Case Name: John D. Macfarland v. West Side Improvement Association
Court: Nebraska Supreme Court
Jurisdiction: Nebraska
Decision Date: 1898-10-05
Citations: 56 Neb. 277
Docket Number: No. 7635
Parties: John D. Macfarland v. West Side Improvement Association.
Judges: Ryan, C., not sitting.
Reporter: Nebraska Reports
Volume: 56
Pages: 277–284

Head Matter:
John D. Macfarland v. West Side Improvement Association.
Filed October 5, 1898.
No. 7635.
1. Corporations: Action Against Subscriber to Stock: Defense: .Pleading: Evidence. Where, in a suit by a corporation against a subscriber to its stock to recover his unpaid subscription, the defense is that the entire capital stock was not subscribed, a reply which avers that the defendant waived the non-payment of the entire stock is good as against a demurrer. Such a plea is not a conclusion of law, but the averment of an ultimate fact, included in which are all the ingredients which constitute waiver.
3. -: -: -: -: --. Under such a'plea the acts and omissions of the defendant which tend to show, or from which may be inferred, an intention on his part to waive subscription of the entire capital stock are competent and relevant.
Rehearing of case reported in 53 Neb. 417.
Lambertson & Hall and A. G. Greenlee, for plaintiff in error.
Ricketts é Wilson, contra.

Opinion:
Ragan, C.
This is a rehearing of Macfarland v. West Side Improvement Ass'n, 53 Neb. 417, in which we affirmed a judgment of the district court rendered in favor of the association against Macfarland. The action was brought by the association against Macfarland on a contract of subscription to its capital stock. His defense was that the entire capital stock bad not been subscribed. On the former bearing we held that be bad estopped himself by bis conduct from interposing this defense, and beyond all question the evidence in the record sustains this holding, as will appear from a resume thereof in the former opinion. But it is insisted by Macfarland that the petition of the association does not state a cause of action and will, therefore, not sustain the-judgment. We think it does. The petition, after alleging the incorporation of the plain tiff, the purposes for which it was incorporated, the amount of its capital stock and Macfarlamd's subscription thereto, recites: That the full amount of the capital stock had not been subscribed, but that "the defendant waived this defense by participating in the execution of the main design for which the company was organized, and is, therefore, estopped to rely on the defense that the whole of the capital stock was not subscribed;" that the corporation, relying upon the subscription of Macfarland and its other assets, entered into contracts aggregating $105,000 for the construction of buildings, the construction and ownership of which were the purposes for which the corporation was organized.
It is true that the petition does not set out the specific acts or conduct of Macfarland which we held estopped him from interposing the defense that the capital stock was not all subscribed, but it does allege that he waived this defense. This plea was good as against a general demurrer. It is not a conclusion of law, but is the statement of an ultimate fact. If Macfarland desired the petition to state what the pleader claimed he had said or done which amounted to a waiver of his defense, he should have submitted a motion to the petition. Waiver is the intentional relinquishment of a right or privilege. It was the right of Macfarland to have all the stock subscribed before being liable on his subscription, but this was a right which he could waive; and the averment of the petition is in effect the same as if it had alleged in express words that Macfarland intentionally relinquished his right to have all the stock subscribed. Of course, when it is claimed that a party has waived a right, it must appear that he knew he had such right; otherwise he could not have intentionally relinquished it. But whether in such a case a party knew that he was possessed of a right is a question of evidence, and we are dealing with a question of pleading; and When the pleader avers that Macfarland waived his right, included in that averment are all the ingredients winch constitute waiver. Contrary to the common-law rule, pleadings under the Code are to be liberally construed. (Code of Civil Procedure, sec. 121.) If the averment is that A went from the city of Lincoln to the city of Omaha, this is the statement of a fact. The means employed by him for going are included in the statement that he went. If A sues an officer, alleging that he seized and sold on judicial process his horse which was exempt, and the officer answers that the allegations are true, but that A waived his exemption, this plea is good as against a demurrer. In the case at bar, if Macfarland waived or relinquished his right to have the full amount of stock subscribed before he should become liable upon his contract, then his estoppal to assert that defense followed as a conclusion of law from his waiver. So that the whole question here is whether the petition avers that .Macfarland did waive or relinquish his light to have the whole amount of the stock subscribed. In express language, it does aver that he did waive and relinquish that right; and to make the petition good as against a demurrer it was not necessary that the pleader should state the specific things done or omitted to be done by Macfarland which constituted' that waiver; and under this allegation the pleader might introduce evidence of the acts and omissions of Macfarland which tended to show, or from which might be inferred, an intention on his part to relinquish the right or defense. In Omaha & R. V. R. Co. v. Wright, 49 Neb. 457, the petition alleged "that the defendant carelessly and negligently ran their engine and train over plaintiffs stock" injured it, etc., and it' was held that this general allegation of negligence was good as against a demurrer; that under the averment evidence of any fact which contributed to the injury sued for was competent and relevant.
We adhere to the former opinion, and the judgment of the district court is
Affirmed.'
Ryan, C., not sitting.