Graham County Mill & Elevator Co. v. Saunders
Graham County Mill & Elevator Co. v. Saunders
Opinion of the Court
The opinion of the court was delivered by
The action was one to recover on a promissory note for one thousand dollars given the plaintiff by the defendant. The defense was that the note was given for shares of the capital' stock of the mill and elevator company which were never issued. The defendant prevailed and the plaintiff appeals.
It appeared at the trial that the subject of the defendant’s stock subscription was covered by a written contract relating to the employment of the defendant as manager of the plaintiff’s mill, fixing the terms of such employment, and providing as follows:
“Second party further agrees to subscribe for and take One-Thousand Dollars in the stock of said Mill Company before this contract shall take effect — first party agreeing to accept in payment for said stock, the note of second party payable in 60 days bearing 10% interest.”
The court permitted the defendant to testify concerning
The first part of the court’s ruling applies only in case of fraud, mistake of the scrivener, or other basis for reformation by a court of equity. If a contract be complete and unambiguous on its face, a form expressing an intention different from that indicated by the language employed can not be shown by parol evidence. The second part of the court’s ruling likewise permitted the written instrument to be impeached. The contract contains a description of the stock to be subscribed which is neither incomplete nor ambiguous — “the stock of said Mill Company.” The stock of a named corporation duly organized and engaged in the pursuit of its charter purposes is a definite thing in existence and subject to disposition by the board of directors. A proposed increase in the capital stock of such a corporation, not yet in existence and which the board of directors can not create, is a definite thing. But the two are, as the defendant contends, quite distinct and wholly different and the substitution of one for the other by the interpolation of the word “new” or the word “additional” in the
The judgment of the district court is reversed and the cause is remanded with direction to enter judgment for the plaintiff.
Reference
- Full Case Name
- The Graham County Mill & Elevator Company v. W. G. Saunders
- Cited By
- 1 case
- Status
- Published
- Syllabus
- SYLLABUS BY THE COURT. Written Contract — Parol Evidence Inadmissible to Vary. The rule that parol evidence is not admissible to show an intention different from that expressed by the terms of a written contract, on its face complete and unambiguous, applied to a subscription to the capital stock of a corporation.