Case ID: sd_40/html/0472-01.html
Source: Caselaw Access Project
Author: {"author": "WHITING, P. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

INDEPENDENT HARVESTER COMPANY, Appellant, v. LEE, Respondent.
    (168 N. W. 28.)
    (File No. 4301.
    Opinion filed June 11, 1918.
    Rehearing denied July 24, 1918.)
    Corporations — Recovery on Notes for Corporate Stock — Rescission Unplead, Unsupported by Evidence — Failure to Direct Verdict, Effect.
    In a suit to recover on notes given for shares of plaintiff’s corporate stock, defendant alleging facts warranting a rescission which he did not plead, held, he was not entitled to judgment of rescission; it further appearing that, after learning facts revealing the fraud set up, and after making a demand not amounting to rescission, he treated the stock as his own. Held, further, that, jury having returned verdict for defendant for all he had paid on the notes, trial court should have directed verdict for plaintiff.
    Appeal from " Circuit Court, Minnehaha Gouotv. H'on. Joseph W. Jones, Judge.
    Action by toe Independent Harvester Company, against Gilbert E. Lee, to recover on promissory notes. From a judgment for defendant, .and from an order denying plaintiff’s motion for directed vendiict, plaintiff appeals.
    Reversed.
    
      Cherry & Abbott, and Roy'B. Marker, for Appellant.
    
      Parliman & Parliman, and Krause & Kraicse, for Respondent.
    Appellant dted, re rescission;' Grymes v. 'Sanders, 93 U. S., 55, 63; 23 L. Ed. 798, 802; Helm v. Wright, Coto., 168, Pac. 36; 6 R. C. L. 935. ' ■
   WHITING, P. J.

Plaintiff had sold to defendant several shares of it®, stock,, taking from defendant several notes in payment therefor. , Defendant had paid some of these notes. This action, was brought to recover on toe unpaid notes. Defendant alleged facts upon which hie might have , sought a rescission of ■toe original transaction, and he ashed judgment for the sums which he haId paid on toe nlotos. He did not plead a rescission. Neither did toe evidence prove more, toan that at one time be •made a demand, upon plaintiff, indicating a desire and, perhaps a present intention to attempt a rescission. The evidence also established .without, .dispute that, after learning facts which reve'aledl the fraud, if any, which had been pradticed upon him, and after making the demand above referred to, he treated the stock as his own and attempted to sell same. It is therefore clear that defend'anit neither rescinded nor was -entitled to' a judgment of rescission. The instructions' of the trial court were to the effect that defendant was entitled to recover if he acted promptly upon discovering the facts upon whíiich- a right to rescind' might be based. The jury returned' a verdict in favor of defendant for all he had pai-d on the nietas. There 'being no rescission proven and! no- proof of facts warranting a judgment of rescission, the trial court should 'have -directed! .a verdict for plaintiff.

The judgment and- -order appealed! from- are reversed.