Irving v. Bankers' Mortgage Co

CourtUnited States State Supreme Court of Mississippi
Citation169 Miss. 890,151 So. 740
Docket Number30796
PartiesIRVING v. BANKERS' MORTGAGE CO
Decision Date01 January 1934

Division A

1 LICENSES.

Investment companies cannot contract to limit authority of agents in sale of investment bonds and thus defeat purpose of statute permitting recovery for misrepresentation (Laws 1916, chapter 97).

2 LICENSES.

Statute authorizing recovery for misrepresentation inducing purchaser of bonds to part with property abrogates parol evidence rule to extent of permitting proof of misrepresentation (Laws 1916, chapter 97).

3 LICENSES.

Purchaser of investment bonds having right of action for misrepresentation by seller under statute could proceed against principal without joining surety (Laws 1917, chapter 97, sections 3, 4, 6).

4. LICENSES.

One who before enactment of 1930 Blue Sky Law was induced to exchange investment bond having cash value for defendant's bond by false representation that buyer could obtain cash surrender value of bond exchanged with interest at any time held entitled to recover such cash surrender value with interest and reasonable attorney's fees (Laws 1916, chapter 97).

HON. T. P. GUYTON, Chancellor.

APPEAL from chancery court of Choctaw county HON. T. P. GUYTON, Chancellor.

Suit by Frank Irving against the Bankers' Mortgage Company. From a decree dismissing the bill, complainant appeals. Reversed and rendered.

Reversed.

A. L. Ford, of Ackerman, for appellant.

Earle N. Floyd, of Jackson, for appellee.

Briefs of counsel not found.

OPINION

Cook, J.

The appellant, Frank Irving, filed a bill of complaint in the chancery court of Choctaw county against the appellee, Bankers' Mortgage Company, seeking to recover the sum of two hundred eighty-three dollars and fifty cents, with interest, and reasonable attorney's fees, alleged to be due the appellant on account of false representations of fact made to the appellant by the appellee's agent in a transaction involving the exchange and sale of installment investment bonds. The appellee answered the bill, and, on the trial of the cause on the pleadings and proof, the chancellor entered a decree denying recovery and dismissing the bill of complaint.

The bill of complaint alleged that the appellee is a corporation organized and chartered under the laws of the state of Kansas, and domiciled in the city of Topeka, in that state, and doing business in this state as a foreign investment company under authority granted by the secretary of state of the state of Mississippi as provided by law; that about October 30, 1929, a duly accredited agent and salesman of the appellee company opened negotiations with the appellant for the sale, of a five thousand dollars investment bond of said company; that said salesman offered to sell him a five thousand dollar investment bond, dated April 30, 1928, fully paid up to October, 1930, with a cash surrender value of two hundred eighty-three dollars and fifty cents, and to accept in part payment therefor a bond issued to appellant by another company on which he had paid the aggregate sum of two hundred eighty-three dollars and fifty cents; and that relying on these representations of the said agent and salesman, he accepted the offer to surrender his bond which then had an accumulated cash value of two hundred eighty-three dollars and fifty cents in exchange for a five thousand dollar bond of appellee which was represented to have an equal cash value.

The bill of complaint further alleged that as an inducement to the appellant to accept the proposed exchange of bonds, the said agent of appellee represented that on the date of the exchange, and at all times thereafter, the appellant might surrender the five thousand dollar bond, and collect and receive therefor the sum of two hundred eighty-three dollars and fifty cents in cash, without paying further premiums thereon; that relying on the said promises, overtures, and representations of said agent, he was induced to surrender the bond then owned by him in exchange for the bond of the appellee company.

The bill further charged that thereafter, with full knowledge of the promises and representations of its said agent, appellee issued to appellant its first mortgage savings bond in the sum of five thousand dollars, and also its receipt acknowledging payment of a cash consideration therefor of two hundred eighty-three dollars and fifty cents; that thereafter the appellant offered to surrender the said bond to the appellee in consideration of the payment to him of the cash surrender value of two hundred eighty-three dollars and fifty cents; that the appellee failed and refused to comply with the representations of its agent by paying the said sum, and refused to pay him any sum whatsoever. The bill then alleged that the appellant was induced to purchase said bond by means of the said misrepresentations of material facts made by the agent of the appellee company as to the cash surrender value of the bond, and the appellee's willingness and readiness to pay the same upon the surrender of said bond at any time on or after October 30, 1929, and that by reason of the facts set forth, the appellant had the right under the statutes of the state of Mississippi to recover from appellee the sum paid out by reason of the said misrepresentations of material facts concerning the value of the bond purchased by him, and also interest and attorney's fees.

The appellee filed its answer to the bill of complaint admitting the exchange of bonds, the issuance of its receipt showing a payment or credit of the sum of two hundred eighty-three dollars and fifty cents to be applied as an installment payment upon the five thousand dollar bond sold to the appellant, but charged that before the issuance of its said bond, it received and accepted an application for the purchase thereof, and issued same in reliance upon express terms, conditions, and representations of the appellant in such application that it was understood that, if its said salesman had made any representations beyond the terms and conditions of the said receipt and application, the same were without the authority, knowledge, consent, or ratification of the appellee, and were outside of the scope of authority of the said salesman. The answer further denied that, within about thirty days after receipt of the said bond, the appellant offered to surrender it in consideration of the payment to him of two hundred eighty-three dollars and fifty cents, but charged the fact to be that appellee expressed no dissatisfaction with the bond until nearly a year after its acceptance by him.

The answer further denied that the bond sold and delivered to appellant had a cash value of two hundred eighty-three dollars and fifty cents, and averred that by the plain terms and conditions thereof it had a cash value of less than one hundred dollars; that if any misrepresentation as to the value or terms of the bond were made by its salesman, the...

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10 cases
  • Felts v. National Account Systems Ass'n, Inc., GC 75-151-S.
    • United States
    • U.S. District Court — Northern District of Mississippi
    • 30 Novembre 1978
    ...The fact that a bond was not posted does not preclude plaintiffs from full recovery under this provision. Irving v. Bankers' Mortgage Co., 169 Miss. 890, 151 So. 740 (1934). Punitive damages may be awarded where recognized under state law and a state law violation is joined with federal cla......
  • Johnson v. Yerger
    • United States
    • U.S. Court of Appeals — Fifth Circuit
    • 29 Febbraio 1980
    ...full purchase price paid for the securities. See Seaboard Planning Corp. v. Powell, 364 So.2d 1091 (Miss.1978); Irving v. Bankers Mortgage Co., 169 Miss. 890, 151 So. 740 (1934); Bankers Mortgage Co. v. McMullan, 165 Miss. 382, 141 So. 331 (1932). Our examination of these cases coupled with......
  • Mohundro v. Alcorn County
    • United States
    • Mississippi Supreme Court
    • 6 Giugno 1996
    ...See also, 74 Am.Jur.2d Suretyship § 24-25 (1974); First Mobile Home Corp. v. Little, 298 So.2d 676 (Miss.1974); Irving v. Bankers' Mortg. Co., 169 Miss. 890, 151 So. 740 (1934). CONCLUSION Alcorn County and its Board of Supervisors have sovereign immunity in this case. There is a genuine is......
  • First Mobile Home Corp. v. Little
    • United States
    • Mississippi Supreme Court
    • 8 Aprile 1974
    ...acting for these corporations and not individually. Our Court has, however, held to the contrary in the case of Irving v. Bankers' Mortgage Co., 169 Miss. 890, 151 So. 740 (1934). This Court said, in discussing Section 4185, Mississippi Code 1930, which is essentially the same as Mississipp......
  • Request a trial to view additional results

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