Opinion ID: 2283199
Heading Depth: 1
Heading Rank: 1

Heading: Summary of facts producing this controversy

Text: We believe the chancellor was absolutely correct when he said in this case: This is certainly a most confused state of facts. The Court believes and finds that the circumstances under which this undertaking got started were strange in that it is clear and all parties seem to agree that Mr. Bostetter, Sr. was in fact the Assignee for foreclosure on the mortgage which he in fact was the purchaser of and that he was the Freestate Corporation and that he directed all these things to take place and much of what took place, funds that changed hands or were transferred, were done from a trust account which is certainly highly irregular if not even more suspect, and Mr. Bostetter by his own conduct apparently was so lax in handling the corporation, because I suspect that he didn't plan on dying anytime soon, because if he had, no one would leave things in such a deliberate bad shape for his heirs, but through either deliberate neglect or benign neglect or whatever there is certainly tremendous neglect to the corporation. Somebody earlier today said that this was a case in which one could chase his own tail around and around and I would have to concur because when you try to have to determine what came first, the chicken or the egg. In 1965, a mortgage was assigned to Bostetter for the purpose of foreclosure and collection. As such assignee, he sold approximately 102 acres of land at public sale for a stated consideration of $36,350. The tract's place of beginning, as called for in the deed, was a large marked walnut tree, a corner of lands of Martin V.B. Bostetter and the beginning of a Deed from Jacob Bostetter and wife to John Seibert bearing date the 6th day of April, A.D. 1829. The reported purchaser was Freestate Land Corp., a Maryland corporation. The incorporators of Freestate were James C. Rice, Edward S. Routon, and Betty L. Mattos. Pursuant to the articles of incorporation, they were to be the original directors and to serve until the first annual meeting, or until their successors [were] duly chosen and qualified.... No minutes of an organizational meeting of the corporation have been found. Oliver says Bostetter told him that he, Oliver, was president and that Bostetter procured Oliver's signature as president on a note of Freestate to Bostetter dated June 4, 1965, in the amount of $32,715. Rents from the farm were collected and deposited in Bostetter's trust account. Bostetter drew a check on that trust account to Freestate in July 1968 for the net sum in that account which belonged to Freestate. He delivered the records of Freestate to Oliver almost immediately thereafter. The check was deposited in an account at Hagerstown Trust Company in the name of the corporation. As directors of Freestate, Oliver and Burris passed a resolution to set up that account. So far as the record discloses, Freestate never issued stock until sometime after Bostetter's death when stock was issued to Oliver and Burris for the amount of money they then contributed. Bostetter, Jr., purported, after his father's death, to have an organizational meeting of the corporation. He procured a conveyance of the land in question from the corporation to him individually.