146 Va. 488 | Va. Ct. App. | 1926
delivered the opinion of the court.
John R. Lynch, the plaintiff in error, was the plaintiff in the circuit court in an action of assumpsit brought by him against the defendant in error, W. J. Highfield, as defendant. The declaration contained all of the common counts in assumpsit, based upon the sum of $1,000 as the price and value, etc., according to the varying common counts. The declaration, in addition, contained the following special count: “And for this, also, that heretofore, to-wit, on the 20th day of July, 1923, in said Accomac county, Virginia, the said defendant bargained for and bought of the plaintiff ten shares of the common capital stock of the Assateague Fish Oil and Fertilizer Company, Inc., of the par value of $100.00 per share, total $1,000.00, which stock then plaintiff was persuaded and induced by the defendant to accept in lieu of a cash settlement of his bonds for $1,000.00 in the Chincoteague Fish Oil and Guano Company, Inc. (of which latter company the Assateague Fish Oil and Fertilizer Company, Inc., named above, was a reorganization and successor, having at the receiver’s sale purchased practically all the assets of the old company), the defendant then and
“(1) Non-assumpsit.
“(2) The defendant denies absolutely that he bought of the plaintiff ten shares of common capital stock of the Assateague Fish Oil and Fertilizer Company, Inc., and further denies that he persuaded and induced the
“(3) The defendant specifically denies that he ever authorized the said plaintiff to draft on him at the Industrial Trust Company, Wilmington, Delaware, in the amount of $1,000.00, in payment of said stock, or for any other amount.”
Upon the trial, and under the instructions of the court, the jury found a verdict for the defendant, and thereupon the plaintiff brought this writ of error.
The plaintiff testified that on the 20th of July, 1923, the defendant, Highfield, was in conversation with him at Franklin City. In this testimony he gives in evidence in chief his version of defendant’s offer as follows: “He came down in an automobile, and we got to talking about different things and I asked Mr. Highfield what he would give me for my bonds, and he said: ‘What will you take, Lynch?’ and I says: T want all I can get; you see what my work is, it is monthly salary, with a big family and I just had a son to get out of the hospital and need the money;’ he says: !In lieu of — our people has agreed to give $1,000.00 worth of stock of the new concern for a $1,000.00 bond of the old concern,’ he says: ‘ You accept your stock and’ he says: ‘Onreceipt of same you draft on me at the Industrial Trust Company, at Wilmington, Delaware, and I will accept same;’ he says: ‘You must keep that under your hat, that is between you and I, and it will be $1,000.00 to you and amount to $1,200.00 for me.” In answer to an in
“Q. Mr. Lynch, now repeat again — I have not asked you on cross examination — just exactly what was Air. Highfield’s declaration to you?
‘‘A. Mr. Highfield was at Franklin City en route to the factory. While waiting for the supply boat to-come for him, we were talking out on the platform. I asked Mr. Highfield about different things about the plant and I asked Air. Highfield what he would give me for my bonds — I still had them.. He says: ‘What will you take, Lynch?’ I says: T want all I can get,’ I says: ‘You see my work here, it is monthly pay, and a large-family, and I have a son just out of the hospital and need ready cash.’ He changed the subject then and. said: ‘Well, our people has said that they would issue-stock in lieu of the old bonds of the Chincoteague Fish Oil and Guano Company,’ he said: ‘You accept your $1,000.00 worth of stock and,’he said: ‘And make draft out on me to the Industrial Trust Company and I will accept the same, which will be $1,000.00 to you and will be worth $1,200.00 to me.” In addition to the plaintiff, one other witness testified on his behalf in which he stated he was present at the conversation between the plaintiff and defendant, in which he heard Mr. Highfield say to Lynch that he was going to give
Mr. Highfield, in his testimony on his own behalf as defendant, denied making any suggestion or arrangement with Lynch or promise to him that he would buy the stock after he, Lynch, should have exchanged his bond for stock. Both parties testified at some length as to all the circumstances surrounding the transaction out of which Lynch alleged that the agreement arose. Mr. Highfield’s account of his interview with Mr. Lynch is as follows: “Gentlemen, on or about July 20, 1923, while en route to the factory at Assateague, Mr. Lynch met me at Franklin City, and, as I recall, this is .verbatim his conversation: ‘Mr. Highfield, I don’t care to take a loss on my bonds, the court allowing some five hundred and some dollars, and I prefer or would prefer to accept stock as I have advised that I would do — what is your opinion of the stock?’ I told him that in my mind the stock, each $1,000.00 worth of stock, had back of it the physical value of $1,200.00. That figure is arrived at by the division of 2,720 shares of stock of the company into the established or agreed valuation by the directors that the plant and steamers were worth, $350,000.00. That being so, the relative or physical value as against the stock was as $1,200.00 is to $1,000.00. At that time I did not state, I did not imply, a desire or intention to acquire his stock. His bonds had been offered to me previously for $800.00; they were not acceptable to me then at that figure and his stock was not acceptable at $1,000.00 had I wanted
At the end of the testimony, the plaintiff offered the following instruction which was refused: “The court instructs the jury that if they believe from the evidence that the plaintiff, on July 20, 1923, agreed to sell to the defendant, ten (10) shares of stock in the Assateague Fish Oil and Guano Company, as soon as the plaintiff received a certificate for said ten (10) shares, at the aggregate price of one thousand dollars ($1,000.00), and if they believe from the evidence that said defendant on said date agreed to accept said ten (10) shares of stock and to pay therefor upon receipt of said certificate said sum of one thousand dollars ($1,000.00), then it is the duty of said jury to find for the plaintiff.”
The defendant offered the following two instructions which were granted:
“The court instructs the jury that if they believe from the evidence that J. R. Lynch, the plaintiff in this case, determined to and did actually accept the stock offered in the new company for bonds in the old company, before July 20, 1923, then any promise or assurance made to the said plaintiff by the said defendant regarding the acceptance by said plaintiff of the stock is without consideration and void.”
“The court instructs the jury that if they believe from the evidence that William J. Highfield promised J. R. Lynch that if he, Lynch, would accept the stock of the Assateague Fish Oil and Fertilizer Company, in lieu of a cash settlement for his bonds, he, Highfield, would dispose of said stock as soon as the salesman began selling the stock, and allow him, Lynch, par for same, still, if they further believe from the evidence that said
The above mentioned two instructions being the only instructions given by the court to the jury, the case was argued, and the jury brought in their verdict for the defendant.
The plaintiff assigned as error the refusal of the court to give the instruction offered by him and the granting of the two instructions given as offered by the defendant.
It appears that a corporation under the style of Chincoteague Fish Oil and Guano Company had been doing business in the county of Accomae, and in the year 1922 had gone into the hands of a receiver, and in the course of the suit for that purpose, its assets had been sold in the spring of 1923. Quite a large issue of bonds had been made by this company and before the sale of the assets took place, all of the bonds had been deposited with a bondholders protective committee of which Mr. Highfield, the defendant, was chairman, except bonds to the amount of $10,500. The plaintiff, Lynch, was the holder of a bond for $1,000.00, which had not been deposited with the committee. This bondholders protective committee bought in the assets of the insolvent corporation at a price which would have enabled the bondholders to receive about fifty per cent for their bonds in the final settlement of the affairs of the insolvent corporation. The bondholders protective committee, after purchasing the assets of the insolvent corporation, proceeded to reorganize a new corporation under the style of Assateague Fish Oil and Fertilizer Company, of which Mr. Highfield became president. Mr. Doughty, an attorney in Accomac county, was counsel for the bondholders committee
The evidence in the case does not justify the first instruction given by the court, which tells the jury that there was no consideration for the contract sued upon if the plaintiff had determined to and did accept the stock in the new company before the 20th of July, 1923, the date of the alleged agreement that Mr. Highfield would purchase the stock. The plaintiff in the case had testified to an actual offer made to him by the defendant, whereby the defendant was to purchase the stock in the new company upon the specified terms as soon as it came into the possession of the plaintiff, in the event the plaintiff accepted the proposition of the exchange of the bonds for the stock. He testified also that he obtained the stock before the offer was withdrawn and it is insisted that the offer and acceptance constituted a contract between the parties. In argument it is insisted by counsel for the defendant that the letter of July 5th, written by Lynch to Mr. Mapp, was a final acceptance of the proposition to take the stock for the bond, and therefore Lynch having so agreed nothing could have acted upon his mind subsequently as an inducement to the agreement. The entire argument here is based upon this letter of July 5th. It seems very plain from the testimony that at the meeting on July 12th it was understood on both sides that no arrangement had been made by or on behalf of the nonparticipating bondholders up to that time. It fairly appears from the testimony that on the 20th of July the whole matter was still in abeyance, i. e., it was not finally determined what any of the nonpartieipating bondholders would do in pursuance of the eon
It is contended on behalf of the defendant that-the instruction offered for the plaintiff and refused is. not justified under the pleadings. It is true that the-special count in the declaration alleges that the plaintiff was persuaded by the defendant to accept the stock in lieu of the bond by reason of his promising to take-the stock and pay $1,000.00 for it. The declaration, does not allege that he would not have accepted the stock except for the inducement offered by Mr. High- • field and that by Mr. Highfield’s representations the plaintiff had been induced to accept the stock to his injury and so had been damaged. On the contrary the action is in assumpsit and, fairly construed, the declaration should be taken to set up a contract resulting • from a conditional offer and acceptance, whereby the • defendant agreed to buy the stock as soon as it was.
So far as the inducement to take the stock is concerned, whatever may have been the situation on July 20th, Mr. Highfield, who was chairman of the committee of bondholders and also president of the new corporation, and was in control of the negotiations between the new corporation and the nonparticipating 'bondholders, must have been aware of the situation-, and must have known to what extent on July 20th Lynch had bound himself to take the stock. In the letter written by Mr. Highfield on July 25th, he presumes that the directors of the new company were merely negotiating with the bondholders represented by Mr. Mapp, and hence he withdraws altogether the offer to “all nondepositing bondholders” after being informed that Mr. Lynch was the only one desiring the stock.
The defendant was entitled to an instruction submitting to the jury the phase of the case presented in the second instruction given by the court. ‘That instruction, however, as given, was not justified by the
For these reasons the ease will be reversed and remanded for a new trial. The evidence seems to show very little reason why Mr. Highfield should have made such a contract as that upon which the suit was brought, but there is distinct testimony on the part of the plaintiff that such an agreement was made and that question is entirely for the jury.
Reversed.