On
Rehearing, December 24, 1919
Appeal
from Circuit Court, Jefferson County; Romain Boyd, Judge.
Action
by A.H. McCormick against H.L. Badham in assumpsit. Judgment
for defendant, and plaintiff appeals. Reversed and remanded.
See
also, 201 Ala. 210, 77 So. 736.
Where
plaintiff who was entitled to purchase corporate stock
claimed that he agreed defendant might sell such stock with
other shares and account for the proceeds, letters written by
defendant adverting to the sale were admissible as tending to
corroborate plaintiff's testimony denied by defendant.
The
third, fourth, fifth, sixth, and seventh counts were the
common counts. The thirteenth count was as follows:
The plaintiff further claims of the defendant the sum of
$10,000 as damages for a breach of contract, for that whereas
on, to wit, the 7th day of July, 1904, the plaintiff and
defendant entered into a written contract in words and
figures as follows:
"State
of Alabama, Jefferson County,
"This agreement made and entered into between H.L
Badham and A.H. McCormick this 7th day of July, 1904
witnesseth:
"That A.H. McCormick, of Birmingham, Ala., and the
Dorchester Lumber Company, Badham, S.C., have entered into a
certain contract as to his connection with and services to
said Dorchester Lumber Company, to which contract this
agreement is made a part.
"It is understood and agreed by and between H.L. Badham
and A.H. McCormick that as a part of said contract H.L
Badham will sell to A.H. McCormick $4,500.00 of stock of said
Dorchester Lumber Company, to be paid for in dividends or
earnings of said Dorchester Lumber Company after its present
indebtedness of approximately $75,000.00 has been discharged,
and that purchase price of said stock shall bear interest at
6 per cent. only after said dividends begin to accrue.
"It is further understood and agreed that in the event
H.L. Badham should desire to sell his interest in said
Dorchester Lumber Company within two years from date he shall
have option of purchase of said $4,500.00 of stock held by
A.H. McCormick for the sum of $2,500.00.
"It is further understood and agreed that in the event
A.H. McCormick should, of his own accord, sever his
connection with the Dorchester Lumber Company, within two
years from date he shall surrender said $4,500.00 of stock.
H.L.
Badham.
"A.H.
McCormick.
"Witness: A.L. Peace."
The plaintiff avers that by said contract defendant agreed to
sell plaintiff 45 shares of the stock of said company at the
par value and price of $100 each to be paid as therein
specified, and that at the time of execution of the foregoing
contract the defendant was the owner of 500 shares, of the
par value of $100 each, of the capital stock of the said
Dorchester Lumber Company, and the defendant's brother,
one V.C. Badham, owner of the remaining stock of said
company, consisting of 500 shares; and the said Dorchester
Lumber Company had entered into a contract with the plaintiff
for services to be rendered by plaintiff to said company for
a term of, to wit, three years, which was the said contract
with the said company referred to in said contract, and the
defendant, in order to induce the plaintiff to enter the
services of said company, entered into the said contract with
the plaintiff above set out.
The plaintiff avers that the making of the said contract by
the plaintiff with the Dorchester Lumber Company for service
was the consideration for the making of the said contract
above set out by the defendant with the
plaintiff; and the plaintiff further avers that, to wit, in
the month of February, 1907, the defendant, who then still
held in his possession the certificates or certificate of
said $4,500 of stock in the Dorchester Lumber Company
consisting of 45 shares which he contracted to sell the
plaintiff in the said written contract, informed the
plaintiff that he was then on a trade with his said brother,
V.C. Badham, to sell him the 500 shares of stock in said
company then standing in his name, including the 45 shares
sold to plaintiff, at and for the price of $100,000, which
was at the price of $200 a share, and the defendant then
asked and obtained the plaintiff's consent to include the
said 45 shares which defendant had sold to the plaintiff in
said sale, and in consideration thereof the defendant agreed
with the plaintiff to account to the plaintiff or to settle
with the plaintiff for the price at which the said stock was
sold to the said V.C. Badham.
And the plaintiff avers that the defendant did thereafter
during the year 1907 close the said trade for the sale of the
said 500 shares of stock in the said company to the said V.C.
Badham, at and for the price of $200 a share, and the
defendant was paid a large part of the purchase money
therefor, and the defendant failed and refused and still
fails and refuses to account to the plaintiff for said stock,
and has failed and refused and still fails and refuses to
settle with the plaintiff for the said stock or the price for
which it was sold to the said brother, V.C. Badham, or for
the value of said stock.
Plaintiff avers that he fully performed said contract for
services with the Dorchester Lumber Company, referred to in
the contract for the sale of the said stock to him by the
defendant, and remained with and in the services of the said
company for the full term of the said contract, to wit, three
years, and performed all the duties devolving upon him
thereunder.
The
fourteenth count contains the same words as count 13 down to
and including the words "entered into the said contract
with the plaintiff set out above," where the said words
first occur together therein, and adds the following:
The plaintiff avers that the making of the said contract by
the plaintiff with the Dorchester Lumber Company for services
was the consideration for making of the said contract above
set out by the defendant with the plaintiff, and the
plaintiff further avers that, to wit, in the month of
February, 1907, the defendant, who then and still held in his
possession the certificates or certificate for said $4,500 of
stock in the Dorchester Lumber Company consisting of 45
shares which he contracted to sell the plaintiff in said
written contract, informed the plaintiff that he was then on
a trade with his brother, V.C. Badham, to sell him the 500
shares of stock in said company then standing in his name,
including the 45 shares sold to plaintiff, at and for the
price of $100,000, which was the price of $200 a share, and
the defendant then asked and obtained the plaintiff's
consent to include the said 45 shares which defendant had
sold to plaintiff, in said sale, and in consideration thereof
the defendant agreed with the plaintiff to account to the
plaintiff or to settle with the plaintiff for the said stock,
meaning the value thereof, not exceeding the price at which
it was sold.
And the plaintiff avers that the defendant did thereafter
during the year 1907 close the said trade for the sale of the
said 45 shares of stock in the said company to the said V.C.
Badham, at and for the price of $200 a share, and the
defendant was paid a large part of the purchase money
therefor, and the defendant failed and refused and still
fails and refuses to settle with the plaintiff for the said
stock or the price for which it was sold to the said brother,
V.C. Badham, or for the value of said stock.
Plaintiff avers that he fully performed his said contract for
services with the Dorchester Lumber Company referred to in
the contract for the sale of the said stock to him by the
defendant, and remained with and in the services of the said
company for the full term of the said contract, to wit, three
years, and performed all duties devolving upon him
thereunder.
The
following are the charges referred to in the opinion:
A. If the plaintiff is entitled to recover in this action
and you find from the evidence that the defendant could have
realized the sum of $200 per share by enforcing the contract
for the sale of the stock to V.C. Badham, and you further
find from the evidence that the defendant, in April, 1908,
and the said V.C. Badham rescinded the contract made by V.C.
Badham for the purchase of the said 500 shares of stock from
H.L. Badham, and that the plaintiff did not consent to the
rescission, then the measure of damages which the plaintiff
would be entitled to recover would be the sum of $200 per
share, less the amount due the defendant from the plaintiff
for the purchase of said $4,500 of stock. Whatever sum the
plaintiff may have been entitled to recover from the
defendant in 1907 will draw interest at the legal rate of
South Carolina up to the present time.
B. If you find from the evidence in this case that the
plaintiff is entitled to recover, and you further find from
the evidence that the defendant and the said V.C. Badham
rescinded the contract for the purchase of the said 500
shares of stock by the said V.C. Badham from H.L. Badham,
without the consent of the plaintiff, and you are not further
satisfied from the evidence that the defendant
could have realized the sum of $200 per share or any fixed
sum by enforcing the contract against V.C. Badham, then the
measure of damages which the plaintiff would be entitled to
recover from the defendant would be a fair and reasonable
market value (not to exceed the sum of $200 per share) of the
said stock in the year 1907, less the amount due the
defendant for the purchase price of said $4,500 of stock.
Whatever sum the plaintiff may have been entitled to recover
from the defendant in 1907 will draw interest at the legal
rate of South Carolina from the time when it was payable up
to the present time.
D. If the defendant included the 45
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