Daily new dominion. [volume] (Morgantown, W. Va.) 1897-1906, 1902-12-26

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as claimed by their plaintiff, but deny.
ing that there was any contract
agreement or understanding whereby
they were TO resign as directors and
permit Others to be appointed Ia their
places, TO be named by said Frazer;
or that there was any fraud against
the plaintiffs contemplated or prac.
ticed in the issue of the one hundred
and seventy eight shares Of stock, and
claiming that in all respects they had
acted In good faith, and for the best
interest OF their company.
They filled their affidaylts In sup
port OF their answer, and moved to
dissolve the injunction, and discharge
the receiver, which motion was over
ruled as aforesaid, and both the in
! junction, and receiver were continued
until a fnal hearing could be had on
deposition and proofs.
In the case of Robrecht V. Robrecht
46 w. Va, 908. this court held that
although the answer plainly and pos
lively denies the allegations of the
bill, yet If the facts and circumstances
shown BY the pleadIngs, exhibits and
a6idavits are strongly presumptive Ia
favor of the plaintiffs equity, it is
not appealable error for the circuit
court to continue an ancillary injunc-
tion awarded for the purpose OF pre-
serving the status OF property until
final hearing The same rule would
apply to the receivers of personal
property.
The only question now presented TO
the court Is as to whether the facts
and circumstances appeared by the
record as strongly presumptive in
favor of the plaintiffs equity. II SO,
the circuit court committed no error
in continuing the injunction and the
receiver until the final hearing of the
cause. There are many undisputed
facts and circumstances in this case
which tend to sustain the plaintiffs
equity, and which if not properly ex-
planned will render the same conclu-
sive.
There is no doubt but that the sale
of stock was made by Boehler and Sig
wart at an exorbitant price, more
than double par aud that such sale
was afterwards ratified by the stock
holders. who were directors and who
received the price agreed on the 2lst
day of February, 1902, for all the stock
held by them on the 10Th day of Feb
ruary, 1902.
Nor is there any doubt that such
directors were fully informed OF this
contract on the Goth day OF February,
1902, when they issued the one hun
dred and seventy eight shares of stock
and became principally the owners
thereof themselves, for the purpose of
retaining control of the company.
Knowing that they were going to
receive double par on the next day for
all their then holdings, they generous
ly issued themselves new allotment
of stock at par for which they gave
ten per centum in cash and executed
promissory notes to cover the balance.
They did not inform the purchaser
of the old, of this new issue of stock,
but con ,ealed it from him and receiv-
ed his money when they were fully
aware that they had secretly by reso-
lutions spread upon the corporate
minutes 'sto release Charles +. Boeh-
Ter and Leopold Sigwart from any all
liabilities from damages that may
arise in and from and by reason OF
their contract with James G. Frazer
and Others"
From this resolution it presumtive-
ly appears that they as board and as
individuals clearly understood the
force and effect of the arrangement
between Boehler and Sigwart and |
James @. Frazer, and that because it |
was not to be carried out in good |
faith, they in their corporate capacity |
agreed to identify and save harmless
Boehler and Sigwart from all damages
By reason thereof.
This stock was presumptively issued |
for the express purpose of preventing
James @. Frazer and those whom he
represented getting the benefit of what
he had bargained for, and kept from
him on purpose to deceive until he
had faithfully performed his bargain
and the benefciaries thereof had re-
ceived more than double value for the
stock already held by them.
Ii worth more than a par, why did
they not pay the true value OF the
stock surreptitiously issued to Them
selves?
Fraud is the concealment OF the
truth just as much as it is the utter
ance Of falsehood.
II these appellants knew that the
ISSUANCE OF this additional stock was
IN violation of the agreem ent, had
with James @. Frazer and the facts
and circumstances point to the fact
that they were fully informed on the
subject. and knew that he was paying
A large price for the stock to gain A
interest, they were guilty
Of gross fraud in concealing from him
5he fact that they bad issued tn
themselves the additional stock at
par. In short they were taking ad.
of his confidence aud selling
him bogus brick.
Not only is this true, but even II
jhe appellants did not know these
things In advance as soon as they
we're made known to them even by
ibis suit, 1t was their duty II they
wished to escape the inference of
fraud to have offered to rescind the
'ale, restore the purchaser his money
Ind take back their stock. II
He who adopts the results adopts