Forster v. Flack

• Citation: 121 N.W. 890,140 Wis. 48
• Parties: FORSTER v. FLACK ET UX.
• Decision Date: 03 June 1909
• Court: United States State Supreme Court of Wisconsin

140 Wis. 48

121 N.W. 890

FORSTER

v.FLACK ET UX.

Supreme Court of Wisconsin.

June 3, 1909.

Appeal from Circuit Court, Milwaukee County; J. C. Ludwig, Judge.

Action by Charles G. Forster against J. W. Flack and wife. From an order sustaining a demurrer to the complaint, plaintiff appeals. Affirmed.

Among other references upon the part of the appellant were the following: Boothby v. Scales, 27 Wis. 626;Woodle v. Whitney, 23 Wis. 55, 99 Am. Dec. 102;Warder v. Fisher, 48 Wis. 338, 4 N. W. 470;Parry Mfg. Co. v. Tobin, 106 Wis. 286, 82 N. W. 154;Fairfield v. Madison Mfg. Co., 38 Wis. 346,Neave v. Arntz, 56 Wis. 174, 14 N. W. 41;Hahn v. Doolittle, 18 Wis. 196, 86 Am. Dec. 757;Osborn v. Nicholson, 13 Wall. 654, 20 L. Ed. 689.

Among other references upon the part of the respondents were the following: Merrill et al. v. Nightingale et al., 39 Wis. 247; 30 Am. & Eng. Ency. Law (2d Ed.) p. 190; Smith v. Hughes, 50 Wis. 620, 7 N. W. 653;McLennan v. Prentice, 85 Wis. 427, 55 N. W. 764;Clementson v. Streeter, 59 Wis. 429, 18 N. W. 340;Falkner v. Woodard, 104 Wis. 608, 80 N. W. 940;Patton v. Taylor, 48 U. S. 132, 12 L. Ed. 637;Kelley v. Kelley, 80 Wis. 486, 50 N. W. 334;Deery v. McClintock, 31 Wis. 195.McGee & Jeger, for appellant.

Blatchley & Gilbertson, for respondents.

TIMLIN, J.

The complaint avers the purchase by the plaintiff from the defendant named of 52,000 shares of the capital stock of a certain corporation in consideration of the sale and conveyance by plaintiff to defendant of a parcel or tract of real estate. Accompanying the sale of the corporate stock, it is averred that there were two agreements: (1) That a dividend would be declared on this stock and paid within 90 days, and thereafter weekly dividends would be declared and paid thereon for at least four weeks; (2) that the defendant would at any time at the request of the plaintiff exchange the whole or any part of said shares of stock for shares of the capital stock of another mining corporation at the rate and in the proportion of 3,000 shares of the latter for 20,000 shares of the former. This defendant within a short time thereafter made many false and fraudulent representations to the plaintiff, and, relying and acting thereon, the plaintiff exercised his option to demand the exchange of stock agreed upon and did exchange 20,000 shares of the 52,000 shares first received for 3,000 shares of the other stock. This defendant mortgaged the real estate received in exchange for $5,000 to some person not named. No dividend was declared or paid on the first-mentioned stock within 90 days from the date of purchase, nor were any weekly dividends declared or paid on said stock at any time thereafter, whereupon the plaintiff tendered to this defendant 32,000 shares of the 52,000 shares first purchased and 3,000 shares of the exchanged stock and demanded of this defendant that he reconvey to the plaintiff the real property mentioned free and clear of all incumbrances, or that he reconvey the said property and pay the plaintiff $5,000, being the amount of the mortgage placed on the property by the defendant. Plaintiff also demanded of this defendant's wife that she release her dower, but both defendants refused to comply. Therefore the plaintiff asks that the defendants be required to reconvey to him the real estate in the complaint described, and that he have and recover $5,000 to compensate him for the mortgage placed on the property by defendant, and that he have costs and general relief.

The false and fraudulent representations by which the plaintiff was induced to exchange the shares of stock are wholly irrelevant to the relief sought to be obtained. The fact that the exchange was made of one kind of mining company's stock for another in pursuance of an option so to do is quite irrelevant to the relief sought. The only ground for the rescission prayed is therefore that no dividend was declared or paid on the stock first received. It does not appear whether the transaction, aside from the conveyance of the land, was or was not evidenced by writing. The agreement concerning the payment of a dividend is pleaded in this form: “That said stock was sold by the defendant J. W. Flack and purchased by the plaintiff upon the condition subsequent and the express warranty that a dividend would be declared on said stock and...