Heller v. Speier
| Decision Date | 23 May 1930 |
| Docket Number | 27085 |
| Citation | 230 N.W. 835,119 Neb. 787 |
| Parties | EDWIN B. HELLER, APPELLEE, v. HERMAN SPEIER, APPELLANT |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Lancaster county: ELWOOD B CHAPPELL, JUDGE. Affirmed.
AFFIRMED.
Syllabus by the Court.
The evidence examined, discussed in the opinion, and held sufficient to sustain the verdict of the jury.
Rescission is an affirmative defense and a question of fact for the jury, the burden of proving it by a preponderance of the evidence being upon the party pleading it.
The measure of damages for a breach of contract to repurchase corporate stock is the amount the seller has agreed to pay the buyer as the repurchase price.
Where corporate stock is held almost entirely by the president of the corporation, members of his family and employees of the corporation, and not listed on any stock exchange or market and not freely bought and sold in the open market, financial statements of the corporation, prepared by an accountant employed by the corporation and forming part of the records of the same, showing the assets and liabilities of the corporation and acted upon by the corporation as correct statements of its financial condition, are receivable in evidence to show the market value of such stock.
Testimony of witnesses familiar with the values of stocks and bonds generally and with their market values, knowing the reputation of the corporation, the nature of its business and the reputation the corporation bore to the stock buying community, and also testifying to the assets and liabilities of the corporation as shown by a financial statement of the corporation forming part of its records and acted upon by it as a correct statement of its financial condition, is competent as to their opinion of the market value of such stock.
Appeal from District Court, Lancaster County; Chappell, Judge.
Action by Edwin B. Heller against Herman Speier. Judgment for plaintiff, and defendant appeals.
Affirmed.
Frank A. Peterson, Charles F. Adams, Claude S. Wilson, Roy F Gilkeson and Hymen Rosenberg, for appellant.
Sanden, Anderson, Laughlin & Gradwohl, contra.
Heard before GOSS, C. J., ROSE, DEAN, GOOD, EBERLY and DAY, JJ., and MESSMORE, District Judge.
This action for damages was brought by appellee against appellant, president of Speier's, incorporated, upon a certain contract in writing which provided for the repurchase of stock in said company by appellant from appellee should appellee leave the company's employ. Appellee's employment, by mutual agreement of the parties, terminated on April 28, 1928, and this suit was brought to recover the value of the stock as of such date under the provisions of said contract.
Appellee's petition alleges that on or about July 1, 1922, he purchased 40 shares of the common stock of the Speier & Simon corporation, of Lincoln, Nebraska, for $ 125 a share, at which time appellee and appellant entered into a written contract; that subsequently they agreed to a modification thereof, appellee to return to appellant 20 shares of said stock and appellant to cancel a promissory note of $ 2,500 referred to in said contract, which was done; that in all other respects the contract remained in full force and effect; that appellee's contract of employment was by mutual consent terminated on April 28, 1928, and at that time appellee demanded of appellant the market value of the remaining 20 shares of stock and tendered to appellant said shares; that appellant refused and failed to pay appellee the market value of said stock, which at that time was worth $ 1,000, and for which amount, with interest, appellee prays judgment.
Appellant's answer admits the purchase of 40 shares of common stock in said company from appellant by appellee for the sum of $ 125 a share and that said contract was made and entered into as alleged; alleges that the repurchase contract was rescinded by the parties when the dividend note was canceled and the corresponding 20 shares returned to appellant in January, 1928.
Appellee's reply is a general denial.
The evidence adduced at the trial shows that appellee entered the employ of the Speir & Simon Company in 1916. Mr. Simon subsequently left the company and appellee remained in the employ of Speier's, incorporated. On July 1, 1922, appellee and appellant entered into a written agreement whereby appellee was to purchase from appellant 40 shares of common stock in Speier's, incorporated, at $ 125 a share.
Appellee testified that appellant stated that he would have to have the books of the company gone over by a man at the First National Bank to determine what he should sell the stock for to appellee. Appellee purchased 20 shares outright for $ 2,500, giving his note for the balance for $ 2,500, the entire 40 shares to be held by appellant as collateral security. The stock was issued in two certificates of 20 shares each. The $ 2,500 note was to be paid for out of dividends on the stock, appellant to receive 6 per cent. interest on the note. There were no dividends paid. In January, 1928, the parties orally agreed that appellant should cancel the $ 2,500 note and retain the stock for which the note was given. This was done. Appellee terminated his employment with appellant on April 28, 1928, and tendered appellant the 20 shares of stock in question in this case. The contract provided that appellant agreed to repurchase the stock at the termination of appellee's employment at the market value of the stock at that time.
Appellee further testified to the balance sheet prepared by Mr. Buckley, an accountant for Speier's, incorporated; also to the nature, condition, volume and expansion of the business and its losses; further, that appellant refused to buy the stock, asserting it had no market value; and that its market value, in appellee's opinion, on said April 28, 1928, was $ 45 a share.
Alfred Exley, appellant's bookkeeper and office manager from June, 1918, until appellee left the company's employ, testified that he had complete control of the books of the company, that his duties made him familiar with the business, that the company had made a good deal of money until recently, having built its capital of $ 18,000 up to a net worth of $ 131,713 in April, 1928; that later it had operated at a loss and, had all the losses been paid off at the time appellee's employment was terminated, the company then would have had assets of $ 131,713 more than its liabilities; the good-will of the company in addition to this was worth at least $ 4,000 to $ 5,000; the company had a very good reputation; he knew of the sale of 10 shares of stock of the company to a Mr. Davison in the latter part of 1927 at $ 100 a share; that the trial balance book received in evidence was prepared under his direction to the approval of Mr. Speier showing assets and liabilities of the company, and the market value of the stock, as shown by such trial balance book as of April 30, 1928, was between $ 42 and $ 43 a share; that he bought and sold stock and was familiar with the conditions of transfers of stock in Speier's, incorporated, during the past 8 or 10 years, giving his opinion as to the market value of the stock on April 28, 1928, as being between $ 42 and $ 43 a share, having testified to a hypothetical question asked of him of the various facts concerning the assets, liabilities, reputation and general financial condition of the company as well as the 10 shares of stock sold to Mr. Davison by Mr. Speier.
Merlin...
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