Kolodney v. Kolodney Bros., Inc.

• Court: Connecticut Superior Court
• Writing for the Court: PHILLIPS
• Citation: Kolodney v. Kolodney Bros., Inc., 154 A.2d 540, 21 Conn.Supp. 312 (Conn. Super. 1959)
• Decision Date: 24 April 1959
• Docket Number: No. 113511,113511
• Parties: Esther KOLODNEY, Administratrix (Estate of Samuel Kolodney) v. KOLODNEY BROTHERS, INC., et al.

Page 540

154 A.2d 540

21 Conn.Supp. 312

Esther KOLODNEY, Administratrix (Estate of Samuel Kolodney) v. KOLODNEY BROTHERS, INC., et al.

No. 113511.

Superior Court of Connecticut, Hartford County.

April 24, 1959.

Ralph C. Dixon, Hartford, with whom was Abraham Silver, New Britain, for plaintiff.

Joseph Adinolfi, Jr., Hartford, for defendants.

PHILLIPS, Judge.

This was a companion suit with Kolodney v. Kolodney Bros., Inc., 154 A.2d 531 and Kolodney v. Kolodney, 154 A.2d 533 [21 Conn.Supp. 313] and the three suits were tried together. It was agreed by counsel that the evidence in each of these suits should be considered by the court in the other suits so far as relevant and admissible, and particularly that evidence affecting the credibility of witnesses in any one suit could be considered by the court in weighing the credibility of those same witnesses in the other suits. The three memorandums of decision should be read together.

This action is by the administratrix of the estate of Samuel Kolodney, who died October 9, 1953, claiming damages for the conversion of 500 shares of stock in the Kolodney Brothers, Inc.

The Uniform Stock Transfer Act (Rev.1958, § 33-75), so far as material, provides that '[T]itle to a certificate and to the shares represented thereby may be transferred only by delivery of the certificate endorsed either in blank or to a specified person by the person appearing by the certificate to be the owner of the shares represented thereby.' Under 'Definitions' (§ 33-72), 'delivery' means voluntary transfer of possession from one person to another, and 'transfer' means transfer of legal title.

In July, 1932, The Kolodney Brothers Hardware Company, now Kolodney Brothers, Inc., was organized with a capital of 1500 shares. On September 1, 1932, 500 shares were issued in the name of the Kolodney brothers, Samuel, Ralph and Abraham, there being 10 certificates for 50 shares issued to each one. Then, or shortly thereafter, each of the brothers indorsed at least nine of his ten certificates in blank. The main issue is whether Samuel Kolodney transferred his stock to Abraham on May 4, 1953. I find that there was no delivery of Samuel's stock to Abraham on that date. I do not credit the testimony of Abraham and Ralph that prior to that date Samuel told them of his intention of turning over his stock to them so that if he died his wife would not wreck the company. I do not credit their testimony as to what happened on May 4, 1953, at the Kolodney store. Possibly Harry Ganz, a brother-in-law of Ralph Kolodney, was asked to and did witness Samuel's signature on that date, for some devious reason of Samuel's, the signature having been made back in 1932, but as to the all-important fact that Samuel delivered the stock to Abraham in payment of a twenty-six-year-old debt for $16,666, I find that this was not so. My reasons follow.

For the reasons set forth in my memorandum in Kolodney v. Kolodney, Conn.Super., 154 A.2d 533 first count and third count, I do not deem the testimony of Ralph and Abraham worthy of credit, and proof of the alleged transfer of May 4, 1953, depends solely upon the testimony of these two men. The assignment to Abraham Kolodney on the back of the certificates was written by Ralph, not by Samuel. It was testified that Samuel was present during this entire transaction. If so, in a matter of such importance, why did he not fill in the assignment himself? The stock was not transferred on the stock transfer book of the company until May 14, 1954. While this is not necessary to effect a transfer under the Uniform Stock Transfer Act, nevertheless the fact that it was not done until long after Samuel died is evidence that no transfer was ever made. Samuel was actively engaged in the affairs of the corporation up to the time of his death and continued to act as president and chairman of the board of directors. This is attested to by the corporate minutes, the annual report and the corporation income tax return, all subsequent to May 4, 1953. The General Statutes (Rev.1949, § 5156 [Rev.1958, § 33-37]) and the by-laws of the company provided that every director shall be a stockholder. It is unlikely that Samuel, even though he may have had differences with his wife, as claimed, would have taken a step which would have deprived both his widow and his son of all interest in his business upon his death. There is missing, from Samuel's ten certificates, one certificate for fifty shares. It is inferable that Samuel only signed 9 certificates for a total of 450 shares when he and Ralph pledged 900 shares of this stock to Abraham on December 5, 1932. Thus, there would only be nine signed certificates available which Abraham could claim were transferred to him on May 4, 1953. Yet the testimony of the brothers is that all of Samuel's stock was transferred to Abraham on that date. Neither Esther Kolodney nor the attorney for the corporation, Leo Gaffney, nor the corporation accountant, Max Epstein, were made aware of any transfer of stock from Samuel to Abraham.

From all the above I find that there was no delivery of Samuel's 500 shares of stock in the corporation to Abraham on May 4, 1953.

As to the pledge of December 5, 1932, I find that this was not a bona fide pledge, but a device to remove the stock from the reach of the creditors of Samuel and Ralph. It was made over six years after the debt which it was supposed to secure. The year of...