The United States Wind-Engine and Pump Company v. Davies

• Decision Date: 01 January 1896
• Docket Number: 15
• Citation: 42 P. 590,2 Kan.App. 611
• Parties: THE UNITED STATES WIND-ENGINE AND PUMP COMPANY v. B. M. DAVIES
• Court: Kansas Court of Appeals

42 P. 590

2 Kan.App. 611

THE UNITED STATES WIND-ENGINE AND PUMP COMPANY v. B. M. DAVIES

No. 15

Court of Appeals of Kansas, Northern Department, Eastern Division

January 1, 1896

Error from district court, Shawnee county; Z. T. Hazen, Judge pro Tem.

Opinion Filed November 11, 1895.

MEMORANDUM.--Error from Shawnee district court; Z. T. HAZEN judge pro tem. Action by The United States Wind-Engine and Pump Company against B. M. Davies to enforce a stockholder's liability. Judgment for defendant. Plaintiff brings the case to this court. Affirmed. The opinion herein, filed November 11, 1895, states the material facts.

Judgment affirmed.

D. E Sowers, and N. B. Arnold, for plaintiff in error.

Quinton & Quinton, for defendant in error.

GILKESON P. J. All the Judges concurring.

OPINION

GILKESON, P. J.:

Plaintiff in error, as plaintiff below, obtained a judgment against the Florence Water Supply Company. Execution was issued on said judgment, and duly returned unsatisfied. Thereafter plaintiff filed its motion and served proper notice on the defendant in error for the purpose of obtaining execution against him as a stockholder in said corporation. The court, after hearing the testimony, overruled the motion. Of this the plaintiff in error complains, and we are called upon to review the action of the court.

The correctness of the judgment of the court below rests upon the question, whether or not B. M. Davies was a stockholder in the Florence Water Supply Company at the time the execution against the property or effects of the corporation was found to be ineffectual? If he was not, then the judgment is correct. It appears from the record that the defendant, B. M. Davies, with 12 others at some time signed the following agreement:

"We, whose names are subscribed hereto, agree to subscribe for and purchase from the Florence Water Supply Company the amount of stock and first-mortgage bonds in equal parts of said company; each share of stock is $ 100, and each mortgage bond of the nominal value of $ 100, and for each $ 100 cash paid in such instalments as the directors may from time to time call, said company agrees to deliver on payment of said subscription to the subscriber for each $ 100, one share of stock and one mortgage bond of the denomination aforesaid. The rate of interest and date of said bond and the time they shall run shall be determined by the directors.

Names.

No. of shares.

Amount.

B. M. DAVIES,

10

$ 1,000."

When this agreement was signed, whether before or after the organization of the company, the record does not show; but from the circumstances surrounding it, we are led to the conclusion that it was prior to the organization. It is also shown by the record that a charter was filed on the 12th day of February, 1887, with the secretary of state; that in September, 1887, a stock ledger was opened, and stock charged to different parties thereon; that among those whose names appear on this ledger were some of those whose names were on said agreement, and others who did not sign it; that the name of B. M. Davies does not appear on the ledger; that he was never assessed for or on account of any stock, but that the identical stock for which he was supposed to subscribe was assessed the same as the other stock, but not to Mr. Davies; that no stock was ever issued -- simply charged on the stock ledger to the parties as assessments were made thereon, and as these assessments were paid the parties were credited with the amounts paid. Under the facts as disclosed in the record, we perceive no error in the ruling of the court below. The only testimony which in any manner attempts to connect the defendant with this corporation is the agreement which he signed; and that, taken in its strongest sense, could not be considered as a subscription for stock, but an executory agreement for stock and to purchase first-mortgage bonds at some future time, when certain things were performed by the company. The subscription to stock and the purchase of the bonds formed an entire contract, each depending on the other, and the company could not enforce this contract against any of the signers as to the stock without tendering the bonds, or for the bonds without the stock; and the fact that it is not shown that any first-mortgage bonds were ever issued as provided for in the agreement, and that some only of those who signed this agreement were assessed, and that others, who were not parties to the agreement, became members of the corporation, and that no assessment on...