Langston v. Phillips
| Citation | 89 So. 523,206 Ala. 174 |
| Decision Date | 09 June 1921 |
| Docket Number | 5 Div. 779 |
| Parties | LANGSTON v. PHILLIPS. |
| Court | Supreme Court of Alabama |
Appeal from Circuit Court, Chilton County; B.K. McMorris, Judge.
Assumpsit by Charles Phillips against J.M. Langston. Judgment for plaintiff, and defendant appeals. Reversed and remanded.
See also, 17 Ala.App. 572, 88 So. 177.
W.M Adams, of Clanton, and Sternfeld & Lobman, of Montgomery, for appellant.
Lawrence F. Gerald, of Clanton, and F.B. Collier, of Yreka, Cal., for appellee.
Phillips sued Langston, declaring on a promissory note which defendant had given to the Pep-to-Lac Company of America and had been transferred to plaintiff. The defense was that the note was given to the Pep-to-Lac Company for shares of stock in that company, which had been sold to defendant in this state, and that said company, a corporation chartered under the laws of Delaware, had not paid its franchise tax, and had no license to do business in this state during the year in which the sale was made and the note given. Trial was had before the court without a jury on an agreed statement of facts.
All else being agreed upon, the sole issue presented by the pleading, and therefore the sole issue to be decided by the court, was whether, within the meaning of the statute (Code §§ 3651-3653), denouncing as void all contracts made in this state by foreign corporations without having first procured a permit by the payment of a franchise tax (Code, § 3647), the issue to be decided was whether the contract for the sale of the stock in question was made in Alabama, or in Delaware where, of course, the law of this state had no effect.
The agent of the Pep-to-Lac Company, employed for that purpose negotiated a sale of its stock in this state and took defendant's note therefor, the note in suit. True, the sale was subject to approval by the company at its home office in Delaware, but the contract was negotiated and the note in suit executed and delivered in this state, and we cannot doubt that the negotiation of the contract and the acceptance of the note in this state, though conditional, constituted the business of selling stock in this state within the meaning of the statute, supra, and if by reason of the company's approval of the sale negotiated by its agent, though the determination to approve may have been reached in the state of Delaware, the contract became operative and binding on defendant in this state,...
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