Palais Du Costume Co. v. Beach

• Decision Date: 06 June 1910
• Parties: PALAIS DU COSTUME CO. v. BEACH.
• Court: Missouri Court of Appeals

129 S.W. 270

144 Mo. App. 456

PALAIS DU COSTUME CO. v. BEACH.

Springfield Court of Appeals. Missouri.

June 6, 1910.

1. PLEADING (§ 93)—ANSWER—INCONSISTENT DEFENSES—GENERAL DENIAL AND SPECIAL DEFENSE.

In a suit by a corporation on a subscription to stock, an answer pleading a general denial, and also a special defense, stating that whatever agreement, if any, the defendant made with any person with reference to the purchase by defendant of the shares of stock referred to in plaintiff's petition, the same was by and with the consent of such person rescinded, is not bad because presenting inconsistent defenses.

2. CORPORATIONS (§ 83)—SUBSCRIPTIONS TO STOCK—ABANDONMENT OF CONTRACT.

The general rule is that all contracts may be mutually abandoned, and agreements to take stock in corporations stand on the same footing, and such abandonment may be inferred from the conduct, acts and dealings of the parties.

3. CORPORATIONS (§ 83)—STOCK SUBSCRIPTIONS —WITHDRAWAL.

Subscriptions to corporate stock may, where no others have subscribed nor debts incurred in reliance thereon, be withdrawn before acceptance by the corporation.

4. CORPORATIONS (§ 83)—STOCK SUBSCRIPTIONS —RESCISSION OF CONTRACT.

Where one subscribing to corporate stock the day after the subscription was made notified the holder of the paper, while it was in his hands, and before it was acted upon by the corporation, that he withdrew his subscription and would not take the stock, which was consented to by the holder, and where for more than a year and until after the corporation had proven a failure, no stock was delivered or tendered, and no request made for the price, the subscription contract was rescinded.

Appeal from St. Louis Circuit Court; Matt. G. Reynolds, Judge.

Action by the Palais du Costume Company against E. F. Beach. From a judgment for defendant, plaintiff appeals. Affirmed.

Sturdevant & Sturdevant, for appellant. Lee Sale, for respondent.

GRAY, J.

This action was commenced in the circuit court of the city of St. Louis, by plaintiff against the defendant, to recover the sum of $3,500 which it is claimed defendant owes the plaintiff. The plaintiff corporation was organized in 1900, with a capital stock of $100,000, consisting of 1,000 shares, of the par value of $100 each. Among the subscribers to the capital stock when the corporation was organized was Mr. St. Clair, who subscribed for 600 shares. St. Clair was a promoter and was unable to pay for his stock, and a settlement was made after the corporation was organized, between him and the corporation, by which the corporation retained $54,000 of the capital stock subscribed for by him. It became necessary to get subscribers for the 540 shares of the stock surrendered to the company by St. Clair, and, in order to do so, a subscription paper was circulated by A. P. Miller, vice president and manager of the corporation. This subscription paper read as follows: "We, the undersigned, hereby agree to purchase the number of shares set opposite our respective names, of the capital stock of the Palais du Costume Company (a Missouri corporation), and agree to pay therefor the sum of one hundred dollars ($100) per share, to be payable in amounts as called for by the officers of the said company." The last one to sign the subscription paper was the defendant, for 35 shares. The enterprise was not a success, and defendant did not pay for the shares subscribed. On the 21st day of July, 1905, he was notified by letter from the plaintiff, inclosing a statement for his subscription aggregating $3,756.67, the same being the original subscription of $3,500 and interest on the same from May 1, 1904. The defendant refused to pay, and this suit was instituted to recover the purchase price of the stock, together with the interest. The answer consists of a general denial, together with a special defense as follows: "Further answering said petition and as a second defense thereto, defendant states that whatever agreement, if any, the defendant made...