Arkansas Grand Prairie Oil & Gas Co. v. Davidson
Arkansas Grand Prairie Oil & Gas Co. v. Davidson
Opinion of the Court
In the court below the plaintiff, a corporate citizen of Delaware, brought an action of assumpsit against Frederick Davidson, with notice to Eleanor Hibbert Davidson, his guardian, both of whom were citizens of Pennsylvania, to recover an unpaid balance of a stock subscription to its stock. On the trial the issue, as submitted by the court, turned on whether the defendant Davidson was sane when the subscription was made, and, if sane, whether he had authorized the signing of his name to the subscription by a third person. The jury having found a verdict for the defendant, the plaintiff sued out this writ.
As shown by its prospectus in evidence, the plaintiff company, with an authorized capital stock of 100,000 shares of $10 each, was formed to develop oil and gas territory, and to that end leased some 80,000 acres in Prairie county, Ark., in “what they considered a great unexplored field for oil and gas.” On February 20, 1913, Miss M. M. Ackley, who resided in Pittsburgh and was selling the company’s stock on commission, wrote Mr. Davidson a letter at Beaver Falls, Pa., in- , closing a prospectus of the company and a stock subscription blank, and requested him to subscribe for some stock. To this letter he replied on February 25th, stating that he would not be able to consider it for two or three days, as he had to go to Buffalo, and stating, “I will write you fully on my return.” This he did not do, nor did he reply to a second letter she wrote him, in which she stated:
■ “If the well comes in good, the stock will go up, and you can’t purchase it at the price quoted you.”
No discussion took place between them as to the stock, but Miss Ackley testified: That on March 22d following she was called on the telephone at Pittsburgh by Mr. Davidson from Atlantic City, who requested she get him 1,000 shares. Having subsequently ascertained she could get it, she called him up later at the Waldorf-Astoria Hotel at New York, and told him she could get it, but that he would have to pay $1,000 down on the subscription. That he thereupon told her he would telephone the first of the week, that shq should sign it for him and hold it until he came home, and that she should call up his brother George at Beaver Falls to send her the $1,000. That she then signed the subscription sued upon, dated March 22d, in behalf of Mr. Davidson, and gave the company her check for $1,000. Having telephoned Mr. George Davidson, who in the absence of any advices from his brother declined to advance any money, she telegraphed Frederick in New York:
“Gave my check $1,000 account 1,000 shares. George wants telegram from you. Check goes to bank Monday. Answer.”
To this telegram no answer was received, but on Monday she received a letter from George, inclosing “my check for $1,000, at request of my brother Frederick.” The plaintiff. further proved that some 10 days before a witness, who was leasing land for the company, talked with Frederick Davidson about the general prospects of the company, and that there was nothing abnormal in his talk or actions.
Such being the case, the inquiry arises: Is the court constrained to set aside this result by reason of some error committed in reaching it? Such alleged errors group themselves into three branches: The restrictions of the pleadings; the character of the proofs; the court’s charge and answers to points.
*644 She denies the allegations of the plaintiff as follows:
“On the 22d of March, 1913, the said Frederick Davidson, by a subscription in writing, duly signed by the said Frederick Davidson by his agent in that behalf, M. M. Ackley, the said M. M. Ackley being thereto fully authorized by the said Davidson as his agent for that purpose, and the said Davidson subsequently ratifying and approving of her said act, subscribed for and agreed to pay for 1,000 shares of the capital stock of the said Arkansas Grand Prairie Oil & Gas Company, at par, that is to say, at $10 per share, the amount of said subscription, to wit, $10,000,' being payable as follows:
25 per cent, on date of subscription, March 22, 1913.
25 per cent, in 30 days thereafter.
25 per cent, in 60 days thereafter.
25 per cent, in 90 days thereafter.
“A true and correct copy of the said subscription is hereto attached and made a part hereof, marked Exhibit "‘A’.”
She denies the allegations of the plaintiff as follows:
“On or about the date of the said subscription, the said defendant paid to the plaintiff the sum of $1,000, leaving due and .payable the sum. of $9,000, with interest thereon as follows:
On $1,500 from March 22, 1913.
On $2,500 from April 22, 1913.
On $2,500 from May 22, 1913, and On $2,500 from June 22, 1913.”
This was followed by statements that:
“Eleanor H. Davidson, guardian, alleges: That through mental incapacity on the part of Frederick Davidson, the defendant, and mistake on the part of one George Davidson, the said George Davidson, on March 25, 1913, paid to Minnie Ackley, the solicitor for the sale of stock for the plaintiff, the sum of $1,000, which was charged to the account of Frederick Davidson. That Eleanor H. Davidson, guardian, therefore denies that the defendant is indebted to the plaintiff in the sum of $9,000, or in any sum of money whatever, but that by means of the premises as herein set forth the defendant is entitled to recover the sum of $1,000 from the plaintiff, with interest from March 25, 1913, being the amount paid as above stated and charged against the funds of Frederick Davidson. A certificate will be demanded in favor of the defendant and against the plaintiff for the said sum of $1,000, with interest as aforesaid.”
Apart from the rules of the District Court, it is clear that in the courts of the United States the defense of mental incapacity here made was admissible under the plea of nonassumpsit. In Craig v. Missouri, 4 Pet. 426, 7 L. Ed. 903, it is said: .
“Everything which disaffirms the contract, everything which shows it to be void, may be given in evidence on the general issue in an action of assumpsit.”
In Mason v. Eldred, 73 U. S. (6 Wall.) 234, 18 L. Ed. 783 :
“It has long been settled that under the plea of the general issue in assumpsit evidence may be received to show, not merely that the alleged course of action never existed, but also to show that it did not subsist at the commencement of the suit.”
And in Young v. Black, 7 Cranch, 565, 3 L. Ed. 440:
“It has been long since established that under non assumpsit the defendant may give in evidence anything which shows that no debt was due at the time when the action was commenced, whether it arise from an inherent defect in the original promise or a subsequent discharge and satisfaction.”
“The guardian made express denial of material averments of the plaintiff’s statement of claim, and then set forth her claim to the $1,000 by allegations ‘that through mental incapacity on the part of Frederick Davidson, the defendant, and mistake on the part of one George Davidson, the said George Davidson, on March 25, 1913, paid to M. M. Ackley, the solicitor for the sale of the stock for the plaintiff, the sum of $1,000, which was charged to the account of Frederick Davidson.’ The plaintiff filed a reply to the claim of the defendant, and denied ‘that the $1,000 mentioned in the affidavit of defense was paid through mental weakness on the part of said Frederick Davidson, or by mistake on the part of George Davidson.’ The plea of the defendant included non assumpsit and a set-off.”
Without, therefore, discussing the assignments seriatim, we may say we find they involve no error, and'the judgment below is affirmed.
“Section 1. In all actions by writ of scire facias for tlie collection of moneys secured by recognizance, judgment, mortgage, or other record or quasi record, also in all actions of assumpsit, the plaintiff's statement of claim may he verified by affidavit; and if so verified, the defendant’s affidavit of defense;, or his affidavit in traverse thereof, shall be deemed and taken to be a pleading in the case, and upon trial no evidence on the part of the defendant shall be admitted in defense except such as may be alleged in his affidavit; and such items of claim and material averments of fact of the plaintiff’s statement as are not directly and specifically traversed and denied by the defendant’s affidavit, shall be taken as admitted. In cases where an affidavit of defense is not required, but the defendant desires to file an affidavit in traverse, it must bo so filed within fifteen days after tile return of the writ.
“Sec. 2. Tlds rule shall apply to a specification of set-off or statement of counterclaim on the part of the defendant, who shall, within fifteen days after filing an averment of such set-off or counterclaim give notice thereof in writing to the plaintiff, who shall, within a like period of fifteen days after such notice, file his reply thereto, verified by affidavit. If the defendant fail to give notice, he shall not be permitted to offer evidence in support of Ms averment of set-off or counterclaim upon the trial; and if the plaintiff, having been duly notified of the defendant’s specification of set-off, or statement of counterclaim, fail to make answer thereto, his failure shall, upon the trial oí the cause, he construed as an admission of all the facts essential to the support of the defendant’s averment of set-off or counterclaim.”
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Reference
- Full Case Name
- ARKANSAS GRAND PRAIRIE OIL & GAS CO. v. DAVIDSON
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- Published