59 W. Va. 343 | W. Va. | 1906
On the 20th day of February, 1903, a deed, purporting to convey a certain lot of land near Mount Carbon in Fay-ette county, was made and executed in the name of Deep-water Council No. 40, Order United American Mechanics of Mount Carbon, and under its corporate seal, by F. M. Bone, its councilor, and John Nichols, its secretary, and delivered to J. E. Renick, the grantee named therein, and duly admitted to record on the 24th of February, 1903. Deepwater Council No. 40, Order United American Mechanics of Mount Carbon, is a corporation, duly incorporated under the provisions of chapter 55 of the Code, and, for convenience, will be hereafter referred to as the “Lodge.” On the first day of June, 1903, the Lodge instituted this suit in equity, in the circuit court of Fayette county, against J. E. Renick, to set aside said deed upon two grounds: first, want of authoritjr on the part of Bone and Nichols, officers of the Lodge, to make the deed; second, actual fraud in the procurement of the deed. The bill alleged willingness on the part of the Lodge to return the purchase money paid by Renick. Renick, by answer, denied substantially all the material allegations of the bill in relation to want of authority on the part of the officers making the deed, and in relation to actual fraud in its procurement. Many depositions were taken. Upon final hearing, the circuit court of Fayette county entered a decree dismissing the plaintiff’s bill. From this decree the Lodge appealed.
The deed did not purport to convey all the property of the Lodge, and thus practically terminate its existence, but only a specific parcel of real estate. The act of conveying this real estate was not ultra vires, so far as the Lodge was concerned, if the act was in fact the act of the Lodge; because the very purpose of such corporation, as expressed in the act under which it was incorporated, is to “hold, lease, sell and convey real property,” etc. Section 2, chapter 55, Code.
Section 42, chapter 53, Code, provides that the number of stockholders, or amount of stock, necessary to constitute a ■quorum at a meeting of the stockholders, and the mode of transacting business at such meeting, may be prescribed by the by-laws.
Section 49, chapter 53, Code, provides that there shall be a board of directors for every corporation subject to that chapter, who shall have power to do, or cause to be done, all things that are proper to be done by the corporation; and that a majority of the board shall constitute a quorum, unless otherwise provided in "the by-laws.
Section 55, chapter 53, Code, provides that the board of directors, in the exercise of their powers, shall be subject to such by-laws and regulations, not inconsistent with the laws of this State, as the stockholders may pass from time to time in general meeting.
These provisions of the statutes in relation to joint stock companies, govern the Lodge, so far as applicable to it.
Usually the members of a Lodge are not, in a strict sense, stockholders of the corporation. They have no stock which they may assign to others. They are simply members, and as such entitled to participate in the business of the corporation, in many respects in like manner as stockholders in a joint stock company, except that such members stand on an equality as to each other. They are entitled to a voice in the proceedings as individual members, and not according to the amount of stock held by them, as in joint stock companies.
We shall discuss the grounds alleged for setting aside this deed, in the order named; first, want of authority in the officers to make the deed. Under this ground, it is contended that the real estate of the Lodge could not be sold, without
It is contended that the officers who made the deed were without authority, because that authority had not been conferred upon them by a proper meeting of the members of the Lodge or by its board of directors.
The deed is regular upon its face, under seal of the Lodge, signed and acknowledged by its chief officers, delivered to the grantee, and by him caused to be recorded. Under these circumstances, authority on the part of these officers to make the deed will be presumed, and the burden is on the Lodge to show want of authority. Fidelity Co. v. R. R. Co., 32 W. Va. 244; Boyce v. Montauk Coal Co., 37 W. Va. 91; Ruffner Bros. v. Welton Salt Co., 36 W. Va. 244; 4 Thomp. Corp., section 5029; Cook Corp., section 725; 10 Cyc. 1149.
It may be claimed that these officers were not the proper officers to sign the deed and to place thereon the seal of the corporation. They were the chief officers of the Lodge, and acted as such without objection at the meeting of the board of directors hereafter mentioned, and were in our judgment the proper officers to execute the deed on behalf of the Lodge.
The question for determination is: Has the presumption of authority, on the part of these officers to make the deed been overthrown by the facts appearing in this record % It was shown that the Lodge had a board of directors, composed of five members, viz.: Bone, councilor, Nichols, secretary, Stapleton, Griffith and Craddock. The by-laws were not produced or copied in the record, although demanded by the appellee. The evidence is ample that by-laws of the Lodge
On the 20th day of February, 1903, there was a meeting of the board of directors, at which three of the five members were present, Griffith and Craddock being absent. At this meeting, the deed mentioned was prepared, executed and delivered. The transaction appears to have been agreeable to all the members of the board present, until it came to signing the deed, when Stapleton seemed to become offended at being told that it was unnecessary for him to sign it, and
It is contended that the record discloses that no legal action
It is also contended that the notice itself was insufficient, because it notified the members of a meeting to make arrangements to raise the money owing to Hopkins, and not to make sale of the property. The raising of money appears to have been uppermost in the mind of the secretary, who gave the notice, and, indeed, the raising of the money to pay the Hopkins debt seems to have been the reason which prompted the action of the Lodge at its meeting on the 18th of February. One way to accomplish that purpose was to sell the property. The by-laws of the Lodge and the rules and regulations of its board of directors, in relation -to notice of meetings of its board, do not appear in the record. We cannot say that the notice did not meet every requirement of such by-laws, rules or regulations; and it was incumbent on the Lodge to show that the action of the board was illegal, else the presumption that the deed was with authority must prevail. It does not appear under the facts presented that the action of the board was illegal.
The record disclosing the action of the members of the Lodge in regular meeting assembled, and also the action of the board of directors, it is unnecessary to discuss the ques
This brings us to the consideration of the other ground alleged for setting aside the deed — actual fraud in its procurement. Where actual fraud is relied on to set aside a deed, it must be clearly proved. This may be done by direct or by circumstantial evidence, or by both. Board of Trustees v. Blair, 45 W. Va. 812; Greer v. O’Brien, 36 W. Va. 277; Parker v. Valentine, 27 W. Va. 677; Frank v. Zeigler, 46 W. Va. 614.
Inadequacy of consideration is alleged. The estimates of the witnesses of the cost of the property in controversy, including lot and improvements, range from $2,200 to $2,500. The estimates of the witnesses of the actual value of the property range from $1,500 to $3,500, the greater number of the witnesses placing it at $3,000. The estimates of actual value seem to be based principally upon the present rental value under existing conditions. The upper story or lodge room had at the time of the sale a rental value of about $288 per year, exclusive of use by the Lodge for lodge purposes. The first story had a rental value of about $200 per year. The terms of purchase by Renick were $1,000, the Lodge retaining the second story with privilege to rent it to others for the period of five years. The rental value to the Lodge of this story, exclusive of use by the Lodge, for the five year period would amount to about $1,500, thus making a total consideration of about $2,500 which the Lodge received or will receive. No actual offer or proposition to purchase this property at the time it was sold is shown, other than the proposition by Renick. The Lodge was indebted to Hopkins in excess of $600. This $600 debt had been carried by the Lodge for some time. It had not grown less in amount. The membership of the Lodge in good standing and paying dues had greatly decreased. Under these circumstances, the sale was made to Renick. These parties were competent to contract, and entered into the contract. It will not be set aside in a court of equity on the ground
It is clear that the deed cannot be set aside on the ground of inadequacy of consideration. This is conceded by the brief of counsel for the Lodge. Inadequacy of consideration, although not so gross as to shock the conscience or amount to proof of fraud, may nevertheless be considered with other evidence or circumstances in determining the question of fraud. 14 Am. & Eng. Enc. Law 516. What evidence in this record shows actual fraud in the procurement of the deed mentioned? The bill alleges that the “deed was obtained by said J. E. Eenick, with the assistance of John Nichols, for the purpose of obtaining the title to plaintiff’s property without paying a just and adequate consideration for the same, and thereby defrauding plaintiff of its property.” Where is the proof of this allegation? We are .unable to point to it in this record.
It is said that John Nichols, secretary, did not enter correctly the minutes of the meetings of the Lodge held on the 18th and 25th of February; but, as we have seen, those minutes stand duly signed as the minutes of the Lodge unimpeached by action of the Lodge. It is also said that Nichols urged haste in consummating the sale, and declared on the day of the directors’ meeting that something would have to be done, or that the property would go for $600. The acts and conduct of Nichols, secretary,may have manifested a desire to speedily consummate the sale, laboring perhaps under the fear of dire consequences from the enforcement of the Hopkins debt. It is not shown that the acts and conduct of Nichols were prompted by an improper motive, or were not in good faith. In the matter of haste,
We have examined this record for proof of fraud on the part of Renick, and find nothing substantial or conclusive in that regard. One witness was produced who said that he was asked by Renick to “talk in favor of him getting” the property, but no terms were mentioned, no price named, at that time. It' is not shown that this witness acted according to that request. On the contrary, he said that he did not. The evidence of this witness, at most, cannot be construed as raising more than a mere suspicion of fraud, if it is even sufficient for that purpose. Fraud cannot be established alone by proof of circumstances raising only a suspicion of fraud; but the evidence and circumstances must be of such character 'as to clearly establish the fraud. 1 Story Eq., section 190.
The circuit court weighed the evidence and circumstances appearing in this record, and determined the conflicts therein in favor of the appellee. The decree appealed from carries with it the presumption of correctness. Having examined this record, we are clearly of the opinion that the circuit court was fully justified in its determination of this case. The action of the Lodge in selling the property was perhaps hasty. It may have been an instance of acting in haste and repenting at leisure; but we find no sufficient evidence to sustain the allegations of fraud in the transaction.
The decree of the circuit court is affirmed.
Affirmed.