Southern States Fire & Casualty Ins. Co. v. De Long

• Citation: 178 Ala. 110,59 So. 61
• Court: Supreme Court of Alabama
• Decision Date: 16 May 1912
• Parties: SOUTHERN STATES FIRE & CASUALTY INS. CO. v. DE LONG.

59 So. 61

178 Ala. 110

SOUTHERN STATES FIRE & CASUALTY INS. CO. v. DE LONG.

Supreme Court of Alabama

May 16, 1912

Appeal from Chancery Court, Jefferson County; A. H. Benners Chancellor.

Suit by Adrian De Long against the Southern States Fire & Casualty Insurance Company. From a decree for complainant, defendant appeals. Reversed, and judgment rendered dismissing the bill.

Lamkin & Watts, of Birmingham, for appellant.

Gordon & Edington, of Mobile, for appellee.

SIMPSON J.

The bill in this case is filed by the appellee to rescind and cancel a purchase of shares of the capital stock of defendant company on account of misrepresentations claimed to have been made by the agent from whom the stock was purchased. The claim is that said agent told the plaintiff, as an inducement to purchase the stock, that the company had declared or agreed upon a dividend of 25 per cent. which would be paid to the stockholders in the following October (the purchase being made in June), also that one Adam Glass of Mobile had purchased 100 shares of said stock, all of which is denied by the respondent.

The plaintiff testifies that the agent, D. J. Marshall, told him that a dividend had been declared of 25 per cent., and on cross-examination states: "I couldn't quote his exact language, but he led me to believe it would be paid--25 per cent. My recollection is he said it had already been declared, and the stock would be advanced $5 per share at that date. I am clear on the point that the stock would be advanced $5 a share from October 1st, and there would be a dividend paid of 25 per cent. My recollection is that he said it had already been declared--it had been decided that they would pay that much." He also states that said agent stated to him that Adam Glass had bought 100 shares.

One R L. Simmons, who was, at the time of the purchase, a partner of complainant, testifies that he was present when the conversation took place between complainant and said Marshall; that Marshall "stated that there was a dividend--was due to be payable in October following" also that Adam Glass had bought 100 shares. He also states that he saw complainant sign a written application for the stock, besides signing the note, while the plaintiff says that he did not sign any application.

Marshall denies positively that he made any statement about 25 per cent. dividends; says that complainant was an old insurance man; that the company had been organized only for one month; that he told complainant so, and that he knew no such dividend could have been declared in that time; that no agents had been appointed, and that he appointed complainant an agent to represent the company at Citronelle, where he lived; that he merely showed him some statistics of what other companies had made, and showed him a letter from Adam Glass stating that he had bought "a block of stock" and "recommending the proposition."

Adam Glass testified that he did have 10 shares of the stock which had been given him by a man named Cozart, but when persons asked him about it he said he had traded furniture for it, and that he thought the stock was worth $10 per share (complainant had paid $25).

Said Marshall also testified that, after De Long and others had given their notes, the bank refused to discount them until it could ascertain that the purchasers were satisfied, as one of them had expressed discontent, that accordingly they had a meeting at De Long's office (De Long being present), at which many questions were asked, and the matter fully gone over, said Simmons also, and...