30313 |
| Parties | JAMES FOLEY, Appellee, v. FRANK A. NIMOCKS, Appellant |
| Court | Iowa Supreme Court |
Appeal from Wapello District Court.--D. M. ANDERSON, Judge.
THIS is an action at law to recover the amount paid by plaintiff for two shares of the capital stock of a corporation, and a stockholder's loss suffered by him, on account of the purchase's being made for the defendant, at his instance and request, and upon his promise to pay the total cost to plaintiff with interest as plaintiff alleges. Plaintiff claims, also, that it was the agreement between them that he should take this stock in his own name and handle it for defendant until such time as defendant could pay plaintiff and take it off his hands, which time defendant promised would not be later than April 1, 1911. There is a difference between the parties as to the nature and effect of the agreement. The facts are more fully stated in the opinion. A jury was waived, and trial had to the court. The court found for plaintiff for the amount claimed, and rendered judgment against the defendant therefor, and from such judgment the defendant appeals.
Affirmed.
Work & Work and Gilmore & Moon, for appellant.
J. J Smith and E. R. Mitchell, for appellee.
1. The petition alleges that before, but about, April 20th, 1910 defendant orally requested plaintiff to purchase for him $ 200 worth of stock in the Union Iron Works, a corporation, which stock defendant agreed to take from plaintiff not later than April, 1911, and pay the total cost of same, including interest thereon, which oral agreement was, on April 20, 1910, confirmed in a letter written by defendant to plaintiff; that, relying on the oral agreement and the letter, plaintiff did, about April 20, 1910, purchase stock in the Union Iron Works to the amount of $ 400, as evidenced by certificates Nos. 31 and 33 for two shares each, at par value of $ 100 a share, and plaintiff claims that one of said stock certificates for two shares of stock was purchased for defendant in accordance with the agreement; that the iron works failed, and plaintiff was compelled to pay, on September 9, 1913, the sum of $ 28.75 per share, making an additional amount of $ 57.50 chargeable to the shares so purchased; that defendant has neglected to take up said stock in accordance with his agreement.
The answer was a general denial, and alleged that, on April 20, 1910, defendant was a director of the Ottumwa Commercial Association, and that, at the request of one Keyhoe, who was the manager of the iron works, he (defendant) undertook to sell some of the unissued capital stock of the iron works; that defendant was not then a stockholder in the iron works, but that he undertook the sale of its stock solely for the purpose of benefiting the iron works, and, incidentally, the city of Ottumwa, by securing additional funds for the iron works which would permit it to increase its business and give employment to more people; that he was informed that plaintiff was already the owner of two shares in said iron works, and that he approached plaintiff to try to induce him to buy some additional stock; that, on the date last mentioned, defendant solicited plaintiff to buy some additional stock, and it was agreed between them that, if plaintiff would purchase and pay for four shares of the stock of the iron works, defendant was willing at that time to pay to the plaintiff the total cost of such two shares to plaintiff, with interest thereon from the time said four shares were purchased by plaintiff until two of the shares were turned over to defendant; that plaintiff did not, on or before April 1, 1911, turn over to defendant, or offer to turn over to him, the two shares of stock, and this has never been done.
It is conceded that plaintiff never did tender the stock to defendant. The letter above referred to is as follows:
Defendant concedes here that plaintiff's evidence was sufficient to establish the contract as stated in the petition. It is undisputed that the iron works went into bankruptcy in January, 1912, and that certain creditors claimed that the stockholders were personally liable because of irregularities in the organization of the iron works, and that plaintiff gave his check for $ 115 to settle the proportion due on the four shares of stock in plaintiff's name. The findings of the trial court upon disputed questions of fact are, of course, of the same force as a finding by a jury; and, in fact, appellant says in argument that he does not intend to base any argument upon any disputed questions of fact, but the argument will be based on undisputed evidence, and especially upon the contract pleaded by plaintiff and the letter before set out; that it is only with reference to the construction of the contract and the rules of law that determine the case that the parties differ.
The same day the letter was written, Mr. Keyhoe, manager of the iron works, called on plaintiff, and plaintiff gave to him a check for $ 200, receiving therefor Certificate of Stock No. 31 in the iron works, showing that plaintiff was the owner of two shares, transferable only on the books of the corporation by the holder in person, or by attorney, upon surrender of this certificate properly indorsed. A blank assignment form was printed on the back. On April 29, 1910, he bought two other shares of stock, represented by another certificate, No. 33, in like form as the other. Plaintiff says, and it is undisputed, that he bought these additional two shares on the strength of defendant's having spoken so well of the iron works.
Two or three months after the time for payment to plaintiff from defendant had elapsed, as plaintiff claims, he called defendant by phone and asked him if he was prepared to take up the matter. Defendant, being busy, requested plaintiff to wait a little longer. In two or three months, plaintiff called at defendant's office three or four times, but did not see him, except that, on one occasion, plaintiff saw defendant, and defendant requested that plaintiff let the matter go for a while. In the conversation between them in regard to their contract, defendant never denied his liability, but always requested more time.
Later, and in the fall or winter of 1911, or early in January, 1912, the plaintiff placed the matter in the hands of his attorney for collection. Letters passed between plaintiff's attorney and defendant, and in one of August 10, 1912, defendant said:
"As I said to you before, if Father Foley (plaintiff) bought $ 400 worth of stock the last time he bought, and I agreed to take $ 200, I would necessarily be bound by that, and I would not try to have Father Foley stand the loss under any consideration, if he took this for me, as I rather think he did."
There is no evidence that plaintiff ever talked with defendant about making a settlement of the claim of creditors against the stockholders of the iron works. Defendant did not own any stock or have any interest in the iron works at any time prior to the purchase of the stock in question.
It is contended by appellant that, if the contract was one by plaintiff to sell and defendant to purchase two shares of stock, then delivery of the certificate by plaintiff and payment of the consideration by defendant were concurrent acts, and neither could be said to be in default until the other had performed or offered to perform his part; that, as plaintiff never offered to perform, he cannot maintain this action, which must be based on the default of the defendant, and further that, time for performance being fixed not later than April 1, 1911, it was of the essence of the contract; and they say that, delivery being at the option of plaintiff, he was bound to give notice; that plaintiff was bound to make his election by April 1, 1911, and to notify the defendant thereof by that date if he desired to turn the stock over to the defendant, and that plaintiff...
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