White v. Stewart
| Decision Date | 06 February 1938 |
| Docket Number | 30186 |
| Citation | 145 So. 747,166 Miss. 694 |
| Court | Mississippi Supreme Court |
| Parties | WHITE et al. v. STEWART |
Suggestion Of Error Overruled March 6, 1933.
APPEAL from chancery court of Hinds county, HON. V. J. STRICKER Chancellor.
Suit by Miss H. M. Stewart against D. M. White and another. From decree for complainant, defendants appeal. Reversed, and bill dismissed.
Reversed, and bill dismissed.
Ernest P. Jones, Jr., of Jackson, for appellants.
It is well established that the relationship of agency cannot be proven by the declarations of an agent.
Postal Telegraph & Cable Co. v. Freidhof, 127 Miss. 498; Gulfport & Mississippi Coast Traction Co. v. Faulk, 118 Miss. 894, 80 So. 340; Wellsford & Withers v. Arnold et al., 140 So. 220; Raleigh & Co. v. Denham, 119 Miss. 406, 81 So. 118.
The relation will not be inferred from the mere fact that third person thought or assumed that the agency existed, nor because the alleged agent assumed to act as such, nor because the condition and circumstances were such as to make such an agency seem natural and probable and to the advantage to the supposed principal.
All persons dealing with one as an agent must take notice of the extent of his power and authority to bind his principal.
Royal Feed Milling Co. v. Thorn, 142 Miss. 92, 107 So. 282; Ismert-Kincke Milling Co. v. Natchez Baking Co., 124 Miss. 205.
If the representation consists merely of a promise or a statement as to a future event, it will not serve as a basis for fraud, even though it was made under circumstances as to knowledge and belief which would give rise to an action fraud had it related to an existing or past fact.
51 A.L.R. 47; 51 A.L.R. 108; 51 A.L.R. 113; Kennebec Housing Co. v. Barton, 123 Me. 293, 122 A. 852; Campbell v. Zion Co-operative Home Building & Real Estate Co. (Utah), 148 P. 401; Deshatreux v. Batson, et ux, 159 Miss. 236, 131 So. 346; Walker v. M. & O. R. Co., 34 Miss. 245.
The court requested additional briefs in this cause saying that it did not exactly understand what relief, if any, the appellee claims under the Blue Sky Law. And "if the appellee claims the right to damages because of violation of the Blue Sky Law, he should point out the section of the statute relied on, and discuss the sufficiency of the allegations of the bill therefor."
The only section which is mentioned and argued by the appellee is section 4186 of the Code of 1930. Therefore, we take it that appellee is relying wholly upon this statute in so far as the Blue Sky Law is concerned.
The appellee's contention with reference to the Blue Sky Law has no bearing whatsoever on this case for section 4186 deals exclusively with investment companies, and other sections with different provisions deal with dealers.
Assuming for the sake of argument only that this case comes within the Blue Sky Law and that the said law was violated by the sale of the stock in question to appellee under misrepresentations on the part of Linsky, then there is no liability on the part of the appellants until the appellee proves that Linsky was the agent of appellants.
The testimony of Barksdale is that they bought this stock from outside the state on their own account and were owners of it and were ready to sell and deliver it to appellee according to her contract. Then even if they were operating under the Blue Sky Law this transaction was an excepted one and was not governed by it. See section 4195, sub-section "g." There is no testimony to show that this case comes within the Blue Sky Law. It was incumbent upon the complainant to affirmatively allege and prove that this was a case under said law and that it had been violated. This complainant failed to do.
W. M. Snyder, of Jackson, for appellee.
By false promises and misrepresentations, the appellee was induced to part with her savings and sign notes for worthless stock-- onethousand dollars in cash and one thousand in notes.
The record shows that the stock at the time was worthless and its sale had not been authorized as the Blue Sky Law requires. There is no dispute in the record and no contention made in the brief for appellants, that the provisions of the Blue Sky Law had been complied with touching the sale of this stock.
It is submitted that this clearly brings the case within the terms of section 4186, Code 1930, being a part of the Blue Sky Law; that statute providing that if stock is sold as the result of misrepresentation, the person so induced to buy may recover for damages sustained.
Bankers Mortgage Co. v. McMullen, 141 So. 331.
Walker Wood, Secretary of State, testified that the sale of Baird's Television stock had not been authorized as required by law and its sale was therefore illegal.
In making a contract to sell the stock to the appellee, the appellants impliedly represented to appellee that they had a lawful right to sell the stock. This was a false representation, as found by the chancellor, and operated to the serious injury of the appellee.
Bankers Mortgage Co. v. McMullen, supra.
The Baird's Television Stock in question was sold by the appellants to the appellee in direct violation of the Blue Sky Law of the state of Mississippi, Code 1930, chapter 100, known as the Blue Sky Law, and in offering Baird's Television Stock for sale to the appellee, she (appellee) had every right to presume that the appellants had qualified this stock under the Blue Sky Law and it was not the duty of the appellee to engage a lawyer to look up the law, but had every right to presume that the appellants had complied with the laws of this state in offering the said Baird's Television Stock for sale.
The Blue Sky Law of the state of Mississippi imposes a duty, Code 1930, section 4184, upon the secretary of state to examine the statements and documents filed in his office pertaining to the stocks offered for sale by any investment company, dealers or agents and in the testimony of Mr. Walker Wood, secretary of state, offered at the time of trial of this cause, the secretary of state testified that there had been no permit issued for the sale of Baird's Television Stock and "under the law the appellants should have qualified that stock before attempting to sell it, but they did not," and the appellants therefore cannot offer any excuse that they did not know what the value of the Baird's Television Stock was, and accepted the sum of ten dollars ($ 10) per share for the Baird's Television Stock which was strictly a violation of the Mississippi Blue Sky Law.
The appellee purchased from the appellants corporate stock issued by Baird's Television, Inc., paying a part of the price therefor in cash, and giving three promissory notes for the remainder. She afterwards repudiated the contract of sale, and sued the appellants for the money paid them and for a return of the notes given by her or their value. The ground of her complaint is that the stock was sold to her in violation of the Blue Sky Law, section 4178 et seq., Code 1930, and that she was induced to purchase it by means of a fraudulent representation and promise.
The case was tried on bill, answer, and proof, and the decree was in accordance with the prayer of the bill.
The facts disclosed by the evidence are substantially as follows: The appellants, co-partners under the name of H. L. Barksdale & Co., are or were doing business as brokers at Jackson, Mississippi, and were engaged in the purchase and sale of corporate stock, bonds, and other securities. The appellee purchased from them two hundred shares of the stock of Baird's Television, Inc., a foreign corporation. The sale to the appellee was made on three written orders for the stock, given at different times, addressed to the appellants, and signed by the appellee--two for fifty, and one for one hundred shares of the stock. These orders, after being signed by the appellee, were delivered to the appellants by one Linsky, acting as agent for either the appellants, or the appellee, it is immaterial which, as will hereinafter appear. One of the orders reads as follows:
The other two orders differed from this one only as to the date, number of shares, the use of the word "cash" for checks, and in the amount thereof, and of the notes.
Baird's Television, Inc., is a going concern, with all of its authorized capital paid up, but its stock has little, if any, market value. It is not shown to have sold, or offered for sale, any of its corporate stock, in this state. The particular stock here in question was purchased by the appellants, from a man named Bradford, who purchased it either in New York or London. The stock was set aside for the appellee by the appellants on these orders. The certificates therefor issued by Baird's Television, Inc., were attached to the notes given by her, and the notes were thereafter sold and delivered by the appellants to another with the certificates of stock attached thereto.
Neither Baird's Television, Inc., the appellants, nor Linsky, had complied with any of the...
To continue reading
Request your trial
-
Guynn v. Shulters
...its resources or prophesied its speedy completion, would be to nullify, perhaps, a majority of such contracts.' See also White v. Stewart, 166 Miss. 694, 145 So. 747. It is evident, in our opinion, that Rigby, under the proof and the rules of law applicable thereto, has no grounds for setti......
-
Berry v. McKay
... ... The ... rule applicable to this case is admirably stated in the case ... of White et al. v. Stewart, 166 Miss. 694, 145 So ... 747, 749, wherein the Chief Justice of this court said: ... " The rule in this court, in consonance ... ...