Crawford v. Fort Dodge Plaster Co.

101 N.W. 479, 125 Iowa 658
CourtSupreme Court of Iowa
DecidedNovember 22, 1904
StatusPublished
Cited by1 cases

This text of 101 N.W. 479 (Crawford v. Fort Dodge Plaster Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Crawford v. Fort Dodge Plaster Co., 101 N.W. 479, 125 Iowa 658 (iowa 1904).

Opinion

Ladd, J.

1. Corporate stock ownership; evidence. In the early part of January, 1899, the plaintiff and his father, E. W. Crawford, one of the defendants, procured an option on an eighty-acre tract of land near Lt. Lodge, in the name of the former as trusteo> a view of prospecting for gypsum and organizing a company to handle it. A sufficient number of holes were sunk to demonstrate that the surface was underlaid with that material, and on March 7, 1899, the balance of the cash payment of $1,000 was made, and a deed was taken in the name of E. W. Crawford’s wife, who executed a note for the unpaid purchase price, $1,000, and secured its payment by a mortgage on the land. There is some controversy concerning the reason the deed was taken in her name instead of C. J. Crawford’s, but the record has satisfied us that this was a mere matter of convenience, and that the enterprise, regardless. of the source of the money paid on the land, was a joint one of father and son. Thereafter they acted together in -promoting a corporation, with capital stock of $34,000, to which this land was conveyed, subject to the mortgage, for $7,000 in stock. Of this, one half, or thirty-five shares, were issued to E. W. Crawford and wife, and the other half to C. J. Crawford. Besides this, C. J. Crawford took thirty shares, for which he paid $3,000. Later, the capital proving insufficient, sixty shares more were issued, of which C. J. Crawford took ten, making seventy-five shares in all held by him. ITp to this time there had been no dilution of the stock, save possibly in the price of the land; but in May, 1900, a stock dividend of fifty per cent, was declared. At that time Emil Durr was president and E. W. Crawford secretary of the company. The pro[660]*660portion o£ the stock dividend to be issued to C. J. Crawford was thirty-seven shares. A certificate of ten of these was deposited with Durr as collateral security, and certificates for the remaining twenty-seven shares, duly signed by Durr as president, were in the hands of the secretary. In January, 1901, the son was compelled to undergo a surgical operation, from any assistance in which his wife seems to have insisted upon excluding the father. The latter became much incensed, and immediately mailed the certificate of the twenty-seven shares of stock to the president of the company, with the request that it be canceled, and in lieu thereof a like amount of stock be issued to R. W. Crawford’s wife. This request was complied with, and the stock certificates delivered accordingly to the interviewer, Clara A. Crawford.

The contention of the defendant R. W. Crawford and the intervener is that the former conducted the negotiations for the land in his own interest, aiid that he advanced his own money in payment thereof,, and that the profits thereon were to be divided with C. J. Crawford only on condition that the latter procured his wife’s • signature to a deed of certain business property in Pt. Dodge. . Probably owing to financial difficulties, this property had been conveyed by R. W. Crawford to one Aldee in his lifetime, and the latter, since deceased, had devised all his estate to the children of Crawford; being Mary A. Crawford and the plaintiff. On the ground that this real estate in truth belonged to their father, the 'devisees executed a conveyance at his request to his wife, but the wife of O. J. Crawford persistently refused to join her husband therein. Possibly R- W. Crawford did say to his son that he should have one-half of the profits on the land deal if he procured his wife’s signature,' and the son may have undertaken to do so. But the son did not agree to waive his interest in these profits, should he fail to obtain the signature, and, as he was entitled to a share in any event, it was not within the power of the father to de[661]*661prive him of the right thereto by arbitrarily imposing the condition mentioned. Nor does the record indicate that such was his original purpose. The division was equitable, and, as we think, in accordance with the understanding of the parties. This view is confirmed by their long acquiescence therein. No objection whatever was raised to the division of the stock as made until the incident related, and we are not inclined to give credit .to the claim of P. W. Crawford that it occurred without his knowledge. At the most, procuring the signature was but a part of the consideration, and the remedy if any, available, was not in seizing and attempting to appropriate the son’s stock, but in an action for damages. Without undertaking to review the evidence, we are content, as is our custom in such cases, to state merely our conclusions. The record amply sustains the finding that the stock in controversy belonged to the plaintiff.

2. conversion of stock: who may obiect thereto. II. Appellants also insist that the court erred in not rendering judgment for the value of the twenty-seven shares of stock, in accordance with the prayer of the petition, instead of decreeing that the intervener surrender certificates for cancellation, and that others be issued to plaintiff m their stead, as prayed in the answer of the defendants Emil Durr and the Ft. Dodge Plaster Company. In order to dispose of this question, a somewhat detailed statement of the issues seems necessary: The petition alleged the conversion of the stock, and asked judgment for its value. The answer and cross-petition of P. W. Crawford, secretary, alleged that his wife, the intervener, owned the land; that she conveyed it to the company in consideration of seventy shares of the stock; that C. J. Crawford, when secretary of the company, fraudulently issued thirty-five of these to himself; that of the stock dividend certificates for seventeen shares were issued on account of these; that defendant first became aware of the diversion of said stock in January, 1901, and thereupon caused the twenty-seven shares in controversy to be issued to his wife, [662]*662to whom they, with twenty-six more, being enough to make up the thirty-five shares issued to C. J. Crawford, and the stock dividend thereon, now in plaintiff’s name, of rig’ht belonged; and he prayed that Clara A. Crawford be made a party; that she be decreed the owner of the twenty-seven shares of the stock, and that plaintiff be ordered to transfer to her the remaining twenty-six shares; and that he pay to the company, for her benefit, all dividends received by him on the thirty-five shares-. Clara A. Crawford intervened, and in her petition against plaintiff and defendants repeated the allegations of the above answer and cross-petition, and prayed as therein stated, with this addition: that she have judgment for the dividends paid on the thirty-five shares against C. J. Crawford and the company, and also for the value of any shares of stock which may not be ordered returned to her.

In response to the plaintiff’s petition and the petition of intervention, Emil Durr, the president, and the company answered that neither of them had any interest in the controversy over the ownership of the stock; that it was issued-to the parties entitled thereto according to the subscription, and the information furbished by the parties; that if either C. J. or R. W. Crawford issued certificates wrongfully, as alleged, it was done to further his own purposes, and was not binding on the company; that in any event the issuance of the thirty-five shares to C. J. Crawford had been ratified by R. W.

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101 N.W. 479, 125 Iowa 658, Counsel Stack Legal Research, https://law.counselstack.com/opinion/crawford-v-fort-dodge-plaster-co-iowa-1904.