Case ID: johns_13/html/0392-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Per Curiam.;", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Cunningham against Spier.
    where A. transItocMn b°turnpike company, •which, at the transfer, appeared by the books therompany ammint0 before toida%Psobtt'SÍ Snd'thfrresoiution was after the transferred pealed, and the stockholders called upon to pay in‘ the amount before allowed for interest, in consequence of which B. paid to the company that sum on the shares transferred to", him by-A.., it was'held thatB, could 'not maintain aü action to recover theamountfrom A.j therebeing neither fraud nóra.warranty. „ ‘ ■ ■ .
    This Wás an action- of assumpsit- for níbñéy paid. Th& .cause was tried before Mr. J. Platt., at the New-York sittings* ; ^n ^ „ ° m IJ^cemoer.i IBloi :
    The plaintiff-gave in evidence a receipt signed bv the de¡1 . ° . ■ r 0 : ' ' fendant,. which was in the .following Words; “Received, Newa York, 18'th .pf Apr-il,-1807, of Mr. William-Cunningham, in cash and notes, five-thousand and seventy-five dollars, in full for One hundred and forty-five shares in the Newburgh and Cochectow turnpike road. Paid thirty-five ■ dollars for each " 1 , jSn8X6* * ' " v * ' '
    
      At a meeting of the directors of, the Néwbürgh and' Cochee• ion turnpike company, on the 12th ‘of December, 1803, it was resolved. “ that the treasurer place to the credit of each stockholder the interest, at 14 percent., of all • money by them advanced to the company, up to the first-day of January; i 8G4, and that the said interest be cast, and placed to each person’s credit every six months thereafter.’’ This , resolution was rescinded on the 26th of December, 1804, and revived again by a resolution of the Mth of May, 1805; and on the 30th of September, l8Q6. it was resolved, “ that the half yearly dividend of interest should in future be credited to the holders at the expiration of the half year.” • This last resolution was, by a resolution of the 17th of January, 1807, discontinued from the preceding 1st of January; and on the 2d July, 1808, it was resolved, “ that whereas by a resolution of a former board of the directors of the Newburgh and Cochecton turnpike road company, a dividend of 14 per cent., upon the capital stock of each stockholder, was allowed and deducted from the money-due by them to said company on said stock, and whereas by an act entitled an act to prevent usury, it is unlawful for any person to take more than 7 per cent, per annum, and whereas by an act entitled an act to establish a turnpike company, for making and improving a road from the village of Newburgk, On the Hudson river, to Cochecton, on the Delaware, a dividend of 14 per cent, is in no case allowed excepting from the clear profit and income of said road. Thereupon resolved^ that said resolution is contrary to an exception contained in the 2d section of said act, which provides, that the president and directors of said company shall make no laws inconsistent with the constitution and laws of this states and that it now is, and always had been, void, and of no efféb-t* Resolved, that the treasurer be authorized to ask, and demand, of • and from every stockholder, all moneys or stock yet due by them to the company, agreeably to the above resolve for rescinding the resolution allowing credits on said stock, by 14 per cent, anticipated interest.”
    It was proved that the stock mentioned in the receipt from the defendant to the plaintiff, consisted of 1,30 shares which stood in the books of the company, in the name of the defendant, and 15 shares, which stood in the name of-one Lock
      wood,, arid were sold \by the defendant, ’and: which Were charged t0 the plaintiff, in the books of the company, at' 35 dollars pér share. ■ After the sale by the,defendant'fo';t'he plaintiff,-there was a balance due from the plaintiff to the company, of 1,388 . dollars and 6 cents, part of which, 1,181 dollars 20 cents,, had been credited to the defendant oh his shares, prior to the sale ' to the plaintiff under the resolution of the company directing 'the treasurer to place'to the credit, of .each stockholder.the-interest, at 14 per cent, of all moneys therein advanced to the company. In consequence of the resolution of the 2d of July, 1808, the treasurer of the company called upon the plaintiff to pay the sum of 1,388 dollars and G cents, or otherwise the shares would become forfeited; the defendant gave-his motes' for this sum, which,Were paid, as-.they. became due ; to recover* part of which, to wit, 1,1.81 dollars 20 cents, the present action was-brought, the residue óf the above-mentioned balance being on account-of other transactions between the plaintiff and the company. It was proved by George Mohell, who was treasurer of the company, at the time of the transfer from the defendant .to the plaintiff, that he had informed the plaintiff of the manner' in which, the- defendant’s stock account had been paid up,and settled, which was by his being credited- with 14-per cent',, pursuant to the resolution which was'afterwards.rescinded ; -by the-books of the company, as they stood at that time, the account of the defendant for stock appeared to have been fully paid up.
    A verdict'was'taken for the plaintiff,- by Consent,' subject to the opiniotnof the court on a cause: containing the above facts»
    
      B. BlrOgden, and Wilkins-, for the plaintiff»,
    
      'Wells,'and Slosson, contra,
   Per Curiam.;

There is no gróytn.d upon,which this action can be sustained. The defendant-cannot be charged with any fraudulent misrepresentation with respect to the value of the stock. - The receipt given by him, to the plaintiff, for the money, is. fairly to be 'understood: as stating that thirty-five dollars 'had' béen paid uplon'each share.. But the manner in which this payment Jhad been 'made: was known to the 'plaintiffs before he purchased the stock, according to’.the.testimony of Monell, who swears that he informed, the plaintiff .how the stock account of the defendant was settled up and paid, by the allowance of fourteen per cent, upon the money paid in : and by the books of the company the defendant stood credited with 35 dollars paid upon each share. If the plaintiff was, therefore, acquainted with the situation of this stock, and the manner in which the 35 dollars had been paid up, he was as competent to judge of the legal effect and operation of such payment as the defendant. He was not misled as to facts, and there can be no reason why the defendant should take upon himself the risk of any subsequent order of the directors. Whether they had a right to pass the resolution for crediting the stockholders with 14 per cent, upon the money paid in, or whether, after having done so, they had a right to rescind that resolution, are questions with which the defendant has no concern; that is a matter between tbe plaintiff and the directors. The plaintiff purchased the stock with his eyes open, knowing as much, with respect to the stock, as the defendant did. There is no evidence to warrant any charge of fraud or deception practised by the defendant; nor is there any warranty with respect to the stock. There is, therefore, no principle upon which the defendant can be made responsible for the loss upon the stock. Judgment must, accordingly, be for the defendant.

Judgment for the defendant.