161 Mo. 333 | Mo. | 1901
This is a suit for an accounting and the balance thereon alleged to be due plaintiff for his share of certain royalties collected hy defendant from the American Brake Company.
In March or April, 1891, defendant sold Arthur Green, a brother of plaintiff, 260 shares of the Consolidated Brake Company. Arthur Green testifies that defendant represented that the last mentioned company was in a flourishing condition and he might expect satisfactory dividends within a year. Defendant denies this.
In 1892 defendant sold to plaintiff,- through his brother Arthur Green, 140 shares of Consolidated Brake stock. Arthur Green testifies that at the time of this last sale he reminded defendant of his statement that said company would pay a dividend and that it had not done so. Contemporaneously with this last'sale, the two brothers and defendant entered into the following written contract:
“Whereas, C. C. Higham, of St. Louis, Missouri, Arthur H. Green, of Rochester, N. Y., and Levi W. -Green, of the same place, are each the possessor of two hundred shares of the capital stock of the Consolidated Brake Adjuster Company; and
“Whereas, the said parties are desirous of forming a pool*336 of said stock for their mutual advantage and benefit; and,
“Whereas, said O. C. Higham agrees to divert to said pool the royalties and proceeds now received, or which may be received by him, from the American Brake Company, of St. Louis, Mo., until such time as the said Consolidated Brake Adjuster Company shall begin paying regular dividends;
“Now, therefore, be it known that we, the undersigned, do hereby form a pool consisting of six hundred shares of said capital stock of said Consolidated Brake Adjuster Company, of which we each shall stand possessed of two hundred shares, the understanding being that all benefits accruing under said pool shall be shared equally, including any sales of said stock, and that said royalties and proceeds also shall be equally shared until such time as the said Consolidated Adjuster Company shall pay dividends as aforesaid, when the said royalties shall revert to the sole use and benefit of said C. C. Higham.
“Witness our hands and seals this twentieth day of February, 1892.”
The Green brothers were brokers. Under this written contract, defendant Higham from time to time received his royalties from the American Brake Company, and paid over to Arthur and Levi Green their respective shares, according to the contract, until the year 1895.
This suit is for their share of those royalties since 1895. Arthur Green assigned his interest in the contract to his brother, the plaintiff.
It should also be stated that when plaintiff bargained for the 140 shares,.he did not get the certificates of stock, but defendant gave Arthur Green a declaration of trust that he held forty shares for Arthur Green’s use and the above contract, and 100 shares for plaintiff’s use, and these papers were all delivered to plaintiff. These transactions placed 400 shares in the Greens. The circuit court adjudged an accounting, and
Three propositions are relied upon for a reversal of the judgment.
First, that the agreement by defendant to divide his royalties from the American Brake Company with plaintiff and his brother was without consideration and unenforcible; second, that in fact, no pool was formed under said agreement; third, no time was fixed for the duration of the pool, and if formed, defendant had a right to discontinue it upon notice to plaintiff and his brother.
I. The circuit court found that the sale of the 140 shares by defendant and his brother to plaintiff was the consideration upon which the contract was based. The gain arising from the sale of this stock was the motive on the part of defendant for agreeing to divide his royalties from the American Brake Company with plaintiff and his brother, and on their part the motive for buying additional Consolidated stock which had paid no dividend, was, to obtain the royalties which the contract secured them. We think the evidence sustains this conclusion. But defendant gives an additional reason why he desired to make this agreement. The stock was not salable in small blocks and would be more salable in a block of 600 shares, and the Greens were brokers. This being so, the mutual agreements that each should share equally in the proceeds from the sale of the stock, secured to defendant the benefit of any advantageous sale plaintiff or either might thereafter make of the stock. These motives for the written contract constituted a valuable consideration which has been comprehensively defined to be “a benefit to the party promising, or to a
The benefit which defendant expected to receive from the sale of the stock through the mutual efforts of himself and plaintiff and his brother, satisfies the law.
The amount of the consideration, so it be appreciable, is immaterial. We think the court correctly held this objection was not tenable.
II. The objection that no “pool” was ever formed is evidently predicated upon the idea that this word had some technical meaning.
The Century Dictionary defines a pool to be “a joint adventure by several owners of a specified stock or other security temporarily subjecting all their holdings to the same control for the purpose of a speculative operation, in which any sacrifice of the shares contributed by one, and any profit on the shares contributed by another, shall be shared by all alike.”
We think that the word “pool” must be read in the light of the whole contract. There is nothing in this contract that requires all the 600 shares to be transferred to one person as a trustee, or that a power of attorney should be given to any one person to hold and sell or dispose of the stock. While this might have been done, the failure to do so in no way invalidates the contract they did make. Neither party required this at the making of the contract or requested it afterwards.
“The practical construction given by the parties themselves is a proper guide to its meaning, and is of more importance than what is the abstract meaning which this court may attach to its mere phraseology.” [Patterson v. Camden, 25 Mo. 21.]
The course of dealing between plaintiff and defendant
• Whether a “pool” .in a technical sense was formed is quite immaterial. A valid contract was entered into and observed by the parties thereto and must govern as to their respective rights.
III. As to the point that there was no time of duration fixed, it falls within the maxim, “id cerium esif’ It was contemplated by all parties that the Consolidated company would soon begin to pay dividends and when it did, the purpose of the pool was ended, and it necessarily ended when the royalties from the American Brake Company to defendant should cease, which, as we understand, would be January 1, 1899.
As to the issuance of the 140 shares of stock to plaintiffs wife, it was done with the full knowledge and direction of defendant, who continued thereafter to pay the royalties as he had previously done.
This was not a sale in the contemplation of either of them. Nor was the temporary pledge of his 260 shares by Arthur Green a sale, within the terms of the contract. None of the parties to the contract have ever sold their Consolidated brake stock and no breach by plaintiff has occurred which would exonerate defendant from complying with the contract.
Upon a review of the whole case, we find no ground for reversing the judgment, and it is' accordingly affirmed.