Gordin v. Bank of Forest

153 So. 375, 170 Miss. 56, 1934 Miss. LEXIS 90

Opinions

Appellant gave a note for five hundred dollars for stock subscription in a corporation. This note was, before its maturity, transferred to appellee for full value without notice. Appellant declined to pay the note, and defended under section 4148, Code 1930, which reads as follows: "A note, obligation, or security of any kind given or transferred by any subscriber for stock in any corporation shall not be considered, taken, or held as payment of any part of the capital stock of the company."

The exact question for decision is whether an innocent holder for value paid before maturity of a note of this character may recover upon it. Appellant cites Ellis Jones Drug Co. v. Williams, 139 Miss. 170, 103 So. 810, and Aldrich v. Rice,161 Miss. 879, 138 So. 570, but in these two cases the point stated was not decided. Also appellant relies upon the long line of cases wherein privilege licenses were not paid, or where the notes were given in future transactions, or for the purchase of intoxicating liquors and the like, in all of which the statute expressly or by inescapable implication declared the note or obligation to be absolutely void. Appellant cites also several cases taken from the Texas Court of Civic Appeals.

The precise question has not often been before courts of last resort. The state of the authorities is shown in the annotation to Washer v. Smyer, 4 A.L.R. 1320-1330, in which case the stated question was answered by the Supreme Court of Texas in the affirmative. We are in accord with the reasoning applied in Washer v. Smyer, 109 Tex. 398, 211 S.W. 985, 4 A.L.R. 1320, and have arrived at the same conclusion.

Affirmed.