64 Minn. 500 | Minn. | 1896
The allegations of the complaint, briefly stated, are that the plaintiff was the owner of $500 of paid-up stock of the defendant association, of the value of $500, for which she paid it the sum of $500, and for which it issued to her, and in her name, stock certificates, which, for her convenience, were left with the defendant; that certain dividends have been declared on the stock, for which defendant made checks payable to her order, but which it still retains in its possession; that she has demanded of defendant that it deliver to her the stock certificates and dividend checks, but that it refused to deliver them, or any of them, to her, but has wrongfully converted the same to its own use, to her damage $700. As it is alleged that the defendant still holds the certificates in plaintiff’s name, as issued, and the checks payable to her order, as executed, it is apparent that the wrongful conversion charged consists of defendant’s refusal to deliver them on demand. The court found that the value of the stock was $437.50, and ordered judgment in her favor for that amount. It does not appear how the judge arrived at this amount, but it is evident that he proceeded upon the theory that the refusal to deliver the certificates and the checks amounted to a conversion of the stock, and that the judgment was intended to be for its value.
The facts are practically undisputed. One Hall and one Mathews had each negotiated and arranged with the defendant for a loan on certain real estate which they had severally purchased from the plaintiff, but upon which they still owed her a, part of the purchase
In pursuance of this arrangement, defendant took from Hall a note and mortgage for $1,800, and advanced him $1,700; and from Mathews notes and mortgages for $9,000, and advanced him $9,200. Defendant then executed, in form, certificates of its paid-up stock in the name of the plaintiff for $100 and $400, but retained them in its own possession, according to agreement; and, when dividends on stock were declared, also executed, in form, checks therefor, payable to plaintiff’s order, but likewise retained them in its possession, except one for $22.50, which was delivered to plaintiff by mistake, as defendant claims. Neither Hall nor Mathews ever made any payments on the principal of their mortgages. Upon Hall’s default, defendant foreclosed his mortgage, and bid in the premises for $1,500, which was $800 less than the amount then due on the mortgage. After Mathews’ default the defendant accepted conveyances of the mortgaged premises in full satisfaction of the mortgages and debt secured thereby, surrendered the mortgagor’s notes, and has since traded off the land for other property. Plaintiff was no party to this settlement with Mathews. For the sake of brevity, we have not strictly followed the record, but this statement of facts accurately presents the legal questions involved on .this appeal. ...
Under this view of the rights of the parties, it is clear that nothing has been received by the defendant on the Hall mortgage which plaintiff was entitled to have applied in payment of the $100 stock certificate. But in the case of the Mathews mortgages the defendant, by taking conveyances of the mortgaged premises in full payment and satisfaction of the debt, and releasing the debtor, has placed itself in precisely the same position as if it had received payment in full in cash. The claim of defendant that the land was not worth the
The question remains, do the facts establish a cause of action against defendant for the value of the stock? There is no doubt of the right of a party to obtain from the agents of a corporation a certificate showing the number of shares held by him; and the general statement of the law, in the books, is that this right may be protected and enforced by each shareholder, either through an action for specific relief, or one for damages, and that in the latter case the measure of damages is the value of the stock. Whatever may be said of the right to this latter remedy where the relation of member and shareholder has been already created and consummated, there can be no doubt about it in a case like the present, where the relation had never been created, its consummation having been prevented by the act of the defendant in refusing to issue the stock and deliver a certificate. It may be a question whether the form of the remedy, in such a case, is an action for a wrongful conversion of the stock, or one for damages for breach of the contract to deliver the stock. But this is immaterial in the present case, for the reason that no question of pleading is raised, and the parties have introduced, without objection, evidence of all the facts; and the measure of damages is the same in either case, viz. the value of the stock.
We fail' to see any merit in the point that the original contract was void as being ultra vires the corporation. It had the right to make the loans it did to Hall and Mathews, and the contract between plaintiff and defendant was for an issue or sale of stock for cash. It was immaterial whether the money was to be paid directly by the plaintiff, or indirectly out of the proceeds of the Hall and Mathews mortgages.
But, as we have seen, while plaintiff was entitled to recover the value of $400 of stock, she was not entitled to recover anything on account of the other $100. The court has ordered judgment for the
Ordered, that a new trial be granted unless the plaintiff, within 10 days after the filing of a remittitur in the court below, remit one-fifth of the amount for which judgment was ordered in her favor, in which case judgment shall be entered in her favor for the balance.