Court Opinion

ID: 9562169
Source: CourtListenerOpinion
Date Created: 2023-08-21 18:22:59.984197+00
Date Added: 2024-06-11T09:17:14.344482
License: Public Domain

Judge BECTON
dissenting.
The provisions of the Business Corporation Act, codified at N.C. Gen. Stat. §§ 55-1 et seq. (1982), do not, in my view, defeat Mr. Penley’s claim. Mrs. Penley’s agreement with Mr. Penley that he was to receive stock when the Kentucky Fried Chicken business was incorporated was neither a pre-incorporation agreement nor a shareholders’ agreement. Further, I am not convinced that the statute of limitations is a bar to Mr. Penley’s claim. No stock in the corporation has ever been issued. I believe the statute of limitations runs from the time Mr. Penley made a demand for the stock promised —the breach of the contract. Mr. Penley filed his action within three years of his demand.
In my view, this case turns on an analysis of simple contract law. The majority has decided that the agreement to split the stock lacks valuable consideration. I disagree. From the outset, Mr. Penley has proceeded on the theory, as revealed by his complaint and his evidence at trial, that the parties entered into a partnership agreement prior to the proposed incorporation. The partnership agreement constitutes the “special agreement” absent in Leatherman. Consequently, Mr. Penley’s surrender of his partnership interest was the valuable consideration for the agreement to split the stock.
Mrs. Penley’s attorney stipulated that the following issue would be submitted to the jury: “Is the Plaintiff entitled to *725ownership of 48% of the stock in Hamburg Valley, Inc.?” Subsumed within the jury’s finding that Mr. Penley was entitled to 48% of the stock is the jury’s determination that there was “valuable consideration.” Although Mrs. Penley’s attorney objected to the court’s instruction on consideration, he based his objection on narrow grounds. His assignment of error deals only with the court’s failure to limit its instruction on consideration to an oral trust theory. Since Mrs. Penley failed to assign error to the sufficiency of the instruction on consideration on a partnership theory, and since she stipulated to the issue submitted to the jury, I believe the jury’s verdict should stand. In my view, the trial court’s judgment should be affirmed.