Tolman v. New Mexico

This action was brought to recover damages for an alleged breach by the defendant of a contract purporting to bind it to take from one La Barre, the plaintiff’s assignor, 2,000 shares of its own stock, held by him, at the expiration of six months from the date of the contract, and to pay him therefor three dollars per share; and it is alleged in the complaint that this contract was made in pursuance and fulfillment of a contract previously made by the company for the purchase of La Barre of an interest in a mica mine, a part of the consideration of which purchase was 2,000 shares of stock, to be. accompanied by the execution and delivery of a contract, of the terms of the one sued upon. The defendant is a corporation organized under the laws of Colorado. The contract was signed by Duane Doty, president, and C. F. Griffing, treasurer of the company, and the corporate seal appears affixed thereto. The answer admitting the incorporation, denies every other allegation of the complaint, and specifically denies that Doty and Griffing ever had any authority to make the alleged contract, and that the defendant ever made said contract and avers that the existence of said contract was never known to defendant until after the commencement of this action. The answer also sets up the statute of Colorado, which declares it shall not be lawful for corporations, organized under its laws, to use any of their funds for the purchase of stock in their own company or corporation, except such as may be forfeited for non-payment of assessments thereon; and avers that the stock mentioned in the contract was stock of the defendant company, not forfeited for non-payment of assessments.

The cause was tried to the court without a jury. The court found all the material issues in favor of the defendant in eight findings of fact, by which it is explicitly and plainly found and declared that the contract sued upon was executed by Doty and Griffing, and the seal affixed by Griffing without the authority, *10knowledge or assent of the defendant or its board of directors, and without any authority, general or special, therefor from the defendant; and that the defendant never, in any manner, authorized, assented to, or ratified the making of this contract, and never knew of it until after the commencement of the suit; and, further, that the defendant never undertook or agreed to execute and deliver the said contract, or any instrument or contract of that character. Upon these points the findings of fact are full, complete, and unequivocal, and cannot be misununderstood. The court also finds as a fact the Colorado statute containing the provisions above quoted, and the facts necessary to bring defendant within its provisions. The conclusions of law are — First, that the contract sued upon is one which the defendant was expressly forbidden by law to make, and could not lawfully make; second, that said contract is not the contract of the defendant; third, that plaintiff is not entitled to recover against defendant any damages for the alleged breach of said contract; fourth, that defendant is entitled to judgment. Judgment was given accordingly..

The abstract of the record contains two sets of exceptions: one entitled “Plaintiff’s Exceistions;” the other. “Bill of Exceptions. ” The second set seem to have been intended as a sort of reaffirm anee of the first. Their legal purpose is not apparent. Both sets contain exceptions to the findings of fact, to the admission of evidence, and to the conclusions of law. The assignments of error are in the most general form, to-wit: (1) That the court below erred in each and every of its second, third, fourth, fifth, sixth and seventh findings of fact. (2) The court below erred in its conclusions of law, and in each thereof. (3) The court below erred in overruling plaintiff’s exceptions to the decision of the court to each of the findings of fact and conclusions of law.” As to which last it may be ob served that the court did not overrule any of the plaintiff’s ex ceptions to its decisions. The court decided, plaintiff excepted as he had a right to do, and the “exceptions” were allowed, and appear of record. Other assignments of error are still more formal.

*11There was no motion for a new trial. The first point which we notice is that although there are numerous exceptions to the findings of fact, yet neither in connection with these exceptions nor wifh the assignments of error, nor anywhere in the abstract of record, is a syllable of the evidence brought to our attention. But the court is asked to search a voluminous transcript for the purpose of ascertaining if the district court has made any mistakes in this respect. Since the clear and explicit statements by this court of the prdper practice in this respect, in the cases of French v. Lancaster, 2 Dak. 276, S. C. 9 N. W. Rep. 716, and St. Croix Lumber Co. v. Pennington, 2 Dak. 467, S. C. 11 N. W. Rep. 497, it ought not to be necessary for this court again to call attention of counsel to the statutes and rules of court. It is contended by counsel for respondent that the question of the sufficiency of the evidence cannot be raised except on appeal from an order denying a new trial.

' We are not prepared to say that where a cause has been tried to the court without a jury, a motion for a new trial is necessary for this purpose; there would seem to be no good reason for requiring it; but we do not now decide this question. We do, however, emphatically reaffirm the rules laid down in the cases above cited, and for this reason decline to consider, in this case, any question, except whether the facts found are sufficient to support the legal conclusions. And, first, as to the conclusion that the contract sued upon is not the contract of the defendant. The first point made by the appellant’s counsel in their argument seems to bo the result of a strange misapprehension of the views of the court below. Whatever its origin, the effect is to distort the findings and conclusions of the court upon this branch of the case, and to predicate of the findings and conclusions, so distorted, a misconception by the court of the law. The point is thus stated: “One of the objections urged against the right of the plaintiff to recover on the contract, and which the court below sustained, as shown by his findings, was that ‘the seal of said corporation was not affixed thereto by its secretary, nor any other person authorized so to do. ’ This is equivalent to a holding by the court that the cor*12poration could not be bound by a contract, except under its corporate seal.” Which “misconception of the law” counsel proceed with needless industry to attack.

The manner in which this objection is stated might possibly lead a casual observer to suppose that the words in subquotation marks were the language of the court, or that the court had in some way adopted them. They are in fact taken from the defendant’s answer, wherein, after stating that the defendant’s by-laws provide that the secretary is the only person having the custody of the corporate seal, and authorized to use the same, it is further alleged: ‘ ‘And that this pretended contract is not signed by the secretary of the defendant, and the seal of said corporation was not affixed thereto by its secretary, or by any other person authorized-so to do; and defendant alleges the fact to be that said seal was fraudulently affixed to said pretended contract subsequent to the execution and delivery thereof, and that said contract is not the contract of the defendant.

What the findings of the court upon these points were has already been stated. They are unimpeached by the record; and it can hardly be necessary to say that they fully sustain the conclusions of law upon that point. This contract purports upon its face to be the contract of the defendant company, executed under its corporate seal, duly attested by the signatures of its president and treasurer. The court found, in terms which admit of no reasonable apprehension, that neither in fact nor in law is it what it purports to be. This alone would suffice to dispose of the case,

There is another point, however, which we will notice; it is alleged that the court erred in holding this contract to be an unlawful one, — one which the defendant could not lawfully make. The matter was pertinent and might have become essential, although, in the present aspect of the case, it is not. The facts in relation to this issue are found in favor of the defendant. The purpose for which the stock was to be purchased is disclosed by the contract itself, not to be for non-payment of assessment, and therefore not within the exceptions of the statute. The contract was an executory one. The theory by *13■which it is so sought to show that it was executed, is unsupported by anything in the contract itself; in fact, is directly opposed to it. Even were the facts as contended for by plaintiff’s counsel, they would only show that the contract, in fulfillment of which the contract sued upon is alleged to have been given, was an executed one. This would still remain executory. But such facts do not appear except in the arguments of counsel. This, contract purported to bind the defendant to do that which the law of its creation expressly forbade. It can hardly require argument or .authority to demonstrate that such a contract was one which defendant “could not lawfully make,” or having made, be compelled by law to perform. Morawetz on Corp. rule 8, p. 84; Davis v. Old Colony R. Co., 131 Mass. 258; Nellis v. Clark, 4 Hill, 424; Thomas v. Railroad Co., 101 U. S. 71; New York State L. & T. Co. v. Helmea, 77 N. Y. 64. We find no error in the record, and the judgment of the district court is therefore affirmed.