The record-union., 1891-03-13

has been any novation or accord and
satisfaction by which the debt to the
| original owners of the property has been
satisfied. If any such arrangement has
| been had it is matter to be set up by way
ofdefense. The presumption against the
| pleader applies in certain cases, as for ex-
ample, where the pleading is silent as to
an essential fact which must have occur
red one way or the other, or where the
language used is fairly susceptible of two
constructions. But it is not carried to
such an extent as to require the pleader
| to anticipate matters of defense, or to
negative the existence of all other facts
| whatever. Even at common law that
was not required. And much less is it
required under n system where plead
ingS are required to be literally construed
with view to substantial justice. &C. G.
p, Sec. 1927
! c. 1t is said that it does not appear
what was doue with the evidences of debt
representing the balance Of the proceeds
of the sale of the 10000 shares of stock;
and that it must be presumed either that
they were turned over to the persons to
whom the debt was due (Which is suffi-
GENTLY answered by what we have just
said) or that they We're turned over to
the corporation itself, and received by it
in satisfaction of the agreement of the de-
PENDANTS.
But such agreement was not that the
proceeds of the stock We're to be turned
over to the corporation. They were to be
applied to the eXhnguishment of the debt
to the original owners. And the court
Will hardly presume that some entirely
new arrangement was made
q. lt is said that it is not shown that the
corporation has paid any money on ac-
count of said debts, or that it has sus-
| tanned any damage by reason of the al
legged performance by said defend
ants of their agreement. But the pay
ment of the purchase money on the
original contracts ofpurchase is essential
| to the protection of the corporations
right to the property. And ii said de-
PENDANTS have not paid said money as
they agreed to do, and have converted the
cash proceeds OF the stock to their own
use, the corporation (or Il stakeholder in
a proper case) has the right to come into
equity to compel the defendants to per-
form their agreement with the corpora
ton.
3. The third division Of the complaint
contains the substance of the second di
vision, and in addition thereto shows the
following facts:
OF the sum due to the original owners
of the property (as to which see fols.
l03-5l, the defendants, Howes, Bonebral>e
and Merrill, paid no more than Sl55, ,9S9 is
tols. 156 and ll2). But prior to the trans
action to be mentioned they had induced
the Board OF Directors to pay on account
of said debt the sum Of $4,000 which, it
is alleged, was paid on account of de-
PENDANTS Howes, Bonebrake and Merrill,
and at their instance and request fols.
1860, which, if true, entities the corpora
ton to recover it back. These payments
left due to the original owners of the
property the sum OF ST, Al IS, for which
said defendants Were personally liable.
In order to get rid of such liability it is
alleged that they induced their creatures
in the Board of Directors to have the
corporation assume the debt without con-
sideration.
The allegations in this regard are as
follows: That the Directors, for the
purpose of defrauding the other stock
holders of said company other than said
Howes, Bonebrake and Merrill, and for
the purpose of encum bering the property
of said corporation with debt, without
any consideration moving in favor of said
corporation, or in favor of any other of
the stockholders of said corporation other
than said Howes, Bonebrake and Mer-
rill, and with the intent of reliev
ing and releasing Howes, Bonebrake
and Merrill from their obligation to pay
Off and discharge the debts upon the lands
and waters of said corporation. did by
connlvance and colluSiOn with said
Howes, Bonebral<e and Merrill, and with
their consent, and at their request and
lnsugatlon,' issue notes of the company
to the original owners of the property in
an aggregate sum OF S272, Al g. bearing
lHtcIcSt dt ScNGn per celll. per dnnultl,
and mortgaged the property of the cor
poration to secure the payment of such
notes folios 149 to 1851; and that "such
notes were given without any considera-
ton in favor of said corporation, or of any
of the stockholders thereof other than
Howes, Bonebrake and Merrill, and
solely for the benefit of Howes, Bone
brake and Merrill, and with the intent to
relieve said Howes, BoIebrake and Mer-
rill from their obligations to pay off and
satisfy at maturity the indebtedness
upon the lands and waters of said cor
poration, for which debts said Howes,
Bonebrake and Merrill were bound and
obligated" Fol. 159-60.) 1t is further al
legged that in and about the above trans
action the Directors unlawfully paid an
attorneys fee of $1,000, which sum was
paid for the sole benefit of defendants
HoweS, Bonebrake and Merrill" (Fol
l66-7.)
The complaint goes on to allege that
!, prior to September 20, 1888, Howes, Bone
brake and Merrill bought up the 10000
shares of stock which they had sold about
, u year previously (the proceeds of which
sale they had converted to their own use),
and sold the same to the corporation at a
| grossly eXorbitant price-the considera-
ton being credit OF the S212, ,4H assumed
: by the corporation as above set forth, the
} conveyance by it of $4,000 worth of land,
and the issuance of its promisSory notes
) for the remainder of the price.
In relation to this transaction it is al
legged: That about four months after the
; assumption by the corporation of the
f debt aforementioned (folios 151 and 172l,
it was proposed by Merrill at a stock
holders meeting, held September 20,
1888, that the corporation should buy said
stock at S37 per share, payment to be
{ made in the manner above stated, viz:
that a credit of S272, AL should be allowed
the company for having assumed the
, debt of Howes, Bonebrake and Merrill;
that the company should assume debt
of Sl4, ,440, due from said defendants on
the Morse property, and another debt of
$3.50; that 1.-The sum of $4,000 be paid in
lands of the company TO be decided to
: three trustees representing the parties to
? whom the 10000 shares Of stock had been
formerly sold;" and that 'the balance of
r said purchase price Of $780, 900 be paid in
l notes of the company (folios I72-6); that
this proposal was accepted at said stock
holders meeting, and that resolution to
that effect was passed, said defendants
and others voting in favor thereof, (folio
| 179); and that Immediately thereafter the
arrangement was carried out by the di-
5 rectors. (Folios 1856 to 1879.
1t is further alleged that "such 10000
shares of stock We're then and there, at the
3 time of such stockholders and directors
f meeting, the property of said Howes,
g Bonebralle and Merrill, having been OBJ
tanned by them from the former purchas-
t ers thereof tol. 1850, and that "at the
9 time such stockholders and directors
f meeting was held, and such 10000 shares
t of stock purchased by said corporation,
2 the said stock was not worth in the open
market, and could not have been sold for
f more than S25 per share, all of which
: facts We're well known to said Howes,
3 Bonebrake and Merrill' Dol. 194); that ali