Court Opinion

ID: 8656215
Source: CourtListenerOpinion
Date Created: 2022-11-24 21:16:12.023458+00
Date Added: 2024-06-11T16:56:43.859788
License: Public Domain

*54On Application for Rebearing.
McCARTY, J.
Counsel for appellant have filed a petition for rehearing. No question or point is presented by the petition that was not elaborately discussed in the original briefs filed in the cause and fully argued by counsel in their oral presentation to this court of the questions involved.
Our attention, however, is called to a miscalculation of figures (which we have corrected) that in no way affects the result arrived at in the prevailing opinion. Notwithstanding every point presented by the petition was carefully considered in the opinions heretofore filed in the cause we nevertheless shall, in view of the earnestness of counsel in their insistence that we have both misconceived the facts and misapplied the law to the facts, again partially review the case and again consider the questions presented by the petition.
We say in the prevailing opinions that the property to which the company succeeded at the time it was incorporated ' exceeded $11,000 in value. It is contended that this is error. ¡Counsel assert that the subscribers to stock — the members of the company before it was incorporated — should be allowed the amount only for the property that it cost them; that is, the market value of the property at the time it was purchased by them should be the price at which it should have been listed to the corporation. It will readily be observed that the difference between the opinion of counsel and the judgment of the court on this point is due to the fact that the court based its judgment on the market value of the property, as shown by the undisputed evidence, at the time it was turned over to and accepted by the corporation, and counsel base their opinion as to value on the price paid for the' property by the members of the company some three months before the company was incorporated. Counsel in their brief filed in support of the petition for a rehearing say:
‘ ‘ This court should * * * be very loth to accept the oral testimony of the delinquent subscribers given on the trial of this ease some five years after the transaction in question took *55place, and to allow them credit for any amount in excess of the amount shown by the books to have been paid by them for the property on hand at the time of the incorporation. * * # The question of value was alone testified to by the interested subscribers and not by * * * disinterested persons who knew the character of the property taken over by the corporation, together with its value.”
And again:
“We propose to show by Mr. Jensen’s testimony and the books of account he kept for the company that the stock subscriptions have not been paid in full. ’ ’
The books of account to which counsel refer, and the correctness of which they vouch for, were introduced in evidence by appellant, and they, in connection with the evidence of Mr. Jensen, secretary of the company, show that the price of sheep during the time the company did business before it was incorporated fluctuated. On February 3, 1909, the company purchased 2,392 head of-sheep for $10,760, and a month later (March 5, 1909) sold 2,365 of these sheep for $14,190, which netted the company (the subscribers for stock) a profit of $2,554.94. The testimony of Mr. Jensen and the books also show that the sheep the company had on hand and turned over to the corporation June 12, 1909, were purchased by the subscribers about four months prior to the incorporation, at about $2.75 per head. The testimony of Jensen and the books also show that on June 9, 1909, a few days — within a week— prior to the incorporation of the company twenty-five head of these sheep were sold for $89.10, which wqs approximately $3.56 per head. Three witnesses testified, and their evidence is not disputed, that the market value of the entire herd on June 12, 1909, was $3.50 per head. In fact there is absolutely no conflict whatever in the evidence on this point.
*564 *55Where subscribers to stock of a corporation turn in prop-' erty in lieu of cash on their stock subscriptions, as was done in the case at bar, the parties are entitled to credit in a sum equal to the market value of the property at the time it is turned over to and accepted by the corporation, unless the parties agree to accept credit for a less amount. The contention that the subscribers to stock in the case at bar should *56be given credit for the amount only that they paid for the property which they turned over to the corporation June 12, 1909, finds no support in law, equity, or reason, and is opposed to every known sound business rule governing transactions of this kind. To show the unreasonableness of counsel’s position we have only to reverse the proposition for which they contend. Suppose, for illustration, the sheep had cost these parties $3.50 per head (instead of about $2.75 as shown by the evidence), and their market value at the time they were turned over to the corporation (June 12, 1909) had been $2.75 per head, would counsel be here contending that the subscribers should be given credit for seventy-five cents per head on each sheep in excess of the market value? Of course they would not. It would be an undeserved reflection on their learning and ability as lawyers to even suggest that they might do so.
Regarding the unpaid subscriptions at the time the company was incorporated, June 12, 1909, counsel say:.
“We submit that the second half, which would be $11,000, of the stock subscriptions was not paid in full. The books of the company conclusively establish that after incorporation the following payments were made: Preston A. Blair, $2,000; Lars Hansen, $2,000; Simon S. Jensen, $2,000; Stephen S. Blair, 300; Seth M. Blair, $300; J. P. Blair, $2,000 — a total of $8,600. To this should be added $1,900 covering property thereafter delivered to the company by J. Park Blair and Lars Hansen and applied upon their stock subscriptions, making $10,500. We have endeavored above to show that there remains due on the second half of the stock subscription $500.”
• Mr. Jensen’s testimony, and the books of account he kept for the company, show, that Preston A. Blair subscribed for 50 shares of the capital stock of the corporation, for which he agreed to pay $5,000; that before the incorporation he paid $2,500, leaving a balance of $2,500 due on his stock subscription ; that on March 31, 1910, he paid $2,000, and on July 30, 1910, he paid the balance, $500, on his subscription. It will be noticed that counsel for appellant have inadvertently omitted to include the $500 last mentioned in their foregoing *57statement of the payments made on stock subscriptions. If counsel had included the $500 payment in their statement of the payments made on the stock subscriptions, the $11,000 . due thereon at the time the company was incorporated would be accounted for, and according to their own table of figures there would be nothing due the' corporation on the stock subscriptions. In the former prevailing opinion the writer stated, and he again asserts, that the evidence without conflict shows the subscriptions of stock were fully paid, and that the trial court did not err in so finding.
STRAUP, J., concurs.