172 Ky. 499 | Ky. Ct. App. | 1916
Opinion op the Court by
Reversing.
This appeal brings to us for review a judgment of $9,518.00, with interest from the date of its entry, and costs, recovered of the appellant, Frank P. James, by the appellee, John E. Golden, on cross-petition, in the Knox circuit court.
By an amended answer, counter-claim and cross-petition it was alleged by appellee that since the filing of his original answer, counter-claim and cross-petition,- a settlement was made between him and John A. Black, the latter acting for himself and for the National Bank of John A. Black, whereby it was agreed that the order for $6,000.00, drawn by appellee on J. E. Curry in favor of John A. Black should be and was surrendered and returned to appellee by John A. Black, and judgment was entered in pursuance of such agreement in the action brought by Black against him. The amended answer, counter-claim and cross-petition further alleged that no part of the $6,000.00 order was ever paid by appellant or J. E. Curry and its surrender to appellee entitled him-to recovér of them the amount of the $10,000.00 note, less the credit of $482.00 to which they are entitled thereon, and for this he asked judgment and asserted a lien upon the Knox county lands.
J. E. Curry, who was only' constructively summoned as a,non-resident on the cross-petition, filed no answer thereto, but the appellant, James, John A. Black and the National Bank of John A. Black, filed separate answers to the cross-petition, as amended, containing a traverse of its averments. The answer of the appellant, James, in addition alleged that appellee never held his or Curry’s note for $10,000.00 or any amount; that; there was never a sale of the Knox county lands or ap-: pellee’s equity therein to appellant -and Curry or either of them; that the only sale made thereof by appellee was to the Knox County Coal Company, in which he and Curry were stockholders to the amount of five shares of $100.00 each and the appellee a stockholder to the amount of 1,240 shares of $100.00 each. The judgment of the court granted appellee all the relief prayed by him, and it now becomes necessary for us to determine whether the judgment was authorized by the evidence.
In a few days appellant and Curry received from appellee the articles of incorporation which had been prepared by his brother, but Curry, acting upon the advice of the attorney, Botts, immediately wrote appellee calling his attention to certain defects in the articles as prepared, in reply to which appellee wrote Curry to have the articles of incorporation prepared in such form as would obviate the defects pointed out in the instrument. -Thereupon new articles of incorporation were prepared
Appellee’s financial embarrassment reached such a crisis by September 3,1912, that he and his wife executed
This action was brought in equity. The issue made by the appellee’s cross-petition and the answers thereto are, in the main, of equitable cognizance, and the evidence upon which the judgment of the circuit court was based is all found in the record in the form of depositions. While it is the rule in this jurisdiction that we will not reverse the judgment of the chancellor on a mere matter of the credibility of the witnesses, or where, under the evidence as a whole, the truth of the matter involved is doubtful, we have, however, often held that though the chancellor’s judgment is entitled to some weight, we will weigh and "judge of the sufficiency of the "evidence for ourselves, and where it is found to preponderate for one side or the other in such a way as to convince us that the chancellor erred, his judgment will be reversed. Farmer v. Hampton, 154 Ky. 83; Coomes Bros. v. Grigsby & Co., et al., 151 Ky. 394; Bullock v. Harrison, 145 Ky. 358; Northrup’s Trustee's v. Summer’s Trustees, 132 Ky. 156; Powell, et al. v. Union Grocery Co., 113 S. W. 912. Our examination of the evidence in this case leads us to the conclusion that it does not support the judgment.
We will not attempt to discuss in detail the voluminous evidence appearing in the record, but will content ourselves with the consideration of such of the salient .facts and circumstances furnished by it as, in our opinion, refute the appellee’s contention that the sale of his interest or equity in the Knox county lands was made to J. E. Curry and the appellant, Frank P. James, as individuals. It is proper, however, to notice first the evidence upon which he relies. This consists of his own testimony, that of W. M. Parker, J. F. Stanfill, R. W.
The witnesses, Stanfill, Cole and Davis, testified as to certain statements which they claim were made by J. E. Curry in the absence of appellant tending to indicate that the transaction between appellee, James and Curry with respect to the Knox county lands was an individual matter. But according to their testimony, substantially all that Curry said to them with reference to the Knox county.lands was that “we” bought them or “our” lands or “his company,” referring, as the witnesses inferred, to himself and James as the owners. These conversations were all denied by Curry. Besides, it is a matter of every-day occurrence that persons connected with a corporation or in control of its property, in speaking of either commonly refer.to the corporation, its property or business as our property, our company and the like. Officers or stockholders, of a corporation cannot be subjected to personal liability for its obligations merely because of referring to it as the witnesses mentioned say was done by Curry. Manifestly such evidence as was thus furnished by appellee and his witnesses is trivial and clearly insufficient to establish his contention of a sale of the lands to James and Curry as individuals.
Upon the other hand, the contention of appellant that the sale .made by appellee of his equity or interest in the Knox county lands was made to the Knox County Coal Company, must be accepted for the following reasons: The deed appellee executed and sent to J. E. Curry at Lexington was made to the Knox County Coal Company. He caused the writing creating the Knox County Coal Company as a corporation to be written and he, together with James and Curry, signed and acknowledged it as incorporators before it was put to record. 'He' and they, acting in concert, effected the organization of the corporation. He and they were the only subscribers to the stock, and the numerous letters found with the depositions of James and Curry show his continuing and consistent recognition of the corporation as the owner of the Knox county lands, and also show his per
It is not to be overlooked that no claim was ever made by appellee that there had been a sale or conveyance of the Knox county lands to James and Curry, instead of to the Knox County Coa-1 Company, until after he was sued by the National Bank of John A. Black upon the $2,800.00 note. The most plausible reason appearing from the record for tMs remarkable -change of front on the part of appellee is furnished by the insolvency of the Knox County Coal Company, resulting from the inability of its officers to sell its capital stock, from the proceeds of which it had been understood by all the parties concerned appellee was to be paid the $10,000.00 he was to •receive from the corporation for his options- on the Knox county lands, and the owners of the iands were to be paid their value. The fact that appellant, after the execution of the $2,800.00 note to the National Bank of John A. Black, gave Black as president of the bank an order on J. B. Curry for $6,000.00, or that the order was accepted by Curry, does not conduce to prove a sale of the Knox county lands to Curry and appellant. The reply filed by the bank, and Black as its president, to the answer and cross-petition of appellee, alleges that the order was given by appellee and accepted by Curry,
Appellee’s contention that there was a sale made of his interest or equity in the Knox county lands to appellant and Curry is not only overthrown by the testimony of the latter and the numerous facts and circumstances we haye already commented on in the opinion, but by his own evidence as well. This shows that though, according to his claim, the deed to them as individuals was written and mailed them on April 25,1912, his admission that they, on the 26th, telephoned him to hasten the execution of the deed to the corporation, together with the failure of proof to show that they ever received the deed to them as individuals, must be held to manifest a failure by them to accept the latter deed; and the further fact that appellee did, as requested by their telephone message, at once execute and send to them the deed to the Knox County Coal Company, demonstrates that the sale of the lands was made to that company.
In our opinion the evidence found in the record furnishes no sufficient basis for the judgment, rendered by the circuit court; hence that judgment is reversed and cause remanded, with directions to the circuit court to set it aside and dismiss the appellee’s cross-petition.