The Goldfield news. [volume] (Goldfield, Nev.) 1904-1911, 1909-07-03
A NOTABLE DECISION IN
THE WEBER=VULTURE SUIT

developed. lie organized a corporation
and fixes its capital stock at 81. 500 900;
turns over the property to the company,
in exchange for its capital stock, with
the exception of one share each to the
board of directors, of his own selection /;
he places 100000 shares of the stock in
the treasury, to be sold for a working
capital. His board of directors select
him as president; they also elect a treas
urer and secretary of the company. The
Office Of the company and Mr.. Weber's
private office are identical. A set of
by laws are adopted for the govern
ment Of the officers in their conduct of
the affairs of the company, by which
the powers and duties of the officers are
prescribed and limited. They provide
that no indebtedness or liability shall
be incurred against the company, I'M
less authorized by the board of direc-
tors. They further provide that the
general manager shall be elected by
the board of directors, etc.
From the time of the organization of
the company, Mr.. Weber assumes full
charge and control of all the ~company's
affairs; appoints a general managers; di
reefs him what to do; commences the
sale of stock. He sells some treasury
stock enough to partly pay for de-
velopment work, at prices ranging from
so to so cents per share; there is no
claim, or pretense, that he could not
have sold sufficient treasury stock to
pay all the expenses of development
and keep a fund in the treasury. He
had full control of the company. 1t
does not appear that the treasurer of
the company ever drew a check. He
disposed of nearly all of his own stock,
at least 80 cents a share for it. He
made no report of his acts to the com
pany, but used up all of it's funds; he
paid some $4,000 for development of
the %company's treasury; he then, with
out the knowledge or consent of the
board of directors, incurred an indebted
ness against the company of practical
ly $4,000, which he pays personally;
and it is fair to presume that he paid
this indebtedness from the proceeds of
the sale of stock Of the company. He
then demands pay from the company,
well knowing that it has no funds in the
treasury with which to pay.
He now asks Judgment of this court
for the amount of the unauthorized ex
penditures, upon which an execution
would be awarded, the property of the
company sold-Mr. Weber would then
have the original property with its ma
chinery and equipment, nicely develop
ed, and in shape for a workable and
producing mine.
1t is true, as counsel urges, that the
company would have six months to re
by paying the amount of the
Judgment, but it has no money, and Mr..
Weber is responsible, absolutely, for
such condition, and the stockholders
some one hundred and forty-eight in
number-must either put up the money
or lose all they have invested, on the
that the affairs of this company
be honestly conducted and their
protected.
Courts were not organized for the
purpose of assisting such a palpable
fraud. The credit of the mining inter
ests of Nevada has already suffered too
much by wildcat mining schemes and
the unlawful manipulations of some OF
its mining corporations, and should it
become known that the courts would
lend their aid to further transactions
of the kind shown by the evidence In
this case, we could hope for no further
assistance from investors to develop the
great resources of the state; and the
court itself would be a shame and dis
grace upon the fair name Of the great
and growing state.
| cannot, in conscience, do otherwise
than find for the defendant, and that
Judgment be entered in its favor for its
costs, and it is ordered that judgment
be entered accordingly.
THERON STEVENS, Judge.