Pinchback v. Bessemer Min. & Mfg. Co.
| Decision Date | 13 December 1904 |
| Parties | PINCHBACK v. BESSEMER MIN. & MFG. CO. |
| Court | North Carolina Supreme Court |
Appeal from Superior Court, Gaston County; McNeill, Judge.
Suit by J. A. Pinchback against the Bessemer Mining & Manufacturing Company. From a decree in favor of plaintiff, defendant appeals. Reversed.
Where a contract between a grantor and grantee required the grantor to convey all its real estate to the grantee, but the secretary of the grantor mistakenly represented to the attorneys instructed to draw the deed that certain lots had been sold by the grantor, whereby they were not inserted in the deed, the deed was subject to correction in equity.
The defendant company was, on and prior to November 16, 1892, the owner of certain real estate, a portion of which had been surveyed and laid off into building lots. A plat was made showing the location, number, etc., of each lot. Some time prior to November 16, 1892, the Bessemer Mining Company made a proposition to the defendant company to take a conveyance and assignment of the real estate and all other property and assets of the defendant company, in consideration whereof the said mining company agreed to pay $50,000, a part of which was to be applied to the discharge of certain indebtedness of the defendant company and the balance paid in cash, and to issue to the stockholders of the defendant company stock in the said mining company to the amount of $325,000, to be apportioned among them as they should determine. The proposition was duly accepted by the stockholders of the defendant company. Thereupon the defendant company executed a deed to the said Bessemer Mining Company, reciting the action of the said company, evidenced by a resolution duly adopted at a meeting of the stockholders. So much of said resolution as is material to the decision of this appeal is in the following words: "Whereas, for the purposes of its business, it is deemed advisable for this company to acquire all the property, real, personal, and mixed, including all accounts, bills receivable, and assets of every name and nature, of the Bessemer Mining & Manufacturing Company," etc. The deed further recited that the proposition of the said mining company, at a special meeting of the stockholders of the defendant company called for that purpose, had been duly accepted, and that a resolution had been duly passed authorizing the directors, president, and secretary to execute "all such deeds of conveyance, bills of sale inventories, transfers, and legal instruments as may be necessary to vest the title to the property of said company in the Bessemer Mining Company, and to carry into full and complete effect the foregoing action of this company," etc. Following these recitals is appropriate language to convey and transfer to the Bessemer Mining Company "all the real estate, property, and rights of property owned by the said Bessemer City Mining & Manufacturing Company is in any manner entitled, wheresoever situate and by whatsoever name known, and more specifically and particularly the lands *** hereafter described," etc., "to wit." Following is a description of the lands conveyed "Excepting and reserving, however, from the operation of these presents the following town lots and blocks in Bessemer City, N. C., to wit." Twenty-six lots are thereupon described by block, number, etc. "Also the lot on which T. A. McGill now resides, *** described in the deed to McGill, but not yet registered." Then follows a reservation of certain lots conveyed to the Bank at Durham etc. This deed was duly proven and recorded. It was shown in evidence that the 325 shares of stock was duly issued, of which the plaintiff received 650 shares. The debts were canceled and the balance of the $50,000 paid and distributed among the stockholders of the defendant company. Since November 16, 1892, the defendant company has transacted no business, held no meeting of its stockholders, nor in any manner exercised any corporate powers. The plaintiff was the owner of 375 shares of the stock of defendant company, the certificate of which the jury find has been lost or mislaid.
Maj Guthrie, introduced by the defendant, testified that he was attorney for defendant company; that the resolutions set forth in the deed were duly passed; that all of the stockholders were present, including plaintiff; that Mr. Cooley and himself undertook to draw a deed in accordance with the terms of the resolution and for the purpose of carrying it into effect; that it was their purpose and intention to so draw it as to convey all of the property, real and personal, belonging to the Bessemer Mining & Manufacturing Company; that J. A. Smith, the secretary and treasurer, had a map showing the location, etc., of the property; the company had sold off a number of lots, as shown on the map, and they incorporated a clause, intending thereby to except from the operation of the deed all the lots which had been sold by the defendant company; they obtained the information in regard to the number of lots sold from Mr. Smith; he called out the lots which he said had been previously sold, and they, relying upon him, excepted from the operation of the deed the 26 lots mentioned in the complaint; if they had been notified by Mr. Smith that the lots had not been sold, they would not have excepted them; the deed was delivered to the mining company, and he heard no more of it until a short time before this suit was instituted; that the witness and Mr. Cooley read the deed over to the parties and explained it; that defendant company executed the deed with full knowledge that the lots described in the complaint had been excepted, and the mining company accepted it with like knowledge. The said mining company is not complaining of the excepted lots, so far as witness knew. Maj. Guthrie further testified that Mr. Cooley and himself excepted the lots because they thought that they had been sold and conveyed to third parties, as was the case with the other deeds excepted from the operation of the deed.
Mr. J A. Smith was introduced by the plaintiff, and testified that he stated to Maj. Guthrie and the stockholders of the defendant company, when the stockholders of both companies were present for the purpose of purchasing and selling the property, that the 26 lots had been sold before that day, and under what circumstances; and it was agreed by all of the stockholders of both companies there assembled in meeting, with a full knowledge of all the facts, that said 26 lots should be reserved from the operation of the deed. The company had contracted to sell the lots to Capt. Runlett. He was present at all of the meetings. He had bought 60 or 80 shares of stock of the company, and was entitled, when the shares were paid for, to one lot for each share. The company had agreed by written contract to convey them to him. Witness made known the contract to the stockholders, explaining it fully. Mr. Carrington, who was spokesman for the mining company, said that they did not care for the lots; wanted the land for the minerals. The stockholders said that the contract with Runlett should be carried out. Witness gave the written contract to the mining company, books, papers, etc., at the time the deed was made, and has not had them since; does not know what became of them. Carrington said that the mining company had no stock to sell at 50 cents on the dollar. He suggested that the only way to carry out the contract was to reserve the lots from the deed, and that witness gave some of his stock to Runlett for the defendant, and to reserve enough lots to make the contract good. Runlett had paid a part of the amount due for the stock. It was unanimously agreed that the defendant company should carry out its contract with Runlett, and that witness should give him some of his individual shares for the company; that when the same were fully paid for, the defendant company should deed him the 26 lots, which should be reserved from the operation of the deed. All understood this. The mining company were eager to get the property; wanted it for mining purposes; said that it was worth...
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