Court Opinion

ID: 7098301
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:13:14.256742+00
Date Added: 2024-06-11T16:13:19.572648
License: Public Domain

ON REHEARING.
Day, J.
I. Upon the petition of defendants a rehearing was granted upon so much of the foregoing opinion as is contained in the fourth point discussed, holding that the defendants took no appeal from the decree in so far as it failed to offset the amount found due the plaintiff on the note sued on, with the amount due the defendant from plaintiff on his two thousand dollars of stock. It is claimed by appellant, in the petition for rehearing, that the opinion, in this respect, misapprehends the real condition of the record. The plaintiff filed a reply to the petition for rehearing, and the question involved is again submitted for determination.
The conflicting views of counsel respecting the state of the record render necessary a more extended statement of it than is contained in the foregoing opinion. The defendants filed a cross-bill, in which, among various matters of defense to the note sued on, it is alleged “that about March or April, 1873, plaintiff purchased of W. J. Ackley, a stockholder of defendant, two thousand dollars of the capital stock of defendant, upon which twenty per cent, or four hundred dollars only, had been paid, and that same was properly transferred to plaintiff upon the books of the company, and that he thereupon became liable, and is still liable, to defendant and its creditors on said stock in the sum of one thousand six hundred dollars.”
The defendants pray “for judgment for costs, and for *604decree declaring said notes and mortgage void, and cancelling said mortgage and the record thereof, and that the rights of all the defendants be determined and settled thereby, and for general relief.”
The plaintiff filed a reply in which he “denies allegations of fifteenth paragraph, except that plaintiff avers he purchased of said Ackley two thousand dollars of twenty per cent stock, which was not transferred to plaintiff on the books of defendant; that afterward, by an agreement with directors of defendant, said stock was surrendered to defendant, and four hundred dollars full paid stock issued to plaintiff therefor.”
The court rendered judgment-for plaintiff against the defendant Waterloo Agricultural Works for one thousand six hundred and thirty-one dollars and twenty-five cents; “and the court further found that the action of the board of directors of said defendant Waterloo Agricultural Works, in taking up and cancelling two thousand dollars of its assessable stock held by plaintiff, and issuing to plaintiff four hundred dollars in full paid stock in lieu thereof, was and is null and void; and the court therefore ordered, adjudged and decreed that said two thousand dollars of stock so purporting to have been cancelled be, and the same is declared to be, in force and belonging to said plaintiff, O. M. Pond.”
The record further recites as follows: “On the 6th day of April, 1877, the defendants Waterloo Agricultural Works and W. J. Ackley perfected an appeal to the Supreme Court of Iowa from said judgment, and so much of said decree as relates to the foreclosure of the mortgage described in plaintiff’s petition, being all of said judgment and decree except that part of the same that relates to the two thousand dollars of stock of the plaintiff, finding that the action of the board of directors of the defendant in canceling said stock was null and void, and declaring the same-to be in force and belonging to plaintiff, by serving upon the plaintiff and clerk of the District Court of Black Hawk county a notice of appeal to that effect; * * * * ■* * * '■* ■* and on thfe 12th day *605of July, 1877, the plaintiff perfected an appeal to the Supreme Court of the State of Iowa, from so much of said judgment and decree as refused to allow plaintiff ten per cent interest and attorney’s fee, as provided for in the note and mortgage sued on, by serving * * * * * * a notice of appeal to that effect. ”
It is apparent, from the record as above set out, that the defendants appealed from every part of the decree which was-adverse to them, and that they excepted from their appeal only that portion of the decree which held void the action of the board of directors in issuing to plaintiff four hundred dollars of full paid stock in lieu of the two thousand dollars of partially paid stock held by him, which portion of the decree was favorable to defendants.
3 pbactice t reiietf 1 II. The plaintiff insists, however, that in the cross-petition there is no prayer for judgment for the amount which' may be found due the defendant on the stock of plaintiff, and that, therefore, the eourt did not err in neglecting to grant any relief respecting it. This proceeding, however, is in equity. The cross-petition prays for general relief. Under this prayer any relief which is consistent with the allegations of the cross-petition, and sustained by the proof, may be granted.
III. The plaintiff further insists that the defendant did not plead the claim for unpaid balance of stock as a counterclaim, as provided in section 2659 of the Code. It is evident that this section refers to pleadings in an action at law. Section 2660 applies to pleadings in a proceeding in equity,, and provides that “an equitable division must also be separated into paragraphs, and numbered as required in regard to an equitable cause of action in the petition.” The cross-petition was-so separated and numbered. See section 2616, subdivision 6. If there was any defect in the mode of separation and numbering it should have been assailed by motion.
IV. The court decreed that the two thousand dollars of stock purporting to have been cancelled be declared to be in *606force, and belonging to plaintiff, 0. M. Pond. Prom this decree the plaintiff prosecuted no appeal. It is claimed, however, that the evidence does not show a transfer of the shares upon the books of the company, as provided in section 1078 of the Code and the defendant’s articles of incorporation, and that the transfer is, therefore, valid only as between the parties in this case, the plaintiff, and the defendant W. J. Ackley. The decree of the court, however, is general, and finds that the stock belongs to O. M. Pond, establishing thus his ownership against the Waterloo Agricultural Company Works, as well as against the assignor, Ackley. There was evidence 'introduced to support this finding, and, as plaintiff has not appealed from this portion of the decree, we cannot now review the evidence as to a transfer of the stock on the books of the corporation.
. Y. The plaintiff holds two thousand dollars of the stock of the corporation, upon which it appears that but four hundred dollars has been paid. The articles of incorporation were entered into in August, 1872, and provide that twenty per cent of the stock subscribed shall be paid each year, at such time as may be required. The sale of the two thousand dollars of stock was made to plaintiff in March, 1873. Twenty per cent thereof had then been paid. The answer and cross-petition were filed in October, 1876. At that túne all the instalments upon the stock were due and subject to demand. The indebtedness of the corporation is shown to be from ten to twelve thousand dollars. The plaintiff is legally liable to the corporation for eighty per cent of stock owned by him, amounting to one thousand six hundred dollars. This should be set off against the one thousand three hundred and fifty dollars which the plaintiff is entitled to from the defendant, and for the balance, three hundred and fifty dollars, the defendant should have judgment. When the affairs of the corporation are wound up, the relative rights of the stockholders may be adjusted between themselves in -an action to which they all may be made parties. The cause will be remanded to the *607District Court, with directions to enter a decree in accordance with this opinion.
Beversed.