Loy v. Rorick
| Citation | 71 S.W. 842,100 Mo.App. 105 |
| Parties | D. B. LOY, Appellant, v. J. B. RORICK et al., Defendants; W. F. RORICK, Interpleader, Respondent |
| Decision Date | 20 January 1903 |
| Court | Missouri Court of Appeals |
Appeal from Lawrence Circuit Court.--Hon. H. C. Pepper, Judge.
Defendants J. B. Rorick and S. C. Ewing were engaged, as partners, in the mining business at Aurora, Missouri, in the years 1899 and 1900. As partners they borrowed money of the plaintiff aggregating $ 4,192.63, evidenced by their two promissory notes. They failed in the mining enterprise and their mining property was sold under a mortgage and proceedings in an attachment suit, and passed from their control. On November 27, 1900, plaintiff brought suit on his two promissory notes in the Lawrence Circuit Court and in aid thereof sued out a writ of attachment by virtue of which twenty-five shares of the par value of $ 2,500 of the capital stock of the Aurora Milling Company (a corporation) was attached as the property of the defendant, J. B. Rorick. On February 11, 1901, W. F Rorick, the wife of J. B. Rorick, filed her interplea in the suit claiming that the twenty-five shares of stock attached were her sole and separate property. To the interplea the plaintiff filed the following answer:
A reply was filed to the interplea and the issues were submitted to a jury, who, after hearing the evidence and receiving the instructions of the court, returned a verdict for the interpleader.
Plaintiff filed timely but ineffectual motions for new trial and in arrest of judgment. Judgment was entered upon the verdict from which the plaintiff appealed.
The articles of association of the Aurora Milling Company show that J. B. Rorick subscribed for ninetynine shares of stock and W. F. Rorick for one share, but when the time came to pay the subscription for the stock J. B. Rorick directed that twenty-six shares be issued to his wife and thirty-five shares be issued to himself and that his subscription be reduced to sixtyone shares for both himself and wife. The certificates of stock were issued as directed by him, to-wit: twentysix shares to W. F. Rorick and thirty-five shares to J. B. Rorick.
J. B. Rorick and S. C. Ewing owed the Bank of Aurora $ 1,200 for money borrowed which they used in the mining business. They wished to increase this loan to $ 3,100. The bank agreed to increase the loan on condition that Rorick would put up thirty-one shares of the Aurora Milling Company stock as collateral security to secure the loan. The loan was made and Rorick pledged the thirty-five certificates of stock issued to himself and one of the twenty-six which had been issued to his wife. These certificates passed into the hands of third parties in the liquidation of the bank debt.
About June 1, 1900, a mortgage, which had been given by Rorick and wife on a house and lot in Monett, owned by Mrs. Rorick, to secure the sum of $ 1,500, became due. To meet this indebtedness Mrs. Rorick made application to the plaintiff to take up the mortgage and proposed to pledge her twenty-five shares of Aurora Milling Company stock as collateral to secure the loan. Plaintiff suggested to Rorick that he have all the shares consolidated in one certificate to be issued to him. Mrs. Rorick assented to this arrangement and on June 2nd, Rorick produced and surrendered the twentyfive certificates of the milling company stock and took one certificate in his own name for twenty-five shares. He took this certificate to plaintiff for the purpose of pledging it as security for a loan to take up the mortgage. It was then agreed that Loy would take an assignment of the mortgage and carry it for thirty days and the stock was not pledged. Loy took an assignment of the mortgage and carried it for a time. On June 28, 1900, Rorick made the following assignment of the certificate:
The transfer was duly entered on the stock books of the milling company. These books show that the twenty-five shares of stock attached stood in the name of Mrs. Rorick from November 9, 1897, the date of their original issue, until June 2, 1900, and that they stood in the name of J. B. Rorick from June 2, 1900, until June 28, 1900, and from the latter date they had stood in the name of Mrs. W. F. Rorick.
J. B. Rorick was secretary of the milling company and was in its employ for nearly two years from and after its organization in 1897 and until the time he formed a partnership with Ewing and went into the mining business.
The evidence shows that at the time Rorick went into the milling company the only visible property he owned was a farm in the State of Kansas which he afterwards sold for $ 500; that he and his wife were married in 1879; that for fifteen or sixteen years he was a conductor on the St. Louis & San Francisco railroad and earned from $ 125 to $ 150 a month; that all the money he earned, over and above his personal expenses during all these years, he gave to his wife and she saved a good part of it, loaned it at interest, invested it in real estate and in building and loan stock; that in 1897 when the Aurora Milling Company was organized she owned a farm in Barry county, one in Lawrence county, some real estate (house and lot) in Monett, and real estate in Pierce City, Missouri, all in her own name and that she owned some shares in a building and loan association in the city of Springfield, Missouri; that she had acquired all of this property by money that had been given to her by her husband and from interest thereon; that the only property she inherited, or that came to her from any source other than from her husband, was a vacant town lot, which had been given to her by her grandfather, but the title to which was in the name of her husband; that in the formation of the milling company and in all his transactions therewith, Rorick acted as the agent of his wife. This agency, however, was not disclosed to any one connected with the milling company and they had no knowledge of the fact that Rorick owned no property in his own name.
The money to pay for the sixty-one shares of milling stock issued to Rorick and his wife was raised in the following manner: cash $ 100, $ 1,100 on matured shares in a building and loan association held by Mrs. Rorick in her own name, $ 1,900 from the sale of her farm in Lawrence county, $ 1,500 raised by mortgages on her farm in Barry county, and $ 1,500 raised by mortgage on her house and lot in the city of Monett, all of which property she acquired by money furnished her by her husband and from interest on loans of such money, and profits and rents from some of the real estate; that she made the purchases and investments on her own account and in most instances without consulting her husband and without his knowledge.
There is evidence that Rorick opened an account with the Commercial Bank of Aurora on November 7, 1894. This account, however, never exceeded $ 300 to his credit and was closed August 4, 1895. There is no evidence that Rorick had any other bank account anywhere prior to the date of his taking stock in the milling company and no evidence that he had any money at that time. In the formation of the milling corporation, and in the issuance of the stock subscribed, and in the management of the corporation after it became a running concern, Mrs. Rorick entrusted her whole interest to her husband and he received the dividends on her stock as declared from time to time and drew money from the corporation in his own name and it appears from the evidence that the other stockholders supposed he was the sole owner of the stock and testified that shares were issued to Rorick's wife at his request with a view of making her a director or officer of the corporation if found advisable.
Judgment...
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