Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1900-11-30

$o,VUV. Inc lllrQ SlOurtn We're DaSed
on allegations Of money loaned by Given
to the company in the same amounts
and at the same dates as the alleged
notes, being the same auses of action
as count n and two. The fifth count
was an alleged balance due OF 1915 OF
salary. Attorneys for the company.
MeAsrs. A. B. Cummins. Of Des Moines,
and Binford & Smelling. OF this city, filed
an answer and likewise a bill in equity
petitioning an estoppel of the law ac-
ton. At a hearing before Judge Munger,
OF Nebraska. sitting for Judge Wooison,
because Woolson was McFarland's
uncle. it was assumed that the answer
presented an equitable defense, which
accounts for the present case, trial
thereof and decree before the trial OF the
law case. A decree favorable to the
plaintiff in the equity case. however,
stops the law action n terminates the
suit.
1t has been explained that prior to 1893
Mcfarland owned all the capital stock,
which in that year he sold to Given,
part Of which Given paid for in cash,
the balance being evidenced by a note
to Mcfarland signed by Given and Sc
cured by stock as collateral. In May,
1896, Given sold all the stock back to
Mcfarland and in December, 1896, came
the suit above mentioned.
The judge in his opinion say that "If
two notes a~ggregating $4,000 were given
to Welker Given by the company, such
notes We're signed bysaffixing the cor
poration name by w. Given, President
I do not believe the notes were given.
and I find that In fact they were not
given. Given. himself, at times in his
evidence is not certain about 1t. The
notes are not produced, and have never
been seen during this litigation. Ills ao-
count of their loss is hazy, and unsatis-
factory to me-" The judge also notices
the fact that no records appear on the
books of the company Of any such notes
having been. executed.
As 10 the question did Given loan the
company $4,000, the Judge finds that the
money was advanced. but asks the ques-
ton ION what account did he advance
it," swe to which he states as fol-
lows: Then the question is. was the
money borrowed or was the Impaired
stock made good? Given owned all the
stock and, aside from creditors, was the
only interested person. II he retained
full ownership of the stock it was OF
no concern to him whether he loaned
the money or put 1t In the business and
thereby made good the impaired stock.
II he loaned the money he would there
by, OF course. become a creditor to that
amount n his capital stock would
thereby be worth lust that much legs.
Upon the dissolution or winding up OF
the affairs of the corporation Given
would have exactly the same amount Of
money. whether the money was bor-
rowed, or used to make good the im-
paired stock
From this the Judge that Civ
en- Gid not care whether he made good
his stock by $4,000 or loaned the money,
and at the time Of the sale 10 Mcfarland
in '9S was indifferent. Mcfarland. who
had been employed by Given and was
acquainted with he books of the busi-
hess, was likewise Indifferent. Further-
more. Mcfarland held Given's note for
part of the purchase price secured by
stock and was interested in keeping his
security unimpaired. 80 the judge says:
X think 1t Was to the interest of both.
and OF course to the detriment of neith-
er. to have the $4,000 put in the business
rather than make the loan"
The judge recites the evidence show
ing that at the time sale back to Nc
Farland was made Given also negotiat-
ed with Mr.. j. p. Dotson, and state
ments from the books OF the company
We're then given Mr.. Dptson which con-
itained no evidence OF any debt owing
Mr.. Given from the company. He then
finds that II Given were a creditor, but
represented he was not, and on ouch rep
fesentation sale was made, he can not
recover. asrr ming that Mcfarland be-
lieved him 10 be no creditor.
All of these facts the judge seumes
that both Given and Mcfarland knew,
saying: And Given knew the same. He
knew that the books no longer showed
him to be a creditor. Such wax the
knowledge Of them both. And with such
knowledge sale was made. and It be-
comes of no Importance whether 1t wac
u sale OF stock or Of the concern ae q
whole. He did not claim that he was a
creditor in May, 1886. and 1t was too
late to claim 1t in December, 1885,, IN
other words. the federal Judge finds that
Given has brought suit on notes that
were never Issued ard for money that.
was never loaned. knowing full well all
the time that the notes were never fs-
sued and money never loaned. Welker
Given was always known here as an &C.
centric man.
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