Snell v. J. C. Turner Lumber Co.
Snell v. J. C. Turner Lumber Co.
Opinion of the Court
This is a motion for judgment upon the pleadings in favor of plaintiffs against defendant upon the first defense set out in the defendant’s answer in paragraphs 1 to 7, inclusive, upon the, ground it is insufficient in law upon the face thereof.
The question is one of res adjudicata. Under date of July 1, 1919, a contract was entered into between the Frank Snell Sawmill Company, a Florida corporation, as party of the first part, J. C. Turner Lumber Company, a New York corporation, party of the second part, and Frank N. Snell and Jay E. Rice, parties of the third part. Inter alia, Snell and Rice agreed to manage and conduct the sawmill and logging operation at Council, Ga., of the Florida corporation, at the monthly
“It is not the intent hereby to give to the said parties of the third part a contract of permanent employment, but such employment shall continue as long as the business is efficiently managed and conducted to the satisfaction of the party of the second part, and it; is the intent by the payment of 42 per cent, net profit to the said parties of the third part, to distribute the compensation between them in such proportion as will enable the said Frank N. Snell to realize the equivalent of dividends on $120,000 worth of common stock, and the said Jay E. Bice to realize the equivalent of dividends on $25,000 worth of common stock, all the parties herein realizing and agreeing that, at the present time the common stock of said corporation, the party of the first part has no value.”
Snell and Rice began suit against the Florida corporation and the New York corporation in the superior court for Clinch county, state of Georgia, which suit was removed to the District Court for the Southern District of Georgia. The bill is lengthy and its details need not be set forth. In the sixth allegation thereof, however, the contract of July 1, 1919, above referred to, was pleaded, and the fifth paragraph of the prayer was as follows:
“That a strict accounting may be taken of the actual investment of the *J. O. Turner Lumber Company in the stocks and bonds of Frank Snell Sawmill Company, the advances made by J. O. Turner Lumber Company to Frank Snell Sawmill Company, the commissions claimed by said J. C. Turner Lumber Company and charged or credited by the parties respectively under the terms of the contract of July 31, 1919, and that the entire business of the said Frank Snell1 Sawmill Company be liquidated, and a distribution of its net profits applicable to common stock, be made on a basis of 58 per cent, to said J. C. Turner Lumber Company and 42 per cent, to your petitioners in the proportions that $120,000 bears to $25,000.”
The suit was in equity and part of the relief prayed for was the accounting, the liquidation, and the distribution of net profits, above referred to.
An answer was duly interposed by both defendants. Thereafter a final decree upon consent was entered by the United States District Court.in Georgia. This decree ordered, adjudged, and decreed, among other things, the following:
“To the owners of record of the. preferred stock of Frank Snell Sawmill Company at face value, with interest accrued since July 1, 1919, as far as may be, and finally the surplus, if any, to J. C. Turner Lumber Company of one part and the complainants Frank N. Snell and J. E. Bice of the other part in the following proportions: 58 per cent, thereof to J. C. Turner Lumber Company, and 42 per cent, to Frank N. Snell and J. E.. Bice, complainants; said latter 42 per cent, to be divided between Frank N. Snell and J. E. Bice in the ratio of 120 to 25.”
Plaintiffs have now begun an action at law in this district to recover $625,000, which they claim is their damage resulting to them.from the breach of the very contract of July 1, 1919, which was set up in the
In such circumstances, plaintiffs’ motion is denied, and the defendant is entitled to judgment dismissing the complaint.
Reference
- Full Case Name
- SNELL v. J. C. TURNER LUMBER CO.
- Status
- Published