Case ID: nc_205/html/0589-01.html
Source: Caselaw Access Project
Author: {"author": "CoNNOR, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

LONNIE BYRD v. TIDEWATER POWER COMPANY.
    (Filed 10 January, 1934.)
    1. Evidence J a — Unwritten part of contract not required to be in wilting may Be shown by parol when not in contradiction of written part.
    Parol evidence that the agent of a corporation for the purpose of selling its stock was expressly authorized and directed to tell proposed purchasers that if they would buy stock the corporation would repurchase it at any time upon the purchaser’s demand at a certain price, and that plaintiff purchaser bought the stock upon this agreement, is held admissible in evidence although no such agreement was contained in the written stock subscription contract signed by the purchaser, it not being required that a contract for the sale of stock should be in writing, O. S., 1164, and the parol part of the contract not being in contradiction of the written terms.
    2. Estoppel C a — Acceptance of dividends will not estop purchaser from declaring on seller’s contract to repurchase stock at fixed price.
    The purchaser of stock is not estopped from bringing action on the seller’s agreement to repurchase the stock at a fixed price upon demand by the purchaser by accepting dividends thereon after demand upon the seller to repurchase in accordance with the terms of the agreement, the purchaser being entitled to the dividends so long as he owns the stock.
    Appeal by defendant from Devin, J., at May Term, 1933, of BladbN. No error.
    Tbis is an action to recover of the defendant the sum of $960.00, on the cause of action alleged in the complaint.
    It is alleged in the complaint that contemporaneously with the purchase by the plaintiff from the defendant of ten shares of its preferred stock, in December, 1930, the defendant contracted and agreed with the plaintiff that defendant would, at any time when requested to do so by the plaintiff, repurchase said shares of stock from the plaintiff, at $96.00 per share. This allegation is denied in the answer.
    It is further alleged in the complaint that some time during the spring of 1932, the plaintiff requested the defendant to repurchase the said shares of stock from him, and to pay therefor -the sum of $960.00, and that defendant failed, neglected and refused to purchase said shares of stock from the plaintiff. This allegation is admitted in the answer.
    The issues submitted to the jury at the trial were answered as follows:
    “1. Is the plaintiff entitled to refund on the 10 shares of the preferred stock of the defendant corporation, upon surrender of the certificate for said shares, as alleged in the complaint? Answer: Yes.
    2. Is the defendant indebted to the plaintiff, and if so, in what amount? Answer: $960.00.”
    
      From judgment that plaintiff recover of tbe defendant tbe sum of $960.00, with, interest from 1 May, 1933, and tbe costs of tbe action, tbe defendant appealed to tbe Supreme Court.
    
      H.ewry L. Williamson for plaintiff.
    
    
      L. JR. Varser, JB. A. McIntyre and- O. L. Hem/ry for defendant.
    
   CoNNOR, J.

Tbe plaintiff is a resident of Elizabethtown, in Bladen County, North Carolina. He was during tbe month of December, 1930, and is now engaged in business in Elizabethtown as a jeweler and merchant. Tbe defendant is a corporation organized under tbe laws of this State, with its principal place of business at Wilmington, in New Hanover County, North Carolina. During tbe month of December, 1930, T. C. Connor was an agent and employee of tbe defendant. As such agent and employee, be bad authority to sell shares of stock in tbe defendant corporation, and was directed by tbe defendant to solicit subscriptions for such shares of stock.

On or about 8 December, 1930, tbe said T. C. Connor solicited tbe plaintiff at bis place of business in Elizabethtown, to purchase shares of tbe preferred stock of defendant at $98.00 per share. As tbe result of such solicitation, tbe plaintiff subscribed for ten shares of said preferred stock, and agreed to pay for said shares tbe sum of $980.00. Tbe subscription agreement was in writing and is signed by tbe plaintiff. Pursuant to said subscription, tbe defendant sold to plaintiff ten shares of its preferred stock, and upon receiving payment in full for said shares of stock, delivered to tbe plaintiff, through tbe mail, a certificate for tbe same. There is no provision in either tbe subscription agreement or in tbe certificate for tbe repurchase by tbe defendant of said shares of stock, at tbe request of tbe plaintiff. It is provided in tbe certificate, however, that said shares of stock are redeemable by tbe defendant, at its option, at any time, at tbe price of $110.00 per share.

There was evidence at tbe trial tending to show that during tbe negotiations between tbe agent and employee of tbe defendant and tbe plaintiff, which resulted in tbe purchase by plaintiff from tbe defendant of tbe ten shares of preferred stock, tbe said agent, as be bad been expressly authorized and directed by tbe defendant to do, told tbe plaintiff that if be would purchase said shares of preferred stock at $98.00 per share, tbe defendant would at any time after such purchase, at tbe request of tbe plaintiff, repurchase said shares of stock, and pay therefor $96.00 per share. Both tbe plaintiff and tbe agent of tbe defendant testified to this effect. Tbe defendant in apt time objected to tbe admission of this testimony as evidence tending to prove tbe contract between tbe plaintiff and defendant as alleged in tbe complaint, and on its appeal to tbis Court assigns tbe admission of said testimony as error. Tbis assignment of error cannot be sustained.

Tbe principle of law applicable in tbe instant case is stated in Fertilizer Co. v. Eason, 194 N. C., 244, 139 S. E., 376, as follows:

“If a contract is not witbin tbe statute of frauds tbe parties may elect to put their agreement in writing, or to contract orally, or to reduce some of tbe terms to writing and leave tbe others in parol. If a part be written and a part verbal, that which is written cannot ordinarily be aided or contradicted by parol evidence, but tbe oral terms, if not at variance with tbe writing may be shown in evidence; and in such case, they may supplement tbe writing, tbe whole constituting one entire contract. Cherokee County v. Meroney, 173 N. C., 653, 92 S. E., 616.” The principle as thus stated has been approved and applied in Roebuck v. Carson, 196 N. C., 672, 146 S. E., 708, and in Smithfield Mills, Inc., v. Stevens, 204 N. C., 382, 168 S. E., 201.

There is no provision in tbe law of tbis State which requires that a contract for tbe sale or purchase of shares of tbe stock of a corporation shall be in writing or evidenced by writing. Such shares of stock are declared by statute to be personal property, C. S., 1164, and may be sold or purchased by tbe corporation which has created them. Blalock v. Mfg. Co., 110 N. C., 99, 14 S. E., 501.

• Tbe receipt and acceptance by tbe plaintiff of dividends on tbe shares of. stock owned by him, subsequent to bis request that defendant repurchase said shares, and subsequent to tbe commencement of tbis action, does not estop tbe plaintiff from enforcing tbe contract as alleged by him in bis complaint. Tbe plaintiff was entitled to said dividends so long as be was tbe owner of tbe shares of stock on which tbe dividends were declared. He cannot be estopped, in law or in equity, from taking what was bis own.

There was no' error in tbe trial of tbis action. Tbe judgment is affirmed.

No error.