Hatcher-Powers Shoe Co. v. Hitchens

• Decision Date: 10 December 1929
• Citation: 232 Ky. 87
• Parties: Hatcher-Powers Shoe Company v. Hitchens.
• Court: United States State Supreme Court — District of Kentucky

Page 87

232 Ky. 87

Hatcher-Powers Shoe Company v. Hitchens.

Court of Appeals of Kentucky.

Decided December 10, 1929.

1. Corporations. — If there was conflicting testimony upon vital issue as to execution of writing in nature of subscription to stock of corporation upon which action was based, it was proper to submit that issue to jury for its determination.

2. Corporations. — If there was an entire absence of evidence to sustain defense of non est factum in action based upon subscription to stock of corporation, there was nothing to submit to jury, and verdict should have been directed for plaintiff corporation as requested.

3. Evidence. — When fact is stated by witness orally and in writing in plain, unambiguous terms, and no mistake, fraud, or inadvertence appears to account for it, and it is not contradicted, it must be accepted as it is established.

4. Corporations. — Testimony in action on corporation's stock subscription held to conclusively show that defendant authorized signing of his name to contract agreeing to purchase stock, and that there was no scintilla of testimony to contrary.

5. Corporations. — Where testimony showed conclusively that defendant sued on stock subscription authorized signing of name to purchase agreement and there was no scintilla of testimony to contrary, it was therefore duty of court, when properly requested, to instruct jury accordingly.

6. Corporations. — In order to raise an issue as to accuracy of recital of written subscription to stock of corporation purporting to have been executed on blank date in March, 1920, it was indispensable that an attack thereon should be made by appropriate allegations in pleading filed by defendant sued as subscriber on subscription agreement.

7. Corporations. — Since defendant sued as subscriber on stock subscription by corporation did not file appropriate pleading attacking recital of stock subscription, and it was executed on blank date in certain month and year, evidence indicating that contract as signed at later date, although admitted without objection, was ineffective for any purpose.

8. Pleading. — Where sole defense relied upon in answer of defendant sued by corporation on subscription to stock was traverse of allegations of petition, that pleading did not tender any issue as to time contract was made, but only issue whether it was made at any time.

9. Corporations. — Subsequent acceptance of subscription to stock by corporation and its engagement in business for which it was created completed contract for purchase of stock and rendered it irrevocable, so that it was immaterial whether date of signing of

stock subscription was before or after filing of articles of incorporation for organization of corporation.

Appeal from Carter Circuit Court.

WOODS, STEWART, NICKELL & SMOOT for appellant.

THEOBALD & THEOBALD for appellee.

OPINION OF THE COURT BY JUDGE WILLIS.

Reversing.

The Hatcher-Powers Shoe Company sued C.S. Hitchens upon a writing by which it was agreed that "the undersigned, in consideration of their mutual promises and agreements do severally agree to and with each other and with H.W. Hatcher, O.P. Powers and James Hatcher, the promoters of said corporation, that they will subscribe for and they do hereby severally subscribe for, the number of shares of capital stock of said company set opposite their respective names." It was alleged in the petition that prior to and in contemplation of the incorporation of the plaintiff company, the defendant together with other persons on or about the ____ day of March, 1920, became a subscriber to the stock of plaintiff by signing the writing, which was set forth in full. Appropriate averments were made showing the completion of the corporation, its acceptance of the subscription contracts, calls for payment, and the launching of the enterprise upon its contemplated business career. The answer of defendant traversed the allegations of the petition. The formal steps in the process of forming the company were proven by uncontradicted evidence, and the ultimate issue between the litigants was whether defendant had executed the writing. The sufficiency of the incorporation, organization, and procedural steps as set out in the petition were before this court and settled in the case of Hatcher-Powers Shoe Co. v. Bickford et al., 212 Ky. 163, 278 S.W. 615, and need not be recited. The circuit court submitted the case to the jury and its verdict was for the defendant. The shoe company has prosecuted an appeal, insisting that it was entitled to a peremptory instruction, or, if not correct in that contention, that it should be granted a new trial because of errors of the court in instructing the jury and in admitting incompetent evidence.

The duty of the trial court respecting the request for a peremptory instruction depended upon the facts shown by the evidence upon the issue involved. If there was conflicting testimony upon the vital issue as to the execution of the writing upon which the action was based, it was proper to submit that issue to the jury. But if there was an entire absence of evidence to sustain the defense of non est factum, there was nothing to submit to the jury, and a verdict should have been directed for the plaintiff as requested. The contention requires an examination of the evidence adduced. Harry W. Hatcher gave his deposition in this and about a score of companion cases some years before the trial. He testified that he took the subscription of Hitchens, who personally signed the written contract with a lead pencil. In the cross-examination counsel pressed the witness with particular emphasis on the matter and manner of executing the contract by Hitchens. Five days later Hatcher...