142 Ark. 471 | Ark. | 1920
On January 29, 1919, appellant instituted suit against appellees in the Pulaski Circuit Court, Third Division, to recover $1,500 and interest thereon at the rate of six per cent, per annum from April 8, 1907, upon a repurchase contract of $1,500 of the stock of the A. J. Neimeyer Lumber Company, a corporation.
The gist of the complaint is that appellant was induced on April 8, 1907, by A. J. Neimeyer, who was the president of said corporation and a large stockholder therein, to purchase $1,500 worth of stock at par, in said corporation, with the understanding that he, A. J. Neimeyer, should repurchase the stock if in the future appellant should not want it, at the par value thereof, with six per cent, for the time appellant held said stock; that on the 28th day of February, 1918, appellant demanded of said appellee that he repurchase said stock in fulfillment of said agreement, but that said appellee failed and refused to do so. The letter containing the inducement for the purchase of the stock was made a part of the complaint, and is as follows:
“A. J. NIEMEYER LUMBER CO.
Manufacturers of Yellow Pine Lumber
Equitable Bldg.
“St. Louis, Mo., 2/23/07.
• “Mr. W. T. McCollum,
c/o Columbia Lumber Co.,
Buckner, Ark.
“Dear Will:
“We are in receipt of a check from Dr. Smith for $600 for stock in our company.
“Now, it has occurred to me that you can afford to take more stock than $600 and I make this offer to you, that you increase it to $1,000, giving us your note for $400, paying it when you can and the note will draw 6 per cent, interest.
“I think this would be a good thing for you to do. It will help you to save your money and I also am satisfied this stock will be a fine investment for you.
“If in the future you should not want this stock, I will take it off your hands and agree to allow you 6 per cent, for the time that you hold it.
“I trust that everything is getting along nicely at lumber and that you help in the woods to keep everything moving along to the best advantage possible for the company.
“Yours very truly,
N/H “A. J. Neimeyer.”
“Mr. McM. took 1,500 and paid for it and has stock certs. ’ ’
On May 28, 1919, appellee A. J. Neimeyer filed a demurrer to the complaint upon the grounds (1) that the complaint did not state facts sufficient to constitute a cause of action; (2) that the action was barred by the statute of limitations; (3) that the action was barred by laches.
Upon hearing, the court sustained the demurrer, and, appellant declining to plead further, dismissed the complaint, from which dismissal an appeal has been duly prosecuted to this court.
Appellant contends that the cause of action did not accrue under the terms of the contract until the 28th day of February, 1918, the date of his demand on appellee and appellee’s refusal to repurchase the stock aforesaid. The soundness of this contention depends upon the correct interpretation of the following clause in the contract: “If in the future you should not want this stock, I will take it off your hands and agree to allow you six per cent, for the time that you hold it.” It is quite clear from reading the clause in connection with the rest of the letter containing it that it was not in contemplation of either party that appellant should make an immediate demand for repurchase of the stock. It was suggested in the letter that, by paying a part cash and executing a note for the balance of the purchase money for the stock, it would enable appellant to save his money. This would indicate that no immediate election as to whether appellant would keep or return the stock was in contemplation of the parties. The fact that, in case appellant did not want the stock, he should receive six per cent, interest on it for the time he should hold it, indicates that it was not in contemplation of the parties that appellant should elect even in a very short time whether he would keep the stock. Under this interpretation of the clause, it cannot be brought within the rule controlling demand paper. Demand paper, under the rule announced in this State, is due immediately, and the statute begins to run from the date of the instrument. Sturdivant v. McCorley, 83 Ark. 278.
We think the proper interpretation to place upon the clause in question is that it was in contemplation of the parties, if, within a reasonable time, appellant should make up his mind that he did not want the stock, appellee Neimeyer would take it off his hands and allow him the amount he had paid therefor, together with six per cent, interest for the time he had kept it. We think it would be a strained construction to say the clause meant that appellant should have all time, or forever, in which to make the election. Such an interpretation would exempt tlie obligation from the statute of limitations altogether. The rule announced in Brooks v. Trustee Co., 136 Pac. 1152, is sound, and we adopt it. It is as follows (quoting syllabus 1) : “An "agreement by a seller of bonds to allow plaintiff to withdraw from her purchase at any time upon return of the bonds after consultation with third persons necessitates plaintiff’s making an election whether to take the bonds or not within a reasonable time.” It will be observed from a reading of the clause in question that the only preliminary action necessary to complete the accrual of his right to return the stock and demand the amount paid, therefor, together with six per cent, interest, rested in him. The contingency upon which his right or claim rested was a power exclusively in himself. Unless required to act within a reasonable time, he could, by non-action, eliminate or postpone indefinitely the operation of the statute of limitations. The doctrine announced in Ruling Case Law, Vol. 17, p. 756, and supported by a large array of authorities, is particularly applicable to the instant case. It is as follows: “When some preliminary action is an essential prerequisite to the bringing of a suit, and such action rests with the claimant, he cannot defeat the operation of the statute of limitations by a failure to act or by long and unnecessary delay in taking the antecedent step. It is not the policy of the law to permit a party against whom the statute runs to defeat its operation by neglecting to do an act which devolves upon him in order to perfect his remedy against another. If this were so, a party would have it in his own power to defeat the purpose of the statute in all cases of this character.” It is conceded that appellant made no demand under the option clause in his contract for a return of his money with six per cent, interest thereon for more than eleven years after the certificate of stock was issued to him. In our opinion, as a matter of law, this was an unreasonable length of time to wait before making’the demand, and, on that account, the action would be barred if not taken out of the operation thereof hy the existence of grounds of avoidance. This is a suit at law and the statute of limitations could not be raised by demurrer unless it affirmatively ap-' peared in the complaint that no facts existed which exempted the action from the operation of the statute. This rule on pleading was announced in the early case of Collins v. Mack, 31 Ark. 684, and reiterated in the following cases: Hutchinson v. Hutchinson, 34 Ark. 164; St. L., I. M. & S. R. Co. v. Brown, 49 Ark. 253; Rogers v. Ogburn, 116 Ark. 233. The complaint in the instant case does not affirmatively show that no facts exist which would take the action out of the operation of the statute.
The court, therefore, erred in sustaining the demurrer to the complaint’and, for that reason, the judgment is reversed and the cause remanded with directions to overrule the demurrer to the complaint.