Court Opinion

ID: 8042631
Source: CourtListenerOpinion
Date Created: 2022-09-09 03:41:52.910576+00
Date Added: 2024-06-11T16:37:22.693541
License: Public Domain

Coleman, J.,
concurring:
I concur in the order.
Conceding that the meeting at which the execution of the note and mortgage was authorized was not duly called, and that for that reason the mortgage was voidable, I am strongly of the opinion that the corporation should be estopped from attacking the validity of the mortgage, under the circumstances of the case. It received the money upon the strength of the mortgage, *129and cannot retain the same and be heard to say that the mortgage is not binding. This is the general rule as to ultra vires contracts (10 Cyc. 1156; Wisconsin L. Co. v. G. & W. Tel. Co., 127 Iowa, 350, 101 N. W. 742, 69 L. R. A. 968, 109 Am. St. Rep. 387; Wayt6e v. Red Cross Pro. Society [C. C.] 166 Fed. 372), and the process of reasoning leading to the result in those cases, which is equally applicable here, as well as good morals, impel a like conclusion under the facts of this case.
Furthermore, I am of the opinion that the trial court was justified, under the evidence, in concluding that the transaction was ratified by Allen L. Clark. Of course, in doing so, it must have totally disregarded the positive testimony of Clark to the effect that he knew nothing about the mortgage in question until a demand for the payment of the interest a few days before the foreclosure proceedings were instituted. His testimony, as a whole, does not commend itself to the court. Though having been away from Reno for some months, he returned a few days before the death of Emily Clark, his then wife, who, so far as appears, left him as the owner of all of the stock in the company, except one share, which was held by Mr. Luke simply to qualify him as a director and officer of the company. Mr. Clark is certainly the only surviving officer of the company who had any material interest in its affairs, yet he testified that he had not looked into its condition enough to learn of the mortgage in question; and this, too, in the face of the fact that soon after the death of the wife he obtained from the bank the canceled checks of the company, some of which were upon a part of the borrowed money. It is quite remarkable that he should manifest sufficient interest in the status of the company to get the canceled checks, but not to prosecute an investigation as to all of its transactions during his absence. But while he testified flatly that he knew nothing of the mortgage in question until payment of the interest was demanded, his evidence as to the conversations which took place when the interest was *130demanded, does not indicate any surprise at learning of the existence of the mortgage, but, to my mind, indicates that he knew of its existence. He said:
“Well, he asked me if I could pay the interest, and I told him I couldn’t pay it all, but could pay him half of it now, and, if he would wait a few days until rent was paid, I could pay him the other part of it. He couldn’t do it, he said. I told him to go and see my lawyer about it, then, and he didn’t go.”
This testimony was given on direct examination. It is true that thereafter, in reply to a suggestive question by his counsel, he did state that he told the party demanding the interest that he knew nothing about the mortgage prior thereto. But in view of the character of the examination, and of all the circumstances, the trial court had a right to reject so much of his testimony as it saw fit.
While it is not a matter of which we can take judicial notice, I think it perfectly proper for me to call attention to certain improbable evidence given by Mr. Clark. Evidently for the purpose of bolstering up his contention that he did not know of the existence of the mortgage in question, he testified that he thought the indebtedness which was discharged by the money borrowed from respondent had been paid out of $3,500 received as insurance money on the Ralston-street property. The fact is that only $1,000 was received from that insurance, and it had not been paid when he gave the testimony alluded to, as it was necessary to bring suit to recover it, which was finally disposed of on February 28 last. See Clark v. London Assur. Corp., 44 Nev. 359. In view of the fact that this witness has been a party to, or has given testimony in, several suits which have come to this court within the last three years (Allen Clark Co. v. Francovich, 42 Nev. 321, 176 Pac. 259; Allen Clark Co. v. Moran, 42 Nev. 356, 176 Pac. 413; Clark v. Clark, 44 Nev. 67; Clark v. London Assur. Corp., supra, and the instant case), it may be, of course, that he has become somewhat confused as to facts, but *131it might stand him in hand to be more guarded in giving testimony.