Empire Life Ins. Co. v. Beaumont Land & Building Co.
Empire Life Ins. Co. v. Beaumont Land & Building Co.
Opinion of the Court
Appellees concede the correctness of the statement of the nature and result of this suit in appellant’s brief, which is as follows: “The Beaumont Land & Building Company received, in due course of trade, a note executed by James E. Ferguson, and indorsed by Wood, Hargrove & Strange, being for the principal sum of $2,000, and secured by 10 shares of the capital stock of the Empire Bife Insurance Company, and to collect the same brought suit after maturity against Ferguson as maker and Wood, Hargrove & Strange as indorsers, and prayed for foreclosure of the lien upon the stock held as collateral. Ferguson admitted the execution of the note, claiming, however, that it was secured by fraud, and that such note was given as the purchase price of 10 shares of stock in the Empire Life Insurance Company, but that at the time he signed the same he was misled by fraudulent representations of a material nature concerning the capital stock and condition of the Empire Life Insurance Company, such fraudulent representations being made by Mr. Strange, of the firm of Wood, Hargrove & Strange, and in his capacity as agent of the Empire Life Insurance Company, and that acting upon such fraudulent representations he bought the stock and signed the note sued upon in payment thereof. Mr. Ferguson claimed that Mr. Strange, in his capacity as agent; for the Empire Life Insurance Company, represented to him that the proposed capital stock of such company was $100,000, represented by 1,000 shares of the par value of $100 each, that its surplus at the time it should begin business would be $100,000, and that the expense of promotion would not exceed $25,000; whereas, in fact, the capital stock was $150,-000, represented by 1,500 shares of the par value of $100 each, the surplus $50,000 and the expense of promotion as represented. Mr. Ferguson therefore prayed that because of such misrepresentations, and because he believed and acted upon the same in subscribing for 10 shares of stock giving the note sued on in payment, that he should be relieved of the obligation expressed in the note; or, if such note was found to be a valid obligation in the hands of its holder, the Beaumont Land & Building Company, that he should have judgment for damages by reason of the fraudulent representations over against Wood, Hargrove & Strange; or, if it was found that Wood, Hargrove & Strange were agents of the Empire Life Insurance Company, that he should then be given judgment against such Life Insurance Company for such damages as arose from his acting upon the fraudulent representations of its agent. Wood, Hargrove & Strange, as well *336 as their principal, the Empire Life Insurance Company, answered, that there were no false representations made to Ferguson at the time he signed said note, but, on the contrary, Ferguson was fully advised and informed by Wood, Hargrove & Strange, through Mr. Strange, as to the plan of organization of said company, and that the representations of Mr. Strange as to the proposed capital stock, surplus, and expense of promotion were true and correct statements and made to Mr. Ferguson at the time he signed the note sued upon, and fully understood by him. The case going to trial before a jury, judgment was rendered in favor of the Beaumont Land & Building Company against James E. Ferguson as maker, and Wood, Hargrove & Strange as indorsers of said note, for principal, interest, and attorney’s fees, as therein provided. Judgment for damages was also rendered in favor of James E. Ferguson against the Empire Life Insurance Company, the jury finding in their verdict that the agents of the Empire Life Insurance Company, Wood, Har-grove & Strange, acting through Mr. Strange, made to Ferguson false representations of a material nature regarding the stock and condition of the Empire Life Insurance Company, upon which Ferguson acted to his damage in the sum of $928.22, such sum representing the difference between the value-of the 10 shares of stock as represented and their book value, including interest upon such sum at the rate of 6 per cent, from the date of the purchase of the stock, August 12, 1909, to the date of the verdict, March 1, 1911, and in addition to such amount was added $200 as attorney’s fees. Upon rendition of the above judgment, the Empire Life Insurance Company duly excepted, and has perfected this appeal to have the same revised and corrected.”
In appellant’s brief four contentions are presented, which are: “First, that the agent of the Empire Life Insurance Company made no false representations. Second, or, if such false representations were made, that the judgment allowing interest as part of the damage was error. Third, that the allowance of $200 as attorney’s fees was not properly included in computing the damages for fraud. And, fourth, if Ferguson is entitled to judgment by reason of fraud, it should be conditioned upon the satisfaction by him of the judgment against him based on the note for $2,000.”
On account of the errofs pointed out, the judgment is reversed, and the cause remanded, as between the insurance company and Ferguson; in all other respects, the judgment is affirmed.
Reversed and remanded in part, and affirmed in part.
Reference
- Full Case Name
- EMPIRE LIFE INS. CO. v. BEAUMONT LAND & BUILDING CO. Et Al.
- Cited By
- 3 cases
- Status
- Published