Court Opinion

ID: 9829644
Source: CourtListenerOpinion
Date Created: 2023-09-01 19:30:04.972616+00
Date Added: 2024-06-11T07:43:03.844344
License: Public Domain

On Motion for Rehearing.
We were in error in our opinion herein in stating that “the court found, among other things, that the acquisition of the 60,000 acres of land was necessary for the corporate purposes of appellee.” The finding of the court was to the contrary of this, and was as follows:
“There was no evidence that would warrant the court in finding that the 60,000-acre tract of land purchased by the plaintiff was necessary to be purchased by it to enable it to carry on the business for which it was incorporated, nor was there any evidence that would warrant the court in finding that the plaintiff purchased said land for the purpose of enabling it to carry on its business under its charter from the state.”
Reference to our original opinion herein will show that we did not base the same upon the findings of the court in this regard, as erroneously stated in said opinion, but that our opinion was based entirely upon the proposition that appellee had authority under the statute to purchase the land referred to.
At appellant’s request we make the following additional findings of act:
(1) The 60,000-aere tract of land referred to in the opinion was not purchased for the purpose of enabling the appellee to carry on the business for which it was chartered, but was purchased for the purpose of resale.
(2) The appellee up to the time of the trial hereof had not constructed, maintained, or operated any canals, ditches, flumes, laterals, reservoirs, dams, or lakes for the purpose of irrigation, but had dug two artesian wells, one of which was on the land sold to appellant.
(3) In addition to the plea of ultra vires, appellant alleged that appellee falsely and fraudulently represented to him that, if he purchased the land in controversy, appellee would grub and clear and put in a state of cultivation 60 acres of the same that was then in a raw state, and would cultivate during the year 1914 100 acres of land, and turn same over to appellant after the crops were *1157gathered in 1914, and that said representations were false and fraudulent, and made with no intention on the part of appellee to perform the same; that he was induced thereby to purchase said tract of land from appel-lee, and, in full reliance on said promises and agreements, appellant purchased said land on or about October 1, 1913, etc.; and further alleged failure of appellee to comply with its agreement to clear and cultivate said land.
The trial court found that the sale of the 160 acres of land to appellant was made in good faith. Such being the ease, failure to comply with the contract to clear and grub the land did not furnish a ground for rescission of the contract, but only for damages for breach of the same, which were allowed in our judgment herein.
In our original opinion herein we affirmed the judgment of the trial court solely upon the ground that the act of 1897 in reference to the incorporation of irrigation companies did not repeal the act of 1895 with reference to the general incorporation law. Such being our view of the law, we did not deem it necessary to discuss any other issues raised by the assignments of error. However, we think the judgment of the trial court should be affirmed for another reason. The trial court filed the following among other conclusions of law:
1. “The question of whether or not a corporation has acted in excess of its granted powers, in the face of an expressed or implied statutory prohibition, is a question which cannot be raised in litigation between it and' a private party, but can he raised only ¡by the state in a direct proceeding either to forfeit the franchise of the corporation or to subject it to punishment for the unlawful act.”
2. “Where a corporation is the vendor, the vendee cannot set up its want of capacity to take and hold land as a defense to an action to recover the purchase price of land sold to him.”
These conclusions of law are supported by the decision in Scott v. Bank, 97 Tex. 57, 75 S. W. 7, 104 Am. St. Rep. 835, and authorities there cited, and many others.
It has frequently been held that equity will not aid a corporation in the unlawful acquisition of land, but no such issue is here presented. The fact that the corporation had acquired the 60,000 acres of land by purchasing the same and paying therefor and receiving deeds in the usual form is not called in question. The only aid which the appellee was seeking in this case at the hands of the court was to collect a promissory note which the appellee had signed, and, as ap-pellee’s title had not failed, he had no legal or equitable defense against said action. Ap-pellee’s motion for a rehearing is overruled.
Overruled.